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An $8 million error for not following procedures

 

October 9, 2024

 

A recent final order from the Pipeline and Hazardous Materials Safety Administration (PHMSA) highlights the severe safety and financial consequences that can occur when operators fail to follow required excavation and pipeline repair procedures.

 

The Incident

 

During an integrity dig in 2020-2021 to maintain and repair a natural gas transmission pipeline, the operator failed to ensure mechanical excavation equipment maintained the required 1-foot buffer zone around the pipeline. As a result, the pipeline was struck and mechanically damaged during excavation or backfilling activities. This damage went unreported. Months later, in February 2022, the pipeline ruptured at the location of the unreported mechanical damage, resulting in a release of natural gas.

 

The Violations and Costs

 

PHMSA cited the operator for violating 49 CFR 192.605(a) by failing to follow its written procedure requiring a 1-foot buffer when using mechanical equipment around the pipe. The operator was assessed a $225,134 civil penalty.

However, the total estimated cost was a staggering $8,293,379 when accounting for the civil penalty, lost gas volumes, and other associated costs from the rupture. This figure serves as a stark financial reminder, in addition to the safety hazards, of the critical importance of adhering to excavation requirements.

 

Root Cause

 

The root cause failure analysis determined that not maintaining the 1-foot buffer led to the pipeline strike and eventual rupture months later. The reputation damage from such a high-profile incident can also be considerable.

 

Tips:

• Ensure excavation procedures have clear requirements for maintaining minimum clearances from the pipeline when using mechanized equipment.
• Provide UPDATED training to ensure all personnel involved in excavations understand and follow the minimum clearance requirements.
• Implement strict oversight and documentation processes to verify minimum clearances are maintained throughout excavation and backfilling activities.
• Review your manual more than the required once a year (but not exceeding 15 months) - and make sure you're tracking regulatory documents, changes to operations, etc. in a Management of Change (MOC) system!

 

This multi-million dollar incident underscores the critical importance of adhering to written procedures during pipeline excavations and repairs. Maintaining vigilant adherence to excavation requirements is essential for protecting people, assets, the environment and the bottom line.