Press Dossier Lussagnet's 50th birthday September

Transcription

1 Press Dossier Lussagnet's 50th birthday September CONTENTS: 1) TIGF presentation page 2 2) The history behind the Lussagnet storage facility (50 years old) page 2 3) The gas chain page 4 4) The challenges of natural gas storage page 5 5) Characteristics of Lussagnet and Izaute storage facilities page 6 6) Storage as part of the local landscape page 9 7) Safety and the Environment: page 10 8) Network map and geographical locations: page

2 1) TIGF TIGF's mission is to provide and develop a natural gas transportation and storage service on a European scale which respects the TOTAL Group's principles of sustainable development and satisfies existing and future clients, while guaranteeing: Levels of reliability and safety which match those of the profession's highest standards, The development of gas infrastructures to increase the fluidity of the market. In January 2005, Gaz du Sud Ouest became TIGF and then acquired Total Stockage Gaz France (TSGF) and Total Transport Gaz France (TTGF). The company thereby benefited from the experience gathered by GSO since 1945 in transportation and by TSGF since 1957 in natural gas storage. TIGF was set up in order to adapt to the changing regulations regarding the opening up of European energy markets were taking place. TIGF operates almost 5,000 km of natural gas pipelines in the south-west of France (Bordeaux Biarritz Carcassonne) and two natural gas storage facilities approximately ten kilometres apart: Lussagnet (Landes department) and Izaute (Gers department). The company has 335 employees in 19 sites; the head office, operational and sales departments are based in Pau (Pyrénées Atlantique department). TIGF's turnover reached almost 263 m in The company wishes to launch an ambitious investment programme which would cost on average more than 100 m per year over the next ten years. The purpose of this programme is to meet the growing future demand for natural gas which is forecast for the inhabitants and firms present in the south-west of France. TIGF has undertaken to implement a continuous improvement policy. Measures taken by the company in the area of safety have been acknowledged. Such recognition is based on the assessment of TIGF's management system carried out by an approved body (DNV) and according to an international reference system (Level 7 of the International Safety Rating System - ISRS). In 2006, the management system for the protection of the environment was awarded ISO certification on all of the company's sites. In the area of quality, TIGF was awarded the ISO 9001 certificate for its odorization activities. In 2007, TIGF introduced a Sustainable Development management system. On September , TIGF celebrated the 50th birthday of the Lussagnet storage site. 2) Background to the Lussagnet storage facility Almost 50 years' experience Geographically close to each other, the underground storage facilities in Lussagnet and Izaute were developed during different periods. Commissioned at the same time as the Lacq field in 1957, Lussagnet was originally intended for regulating natural gas production coming specifically from the Lacq plant. Its capacity has quadrupled since it was created to meet the consumption needs of the south-west of France. The Izaute storage facility was commissioned in the early 1980s to respond to the increase in gas demand. The demand for natural gas - a clean and competitive source of energy - will continue to grow and thereby bring about the need for greater storage capacities : Lussagnet meets the storage requirements of the Lacq plant In 1956, studies reveal the existence in Lussagnet of a natural geological configuration which is suitable for the installation of a reservoir. In 1956, studies reveal the existence in Lussagnet of a natural geological configuration which is suitable for the installation of a reservoir. In March 1957 the decision to operate this structure is taken : Lussagnet fulfils France's modulation needs In 1961, the 'Etablissement de Stockage et de Transport du Gaz' (E.S.T.G) is created. The role of the E.S.T.G. is to deliver gas on demand and thereby fulfil three functions: the transportation of gas produced in Lacq, its storage to ensure the safety of supplies and quantitative and qualitative checks. Lussagnet is forced to adapt to market changes and meet the demand for gas for domestic needs which vary in line with the seasons, days of the week and also the times of day. With the increase in production and the development of high pressure pipelines, the - 2 -

3 Lussagnet storage facility is then used for the modulation requirements of private individuals. From 1957 to 1967, Lussagnet will provide alone and then together with the Beynes strorage facility in the Paris area, France's entire natural gas modulation needs : Lussagnet exclusively ensures the modulation needs of the south-west of France The growth in natural gas consumption in France will subsequently require the introduction of new storage facilities as close to the areas of consumption as possible. As from 1968, Lussagnet therefore only meets the consumption needs of the south-west, from Bordeaux to Perpignan. In 1974, the Lussagnet storage facility site becomes an essential part, on a technical level, in the operating of the south-western network and, on an economic level, in the sale of gas. In 1975, several measures are taken: facilities are modernised; studies into the storage possibilities of a neighbouring structure are undertaken; real-time management of the entire operation is centralised. Furthermore, 1975 is also a key year in the organisation of the Department. E.S.T.G. becomes part of the 'Direction des Exploitations de Lacq' and, so as to avoid any legal confusion, the term 'Etablissement' is replaced with the word 'Installation' : Izaute to meet the modulation needs of central France To deal with the growing demand for gas in its coverage areas, Gaz de France increases the number of its purchase agreements with firms abroad and diversifies its supply base. Gas comes from Algeria, the Netherlands, the USSR and the North Sea. Lussagnet's storage capacities are not enough; another site is therefore created in 1979: Izaute. The Izaute site is created to respond to the modulation needs of central France. Lussagnet's gas storage and transportation facilities become an entirely separate company and adopt the name, Elf Aquitaine Gaz France Stockage (EAGFS) on January : Lussagnet, a player in the opening up of the energy markets The first European directive on the opening up of natural gas markets in Europe is published in June In 2000, Elf Aquitaine Gaz France Stockage becomes Total Fina Elf Gaz France Stockage (TSGF). The service agreement, signed in 1997 between EAGFS (later to become TSGF) and EAEPF and which included the subcontracting of the industrial site to EAEPF, was not renewed due to the fundamental change in the organisation of TSGF. In 2005, with the creation of TIGF, the Total Group's natural gas storage and transportation activities are brought under the same body. TIGF gradually introduces a new form of organisation around these two activities

4 3) The gas chain TIGF's storage activities are a part of the gas chain, from the places of production until the end user. (*) Transported to the storage facilities from production sites or methane terminals, in the summer and spring, the gas is compressed and then injected through wells into the underground reservoir. The gas displaces the water contained in the storage facility's sand. To meet growing demand in winter, gas is decanted via the same wells. Synergy between the storage facility and the transport network Gas arrives at the storage facility via the transport network; it is then stored here. It later leaves through the same network en route to its industrial and/or public consumption point. Complementary nature between gas storage and transport activities means shippers are offered increased flexibility in the day-to-day management of volume allocation

5 4) The challenges of natural gas storage: - The role of a storage facility: The gas which is stored does not belong to 'storage facility operators' but gas suppliers (who are independent from the operators) to meet the needs of consumers. The suppliers' right to use storage capacities is recognised in the European directive of 26/06/2003 as well as the law of 09/08/2004. This is referred to as TPA (Third Party Access). TIGF, as a storage facility operator, must therefore provide gas suppliers with the capacities needed to meet the demands of end users. Gas suppliers act, in compliance with the law, under conditions of transparency and nondiscrimination under the control of the ERC. One of TIGF's roles is to anticipate the development of these needs while considering that it takes around 20 years to develop a storage facility; approximately ten years for exploration; two to three years for authorisation; three to four years for surface and sub-surface works, and three to four years for the injection of 'cushion' gas. - The role of storage: Underground gas storage facilities constitute a strategic link in the gas chain as they allow: > imbalances between natural gas supply, which is relatively constant throughout the year, and consumption, which varies greatly depending on the season, to be bridged. Gas drawn from deposits in fact arrives in France constantly throughout the year. In summer, the volume imported is greater than the amount consumed while in winter consumption cannot be covered by imported volumes alone. Without storage, not all consumption needs would be met at times of extreme cold. Storage facilities therefore provide a balance between consumer needs and imported production volumes throughout the year. Gas is stored in summer to be removed in winter. > security of supplies to be ensured, particularly in the case of a country failing to provide supplies. Storage facilities are therefore essential to make sure natural gas continues to flow to the general public as well as industry. In the case of peak consumption on cold winter days, storage contributes to meet more than 60% of demand while foreign supplies and methane tanker terminals account for only 40%. - Evolving storage needs: According to the International Energy Agency (IEA), European gas consumption is set to rise by 60% between 2004 and 2030 while European gas production is set to drop by the same amount. IEA experts believe storage capacities should increase from 60 Gm3 to 138 Gm3 in Europe over the same period. For several months, the European Union has drawn the attention of member states, particularly France, to the need for additional storage capacity so as to face up to the rise in consumption and bolster the security of supplies. According to a Pluriannual indicative programme (PIP) report from the Ministry for the economy, finance and industry, gas storage capacity requirements in the future will stand at: 2007: 126,39 TWh 2010: 135,10 TWh 2015: 144,85 TWh With regard to decanting flow requirements, the PIP report puts these at: 2007: 2957,5 GWh/j 2010: 3202,3 GWh/j 2015: 3411,4 GWh/j - 5 -

6 5) Characteristics of the Lussagnet (Landes) and Izaute (Gers) storage facilities: 1 Storage aquifer 4 Storage operations 7 centre 2 Porous rock 5 Ocean 3 Impermeable layer 6 Spa Pyrenees mountain chain - Below the ground, the sands of Lussagnet and Izaute Forty million years ago, Lussagnet and Izaute were located on the coast. Erosion of the Massif Central deposited the different geological layers that make up the substratum. The sands of one site enclose an aquifer covering the whole of south-west France, from the Pyrenees to the north of the Bordeaux region and the foothills of the Massif Central. The emergence of the Pyrenees then created the folds. It is the sandy layer of two of these folds that is now used as storage. This geological layer is formed from molasse, plastic clay and calcium beds that are over 600 metres thick and completely airtight. The Lussagnet and Izaute storage facilities are located at a depth of between 600 and 900 metres. Furthermore, the sites are located in an area which has a seismicity of zero. The risk of seismic activity is considered as 'negligible' by the Ministry for the Environment and Sustainable Development and the Ministry of the Interior, Overseas France and Local Authorities. Controlled risks Underground storage in an aquifer is a sound guarantee against flammability. Stored only in contact with sand and water at a depth of 600 m and deprived of oxygen, natural gas is not flammable in this condition. Aquifer storage: Aquifers are the most common storage solutions used in France

7 The technique behind aquifer storage consists in recomposing the geological equivalent of a natural deposit by injecting gas into an underground layer of porous and permeable rock which originally contained water covered by an impermeable layer which constitutes a leaktight cover, all of which has the shape of a dome. Due to the permeability of the land and the operating conditions, about half of the gas stored remains within the storage facility: this is 'cushion gas'. The gas is compressed in the substratum to an average of around 64.4 bars in Lussagnet; this means that the gas takes up around 64.4 times less space in the ground than on the surface. For Izaute, the average pressure value is around 56.4 bar. > For example: 65 m3 of surface gas compressed to 65 bar will only take up 1 m3 within the storage facility. The amount of gas held by Lussagnet and Izaute combined, namely, 5.4 Gm3, only represents in fact around 85 Mm3 within the storage facility. Once on the surface and compressed, the gas undergoes various processes to meet regulatory specifications for transportation and distribution. In winter, the gas contained in the storage facility is decanted and prior to distribution it undergoes the following stages: dehydration, and where applicable, desulphurisation, decompression and then odorization (as natural gas is odourless). - Strategic equipment The two underground storages facilities in Lussagnet and Izaute represent almost a quarter of France's gas storage capacities and are primarily meant for the provision of natural gas to consumers in the south-west of the country. Overview of the Lussagnet and Izaute storage facilities (key figures): -22% of France's gas storage capacities (2 underground gas storage sites - Lussagnet and Izaute - with a global capacity of 5.4 Gm3 - of which around half corresponds to 'current gas' (gas which is injected and decanted each year) m invested in 2006, - 30 m to the benefit of 290 companies; 60% of this amount is attributable to firms whose head office is located in the south-west of France, m in the form of tax contributions in 2006, direct and indirect jobs on the Lussagnet site, - 31 Mm3/day peak flow for Lussagnet + Izaute (20 Mm3/day for Lussagnet alone, the equivalent to average gas consumption for the south-west region (around 3 million inhabitants) at a peak hour in winter) - 2 gas dehydration units, - 1 triethylene glycol regeneration unit (by-product of the dehydration process), and 4 boilers, - 2 desulphurisation units (active carbon reactors), - 10 compressors (developing a total power of 27 MW = (equivalent to the output of two small 10 MW hydraulic power plants), - 1 analysis laboratory for the continuous control of gas quality, - 1 gas odorization unit, - 1 control room, - Origin of stored gas The gas stored in Lussagnet and Izaute comes mainly from production sites in Norway, Russia, Algeria and Nigeria

8 Natural gas storage locations in France in 2006: (**) Methane terminal (regasification) - 8 -

9 6) Storage as part of the local landscape: TIGF is one of the motors behind regional economic development. TIGF is one of the main investors in the region with a planned average investment package worth over 100 m/year over the next ten years. - TIGF in 2006: OVER 65% of expenditure goes on one of the departments in the south-west region of France. - A lasting relationship with parishes Operator of two storage sites located on the borders of Gers and Landes for many years, TIGF has managed to develop close relations with the fifteen neighbouring parishes. Available to listen to local people, TIGF strives to provide as much of the general public as possible with all necessary explanations regarding the firm's activities and, particularly, the guidelines defined for the Lussagnet storage facility's future. The company supports a number of local educational and cultural projects and, with the same intention, wishes to assist neighbouring parishes and accompany the sustainable development actions that they put in place. - TIGF also has an impact on job creation in the region: 350 jobs on TIGF's geographical locations and up to 450 additional temporary jobs at the time of works. - TIGF: TIGF, one of the motors behind regional economic development: The company enters into a large number of agreements with numerous local and regional contractors who work in areas which complement its own lines of activity: civil engineering, painting, maintenance, green area works, engineering, topographic and national land services, welding, electricity and instrumentation, piping, boiler work, IT systems, etc. Furthermore, due to its natural gas storage activities, TIGF is one of the main contributors to business tax

10 7) Safety and the Environment: TIGF's Health, Safety, Security, Environment, Quality and Sustainable Development policy reflects the same policy in place in the Total Group. TIGF has undertaken the introduction of safety and environmental management systems: _ International Safety Rating System (ISRS). _ TIGF has obtained an ISO rating of 7, awarded by DNV, for its Safety Management System - Environmental procedures on all TIGF sites. Certification in September _ ISO Quality process for its gas odorization activities. - Lussagnet: 'surface installations': - Storage under high surveillance For its storage facilities, classed as "Seveso II", TIGF has developed a safety management system (SMS) intended to prevent major disasters from happening. Hazard studies have identified accident scenarios and the measures to deal with such situations. These studies, meant for the public authorities, ensure the measures are coherent; third party experts may then be asked to validate them. Emergency plans are drawn up and exercises are held periodically with the state emergency services (fire brigade, etc.) to check their effectiveness. TIGF organised 18 safety/environment exercises in 2005 and 19 in 2006 on its Lussagnet and Izaute sites. - The site's safety/environment policy The prevention of environmental disturbances is also ensured by carrying out studies on the impact that the operating of the installations has on the environment; this process is ongoing in accordance with standard ISO and systematic for new projects. The monitoring and control of various environmental aspects: Noise: Measurements are taken periodically within the site's surrounding area. As the site stands today, noise levels do not exceed the thresholds laid down by law. Water management at the Lussagnet storage facility: The water which is a by-product of gas processing is collected, treated by a biological water treatment plant and analysed by approved laboratories as well as public authorities before being discharged into the environment. Water is treated in a biological purification plant specific to the site. Analyses are carried out by approved laboratories, thereby ensuring that the discharges can be traced. There are also internal procedures to deal with any non-compliant water which cannot be discharged. Waste management: Waste produced as part of the Lussagnet site's activity is sorted by TIGF employees in specific skips then collected and processed by approved service providers. In line with current legislation, these service providers are the subject of administrative and regulatory monitoring. For all of these environmental areas, administrative bodies, particularly, the prefecture, the Regional Directorate for industry, research and the environment (DRIRE), and the water authority (Agence de l'eau) receive environmental reports and follow-up regarding the site on a regular basis. The Lussagnet site is also inspected on all of these areas each year

11 - Strict supervision of facilities One of TIGF's main responsibilities is to continuously measure the quality of the gas which runs through the network. Goals: inform clients of the composition of the gas and its compliance with their specification sheets. Analyses are carried out every ten minutes with a chromatograph, in particular, which assesses all of the parameters to identify the product s characteristics. The Izaute storage facility is linked to Lussagnet by a pipeline. The surface facilities of the two storage units are managed and controlled from the Lussagnet control room. From this nerve centre, TIGF teams view and act on the two sites' operating parameters through a network of fibre optics and industrial robots. - Storage facilities that blend with their environment Respecting the environment also means making sure buildings blend in with the landscape. This is the case both in Lussagnet and Izaute, whose surface installations, which are hardly visible, blend in as much as possible with the natural environment of the Bas-Armagnac region. Furthermore, Lussagnet will move its administrative buildings outside of the immediate proximity of its industrial installations (outside of SEVESO zones 1 and 2) by the first quarter of The professionalism of the teams The professionalism of TIGF teams particularly relies on career management which incorporates professional mobility as well as a high level of investment in training. TIGF dedicates around 7% of its payroll to the training of its teams; this is equivalent to almost 15 full-time employees per year. Almost 50% of these training programmes focus on safety. Quality, safety and respect for the environment: Proven expertise In the current context concerning the opening of the gas market, the storage facilities in Lussagnet and Izaute have all of the assets required to meet the demand for flexibility voiced by gas suppliers. Online measurement facilities which guarantee the quality of the gas are ISO 9001 certified. The concept of continuous development therefore has a central place in the storage facility management system. - Lussagnet: the 'substratum': Storage does not consume any water. While the storage facility is being filled, the gas generates a pressure wave on the gas; this is known as an 'area of influence'. In this area, analyses are taken through a network of surveillance wells. 18 wells are sampled at the end of the injection period (around the month of October) and 12 at the end of decanting (around the month of April). Generally, six samples are taken and analysed per well; this corresponds to a total of 180 water analyses per one year cycle. In addition, water quality inspections are carried out twice a year by independent approved laboratories. - An activity under the control of public authorities: Storage permits are awarded by decree following a public enquiry. The main local and public authorities, associations and other bodies are invited to submit opinions on the authorisation application. France's CSHP (Higher council for public health), General council for mines and the Council of State are also consulted. The Ministry for the economy, finance and industry and the Ministry for the environment and sustainable development also form part of the authorisation process. The Regional Directorate for industry, research and the environment (DRIRE) and the prefectures constantly monitor the operating of the storage facilities; monitoring also occurs at a national level by: the CSS (Storage monitoring committee), the General council for mines, the Hydro geologists committee and the Higher council for public health. At a local level, CLI's (Local information committees) may be convoked by the departmental councils (Conseils Généraux)

12 8) TIGF network map and geographical locations as on July :