Plains All American Pipeline Settlement

(Washington, DC - August 10, 2010) The U.S. Environmental Protection Agency (EPA) and the Justice Department announced that Plains All American Pipeline and several of its operating subsidiaries have agreed to spend approximately $41 million to upgrade 10,420 miles of crude oil pipeline operated in the United States. The settlement resolves Plains' Clean Water Act violations for 10 crude oil spills in Texas, Louisiana, Oklahoma, and Kansas, and requires the company to pay a $3.25 million civil penalty.

On this page:

• Overview of Company and Facility Locations
• Violations
• Injunctive Relief
• Pollutant Addressed
• Environmental Effects
• Civil Penalty
• Comment Period
• Contact

Overview of Company and Facility Locations

Plains All American Pipeline, L.P. (Plains) is a publicly traded master limited partnership (MLP) engaged in the transportation, storage, and marketing of crude oil, refined products and liquefied petroleum gas (LPG).

On average Plains handles over 3 million barrels per day of crude oil, refined products, and LPG.

Plains is a partnership organized and existing under the laws of the State of Delaware, and doing business in the State of Texas. Its headquarters are in Houston, Texas. Plains holds direct and indirect ownership interests in Plains Pipeline, L.P., Plains Marketing, L.P., and Plains Marketing GP Inc.

Plains Pipeline, L.P. and Plains Marketing, L.P. are partnerships organized and existing under the laws of the State of Texas, and doing business in the State of Texas.

Plains Marketing GP, Inc. is a corporation organized and existing under the laws of the State of Delaware, and doing business in the State of Texas. Plains Marketing GP, Inc. is the General Partner of Plains Pipeline, L.P. and Plains Marketing, L.P.

Ten discharges took place at or near the following locations:

• Ellis, Kan. ( East Spring Creek)
• Houston, Texas (Bull Creek Canal)
• Iraan, Texas (Pecos River)
• Longview, (Sabine River)
• Osage County, Okla. (tributary of Pond Creek)
• Tensas Parish, La. (tributary of Big Lake)
• Vealmoor, Texas (Colorado River)
• Vealmoor, Texas (Glen Creek)
• Waskom, Texas ­­(tributary to Harrison Bayou)
• Westbrook, Texas (Iatan Creek)

Violations

On 10 occasions between June 2004 and September 2007, approximately 6,510 barrels (273,420 gallons) of crude oil were discharged from various pipelines and one tank owned and operated by Plains into navigable waters or adjoining shorelines in the states of Texas, Louisiana, Oklahoma, and Kansas, in violation of Clean Water Act (CWA) sections 311(b)(3) and 301(a).

The ten discharges ranged in size from 2.5 barrels (105 gallons) to 4,500 barrels (189,000 gallons). Most of the spills were caused by corrosion on the pipelines. The two largest spills were caused by a cracked weld joint at a pre-existing flaw; and a temporary relief tank that was undersized for pressure relief and located outside of the secondary containment berm. The ten discharges in the complaint are:

• June 2004: Approximately 185 barrels of crude oil were discharged from a portion of Plains Pipeline near Ellis, Kan., some entered East Spring Creek and the adjacent emergent wetlands. This discharge was caused by failure of a poly-pipeline slip insert and existing external corrosion of the outer steel pipeline.
• November 2004: Approximately 50 barrels of crude oil were discharged from a portion of Plains Pipeline near Westbrook, Texas, some in the Iatan Creek. This discharge was caused by external corrosion around several existing dents in pipeline coating.
• December 2004: Approximately 4,500 barrels of crude oil were discharged from a portion of Plains Pipeline near Iraan, Texas, some in the Pecos River. This discharge was caused by a cracked weld joint. A Metallurgical Failure Investigation indicates a pre-existing flaw extending over most of the final flaw.
• January 2005: Approximately 1,197 barrels of crude oil were discharged from a tank located at Plains' White Oak Station near Longview, Texas, some in the Sabine River. This discharge was caused by a faulty pressure relief pin and an undersized temporary relief tank located outside of the secondary containment.
• March 2005: Approximately 2.5 barrels of crude oil were discharged from the ArkLa Tex Pipeline belonging to Plains Pipeline, LP., near Waskom, Texas, some in an un-named tributary to Harrison Bayou, which empties into Caddo Lake. This discharge was caused by external corrosion.
• April 2005: Approximately 5 barrels of crude oil were discharged from a portion of Plains Pipeline near Tensas Parish, La., some in a tributary of Big Lake and adjacent wetlands. This discharge was caused by internal corrosion.
• July 2005: Approximately 50 barrels of crude oil were discharged from a portion of Plains Pipeline pipeline in Osage County, Okla., some in a tributary of Pond Creek. This discharge was caused by internal corrosion.
• November 2005: Approximately 20 barrels of crude oil were discharged from a portion of Plains Pipeline pipeline near Houston, some of which entered Bull Creek Canal. This discharge was caused by external corrosion.
• August 2007: 400 barrels of crude oil were discharged from a portion of Plains Pipeline pipeline near Vealmoor, Texas, some in Glen Creek, a tributary to the Colorado River. This discharge was caused external corrosion.
• September 2007: 100 barrels of crude oil were discharged from a portion of Plains pipeline near Vealmoor, Texas, some in the Colorado River. This discharge was caused by external corrosion.

Injunctive Relief

Enhanced Integrity Management and Corrosion Control

• Plains must:
  • Perform digital GIS mapping and centerline verification
  • Operate in accordance with its integrity management plan (IMP)
  • Implement a risk screening process (RSP)
  • Implement additional requirements on low stress and gathering pipelines
  • Spend at least $6 million on anode beds, rectifiers, equipment to inject corrosion inhibitor and biocides for internal corrosion control, and close interval surveys on at least 2,400 miles of pipeline

Plains may not make material changes to its IMP or RSP that are less protective of waters of the U.S. or adjoining shorelines without prior written approval from EPA.

Enhanced Pipeline Leak Detection

• Plains must:
  • Conduct weekly aerial patrols of its pipelines
  • Comply with the American Petroleum Institute's performance standards for computer-based computational pipeline monitoring (CPM) leak detection systems on 110 identified pipeline segments, including 30 segments which will receive new CPM equipment
  • Complete and implement an investigation of specified pipeline segments that are not operated under continuous pressure (known as slack lines) for enhancements to leak detection capabilities, minimizing slack line operations, and evaluating slack line effects on CPM leak detection systems

• Requirements for Replacement and/or Substitute Breakout Tanks
  • Any temporary tank that Plains uses for surge protection must have sufficient capacity to receive and safely contain oil from surges, pressure relief events, operational upsets or other abnormal events and must be properly located within secondary containment areas

Personnel and Training

• Plains will:
  • Preserve and staff eight employee positions related to integrity management, leak detection, records, quality control and training
  • Provide operator qualifications training, conduct pre-screening testing for all new pipeline controllers who use the CPM leak detection software
  • Train field personnel on proper pipeline cleaning techniques and procedures

Pollutants Addressed

The oil spills addressed by this settlement discharged approximately 6,510 barrels (273,420 gallons) of crude oil.

Environmental Effects

Oil spills are known to cause both immediate and long-term harm to human health and ecosystems. Oil prevents oxygen in water and can suffocate wildlife.
Oil emulsions may stick to the gills of fish or coat and destroy algae or other plankton. Floating oil may reduce water exposure to the circulation of oxygen and, in conjunction with emulsified oil, interfere with photosynthesis.

Oil slicks can kill birds, contaminate food sources, reduce animal and plant reproduction and contaminate nesting habitats. Oil spills can cause long-term effects years later even if the oil remains in the environment for a relatively short period of time.

Petroleum oils can also undergo oxidation and polymerization reactions and can form tars that persist in the environment for years. These harms will be prevented by EPA's Section 311 enforcement efforts and this settlement agreement. Please see EPA's Emergency Management pages for more information about the effects of chemicals, hazardous substances and oils on the environment.

Civil Penalty

Plains will pay a penalty of $3,250,000 to resolve its liability for CWA Sections 311(b)(3) and 301(a) violations related to the spills. The penalty will be paid to the Oil Spill Liability Trust Fund.

Comment Period

The proposed settlement, lodged in the U.S. District Court for the Southern District of Texas, is subject to a 30-day public comment period and final court approval. Information on submitting comment is available at the Department of Justice website.

For more information, contact:

Cheryl Rose
U.S. EPA
1200 Pennsylvania Ave., NW
Washington DC 20460
(202) 564-4136
Cheryl Rose ([email protected])