HOLLY ENERGY PARTNERS - OPERATING, L.P.

Incident Narrative

ON JANUARY 3, 2024 AT APPX. 2:20 PM CENTRAL, A TECHNICIAN AT THE EL DORADO WEST TANK FARM HAD RETURNED TO A TANK DIKE WHEN HE OBSERVED CRUDE (ON PREVIOUSLY ACCUMULATED RAINWATER) WITHIN THE DIKE AND, ALSO FLOWING INTO AN ON-SITE, STORMWATER DETENTION POND. THIS APPEARED TO BE COMING OUT OF THE 18"" LINE BETWEEN TKS 4158 AND 4159. THE TECHNICIAN IMMEDIATELY CLOSED VARIOUS VALVES, ISOLATING THE LEAK AND FURTHER RELEASE INTO THE DETENTION POND. EMERGENCY RESPONSE CONTRACTORS WERE CALLED OUT THEREAFTER TO BEGIN AIR MONITORING AND SKIMMING OPERATIONS. A TEMPORARY CLAMP WAS ALSO BROUGHT ON-SITE AND APPLIED. PERTAINING TO ESTIMATED VOLUMES, THE INITIAL DETERMINATION FOR THE RELEASED VOLUME WAS MADE AS PER PROCEDURES, UTILIZING THE SPILL CALCULATION SPREADSHEET. HOWEVER, DUE TO RECENT HEAVY RAINFALL AND SAFETY CONCERNS PREVENTING PERSONNEL FROM ACCESSING THE INNER AREA OF THE POOLED CRUDE, MEASUREMENTS WERE PRIMARILY TAKEN AT THE PERIMETER. THIS LED TO AN INITIAL ESTIMATE OF 110 GALLONS OF CRUDE OIL RELEASED. AS RECOVERY OPERATIONS PROGRESSED, A SIGNIFICANT MIX OF CRUDE OIL AND WATER WAS EXTRACTED AND PLACED INTO FRAC TANKS. EFFORTS ARE ONGOING TO DETERMINE THE PRECISE DISTRIBUTION BETWEEN CRUDE OIL AND WATER, BUT UPDATED ESTIMATES SUGGEST A POTENTIAL RECOVERED VOLUME OF 340 BBL. OF CRUDE OIL. IT'S IMPORTANT TO NOTE THAT THE INABILITY TO DEFINITIVELY DETERMINE WHEN THE RELEASE BEGAN, GIVEN THE LOCATION OF THE FAILURE POINT ON A SEGMENT OF FACILITY PIPING, WILL MOST LIKELY RESULT IN EQUIVALENT RELEASED AND RECOVERED VOLUMES. HENCE WHY VOLUMES ARE REFLECTED AS SUCH IN PART A OF THIS REPORT. DUE TO THE INITIAL, ESTIMATED RELEASE VOLUME, NOTIFICATIONS WERE MADE TO NATIONAL RESPONSE CENTER (NRC) AND THE KANSAS DEPARTMENT OF HEALTH AND ENVIRONMENT (KDHE). AT THE TIME OF THIS REPORT, THE APPARENT CAUSE OF THE LEAK IS DUE TO A PINHOLE LEAK FOUND AT THE BOTTOM OF THE 18"" LINE AT THE 6 O'CLOCK POSITION. THIS DETERMINATION HAS PRELIMINARY BEEN MADE BASED OFF A NON-DESTRUCTIVE EXAMINATION (UTILIZING BOTH GUIDED WAVE AND AUTOMATED ULTRASONIC TESTING) THAT WAS CONDUCTED FOLLOWING THE RELEASE. HOWEVER, THE FAILED SEGMENT WILL BE CUT OUT AND SENT FOR METALLURGICAL ANALYSIS TO MAKE A FINAL DETERMINATION. ADDITIONALLY, A FORMAL INCIDENT INVESTIGATION HAS BEEN INITIATED TO FURTHER ANALYZE THIS RELEASE EVENT, CONFIRM THE ROOT CAUSE AND, BEGIN ASCERTAINING ACTIONS NEEDED TO PREVENT REOCCURRENCE (TO INCLUDE DISSEMINATION OF LESSONS LEARNED, WHERE APPROPRIATE).