Presentation to the Bahamian Forum on LNG British Colonial 6 pm - - PDF document

Presentation to the Bahamian Forum on LNG British Colonial 6 pm July 5, 2005 Revised August 8 2006 By Sam Duncombe “There are several ways to measure the effectiveness of a democracy. One is to look at how much the public is included in community decision-making. Another is to evaluate access to

• justice. The most telling aspect of a government however is how it distributes the goods of

the land. Does it safeguard the commonwealth - the public trust assets - on behalf of the public? Or does it allow the shared wealth of our communities to be stolen from the public by corporate power?” That was an excerpt from an article by Robert Kennedy Jr., America’s leading environmental attorney. When reEarth began this fight it was not so much whether or not the Bahamas should engage in an industry we had no clue about, it was about the transparent process and Freedom of Information we had been promised by the PLP in their platform “Our Plan.” They also promised to include the people of the Bahamas in all decisions. In February of 2003 we had a meeting with the BEST Commission, and shortly after with the Minister of Health and Environment, Marcus Bethel. On both occasions we submitted a number of questions regarding the way forward for the review of Environmental Impact Assessments EIAs for these LNG projects and how the public could go about submitting their questions and concerns. Unfortunately, the contentious nature of those initial meetings were an indication of things to come. We

believed then and we still believe that a proper environmental review allows the public and government decision makers the opportunity to make a clear assessment of all the costs and benefits of a project prior to its commencement. In the following months we pushed publicly for there to be an open review of the EIA submitted by AES, one of the energy companies wishing to locate an LNG facility in the Bahamas, specifically at Ocean Cay. Our government promised us that the facility would be built according to U.S. standards. U.S standards include extensive pubic consultation. At no time have the U.S. standards for the location and operation of an LNG facility been presented to the Bahamian people. The very first chapter of the Federal Energy Regulatory Commission’s (FERC) “Guidance Manual for Environmental Report Preparation for Natural Gas Facilities states “…a Notice

• f Intent to prepare an EIA should be mailed to potentially affected landowners as well as
• ther interested parties…”

Yet it was 2½ years later that the residents of Cat Cay – the closest neighbor less than 8 miles from the project were officially notified by a meeting they called. In the U.S., meetings are conducted by the FERC to hear the community’s concerns about LNG facilities. The proposed project is given a brief introduction of purpose and need by the FERC, followed by the company’s presentation of the project. Persons that wish to comment are given ample time to ask whatever questions they have, or to make statements about the project. I know because I attended and presented to the FERC at a meeting in Florida in May of 2003. However, in the Bahamas the public was limited to one or two questions and these questions were fielded by a moderator. Frankly, we were treated with contempt at home, as though how dare we question the right of government to make decisions for us. By simply emailing the Florida Department of Environmental Protection, I was able to join the mailing list that circulates all correspondence between the US governmental agencies and the LNG companies, a level of inclusion and transparency that has NEVER been

• ffered in the Bahamas.

If these simple U.S. standards of public participation have been ignored, how then can we have confidence that our government is going to follow US standards for the environment

for the planning, construction operation, and decomissioning of these facilities? The question that I continue to ask and have yet to receive an answer is “why The Bahamas and not Florida – the recipients of the LNG? Why should the Bahamas bear the brunt of the environmental degradation and safety risks for Florida’s energy needs?” According to the US National Environmental Policy Act, alternative sites should be a part

• f the applicant’s plan.

I met Aaron Sampson, the project manager for AES, and James Ebeling, project manager for Tractebel, at the FERC meeting in Florida. I asked both of them, why the Bahamas and not Florida. Mr. Ebeling told me there was no land available in Florida with a deep-water

• port. Mr. Sampson’s reply was they could build it in Port Everglades, but the land would

cost a hundred million and permitting would take forever. He also echoed Mr. Ebeling about the lack of deep-water ports in Florida. Strange - but lack of a deep-water port is also an issue for the Bahamas. The sea bed around Ocean cay will have to be dredged to create a deep-water port there to facilitate the 12 story LNG tankers that may be docked there. I have great news for both gentlemen; they need not look further than Florida Bay. There are dozens of islands there that could accommodate an LNG facility. Sure, they would have to do a bit of dredging, but it’s right next to their customer base, and should be cheaper than building a 100-mile pipeline, and should result in a cheaper gas for their clients. If that is not acceptable, why can’t they build their own “Ocean Cay” off Florida’s main land that should be a small price to pay for their own country’s energy needs. Or better yet they could take advantage of the latest LNG technology and build a floating regassification facility. So why isn’t this facility being sited in Florida again??? Could it be that there are at least 12 regulatory agencies these companies would have to satisfy to get approval, compared to the one understaffed, overworked BEST Commission here in The Bahamas? Could it be that from California to Florida and Canada to Mexico communities are fighting tooth and nail to keep these facilities out of their back yards? Why would these communities be turning away such a “lucrative” proposition? Why don’t they want the jobs and revenue these facilities promise? In fact states and counties are passing legislation refusing LNG companies to operate in their areas, they include but are not limited to, Rhode Island - Governor Don Carcieri has signed a law effectively banning liquefied

natural gas tankers from Narragansett Bay. East Providence, Suffolk County NY Executive Steve Levy and the leaders of the Suffolk County Legislature announced that they were filing a bill that would prevent the construction of LNG (Liquified Natural Gas) facilities in the waters of the Long Island Sound off Suffolk's north shore. The Baltimore County Council passed a bill Monday banning liquefied natural gas facilities within five miles of homes — essentially blocking the proposed LNG terminal at the Sparrows Point Shipyard Two of Maryland’s State top elected officials have joined the mounting criticism over a liquefied natural gas (LNG) plant being proposed for the former Sparrows Point Shipyard... Fall River, Massachusetts City Council Voted to Oppose LNG Terminal in 2003 In 2003, Mr. Richard Coulson Managing Director of RC Capital Markets asked if he could interview me about LNG. I told him that primarily my concern was the lack of access to the documentation, but that I was also concerned about the impact of laying a 100 mile 24” pipeline on the seabed, as well as pollution from the terminal itself. His concerns were, given the volume of gas that would be flowing through that proposed pipeline, the Bahamas did not appear to be getting the kind of money that it should in “through put” fees. A fee based upon the volume of gas being delivered through the pipeline.

• Mr. Coulson also indicated that AES is expected to produce revenues of over $1.2 billion.

The 15 million negotiated by the government was extremely low, and a royalty of 5-7% would initially generate some $60 million, additionally with gas prices expected to increase so that fee should escalate. Shortly after our interview, Mr. Coulson’s column stated and I quote “Local environmental groups such as reEarth will be quite right in demanding hard answers to questions.” For the record, Mr. Coulson, not one of my questions or yours have received any answers, hard or soft. By October of 2003 after many heated exchanges in the press, the government finally conceded to allow the public to review the EIA for AES. We were given 20 working days to review five 3-4 inch thick volumes of information. May I remind you that our government promised us U.S. standards in all aspects pertaining to this exercise.

In the US, the public is informed about a project before an EIA is done, so that local knowledge can be included, concerns that require studies can be addressed, and submitted in the first draft of the EIA. This was never done. We were presented a first draft EIA with no public inclusion. The draft EIA when completed is open to review by the public, by appointment, and the public is given a time frame in which to submit comments. The public is also allowed to have copies of pages for a small fee. In fact, in the US, EIA’s are available on the internet for unlimited review. Once comments are made, they are integrated into the EIA and if further studies are necessary they are performed, and revisions are made available for additional public review. The 20 day review period we were afforded was an insult, especially considering the Government took over 2 years to process the same EIA. I personally spent 30 hours reviewing the EIA, and while I barely scratched the surface, I did generate over 100 questions, which I submitted to the government. To date I have not even had acknowledgment of my letter, much less had any of my questions answered. To be honest, I can’t possibly begin to know what all our concerns about LNG projects might be since we did not have the opportunity, nor were we allowed to review ALL of the

• documentation. To add insult to injury while reviewing the EIA we were monitored by a

BEST employee. I will however share some of my concerns. Although 43 miles of the pipeline will lay in Bahamian waters, only 10 miles of the route were video surveyed. Upon this survey, the decision was made that there would be no damage to our seabed or sea life. But how can we know that if we do not know what is in the remaining 33 miles since there is no video documentation? The following are excerpts from AES’s EIA. Biocides ” active ingredients usually toxic to fish and invertebrates” N-SEAL - Viscosifier “Toxilogical Information- no data available on carcinogenic effects. Degradability not determined, Bioaccumulation not determined, Fish toxicity not determined.” QUICK_TROL - gelling agent “Hazard Overview CAUTION:- Acute health hazard lung cancer - crystalline - associated with scleroderma and kidney disease. Environmental Precaution - none

known, toxicity to crustaceans and algae not determined” “A maximum of approximately two hundred and fifteen thousand cubic meters of water a day will be discharged from Outfall 001.” Comment This “water” will also contain neutralized sulphric acid, sodium hydroxide, hydrochloric

• acid. As well as sodium hypochlorite (a corrosive), citric acid solution, Sodium Bisulfate,

brine and sand filter backwash, diesel fuel, oils, antifreeze and storm water. There is nothing that we have found in the EIA that addresses these chemicals impact to the receiving waters. How are all these chemicals going to affect fish populations? The LNG underwater pipeline will cause a change in water temperature. What effect will this have on ocean organisms and fish eggs? Toxic smog-producing emissions from the gas energy plant could be as high as 1.2 tons daily, adding to green house gasses that cause global warming and sea level rise.– how will this affect our biodiversity on land and in water? Some LNG cooling systems dependent upon Sea Water could cost us up to 4.9 billion fish eggs and larvae per year as water is pulled in from the ocean, cooled and returned at a lower temperature. Noise created by the barges and the laying of the pipelines will cause fish, whales and dolphins to abandon their natural routes. We promote Bimini as the fishing capital of the world just 20 miles away from Ocean cay – yet the EIA claims there is no fish life in this area - Are people then catching phantom fish in the Biminis? Maybe we’re practicing virtual fishing…how enlightened… Initiated by the United Nations Food and Agriculture Organization in 2003, eighty four scientists conducted the most comprehensive study of its kind - The Living Marine Resources of the Western Central Atlantic - they found that the Florida Straits, the body

• f water between the Bahamas and southern Florida, have the Atlantic’s greatest

concentration of endemic species – or species found no where else in the world. Some of them have ranges so small that even localized human activities can cause their EXTINCTION! Threats to these marine animals also include destructive fishing methods, dredging of estuaries and harbours, and laying of natural gas pipelines on the sea floor.

We can no longer look at projects in isolation. We have to look at what developments have

• ccurred and what other projects are on the drawing board so that the cumulative effects of

all the projects can be measured.

• Dr. Ray McAllister Prof. Emeritus Ocean Engineering who has dived and done

environmental work for Marcona Ocean Industries, the former owner of the aragonite mining facility at Ocean Cay, continues to ask “why are they boring under the reefs in Florida but laying the pipe on or through reefs in the Bahamas? Don’t the sensitive marine communities off Ocean Cay deserve the same protection as those off Florida?”

• Dr. McAllister’s work at Ocean Cay spans 50 years and he - quote “knows of no gap

within the reef within a half mile of the ship channel.” Incidentally, what is the going rate of a reef these days? Can we put a price tag on a resource that once damaged takes hundreds or thousands of years to regenerate? Other issues that concern Dr. McAllister include possible hurricane damage, he continues… “There is also the danger of an uncontrolled breach and hours or days of highly flammable gas flowing unchecked into the ocean and atmosphere. As far as we are aware, there is no shutoff valve proposed on the Bahamas side under water, so if there is a breach from grounding ships, hurricanes, terrorist activities, this 24 inch pipe carrying gas at a pressure

• f 2200 psi would be discharging its gas into the water and atmosphere. There will be a

potentially highly flammable gas plume for many tens of miles. Which if ignited by a spark from an outboard motor, a cigarette carried by a fisherman, pleasure boater, or sparks from a grounding ship, may cause a major disaster.”

• Dr. Stanislav Patin, a Russian specialist on environmental problems of the ocean, for over

40-years states . In his book Environmental Impact of the Offshore Oil and Gas industry, "The first important feature of interaction between gaseous traces and marine organisms is the quick fish response to a toxic gas Gas rapidly penetrates into the organism (especially through the gills) and disturbs the main functional systems (respiration, nervous system, blood formation, enzyme activity, and others). ...The interval between the moment of fish contact with the gas and the first symptoms of poisoning is relatively short. Further exposure leads to chronic poisoning. At this stage, cumulative effects at the biochemical and physiological levels occur. A general effect typical for all fish is gas

• emboli. The symptoms of gas emboli include the rupture of tissues (especially in fins and

eyes), enlarging of swim bladder, disturbances of circulatory system, and a number of other pathological changes.” To date we have not seen the Environmental Management Plan as promised at the Cat Cay meeting in April of last year. The EIA states “No findings of significant land or subsea cultural resources (including ship wrecks) were made during the baseline studies therefore no impact to cultural resources is expected.” But Dr. McAllister states “There is a historically valuable shipwreck just north of the runway at Ocean Cay which both my son and two diving friends here in Florida have been

• n. It is a wooden ballast stone wreck which means probably 1700s or early 1800s.” Since
• Dr. McAllister’s diving trips to this area, he is not aware of any further exploration or

conservation of the wreck. The book “Brittle Power” prepared as a Pentagon Study states that “a 9% spill from a tanker will be so cold that it will be denser than air. It will therefore flow in a cloud or plume along the surface until it reaches an ignition source. Such a plume might extend at least 3 miles downwind from a large tanker spill within 10-20 minutes. It might ultimately reach much further - perhaps six to 12 miles. If ignited, such a fireball would burn everything within it and by its radiant heat would cause 3rd degree burns and start fires a mile or 2 away. The energy content of a single standard LNG tanker carrying 125 thousand cubic meters is equivalent to about 55 Hiroshima bombs.” The Sandia Report requested by the U.S. Department of Energy (DOE) on the Guidance

• n Risk Analysis and Safety Implications of a Large Liquefied Natural Gas LNG

Spill Over Water, states: “Currently, the potential for an LNG cargo tank breach, whether accidental or intentional, the dynamics and dispersion of a large spill, and the hazards of such a spill, are not fully understood… “There are many theoretical and experimental gaps related to understanding the dynamics and subsequent hazards of an LNG spill on water. Filling some of the gaps is currently impossible due to experimental and computational

• limitations. It is questionable whether the spill sizes investigated to date give an

indication of the atmospheric dispersion that would occur for very large spills”.

The truth is we, including the LNG industry do not know what the effects of a large spill of LNG would be. Are we prepared to be guinea pigs for this industry? SANDIA REPORT SAND2004-6258 Unlimited Release Printed December 2004 http://www.fossil.energy.gov/programs/oilgas/storage/lng/sandia_lng_1204.pdf 14 The Congressional Research Service Order Code RL 32205 concludes and I quote “LNG imports pose significant safety challenges. LNG is inherently hazardous and its infrastructure is potentially attractive to terrorists. The recent LNG terminal fire in Algeria demonstrates that despite technological improvements since the 1940’s, LNG facilities can still experience serious accidents.” On April 21, 2005 The Congressional Record at page H2344 quotes Congressman Patrick Kennedy of Rhode Island as follows, “I will tell my colleagues in Rhode Island we would welcome the chance to have our gas piped in from some other country because the fact of the matter is, our State knows, as every other State that has an LNG facility knows, that if we were to ever have that explode, it would decimate a fifty mile radius.” Minister Miller claims that the congressman recanted his statement. I can find nowhere where this is so. I am not a scientist. I have never claimed to be one. I am as Minister Miller pointed out in the honourable House, a graphic artist – albeit a literate one. Mr. Miller continued to ask “who should he listen to – a graphic artist or the experts at the BEST Commission?” For the record, none of the scientists at the BEST Commission are experts on LNG. There are literally a handful of people in the world who are experts in LNG most of whom work for the LNG industry – and as we say “a fisherman ain’t going to call his own fish stink.” However, there exist scientists Like James Fay from prestigious institutions like MIT that counter the industry’s claims about the safety of LNG. He states “The fire that would ensue from a boat bomb attack on a tanker would be of unprecedented size and intensity – like the attack on the world trade centre in new your city. There exists no relevant industrial experience with fires of this scale from which to project measures for securing public safety.” The LNG industry claims they have improved their safety record significantly since the blast in Cleveland in 1944. I wonder if the 11 people killed in 1989 in the Gulf of Mexico when their fishing boat struck and ruptured a pipeline think so, or the 12 killed in Pakistan and the 575 killed in Russia in the same year agree. I wonder if the 36 killed in Venezuela by an exploding pipeline in 1993 thought so, or the 11 killed including 5 children who were camping near a pipeline that exploded in New

Mexico in 2000. And what about the 30 killed in Algeria, and the 17 killed in Belgium in 2004? Do you think they thought LNG was a safe industry? These are only the explosions that have caused human casualties. There are dozens of other explosions that fortunately did not result in death. According to the US Office of Pipeline Safety, since 1986 operators and distributors of natural gas have experienced 4663 incidents, which have cause 404 deaths, injured 1708, and caused over 1 billion dollars in damages. And our own Minister of Agriculture and Marine Resources continues to blatantly ignore the truth claiming that there has been no loss of life at an LNG terminal. If LNG is so safe why is AES taking out insurance out on all the residents of Cat Cay as announced by Minister Miller at the Cat Cay meeting last year? If you think I am exaggerating the dangers of an LNG tanker I will run through the procedure that must be followed for the Distigas Facility in Everett Massachusetts. Upon notification of an LNG shipment, the US Coast Guard notifies the state police who deploy 2 undercover officers to observe the docking site 24-26hrs before the tankers

• arrival. 11 members of the State Police dive team inspect the wharf as well as a large

section of the river –A unified command post is set up several hours before the arrival of the tanker which is made up of USCG, State Police, Environmental Police, and the Fire

• Department. 2 miles from the dock 5 armed USCG ships establish a 500 yard perimeter.

Another security bubble is established which is comprised of 4 state police boats, 1 police dept boat and 1 environmental police boat. In addition to the water assets, state police shut down traffic, State police helicopter provides observation until the tanker is docked. The police department closes all adjacent roads. The Fire Department is always on hand. Additionally 5 members of the Police department maintain a visible presence while the tanker is in port unloading – which generally takes 24 hours. EVERY time a tanker is docked. I met a very high-ranking Defense Force officer recently and asked him what role is the Defense Force going to play in docking these floating bombs. He said no one had said anything to him. It is not up to me to prove every thing I find that opposes LNG, rather it is the responsibility of our government, and the BEST Commission to thoroughly investigate what these studies are saying and come back to us with a true and balanced accounting of the findings of locating an LNG facility in our country. It is clear that the assessment of the project to date remains cursory, inconclusive, inadequate, incomplete and contradictory, and

does not give us a basis for weighing the costs and benefits of this project. As Sir Arthur Foulkes offers in his column ‘To the Point’: “The debate is not about the merits of LNG as opposed to other fuels. It is not about whether LNG is safer than the LPG, which is transported through the streets of Nassau to serve the needs of people who live here. It is not about a comparison with the fuel installation at Clifton Pier, which is also there to serve the needs of residents. Neither is it about how many countries and states are building LNG terminals to serve the needs of their

• people. It is about whether we should take the risks associated with these proposed

projects not for ourselves but for the people of Florida who do not want them in their own backyard.” More recently, AES Corporation has been sued by the government of the Dominican Republic for allegedly dumping toxic ash on one of their beaches. One would think that an insult to the environment of this magnitude to a sister island would automatically preclude AES’s LNG proposal from being considered. But evidently not.

• Dr. Marcus Bethel, our Minister of Energy and Environment was quoted as saying "I don't

think [the lawsuit] would have any impact whatsoever [on our consideration]," "First of all, the issues are related to a subcontractor for AES who had responsibility for disposing of waste from a coal operated facility," he said. "Nothing here in The Bahamas being proposed has anything to do with coal so the whole setup and situations are quite

• different. So the legal concerns that have been expressed in another jurisdiction have little
• r no application here in The Bahamas with respect to what's being proposed here."

“As a citizen , writes Audrey Roberts, I question the veracity of the remark by Minister Bethel that what occurs in one jurisdiction has little or no relevance here. Certainly there are significant contextual similarities: the DR like the Bahamas depends on its marine environment for cultural and economic livelihood; both are small island states with attendant vulnerabilities - to name but two. “Minister Bethel's remarks are reckless and irresponsible. They suggest that there are no substantive lessons to be learned from the DR experience because of logistical differentials, that there is no need for critical analysis and that citizen's must just accept unilateral, uncritical thinking from ministers of government. “If it matters to our Government that public confidence and trust is important here, then may I suggest that the Minister of the Environment adopts a policy of scrutiny into all matters concerning common resources such as the marine environment AND further, that the manifestations of such a policy is communicated to the citizens of the Bahamas?”

• Dr. Max Puig, the Dominican Minister of Environment stated "The US Federal law

establishes that when a (company) generates waste, (that waste) is (the company's) responsibility until it disappears. What the legal representatives have established is that this company violated the US federal laws in proceeding to get rid of the waste produced by creating phantom companies and hiding their responsibility". Additionally AES EIA states that they bear no responsibility for what their contractors do. As the lead company in this project they MUST be held accountable for the companies they hire to carry out their work. And what about the US standards they claim to be following whilst trying to shirk their accountability on their contactors? The Attorney General Mrs. Alyson Gibson recently tried to lay the decision for accepting LNG at the feet of the FNM saying, "This administration was simply honouring the LNG policy that was put in place by the former administration, which gave agreements in principle to three LNG plants subject to certain

• criteria. However, as reEarth sees it, the Christie government is accountable for

its own decisions. The PLP government is the government of the day. They are the ones that have the power to allow the project to proceed or not proceed. This decision cannot be thrown in the FNM's lap. Meanwhile we have the Opposition leader, Hubert Ingraham refusing to pass comment until more information is released. What is going on? We need a definitive position from the FNM on LNG; are they FOR becoming Florida's gas station or AGAINST? Is the FNM willing to accept all the safety and environmental risks to appease our US neighbours who have so far been unwilling to accept these risks themselves? Is the FNM waiting to make a decisive comment until after the project is approved and the horses are out of the gate? Don’t bother! According to the Minister of Tourism, Obie Wilchcombe in a contribution to the House, the Bahamas expects to realize 2 billion dollars from tourism in 2005. While tourism is fraught with its own environmental challenges, according to the World Travel and Tourism Council almost 70% of all jobs in the Bahamas come from tourism . To put it into perspective LNG will account for 1.25% of what tourism brings in. Should we not then carefully guard our “golden goose” and actively seek out industry that is in keeping with our #1 industry while working on perfecting how we go about approving tourist developments? When asked about approvals for LNG the Prime Minister said, and I quote “We are not just another country looking for revenue opportunities. We are a country whose primary industry is tourism and there fore we cannot mistakenly and inappropriately agree to developments and industries that are inimical or inconsistent with the best interest of our tourism industry.”

Do you think the average tourist knows where Ocean Cay or Freeport Harbour are in relation to New providence – when hurricanes pass through our country, they believe the whole country has been shut down. Should there be an LNG accident and we cook the goose how are we going to replace the billions from tourism? Why should we destroy our environment while Florida makes constant progress in making it more difficult to destroy theirs? We spend millions of dollars promoting the Bahamas as a pristine ecosensitive destination

• we need to do more that just show images of our spectacularly beautiful country. We need

to conserve and preserve it like the precious resource it is – our children’s future. “The Lakota Indians of the United States have a saying that has been expropriated by the environmental community. “We do not inherit the Earth from our fathers, we are borrowing it from our children”. The last thing I wish to say is, If we don’t leave our children something that is roughly equal to what we’ve received, they will have the right to ask us some very difficult questions. Thank you for your time. Goodnight. PAGE PAGE 12