Company answers our questions on LNG fears (From Western Telegraph)

Company answers our questions on LNG fears

AS controversy continues to rage round the proposals to set up LNG terminals on the shores of Milford Haven, the South Hook LNG project sponsors have offered to respond to local concerns.

The LNG development will take place on the former Esso refinery site near Herbrandston. Pembrokeshire Friends of the Earth have urged that the proposal should be called in by the National Assembly.

Because of increasing local fears, the Western Telegraph put a number of searching questions to South Hook LNG and spokesman Nick Thomas responded as follows:

What is LNG? Natural gas is one of the main sources of energy used by residential, commercial, and industrial customers in the UK. LNG is simply natural gas which has been cooled so that it condenses into a liquid. Almost all the natural gas used in Japan comes from LNG. Liquefying natural gas means that gas from distant regions of the world can be safely delivered to the UK. Since the world's largest supplies of gas are located at much greater distances, the gas must be transported in its liquid form.

Where will the LNG come from? The source for South Hook will be the state of Qatar on the Arabian Gulf. It is proposed to transport the LNG in purpose-built tankers and offload it at the existing jetty at Milford Haven.

How volatile is LNG? LNG evaporates quickly and disperses rapidly because it is lighter than air. However, as it is simply cooled natural gas, it is no more 'explosive' than the natural gas used to heat homes.

Could LNG explode if there was a collision at sea or in the Haven? Or could it explode for any other reason? The South Hook sponsors have been working closely with organisations such as Milford Haven Port Authority to ensure that the possibility of a shipping incident is extremely low. Vessels are also designed to withstand significant impact. If an LNG release were to occur from a shipping incident, and if it were ignited, then the effect would be localised to the vessel and its immediate surroundings and unlikely to impact the land. The recent Health and Safety Executive assessment examined the consequence of such an incident and found no cause for local concern.

How will it be transported? What regulations are in place for vessels and their crews? And is there specialist training for crews? LNG will be transported in ships of similar size to VLCCs (very large crude carriers) bringing crude oil to refineries. The design of these vessels will be to the latest standards, and will comply with all relevant marine design codes. Vessels will be regularly checked and there will be checks on training and competence of ships' crew.

Have there been any previous shipping incidents at sea or at a berth? The LNG shipping industry has an exemplary safety record. There are over 135 LNG ships in active service and these ships handle approximately 120 million tonnes of LNG every year. In the last 40 years there have been over 33,000 LNG voyages covering more than 60 million miles without major accidents or safety problems.

What would happen if there were a spill on sea or on land? Health and Safety Executive experts have considered potential spill scenarios and have found no areas of concern. An incident at sea is extremely unlikely, and the current design of ship is aimed at minimising the likelihood of release in the event of collision. Milford Haven Port Authority has emphasised its ability to safely handle LNG shipping.

Could there be a similar situation to the Sea Empress? Our planning application was submitted with an environmental impact statement, which has been reviewed by the Environment Agency. Any LNG spill would harmlessly vaporize and not pollute the Haven.

What are the operational risks in transferring LNG to the tanks at the terminal? LNG will be transferred through rigid stainless steel pipes. This is to ensure the highest level of safety protection. The terminal and the ship will have many shutdown systems, designed to deal with emergency situations.

What are the risks from a pipeline? The HSE has examined the risks of a serious pipeline failure, and has found no reasons for concern. The gas pipeline, which leaves the terminal and connects to the gas pipeline at Swansea, is no different from the thousands of miles of pipelines across the UK that have been operated by National Grid Transco for decades. The HSE included the on-site gas pipeline in their assessment, which concluded there are no significant risks to the local community. We have been in extensive discussions with National Grid Transco and will be designing and building the gas pipeline to strict pipeline standards.

There has been concern about the explosion in Algeria. Could that happen here? While the sponsors of the South Hook LNG project do not have any direct involvement in the Skikda plant in Algeria, it should be noted that the South Hook LNG terminal facility is totally different. Our project involves the process of warming up the cooled LNG to turn it back into gas before it is put into the gas pipeline network. The Skikda plant was involved in the more complex activity of processing and cleaning the gas from the producing natural gas fields, then cooling and liquefying the gas.

What kind of exclusion zone would there be? 'Exclusion zones' are determined by the Port Authority and the HSE. The HSE has advised a 'land use planning exclusion zone' for the South Hook plant that extends mainly over the existing Esso site, over water and does not adversely impact on any residential property.

Would it not be better if such a terminal was in a more uninhabited area? The HSE's review has concluded there are no safety reasons to object to the proposed development. Our plans will be subject to a further safety review by the HSE, Environment Agency and the Coastguard under the Control of Major Hazards (COMAH) requirements. We, as operator, will have to demonstrate that all necessary measures have been taken to prevent major accidents. Any issues raised locally relating to safety systems, operating procedures and emergency response plans will have to be fully addressed.

There have been many calls for a terminal to be located ten miles offshore. Would this be safer? Currently there are over 50 LNG loading/unloading terminals operating around the world, none of which are offshore. Offshore facilities would present very significant engineering, cost and safety challenges. The HSE has concluded that the planned onshore terminal will meet exactly the same safety, risk, and health standards as other industrial facilities in the UK. There would not be any significant additional safety benefit by situating the plant offshore.

What will be the benefits to Pembrokeshire of this LNG terminal? During construction, up to 700 workers will be employed. Construction will extend from mid-2004 to late 2009. The new underground pipeline required to carry gas from Milford Haven to the main UK natural gas pipeline will also represent a major capital investment. Furthermore, the availability of a major source of gas in south-west Wales could potentially attract other industries which need gas as a fuel. How many jobs will it provide?

During the construction phase, employment will peak at around 700. During routine operation, in the long-term, the terminal will employ approximately 50 - 60 full-time employees. The ancillary activities required will also generate significant employment. The shipping aspects of the project will also bring jobs (tug-boat crews, pilots, service boats, stores) and the plant itself will have a steady need for sub-contractors.

Would you consider holding a public meeting to answer concerns? We have already held a public meeting in Herbrandtson before our planning application was approved. In addition, our visitor centre at Nelson Quay in Milford has had many visitors over the past year. However, we are in discussion with Milford Haven Town Council about a further public meeting towards the end of March.

In the case of accidental injury, loss of life or damage outside the proposed site, will the company pay compensation? Compensation for industrial accidents is determined by law. The proposed South Hook LNG plant will be covered by the same legislation as all other refineries, chemical plants and other industries operating in the UK.