A cryogenic natural gas liquid (“NGL”) facility with capacity to process approximately 1.0 billion cubic feet per day of raw natural gas while recovering around 1.4 gallons per million cubic feet of NGL product in the ethane rejection mode of operation suffered a release of approximately 19,000 pounds of NGL at the truck loading area on 10/9/2014. In the aftermath of the Release, EPA conducted an investigation pursuant to Section 114 of the CAA, to determine whether Respondent was in compliance with the Chemical Accident Prevention Provisions at 40 C.F.R. Part 68. EPA sent four information requests to Respondent to which Respondent responded with letters. Based on the information obtained in Respondent’s responses to the information requests, EPA determined that the truck loading area includes four 70,000-gallon NGL storage tanks and two NGL truck loading skids which consists of pumps, piping and instrumentation. The NGL consists of a mixture of highly flammable liquids. The flammable mixture consists of at least 1 % each of propane, pentane, isobutane, butane, isopentane, methane and ethane. All of these chemicals comprising the NGL constitute regulated substances pursuant to Section 112(r)(5) of the CAA, listed in 40 C.F.R. § 68.130, Table 3. The weight of the liquids in each 70,000-gallon storage tank containing NGL is greater than 10,000 pounds, at approximately 1,166,200 to 1,526,060 pounds.
Based on the information obtained in Respondent’s responses to the information requests, the Release began at approximately 5:00 a.m. on October 9, 2014, when a 6-inch steel braided flex hose ruptured during loading of NGL, releasing approximately 19,000 pounds of NGLs causing a vapor cloud. The truck loading area was immediately shutdown. The vapor cloud was monitored until it dissipated and emergency response personnel made full checks to ensure public and employee safety. Operations re-commenced at 11 :00 a.m. However, the truck loading area remained out of service.
Process Safety Requirements
The relevant industry design code and standard for the Facility, which is a “design code and standard” and a “recognized and generally accepted good engineering practice,” is the American Petroleum Institute Standard 2510, Design and Construction of Liquefied Petroleum Gas (LPG) Installations (8th Edition, May 2001 ) (“API 2510”). API 2510 provides
“minimum requirements for the design and construction of liquefied petroleum gas (LPG) installations at marine and pipeline terminals, natural gas processing plants, refineries, petrochemical plants, and tank farms.”
It contains the following provision:
“A hose for product transfer “shall be designed for a minimum working pressure of 350 pounds per square inch (“psig“) and a minimum bursting pressure of 1750 psig.” API 2510, § 9.5.1.3.1.
Based on the information received in the responses to the information requests, EPA made the following observation about the equipment at the Facility:
- Respondent had not provided a properly rated flex hose for product transfer on the truck loading skid, consistent with the protection provided by API 2510. The hose at the Facility at the time of the release had a maximum working pressure of 165 psig and minimal burst pressure of 660 psig. These pressures are far below the minimums set forth in API 2510. According to API 2510, the required minimum working pressure for a hose is 350 psig and the minimum bursting pressure is 1750 psig.
On or about August 28, 2015, Respondent placed the truck loading area back in service and included a new truck loading skid which utilizes a steel pipe spool and not a flexible hose. For purposes of this Settlement Agreement, it is assumed that Respondent had a noncompliant hose at least from the time the truck loading area went into service, on October 12, 2012, until the date of the Release, on October 9, 2014, when the truck loading area was shut down.
After the incident, Respondent assessed all other truck loading skids at the Facility and its other natural gas processing plants and confirmed that none utilize the flexible hose that had been used at the Facility.
Mechanical Integrity Requirements: Inspections and Tests
The Chemical Accident Prevention Provisions require an owner or operator to perform inspections and tests on process equipment as part of its mechanical integrity obligations. 40 C.F.R § 68.73(d). The “frequency of inspections and tests shall be consistent with applicable manufacturers’ recommendations and good engineering practices”. 40 C.F.R. § 68.73(d)(3).
API 2510 contains good engineering practices relevant to testing procedures for hoses. It contains the following provision:
“Hose assemblies shall be tested at least annually at whichever is greater, the maximum pump discharge pressure or the relief valve setting.” API 2510, § 9.5.1.3.3.
Based on the information received in the responses to the information requests, EPA made the following observations about the equipment at the Facility:
- Respondent had not conducted annual testing of the flex hose at the Facility, consistent with the protection provided by API 2510. The hose went into service on October 12, 2012, but the hose was not tested one year from that date, on October 12, 2013. The first inspection of the hose occurred on October 9, 2014, after the Release. As a result, the hose was not protected from damage or defect.
EPA’S CONCLUSIONS OF LAW RELATED TO THE ALLEGED VIOLATIONS OF SECTION 112(r)(7) OF THE CLEAN AIR ACT
Based on the information provided by Respondent to EPA in the responses to the information requests, Respondent had not documented that its equipment at the Facility as described above was designed consistently with industry standards and guidance.
Based on the information provided by Respondent to EPA in the responses to the information requests, Respondent had not provided equipment inspection and testing in accordance with recognized and generally accepted good engineering practices.
COUNT 1 – HOSE DESIGN AT THE FACILITY
Respondent failed to comply with the process safety information requirements at 40 C.F.R. § 68.65(d)(2) at the Facility, i.e. , to document that the equipment in the process complies with recognized and generally accepted good engineering practices, because the hose at the Facility did not provide protection consistent with the recognized and generally accepted good engineering practice identified in Section 9.5.1.3.1 of API 2510.
COUNT 2 – ANNUAL TESTING OF HOSE ASSEMBLY AT THE FACILITY
Respondent failed to comply with the mechanical integrity requirements at 40 C.F.R. § 68.73(d) and (d)(3) at the Facility, i.e., to perform inspections and tests on process equipment, and to do so at a frequency consistent with applicable manufacturers’ recommendations and good engineering practices, because Respondent did not annually test the hose, to provide protection consistent with that provided by Section 9.5.1.3.3 of API 2510.
SETTLEMENT
In accordance with 40 C.F.R. § 22.18(c), and in full and final settlement and resolution of all allegations referenced in the foregoing Findings of Fact and Conclusions of Law set forth above, and in full satisfaction of any and all civil penalty claims pursuant thereto, for the purpose of this proceeding, Respondent consents to the assessment of a civil penalty for the violations of Section 112(r) of the Clean Air Act, 42 U.S.C. § 7412(r), set forth above, in the amount of FORTY-TWO THOUSAND EIGHT HUNDRED AND NINETY THREE DOLLARS ($42,893)(“CAA Penalty”).
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