PHMSA Assesses Big Safety Penalty Against El Paso

January 2010 Vol. 65 No. 1

Two weeks after the new administrator of the federal pipeline safety agency formally took over the agency, the Pipeline and Hazardous Materials Safety Administration (PHMSA) announced Colorado Interstate Gas (CIG) Company was paying the biggest fine the agency has ever levied under its own authority. What PHMSA did not say in the press release it issued on Dec. 1, 2009, was that the El Paso subsidiary had been fined $3.3 million in the original proposed civil penalty in March 2008, but that had been negotiated down over the past 18 months.

Although El Paso and its subsidiaries cooperated fully with PHMSA, company spokesman Richard Wheatley says, "We do not believe the penalty reflects the complex facts of this incident and believe it fails to take into account the serious errors of the constructing pipeline company and its contractors, which led, we believe, to the tragic results. We have taken a number of proactive actions since the 2006 incident, including thoroughly reviewing our policies and procedures.”

PHMSA argued, among other things, that CIG passed inaccurate line marking information to a construction company working on Kinder Morgan's Rockies Express Pipeline. REX was building a new pipeline adjacent to an existing line operated by Wyoming Interstate Co.(WIC), a CIG subsidiary. WIC gave the construction company REX alignment sheets marked with a disclaimer as to their accuracy. Those sheets did not show a bend in the WIC pipeline. As a result, a bulldozer operator hit the WIC pipeline and was killed in 2006. Federal regulations require pipeline operators to establish and follow procedures for properly locating and marking their underground systems before excavation work is commenced to prevent accidental contact and safety risks. CIG argued that it told the construction company that accurate maps were available 10 miles away at its Cheyenne facility. But PHMSA responded that the accurate maps had to be available at the job site.

"Pipeline and other underground facility damage is almost entirely preventable," says Cynthia L. Quarterman, PHMSA Administrator. "Pipeline operators must be the first line of defense in protecting the public from incidents related to their systems."