Cascade Natural Gas has agreed to pay a $425,000 fine for pipeline safety violations under a settlement agreement approved by state regulators.
The cost of the fine may not be passed along to customers through the company's rates, according to the Washington Utilities and Transportation Commission, which announced approval of the settlement agreement Friday.
The agreement suspends up to $1.8 million in additional penalties if Cascade complies with an improvement plan spelled out in the agreement.
"We feel strongly that our pipeline system is safe, but we recognize that we have not met all of the requirements to document those safety actions," said Mark Hanson, a spokesman for Cascade.
It is working with the commission to become compliant and to maintain thorough documentation, he said.
The settlement requires Cascade to correct violations identified in a complaint filed by the state of Washington in March. It was the result of a two-year investigation that turned up 364 alleged violations of gas safety rules.
They occurred in the Tri-City area and elsewhere along the company's 4,436 miles of natural gas pipelines in Washington, according to the complaint.
Cascade also must review its pressure control layout, develop cold weather operating procedures, revise its leak evaluation procedures and update its pipeline maps.
"In this industry, incomplete or inaccurate records present a substantial risk to public safety," said the three commissioners in their written decision. "The magnitude of the penalty being assessed against Cascade indicates the seriousness with which the commission views violations of gas pipeline safety rules and recordkeeping rules in particular."
In the Mid-Columbia, Cascade was accused of failing to complete corrosion control monitoring for Kennewick and Walla Walla within the required 39 months.
In addition, corrosion control records were incomplete, only being kept where problems occurred, and then not always including adequate information, according to the complaint.
The company did not follow its own procedures for evaluation and documentation of underground leaks, failing to document the perimeter of leaks in Richland, Kennewick and Pasco, according to the complaint. It also failed to document a follow-up to leak inspections after a leak repair at six Tri-City locations, according to the complaint.
The complaint also alleged that gas pipeline records lacked sufficient details in maps or that pipelines in the Tri-Cities had not been mapped.
Elsewhere in the state, Cascade was accused of operating a pipeline at a higher pressure than allowed.
"We have invested substantial resources to remedy the deficiencies noted," Hanson said.
It has worked to educate employees and improve documentation and also has invested in equipment, including computerized mapping, the company said.