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Dutch IGCC pioneers chalk up pain and gain Emergency response is behind schedule in the European public sector A new refining industry in Europe's Asian Corridor Commission proposes milestone energy proposal Replace fuel oil with distillate? Cancelled projects will sustain margins “Marine distillate not fuel oil from 2010” Branson's biofuels megastore You heard it here first: refinery CO2 storage a reality in Norway Buncefield 2: Investigation critical Where now for Swedish Class 1 diesel My slow awakening to climate change The luckiest motorist alive Safety row goes on over Europe's largest LNG terminal New WHO guidelines on city air quality put focus on diesel Would LNG really 'evaporate harmlessly' in an accident? Another lesson in the thermobaric bomb Spare a thought for the oil-rich But will the good times keep on rolling? Carbon storage and the zero emissions refinery Everything just changed E85 and high octane gasolines The problem of small-minded young engineers New Permit Regulations Biodiesel newbuilds and a new green superfuel Spilled wine and our split industry Drilling down into the prospects for IGCC The beginning of the start of the end of oil | Thorny issue of where long-distance gas should finally come ashore In the case of the little campaign group versus the parties to the world’s biggest hydrocarbon deal, it seems as if the positions are irreconcilable. The UK Court of Appeal disagrees. Last week, as I write, it found against the campaigners. The group believes it can and will carry on its case, and I suspect I won’t be the only observer who also finds it hard to consider the matter closed. Therefore, in this column I’m returning, as I said I would, to operational aspects of Europe’s largest LNG terminal, which is being built in Wales. You may remember that in my March column I wrote about general hazards associated with LNG spills. That article was a stop-gap. I’d planned to write about one of two envisaged terminal facilities at Milford Haven in Wales. But my questions to operator consortium, South Hook LNG, were negotiating a no-doubt well-meant, but laborious chain of command stretching from London to the Gulf of Mexico and Qatar. It was taking weeks and I certainly didn’t intend writing about their specific project without including them in the process. In the end, as you may remember, with the help of Dr Tony Cox, I attacked some blithe reassurances about general LNG spill hazards that had appeared in the local press in Wales, on a US government websites and in correspondence between concerned members of the public and emergency planning officers in local government there. It was a much-debated article here at the magazine, not least, I suppose, because it spelled out the catastrophe that could take place in an uncontrolled leak of LNG without going on to look at the actual likelihood of that happening. Some views were even sought from the industry about the column and one came in from Dr G Melhem, CEO and President of a US risk and safety consultancy. He says he ‘agrees completely’ with Dr Cox, and then goes on: “…but, in order to judge the overall safety of an LNG project the entire project must be examined from a risk perspective.” As it happens, the operators and port authority say just that has been their concern about the way the campaigners have conducted their argument, which revolves around LNG ship safety in the port. They say the group, Safe Haven, has indiscriminately published official documents showing alarming potential outcomes – maps with vapour plumes stretching across the nearby town, without publishing the accompanying, and extremely small, likelihood of those outcomes. The operators, South Hook LNG, go as far as saying that they will not make public their own risk analyses for fear of them being published selectively and misrepresented by the campaigners. Interestingly, the key concern of the campaigners is also about the link between hazard, risk and safety. But, alleges Safe Haven, the reason no-one is publishing a full risk assessment of LNG carrier safety inside the port is that none has been carried out. They’re calling for publication of a full risk assessment of a vapour cloud flash fire near their community. Massive project But let’s pull back for a wider view just to recall what we’re writing about here. South Hook LNG’s project is of key strategic importance to Europe. It’s part of the massive growth of long-distance gas and is the key European bridgehead of what the operators claim is the largest hydrocarbon deal in history. The small town in Wales – albeit a major port and refining hub for many years – is to be the home of Europe’s largest LNG terminal. There are two proposed facilities and, one of those, the South Hook terminal, will be operated by a consortium of Qatar Petroleum and ExxonMobil. It will be used to import natural gas from Qatar’s offshore North Field as part of the Qatargas II project. The proportions of this project are particularly impressive by anybody’s standards. Gas from the world’s largest discovered field will be liquefied using the world’s largest LNG trains and shipped in 14 new vessels to the UK and Northern Europe for 25 years in a US $12 billion capital cost agreement. In Wales, a two-phase project will eventually see the construction of five storage tanks, receiving lines, re-gasification and safety facilities and a control room. If that sounds a little more graspable in size, then the capacity of this terminal is no less impressive for that. On completion, the site is intended to handle 16 million tonnes a year of LNG, or 2bcf/day. On fairly conservative assumptions South Hook could be handling gas with a market value of $5 billion-worth of natural gas a year. This project furthermore involves refurbishing and pressing back into operation two tanker berths on the loading jetty that served the now-closed Esso refinery in Milford Haven harbour. SIGTTO guidelines This jetty and the marine operations around it are the focus of the local safety fears. 20,000 people live within 4 miles, and the tankers involved – twice the capacity of today’s typical LNG craft – will navigate and turn in the harbour before returning to the jetty. The campaigners are worried about what would happen if a wreck took place within the harbour area, including the risk of a collision between an LNG carrier at or near the terminal and a passing vessel. It’s ten years since the oil tanker Sea Empress grounded and spilled 72,000t of crude oil at the mouth of the same natural harbour. On face value, the concerns of the local people are lent additional weight by a record of collisions with the jetty in the 1970s and 1990s. They were brought to light when a group of retired harbour pilots also voiced detailed operational safety concerns. Lord Crickhowell, a former director of Associated British Ports and marine insurance broker, and one-time Secretary of State for Wales has also voiced concerns. They claim the terminal is too close to passing vessels and cite the Society of International Gas Tanker and Terminal Operators’ (SIGTTO’s) paper Site Selection and Design for LNG Ports and Jetties. It states that jetties should be located “in remote areas where other vessels do not pose a risk and where any gas escape cannot affect the local populations.” It adds: “no terminal should be sited in a position that admits the possibility of its being approached by heavy displacement ships, having an inherent capability for penetrating the hull of an LNG tanker.” Lord Crickhowell raised his concerns at Westminster in the autumn and has been a vocal critic of the jetty provisions. “I think the planning arrangements are fundamentally flawed,” he told me. “The location at South Hook is clearly not a sensible place to put it. It is in breach of all the guidance in SIGGTO’s papers.” SIGGTO is a respected industry association known for promulgating best practice in the handling of LNG. But if the campaigners thought they’d found an ally in the organisation’s General Manager, James MacHardy, then a statement (provided by the operators) dashed those hopes. He wrote to Safe Haven: “What is acceptable in any given set of circumstances rests ultimately on local judgements of the circumstances of a particular event and an appreciation of the operational circumstances of particular port areas.” In court Last week the Court of Appeal threw out the campaigners’ claim that the risk and consequences of a collision in the port waters had not been sufficiently examined. In his Judgement Lord Justice Keene said: “The risks to the population from a vapour cloud travelling over land or sea had already been considered by the Health and Safety Executive (HSE), since the jetties end far out in the Haven. What the Port Authority needed to concentrate on above all else was the risk of a collision, and that it seems to have done.” The operators and Port Authority feel vindicated. Chief Executive of Milford Haven port, Ted Sangster, said: “[The judges] found that that scenario had been taking into account by HSE and the county council… The judges said that risk has been identified and was not felt to be material in any way.” But the campaigners and their solicitor were swift to provide HP with a substantial dossier of HSE panel minutes along with considerable correspondence. There’s no sign of the kind of assessment to which the judges refer: namely, one quantitatively assessing the risk of a large cargo failure and vapour plume at sea. Curiously, even when South Hook LNG attempted to guide me with a reference, I instead found the following from HSE’s IL Hirst: “It was agreed to postpone consideration of flashfire risks from ship releases until policy for ship releases had been clarified.” HSE had earlier started some initial work on such a risk involving a 4km vapour plume, but sought guidance and stopped as described in a 29 November, 2004, email from HSE. Clarification had come from the Office of the Deputy Prime Minister to the effect that HSE was not the competent agency. Despite this, both the Milford Haven Port Authority and the operators have commissioned extensive work on modelling the marine operations of the port, including a substantial number of risk-based exercises. They say they’ve gone beyond what is required by the local regulatory regime, which does not require HSE to be involved in assessing shipping risks. They list reports and analyses by Det Norske Veritas, Burgoyne, Marico Marine, Marin, ABS Consulting Ltd, and a report commissioned from Gordon Milne, Senior Risk Analyst at Lloyd’s Register of Shipping, assessing the risk of explosion and gas release from LNG carriers. It concludes that: “LNG has specific parameters which make the likelihood of a major explosion remote...These features combined with the high standards of design and operation throughout the industry mean that compared to other chemicals LNG poses one of the lowest threats to the general public and property”. In addition to the above, the operators and the port propose safety measures in the handling of the incoming LNG carriers which are very extensive. They include a four-tug active escort procedure, a powerful tug on permanent standby at the berths, two pilots onboard ship and a slot system to separate large ships. Additionally, they’ve been through a long and thorough process for the landside development of the terminal, which the campaigners and local people are generally happy with. Perhaps it’s the statutory involvement of HSE that is more reassuring for local people. It doesn’t surprise Tony Cox that the onshore terminal has generated less concern. “People in the industry are wary of LNG so the engineering that gets done is extremely good, the tanks are very good and thorough risk assessments are conducted,” he says. “On the shore side that’s been done. HSE has done an assessment of something going wrong. It’s not zero, but it’s been decided it’s okay in that location and the residents have accepted it.” “On the maritime side, nothing like that has been done, so what they’re saying is “we’ll make sure it never happens,” says Dr Cox. “And that’s the most dangerous thing I ever hear.” | |||||||
Download Energy Industry Resumé with work samples Profile: Tim Lloyd Wright MA Here you'll find a brief profile of my work with international energy, transport and associated environmental issues. Energy trends articles You heard it here first: refinery CO2 storage a reality in Norway From the archive... Over-processed fuel leaves oil tankers adrift | ||||||||
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