HOLLY ENERGY PARTNERS - OPERATING, L.P.

Incident Narrative

TECH CON TRENCHING STRUCK THE PIPELINE WHILE TRENCHING ON JUNE 12, 2013. TECH CON HAD FAILED TO (1) SEND PROPER ONE-CALL NOTIFICATION; (2) ACCURATELY IDENTIFY OR WHITE LINE THE AREA OF EXCAVATION; OR (3) NOTIFY HOLLY ENERGY PRIOR TO EXCAVATING AND/OR EXPOSING (POT-HOLING) THE PIPELINE SO THAT HOLLY ENERGY COULD RE-MARK THE PIPELINE AND WITNESS THIS EXCAVATION PROCESS AS REQUESTED IN ACCORDANCE WITH TEXAS UTILITY CODE SUBCHAPTER D SEC. 251.151(C). TECH CON TRENCHING NEVER NOTIFIED HOLLY ENERGY OF ITS INTENT TO EXCAVATE ACROSS HOLLY ENERGY'S PIPELINE. HOLLY ENERGY RECEIVED A ONE-CALL NOTICE FROM JD KING ON THE EVENING OF JUNE 6. HOLLY ENERGY DOES NOT FULLY UNDERSTAND THE CONNECTION BETWEEN TECH CON TRENCHING AND JD KING, BUT BOTH ENTITIES APPEARED TO HAVE BEEN WORKING ON THE SAME PROJECT FOR WHICH TECH CON TRENCHING WAS CONDUCTING TRENCHING ON JUNE 13. ON THE MORNING OF JUNE 7, JOHN OSBORNE OF HOLLY ENERGY CALLED RICKY KNELSEN OF JD KING AT THE NUMBER IDENTIFIED ON THE ONE-CALL NOTIFICATION TICKET BUT RECEIVED NO RESPONSE. ON THE MORNING OF JUNE 10 (JUNE 8 AND 9 WERE WEEKEND DAYS), OSBORNE REACHED KNELSEN BY TELEPHONE TO REQUEST A DESCRIPTION OF WHERE JD KING PLANNED TO EXCAVATE. THE ONE-CALL TICKET DID NOT PROVIDE A CLEAR IDENTIFICATION OF THE AREA, AND NEITHER JD KING (NOR TECH CON TRENCHING) HAD MARKED THE PROPOSED EXCAVATION AREA WITH WHITE LINES. AFTER OSBORNE EXPLAINED THE LOCATION OF HOLLY ENERGY'S PIPELINE, KNELSEN TOLD OSBORNE THAT JD KING WOULD NOT START EXCAVATING IN THE VICINITY OF THE PIPELINE UNTIL THE WEEK OF JUNE 17. OSBORNE AND KNELSEN AGREED THAT THE TWO WOULD MEET AT THE SITE AT THIS TIME SO THAT KNELSEN COULD IDENTIFY WHERE THE EXCAVATION WOULD CROSS THE PIPELINE AND OSBORNE WOULD MARK THE PIPELINE IN ADVANCE OF TRENCHING ACTIVITIES. KNELSEN SAID THAT HE WOULD CALL OSBORNE WHEN THE EXCAVATION WAS CLOSER TO THE PIPELINE TO ARRANGE THE MEETING SPECIFICS. OSBORNE ALSO TOLD KNELSEN THAT HOLLY ENERGY WISHED TO BE PRESENT DURING EXCAVATION SO THAT OSBORNE COULD VISUALLY OBSERVE POT-HOLES CORED ADJACENT TO THE PIPELINE AND TO ENSURE THAT EXCAVATION BELOW HOLLY ENERGY'S PIPELINE WAS PERFORMED SAFELY. AS INDICATED ABOVE, KNELSEN TOLD OSBORNE THAT JD KING WOULD NOT ARRIVE TO THE PIPELINE AREA UNTIL THE WEEK OF JUNE 17. BUT, THE EXCAVATORS MOVED INTO THE AREA MUCH SOONER THAN OSBORNE HAD BEEN TOLD, AND NEITHER KNELSEN NOR ANYONE ELSE WITH JD KING CALLED OSBORNE TO INFORM HIM OF THIS FACT. ON JUNE 12, EXCAVATION EQUIPMENT HIT HOLLY ENERGY'S PIPELINE, CAUSING SIGNIFICANT DAMAGE AND THE RELEASE OF PRODUCT TO THE ENVIRONMENT. IT IS NOTEWORTHY THAT, AS A RESULT OF A PRIOR ONE-CALL NOTIFICATION, HOLLY ENERGY'S PIPELINE WAS ALREADY MARKED IN THE AREA WHERE THE TRENCHING EQUIPMENT HIT THE PIPELINE WITH YELLOW PIN FLAGS. HOLLY ENERGY'S YELLOW PIN FLAGS. HOLLY ENERGY'S YELLOW PIN FLAGS WERE STILL PRESENT AND VISIBLE WHEN HOLLY ENERGY REPRESENTATIVES ARRIVED TO THE SITE AFTER ITS LINE WAS STRUCK.