MEDALLION OPERATING COMPANY, LLC

Incident Narrative

INCIDENT DESCRIPTION THE INCIDENT OCCURRED AT MEDALLION'S HOWARD FACILITY. THE FACILITY CONTAINS A 10' CRUDE OIL TRUNK LINE AND PIPELINE PUMPS AS WELL AS A BREAKOUT TANK AND TANK TRUCK LOADING OPERATIONS. AT THE TIME OF THE INCIDENT, THE PIPELINE AND TANK TRUCK LOADING OPERATIONS WERE IN-SERVICE AND CONSTRUCTION WAS ON-GOING ON THE REMAINING PORTIONS OF THE FACILITY. ON APRIL 21, 2016 AT APPROXIMATELY 0630 A CONSTRUCTION OPERATOR ARRIVING AT THE HOWARD FACILITY DISCOVERED A 1' NIPPLE ON THE DISCHARGE LINE FROM A TEMPORARY FACILITY PUMP WAS LEAKING AND SPRAYING CRUDE OIL INTO THE AIR. THE CONSTRUCTION OPERATOR IMMEDIATELY NOTIFIED A MEDALLION OPERATOR AND BEGAN TO SHUT DOWN THE FACILITY TO STOP THE RELEASE OF CRUDE OIL. ONCE THE PUMP WAS SHUT DOWN AND THE RELEASE STOPPED A CALL WAS MADE TO MEDALLION'S REGULATORY AND COMPLIANCE MANAGER AT 0725 ON APRIL 21, 2016. THE TEMPORARY PUMP IS BEING USED UNTIL THE MAINLINE PUMPS ARE COMMISSIONED. THE COMMISSIONING IS EXPECTED BEFORE JUNE 1, 2016. THE TEMPORARY PUMP IS EQUIPPED WITH PRESSURE SWITCHES FOR HIGH PRESSURE AND LOW PRESSURE SHUT DOWN IF THE SUCTION OR DISCHARGE MOVE BEYOND THE DESIRED OPERATING PRESSURE. AFTER THE INITIAL RESPONSE TO STOP THE RELEASE, MEDALLION IDENTIFIED THE SOURCE OF THE RELEASE TO BE A CRACK IN THE THREADS OF A 1' NIPPLE. AN INVESTIGATION DETERMINED THAT THE NIPPLE THAT FAILED HAD CRACKED DUE TO VIBRATION ON THE LINE RESULTING IN A MIST OIL BEING SPRAYED INTO THE AIR AND RELEASING A TOTAL 40 BBLS OF OIL ONTO THE GROUND, IMPACTING APPROXIMATELY 4000 CUBIC FEET OF SOIL. SINCE THE NIPPLE DID NOT FAIL COMPLETELY THE LINE MAINTAINED PRESSURE AND PREVENTED THE LOW PRESSURE SHUT DOWN FROM SHUTTING DOWN THE PUMP BEFORE THE FIRST PERSON ARRIVED ON LOCATION AND DISCOVERED THE RELEASE. THE FACILITY REMAINED IN OPERATION DURING INITIAL RESPONSE AND CLEAN-UP ACTIVITIES. THE PUMP AFFECTED BY THE CRACKED NIPPLE WAS REMOVED FROM SERVICE TEMPORARILY UNTIL THE BROKEN NIPPLE ALONG WITH ALL OTHER NIPPLES ASSOCIATED WITH THE PUMP WERE REPLACED AND THE PUMP WAS PUT BACK IN SERVICE AROUND 1800 ON APRIL 21, 2016. MEDALLION BEGAN REMEDIATION ACTIVITIES TO REMOVE THE RELEASED CRUDE OIL AND IDENTIFY THE EXTENT OF THE RELEASE. MOST OF THE CRUDE OIL RELEASE REMAINED ON MEDALLION'S SITE; HOWEVER, APPROXIMATELY THREE ACRES OF CROP LAND ADJACENT TO THE SITE WAS IMPACTED BY A MIST OF PRODUCT THAT WAS SPRAYED IN THE AIR. THERE WERE NO CROPS PLANTED AT THE TIME AND ONLY THE SOIL WAS IMPACTED. DUE TO RAIN ACTIVITY THE PREVIOUS DAY THE RELEASED CRUDE OIL MIXED WITH STANDING WATER. CREWS WORKED TO CLEAN EQUIPMENT WITH STEAM POWER WASHERS AND COLLECT THE FREE STANDING WATER AND CRUDE OIL WITH VACUUM TRUCKS. APPROXIMATELY 85 BARRELS OF CRUDE OIL, WATER AND SOILED WERE REMOVED BY THE VACUUM TRUCK. ADDITIONALLY, A BACKHOE WAS USED TO SCRAPE UP AFFECTED SOIL PLACED IT ONTO A PLASTIC LINER THAT HAD BEEN BERMED TO PREVENT RUNOFF. NOTIFICATION TIMELINE (ALL NOTICES WERE MADE ON APRIL 21, 2016. TEXAS RAILROAD COMMISSION-PIPELINE SAFETY AUSTIN, TX WAS NOTIFIED AT 0821. INCIDENT NUMBER 1341 NATIONAL RESPONSE CENTER WAS NOTIFIED AT 0829. INCIDENT NUMBER 1145820 TEXAS RAILROAD COMMISSION-OIL&GAS, MIDLAND, TX WAS NOTIFIED AT 0847. INCIDENT NUMBER 34912. SUPPLEMENTAL INFORMATION: REMEDIATION OF THE AFFECTED SOIL WAS COMPLETED JUNE 1, 2016 AS SAMPLES COLLECTED MAY 27, 2016 INDICATED CONTAMINANT CONCENTRATIONS BELOW TEXAS RAILROAD COMMISSION REQUIREMENTS. ADDITIONALLY, ALL 1"" SCHEDULE 40 NIPPLES SERVING IN THE SAME FUNCTION AS THE NIPPLE THAT FAILED AT THE FACILITY WHERE IDENTIFIED AND REPLACED WITH NEW SCHEDULE 160 NIPPLES.