US ExxonMobil faces $2.66m fine for Pegasus pipeline violations

06 November 2013 22:44  [Source: ICIS news]

HOUSTON (ICIS)--The Department of Transportation (DOT) is proposing a civil penalty of $2.66m (€1.97m) against ExxonMobil for alleged violations of the US Pipeline Safety Regulation related to the 29 March rupture and subsequent oil spill in Arkansas, the federal agency announced on Wednesday.

The DOT's Pipeline and Hazardous Materials Safety Administration (PHMSA) sent ExxonMobil a notice of probable violation and a proposed compliance order as a result of the agency's investigation into the Pegasus pipeline failure in the town of Mayflower.

According to the notice, ExxonMobil's integrity assessment schedule did not include consideration of certain manufacturing information - specifically the susceptibility of its pre-1970, low-frequency, electric-resistance welded pipe seam - to failures as a risk factor. The schedule also failed to prioritise the assessment of pipeline segments according to the amount of risk they pose.

Additionally, ExxonMobil did not present an acceptable engineering analysis to PHMSA to demonstrate that the pipe was not susceptible to seam failure, the agency said. The company also failed to establish a five-year reassessment interval for the segment of the pipeline after hydrostatic test identified that seam failure was a possibility.

The notice also claimed ExxonMobil did not follow its own procedures for extending the timeframe for conducting its assessment and notifying the PHMSA, updating its risk assessments as changes occur, as well as creating a management of change document for merging testing segments for the pipeline.

Furthermore, the company failed to declare discovery of immediate repair conditions and take prompt action to address them, PHMSA said.

ExxonMobil has 30 days to respond to the notice.

A company spokesperson did not immediately respond on Wednesday to a request for comment.

The Mayflower incident spilled about 5,000 bbl of oil and forced the evacuation of 22 homes in the surrounding neighbourhood.

($1 = €0.74)

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By: Tracy Dang
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