PNM Fined $371,000 for Gas Leak Issues

In early July, the PRC issued an order fining PNM $371,000 for its handling of a 2008 gas leak in Albuquerque and for other pipeline safety deficiencies.    The incident occurred while PNM was still operating the natural gas utility, making them liable for the fine.   New Mexico Gas Company now operates the gas utility using substantially the same personnel, and was a party to the case with respect to corrective actions aside from the fine.

The PRC’s Pipeline Safety Bureau, which investigated and brought the enforcement case, had negotiated a $66,000 fine with the company.  The Commission rejected this amount as not proportionate to the very serious risk to life that had been allowed to persist for almost two months through PNM’s multiple acts of negligence.  At my request, the PRC’s final order in the matter specifically called attention to a failure in the culture of safety at the gas company, based on the fact that multiple employees knew of explosive gas concentrations underneath one of Albuquerque’s busiest intersections, but for whatever reason, the problem was never elevated to upper management and was only resolved when a whistleblower employee, working through his labor union, reported it to the PRC.

The other violations for which PNM was cited were a failure to report a reportable leak in Santa Fe, and failure to properly odorize gas for extended period in two parts of the Albuquerque distribution system. 

The Montgomery Carlisle Leak

On May 19, 2008, a Public Service Company of New Mexico (PNM) maintenance crew tested the ratio of gas to air in Vault B that lay under the sidewalk and Carlisle Boulevard near its intersection with Montgomery Boulevard. A proportion of gas to air in the 4.5% to 20% range explodes if ignited. That day, the test found that the amount of gas in the air fell into that range.

Because of the risk of explosion, PNM policy classified a leak of this type as Grade 1 warranting expedited and special treatment. Company procedure required the maintenance crew to fill out and submit a ticket describing the situation and position a crew member on site until the repairs were made. When a Grade 1 ticket arrived at the maintenance, the staff assigned it a high priority for allocating resources to fix the leak. PNM was required to file a report to the Pipeline Safety Bureau, Transportation Division, of the Public Regulation Commission (PRC) within five days after discovering a Grade 1 leak.

The crew could not identify the source of the leak and a miscommunication occurred. The maintenance office believed it instructed the crew not to fill in that section of the ticket. The crew believed that it was instructed not to fill out the ticket.

As a result, a Grade 1 ticket was not submitted for the Carlisle leak. The crew vented the vault and, from time to time, until June 20, a maintenance crew would return and vent the vault, and after that date, the vault remained untended. Without a Grade 1 ticket in the maintenance office to trigger a repair schedule, no resources were allocated to fix the leak, and it was neglected. Moreover, PNM did not file a report with the Pipeline Safety Bureau.   Under guidelines that should have been followed, a leak of this nature should have been monitored and vented continuously until repaired, hazard barricades should have been placed at street level and tests of gas infiltration in the surrounding areas performed.

On July 16, 2008, responding to a whistleblower report, a Pipeline Safety Bureau inspector arrived at PNM and reported he intended to inspect the Carlisle leak. The maintenance division sent a crew out to vent Vault B, which would lower the ratio of gas in the air, and try and find the leak. In response to the inspector’s request to see the work tickets for the site, PNM maintenance staff created a Grade 1 ticket for the incident and backdated it to May 19. PNM maintenance staff also reported to the inspector that PNM had been regularly monitoring the site, although maintenance field crew logs indicated that this had ceased in mid-June.

Within a few days, PNM identified the source of the leak on a valve, barricaded the area, and, by mid-August, had corrected the problem by capping the lines leading into the vault, removing equipment from the vault, and filling the vault with concrete.

PNM subsequently disciplined several employees who had violated corporate policies and procedures regarding the incident.  One employee was given a

The successor company to the PNM gas business tightened relevant procedures. The PRC fined PNM for the laxness with which it handled the Carlisle leak by not follow its internal procedures and for not reporting the incident to the Pipeline Safety Bureau.

Thanks to Ray Shortridge, a constituent who volunteered to draft the Carlisle-Montgomery narrative above from a PRC hearing transcript.