ENERGY AND THE ENVIRONMENT Presentation to Mid and West Wales Regional Committee, Welsh Assembly Government 16 February 2007 John Constable South Hook LNG Terminal Company Ltd
Oil & gas critical to meeting world energy demand
LNG is good for the environment Power Generation CO2 emissions 1200.0 1000.0 Grammes CO2/KWh generated 800.0 � ======== GAS ======= � 600.0 400.0 200.0 0.0 Coal Long P/L Short P/L LNG Nuclear
Gas now largest UK energy source – power generation key growth area UK Gas Demand by Sector 12.0 10.0 Power generation 8.0 Billion cubic feet per day 6.0 Industrial 4.0 Commercial 2.0 Residential 0.0 1970 1980 1990 2000 2005
Gas growth critical to UK meeting Kyoto target Delta 2005 vs 1990 15 10 5 Mt carbon dioxide 0 -5 -10 -15 -20 -25 -30 Transport Industry Energy Residential Commercial supply
UK Gas Supply/Demand Outlook UK/Ireland Gas Supply/ Demand 16 Demand 14 Billion Cubic Feet per day 12 ~7 10 ~10 8 6 4 UK Production+ Discoveries 2 0 2000 2005 2010 2015 • UK : supply gap opened in 2005 as production declines – Demand growth expected to slow to 2-3%/year to 2010, then levels off – First Qatar LNG imports available starting in Winter 2007/08
Project Scope Gas LNG LNG Gas to Pipeline Gas Gas Treating & LNG LNG Production Liquefaction Shipping Regasification $ 13 billion dollar mega-project employing full value chain integration, step-out technologies, and economies of scale to offset distance to market. • Gas from world’s largest gas field; 2.8 billion cubic feet per day • Two 7.8 million MTA trains will be the largest ever constructed; 60% larger than any to date • A fleet of 14 large LNG ships; at 210 – 265 km3, 70% larger than any ever built • Receiving terminal in the U.K. to re-gasify and deliver 2.1 billion cubic feet per day - 15- 20% of UK demand
South Hook Terminal Development Plan Description • Upgrade and refurbishment of existing jetty • Five 155 km 3 full containment LNG storage tanks • Two berths • Submerged Combustion Vaporizers (SCVs) • 2.1 BDFD export • Pipeline extension ( ∼ 128 km) to national gas grid to be built and operated by others (NGG) • PL grid reinforcement by NGG • EPC by Chicago Bridge & Iron • Total capex of $1.4 B spent over 2003 – 2009 • Status • Phase 1 currently 65% complete; Phase II 40% complete • First gas early 2008
The Environment & South Hook LNG: Jetty Gas Pipeline • Maximise use of existing structure to minimise impact on marine environment • Close consultation with DEFRA, EA, CCW, MHPA on management of redundant structures • Careful management of jack-up rig/anchor positioning to minimise impact on eel grass, red maerl • Highly efficient new-build ships to be deployed • Efforts to minimise impact on public use of coastal path, small boat passage
The Environment & South Hook LNG – Tanks Gas • Full containment (tank within a tank) structure for maximum integrity • Gas kept liquid through effective insulation; no refrigeration requirement • 2 million tonnes spoil moved; screening bunds created • minimise visual intrusiveness of facility • Tanks, though large, were specifically designed to be wider and squatter than normal to minimise visual impact
The Environment & South Hook LNG – Vapourisers Gas • Two competing technologies: open rack, submerged combustion • Open rack • Use large quantities of sea-water; impact on marine organisms • Pumps/lines require anti-foulants • Return water significantly colder • Submerged combustion • Small quantities of LNG boiled off • Used to heat water bath; some CO2 emissions; very high efficiency (98%) • Technology choice made in conjunction with key stakeholders • Designed to minimise impact of emissions from vapourisers
The Environment & South Hook LNG – Water Management Pipeline • Topography of site presents water drainage challenges • Exacerbated by soil disturbance during construction • Complex system of hold up ponds developed • Existing settlement pond by-passed • ‘Silt Buster’ installed • Regular monitoring of effluent quality; daily sampling, multiple visual inspections • Achieving 30 mg/litre sediment levels (c.f. permitted level of 75 mg/litre) • System proved robust even during recent heavy rains
The Environment & South Hook LNG – Conservation Area Gas to Pipeline • Unique eco-system • Legally binding Section 106 Agreement with PCC/PCNPA • 110 acres of site made over for nature conservation • Management plan under development • Steered by site manager + representatives from interest groups • Access to area will be controlled • Artificial badger sett created • Kestrel nesting boxes to be installed shortly
South Hook LNG – Community Gas Gas to Pipeline • Public consultation a key element of advocacy strategy • Visitor Centre • Website • Leaflets • Public/stakeholder meetings • Significant engagement with the Media • Rolled out Community Funding Initiative in 2006 • ‘shallow and wide’ strategy • Focus on education, health, environment • Not a substitute for public funding • Focus for 2007 is to develop more self-sustaining initiatives
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