Summary of Oil Spills Prevention and Response Plan for Prigorodnoye Asset Onshore Operations 2011

Transcription

1 Purpose This summary document Summary of Oil Spill Prevention and Response Plan for Prigorodnoye Onshore Operations is provided for public information, in accordance with the requirements of the Sakhalin Energy s Health, Safety, Environment and Social Action Plan (HSESAP). The purpose of the Oil Spill Prevention and Response Plan for the Prigorodnoye Onshore Operations (LNG Plant and OET) is to arrange and prepare the effective Emergency Response that mitigates the potential consequences of an Incident to people (local community and Company personnel), environment, Company assets and reputation, and enables normal operations to be resumed efficiently. Please refer to the document Summary of the Corporate ER Standard in relation to oil spill preparedness and response for an overview of this topic and links to Summary OSR plans of other Sakhalin Energy facilities. 1

2 Table of contents 1. Plan Scope and Description of the Asset Oil Spill Prevention Oil spill Scenarios and Planning of Resources Response Strategy and Priorities for Protection Receptors Environmental Priority Protection Objects Receptors Economic, Cultural and Historical Resources Response Preparedness Company s Emergency Response Command and Control System, Including Oil and Oil Product Spills Oil Spill Detection and Notification Real-time Emergency Assessment Response Resources Personnel Response Resources Equipment Preparedness Assurance Third parties resources engaged Governmental manpower and resources Manpower and resources of oil companies International manpower and resources Sakhalin Energy compliance with RF standards and International best practice Acronym List

3 1. Plan Scope and Description of the Asset Prigorodnoye Asset (Prtigorodnoye Production Complex) is situated in Prigorodnoye village area, 11 km east of Korsakov. The asset territory makes up hectares and is divided in two by the Goluboy Stream. The LNG Plant is located in the western part of the site, and the eastern part is occupied by the Oil Export Terminal (OET). The north-east corner of the site has the coordinates north latitude and east longitude, and the landfall point in Aniva Bay has the coordinates north latitude and east longitude. Prigorodnoye Production Complex comprises the following facilities (Fig. 1): 1. Liquefied natural gas (LNG) production plant including process trains, power plant, emergency diesel generators; 2. Oil Export Terminal (OET) tank farm; 3. Onshore process pipelines; 4. Marine Operations Base (MOB); 5. LNG loading jetty; 6. Tanker Loading Unit (TLU) for oil tankers loading; 7. Support vessels providing support for production operations, including tanker and LNG carrier piloting and servicing; and 8. Offshore process pipelines. Fig. 1 Schematic map of the Prigorodnoye Asset (Production Complex) Facilities described in 1-3 are located onshore and refer to onshore OSR operations. Facilities mentioned in 4-8 are located shoreline and offshore (Fig. 2) and refer to marine response operations. Prigorodnoye Production Complex receives oil and gas delivered from the north of Sakhalin via onshore pipelines. Oil enters the oil storage tanks situated on the territory of the Oil Export Terminal (OET) and as tanks are filled, is loaded into tankers for further delivery to consumers. Gas is processed in LNG plant gas liquefaction equipment: purification (removal of water, mercury and acid gases), dewatering, fractionation, liquefaction to 1:600 volume at -160 о C, then liquefied natural gas (LNG) is delivered for storage into purpose-built tanks. As tanks are filled, liquefied natural gas is loaded into LNG carriers to be delivered to customers. 3

4 The Oil Export Terminal is situated on the same territory with the LNG Plant, with the observance of a 500m safety zone between process installations, buildings and structures of the LNG Plant, and occupies a territory of 45 ha. During performance of Sakhalin Energy production activities at onshore facilities of Prigorodnoye Production Complex, spills of the following four main types of oil and petroleum products are possible: Diesel fuel used mainly in emergency situations, in case of main generators failure; Lubricating oils; Mixture of medium and light Vityaz crudes from Piltun-Astokhskoye field and condensate from Lunskoye field in different proportions; and Condensate. Physical characteristics of oil products are shown in Table 1 below. Table 1. Oil products physical characteristics Oil Type Density (SG), g/m 3 Pour Point C Flash Point C Viscosity cst (1) Oil Group (2) Condensate (indicative) 0.75 Very Low Very Low Very Low I Diesel L Grade II Vityaz/Lunskoye Crude 0.85 < III Shell Rimula Super III Shell Gadinia III (1) Centistokes- A measure of unit of kinematic viscosity in the CGS system. In MKS system viscosity is measured in m 2 /s : 1 CS=sm 2 /s; 1 cst=1mm 2 /s, one centistokes equals to 1 square millimeter per second (2) Oils group under the ITOPF/IMO/USCG classifications. Refer to ITOPF documents. A mixture of Vityaz crude oil (from Piltun-Astokhskoye field) and condensate from Lunskoye field is delivered to OET via trunk pipeline. Vityaz crude pertains to medium-light oil grades with low paraffin and sulphur content, which becomes saturated with light volatile fractions when mixed with condensate. It should be noted that in each case characteristics will be determined by the proportions of the mixture. The indicative density value of the crude oil and condensate mixture for calculation purposes is taken as 0.82 t/m 3. Tests for weather resistance (weathering) carried out for Vityaz crude have shown that oil losses due to evaporation after 2 hours of exposure will make around 36%, and during the period from 24 to 48 hours - up to 54%, depending on the size and thickness of the spill slick (AEA, 2001; Leeder Consulting, 2006). Diesel fuel for temperate and subarctic climate falls in the category of light oil products, characterized by a relatively high intensity of evaporation. According to potential diesel spill scenarios, there is a risk of minor spills only, so it can be concluded that oil slicks formed as a result of such spills will be quickly contained and eliminated. Lubricating oils fall in the medium-heavy oil products category. They have different viscosity, but typically have a high degree of hygroscopicity and low evaporation. All units using lubricating oils are located in closed premises with concrete floors and are equipped with accumulating collectors with a capacity sufficient to hold the full volume of oil contained in the unit. Accumulating collector is equipped with electronic monitoring system which monitors its filling, and its contents may be pumped out by vacuum trucks at any time. Condensate represents a mixture of very light volatile liquid hydrocarbons condensed from natural gas during production or processing. Extreme volatility determines the very small lifetime of condensate slicks onshore and offshore. Possible causes of oil spills at Prigorodnoye onshore facilities are as follows based on quantitative risk assessment: 4

5 1) Oil spill risks from the main oil storage tanks to additional facilities for oil products spills containment: Leaks from lubricating oil process lines; Leaks from diesel fuel day tanks; Leaks from Ø50 mm process pipeline during diesel fuel transfer; Leaks from Ø600 mm process pipeline; Traffic accidents; Leaks from the tank truck during transfer; and Leaks from crude oil storage tanks at OET - The worst oil spill scenario. 2) Oil spill risks from additional facilities for containment of oil spills: 100% leak of oil from a tank accompanied by heavy rains which may result in overflowing of the closed hydrocarbon drainage system and entering of oily contaminated water to the accidentally contaminated discharge system and their further discharge to the treatment facilities. 2. Oil Spill Prevention Sakhalin Energy has designed facilities and systems at Prigorodnoye to the highest international standards. There is an integrated 3-tier response with provision of resources to respond to any oil spill that may occur. Design and construction of the facilities were performed in such a way that the maximum possible area of contamination of onshore facilities of Prigorodnoye Production Complex was limited to the boundaries of the production site of the asset. The design of the systems Prigorodnoye Production Complex where oil and oil products are stored, transported or circulated provides for installation of equipment and systems to prevent oil spills, to control volumes, liquid levels, which allow reducing the probability of spills. Means and measures to prevent and control leakage of liquid hydrocarbons include: Pipeline design ensuring surge control; Development of detailed technical instructions for oil and oil products operations; Emergency shutdown system; Emergency release system (for hose release); Check valves; Shearing couplings; Tank overflow alarm sensors; and Each oil tank is surrounded with dikes capable to accommodate 120% of the tank volume. Prigorodnoye Production Complex facilities are provided with fire and gas detection, alarm and protection system. This system represents the main tool for detecting fire hazard and gas entry into (semi-)enclosed premises at Prigorodnoye Production Complex facilities. Its purpose is to send a respective signal to the equipment emergency shutdown system and to turn on the emergency audio and visual alarm at LNG and OET facilities. These protection measures are part of safety systems and emergency shutdown systems at onshore OET and LNG Plant facilities. 3. Oil spill Scenarios and Planning of Resources In the course of preliminary planning of the OSR resources, as per the Special Technical Specification of the Risks Quantitative Assessment Project, Sakhalin Energy conducted spills risk assessment providing for: - Identification of potential spill sources; and - Calculation of potential spill volumes. Calculation of potential spill volumes is conducted in compliance with the recommendations of the Russian Federation Government Decree No. 613 dated 21 August Volumes of potential maximum spills as per the results of quantitative risk assessment made by Sakhalin Energy and normative requirements of the Russian Federation legislation are indicated in Table 2. The calculations show that: The maximum area of the potential contamination zone does not extend beyond the territory of Prigorodnoye onshore complex, including the shoreline; 5

6 The maximum possible spill volume for onshore facilities of Prigorodnoye Production Complex will make up 95,400 m 3 or 78,228 t, source oil storage tank of the Oil Export Terminal. In this case, the spread of the oil spill will occur within the OET tank farm bund. Bunding height is 4 m (holds a volume of about 120,000 m 3 ). Bunding is made of concrete; it is designed in such a way so as to withstand the hydrodynamic impact due to disruption of the tank. This scenario describes the most serious incident that can happen at the site and lead to such destructive factors as hydraulic blow and oil spill out of bunded area. In this case oil will be detained by the second level of containment which includes the quality control pond (QCP), located from the side of the Goluboy stream and bypass road built for OET area for routine inspections of the facility; and The scenario when oily polluted waste water spills from secondary containment has lowprobability due to 1) low probability of coincidence of such rain with the leak from the tank; 2) the design of the facility providing that storm drains polluted by oil will be directed to drainage system which is under the permanent control of operators. According to Russian legislation the category of the Plan for onshore facilities is defined as federal by its probable spill volume (maximum spill exceeds 5,000 t). Table 2. Oil Spill Causes and Worst-Case Scenarios Sce nari o Installation, Oil Product Type 2 Process feed pipeline from V to diesel generator (diesel fuel) Scenario Description Pipe corrosion with outflow less than 5% or poor pipe welding quality 4 Fuel storage tanks Hose detaches during fuelling and fuel is spilled on the concrete area. Leak Preventative Measures Volume Calculat ion, m Duty operator walkthrough of all installations twice per shift. Automated oil loss monitoring system All above ground storage tanks are located in a concrete tray (concrete sides and floor) and have a drain leading to emergency wells. Each well is equipped with electronic overflow protection system and level detection system, there is a system for connecting the pump for pumping oil products out of the well into the tank truck. 5 Fuel storage tank Tank damage 330 Bunded by a concrete pool with the wall height up to 1.4 m able of holding 110% of the total tank volume. Equipped with electronic level monitoring system and automatic overflow alarm. 6 Tank truck, diesel fuel. Hose detaches during fuelling and fuel is spilled on the area 7 Fuel truck overturns as a result of a traffic accident while driving from the entrance gate to the place of unloading 8 Process trains, Hydraulic oil. Spill due to detached hose during oil drain 0.06 Tank loading locations are concreted, formed runoff ends up in closed drain system; fuel level in the tank is controlled during fuelling; additional staff on duty during fuel transfer. 20 Vehicle speed limit - 20 km/h; in case of an incident, the spilled liquid enters the sewege system where the flow is controlled by plant operators; use of protection means in case of accidental oil spills Effluents from the production site flow into emergency wells which are not connected to the general sewer system; 6

7 9 Emptying all systems in case of damage 10 Oil Export Terminal tank (OET), Mixture of oil and condensate. 12 Process pipeline to OET, Mixture of oil and condensate 13 Process pipeline to OET, Mixture of oil and condensate Complete loss of containment of one of two oil storage tanks Т- 3301А and Т- 3301B followed by spills and formation of fuelair mixture and its consequence explosion. *1, 2 Rupture. Outflow of 25% from the maximum pumping rate during 6 hours plus volume between BVS, according to PP No. 613 *1, 3 Puncture. Outflow of 2% from the maximum pumping rate during 14 days according to PP No accumulated fluids are pumped out by a vacuum truck and after quality control are sent for disposal in accordance with approved Waste Disposal Limits. Spill volume up to 95,400 m³ and formatio n of vapour cloud, mass 50t In case of oil spills embanking is installed around each tank. It is made of non-combustible and impermeable material (concrete coating is used). Embanking wall height is 4 m. Embanking capacity is 120,000 m 3, i.e. active capacity of additional containment is not less than 120% of the oil tank volume. The liquid level in tanks is controlled using an automatic monitoring system; Alarm installed to detect tank filling over critical level; In case of complete tank breakdown oil is pumped over to specially arranged ponds lined with hard impenetrable and fireproof material; In case of hydraulic impact during breakdown oil will be contained within the bunding walls, pond and road enclosing the oil storage installations and the pond. Oil sampler unit for Т-3301А/B tanks is installed above the oil tank in case of spills or accidental spillage. Fluid from this unit is again supplied to the oil storage tank, spills to the surface are completely excluded. 4,101.4 Regular pipeline inspection, leak detection system, oil metering system 17,741 Regular pipeline inspection, leak detection system, oil metering system (*1) calculation is made as per the direct instructions of the Russian Federation Government Decree No. 613, which first of all relate to the experience of usage of the onshore oil products processing and transportation facilities, applied within the Russian Federation. When determining OSR resources the following scenarios were not considered due to the following: *2 oil spill due to the puncture of the pipeline within 14 days. This scenario is not realistic for this facility. Pressure level is monitored as well as fluid level in tanks, operators inspect the facilities regularly. *3 oil spill due to rupture of the pipeline during oil pumping within 6 hours. This scenario is not realistic for this facility since pressure level is monitored automatically as well as fluid level in tanks, operators inspect the facilities regularly. 7

8 . Figure. 2. Effects Zone for Worst-Case Scenario 4. Response Strategy and Priorities for Protection The oil-spill emergency response strategy for the Prigorodnoye Production Complex specifies the following: 1) Taking appropriate measures to ensure safety of Sakhalin Energy personnel; 2) Spill source control; 3) Containment and recovery of spilled hydrocarbons at the spill source to prevent their distribution; 4) Restoration and rehabilitation of contaminated areas. Activities specified by the OSR Plan are aimed to minimize the probability of environmental footprint through prioritization of operations on hydrocarbon containment and recovery at the source of the spill. The following priorities are singled out during performance of OSR operations: People: safety assurance of workers at the asset, emergency teams personnel and population; Environment: protection of environmentally sensitive areas and species of flora and fauna; Assets: protection of property and socioeconomic resources, as well as Sakhalin Energy facilities; Reputation: protection of Sakhalin Energy reputation through: o rapid response with engagement of all necessary resources and trained personnel; o regular inspection of the organization of response operations and response procedures, emergency communications and alarm systems; o informing people (Sakhalin Energy personnel, their immediate families, representatives of state supervisory and regulatory bodies, the public and mass media); o wish to help and honest behaviour; o restoration of environmental quality to original condition; o fair treatment of complaints and compensations; and o lessons learned. 8

9 Particular priorities in response measures are identified based on the following criteria: Measures should provide maximum general environmental benefit; Selected strategies should be aimed at maximum possible cleaning from spilled oil given that the minimum possible damage to the environment should be made; Measures taken should be primarily aimed at those territories and resources, which are characterised by the least self-restoration capabilities; Materials and personnel should be utilized in the most efficient way during emergency response works; and Quantity of waste generated during response activities should be kept to the minimum. All people present in the OSR operations zone shall be provided with personal flotation devices and cold weather PPE. Safety requirements of the OSR Contractor shall be strictly observed at all times. The emergency response strategy is based on spill containment and oil removal where it is possible to be performed in a safe manner. Measures for oil spill response at the asset shall be carried out in the following ways: natural recovery, manual cleanup, mechanical containment and collection, or combinations of these options. Choice of the oil containment method depends on the type of surface ground layer (asphalt, concrete, unpaved ground), weather and other conditions. Waste minimization principles include: Reuse of contaminated materials, such as sorbents; Prevention of oil pollution of garbage; Application of cleanup strategies that minimize the amount of waste generated; and Waste processing at the place of generation, for example incineration. Waste generated as a result of any spill shall be collected and segregated by class of hazard and types on special waste storage areas at Prigorodnoye Production Complex; further they will be transferred to the contracting companies for waste disposal as per approved procedures. Note: collected oil is not classified as waste and is subject to recycling as a multiple use product. Mobile incinerators manufactured by Lamor (Finland) are available at all PMDs, including the Offshore OSR Base at Prigorodnoye Asset, and may be used for incineration of contaminated materials. Installations such as Smart-Ash manufactured in the USA, previously purchased by the Company and placed at Sakhalin Energy-ENL Base in Nogliki may also be used. These incinerators allow the incineration of the following materials: Wood and remains of vegetation; Adsorbents made of cellulose, cotton, polypropylene and cotton mixtures, peat chips; Waste oils and hydraulic fluids; Contaminated overalls; and Rags. Upon completion of all response measures, all temporary waste storage sites shall be shut down, cleaned up and restored. Waste Management Coordinator is responsible for ensuring compliance of these works with requirements stipulated by authorized governmental bodies. Activities are considered completed after obligatory fulfilment of the following steps: Stopping of oil and oil products discharge; Recovery of spilled oil and oil products to the maximum achievable level allowed by technical characteristics of special technical devices used for this purpose; and Placement of recovered oil and oil products for further disposal excluding secondary contamination of industrial facilities and environmental compartments. Follow-up work on oil spill response, reclamation of contaminated territories and water bodies shall be carried out in accordance with projects (programmes) on land reclamation and water bodies recovery, having a positive state environmental expert opinion Receptors Environmental Priority Protection Objects. Zones of special importance in the asset area are as follows: water protection zones of rivers and streams (Goluboy, Mereya), the coast of Aniva Bay. 9

10 The Mereya, a river of the highest fishery category, flows at the western side of the facility; Goluboy stream crosses the Prigorodnoye Production Complex territory. They are of priority for protection from oil contamination in case of oil spills within the Prigorodnoye Production Complex area. The nearest natural monument is the Korsakov spruce forest. It is located 2 km to the north of the Prigorodnoye Production Complex upstream the Mereya River, therefore pollution of this natural monument in case of spills is impossible. Impact on atmospheric air will be made by evaporation of light fractions of oil products, and this influence will quickly diminish over time. Impact on soil is possible only in case of spills from process pipelines. Maximum contamination area will not exceed 1,365 m². The soil under the pipeline is clayey; therefore the soil stratum will not be contaminated. Oil products will be collected from ground using sorbent materials. Soil contamination is insignificant. No nesting places of Red Book birds are observed in the Prigorodnoye asset area; but during the period of seasonal migration they can be met in the adjacent region. However, it is unlikely that birds will accumulate in close vicinity to the asset area due to noise at the production site and consequently will not be exposed to noise and risks of oil pollution. No habitats of rare or protected species of mammals and plants are observed in vicinity of the asset, either Receptors Economic, Cultural and Historical Resources. The following communities are situated in the area of the Prigorodnoye Production Complex: Korsakov (37,700 people) is located 11km west of the site; and Ozersky (2,200 people) is located 15.5km east of the site. A brief socio-economic profile of the OSRP coverage area is provided in Table 3. Table 3. Socio-economic summary of the OSRP coverage area Parameter Infrastructure Population Fishing Agriculture Tourism Ports Coastal Recreation Description Sakhalin Island has limited infrastructure, although there is a good sealed road from Yuzhno to Korsakov. An earth road connects Prigorodnoye Onshore Facilities with Korsakov. This road is maintained in good condition by Sakhalin Energy. The bridges on the coastal road around Aniva Bay are built to carry fishermen s trucks and have load limits of between tonnes. Further details are provided in Appendix 17 and on the Sakhalin Energy GIS. Korsakov is the largest town in the Aniva Bay area. As of January 1, 2001, the population in the Korsakov District of the Sakhalin Region made 45,900 people. The town of Korsakov has a population of approximately 37,000 people. Fishing activity in Aniva Bay is significant, with many seasonal fishing camps setting nets along the coast and in river mouths. No fishing camps are found in the immediate proximity to industrial site of Prigorodnoye Asset onshore facilities. No agricultural farms are located near Prigorodnoye Production Complex Onshore Facilities. Several salmon hatcheries operate in the area and release juvenile salmon into the rivers that flow into Aniva Bay. There is also a sea cucumber farm at Busse Lagoon. None at present Korsakov is one of the major ports of Sakhalin, as ice-free conditions prevail for most of the year. Cargo ships travelling into and out of Korsakov provide the primary method of importing and exporting goods from Sakhalin Island. Ozersky is a minor fishing port to the south-east of Korsakov. The main recreational activities in Aniva Bay are fishing, shellfish gathering, swimming and sunbathing. Beaches near Prigorodnoye Production Complex onshore facilities are popular recreational beaches used by local population. 10

11 5. Response Preparedness 5.1. Company s Emergency Response Command and Control System, Including Oil and Oil Product Spills To comply with the Russian legislation and applying to the Best International Practice, the Company established and maintains the following Emergency Response Management Bodies: The Sakhalin Energy s response management system is based on an Incident Command System (ICS) organization and is compatible with the structure of emergency rescue services and teams of the National Russian Federation Unified Emergency Prevention, Preparedness and Response System (RSChS). The scheme of the structure is shown in Fig. 3. Fig. 3. Organization of Emergency Response Command and Control Bodies in Sakhalin Energy Coordination Body. Company s Сommittee on Prevention and Response to Emergencies and Fire Safety (Company s KChS & OPB); Standing Management bodies. Emergency Response Management Team (ERMT) with support of departments and divisions of Sakhalin Energy, which may be mobilised in an emergency and also those dedicated to emergency management, HSE, Security departments, Logistic section, External Affairs and the Finance department and other if required. Day-to-day Management Bodies: 1. Duty Dispatcher Service (DDS 2500) of the Company (Emergency Call Centre) in Yuzhno-Sakhalinsk. 2. Emergency Coordination Team (ECT). The ECT provides support to asset emergency Site Control Team to small spill on the territory of facilities. In case of larger spills, especially spills spreading outside the boundaries of the site, SRC assumes control over all accident response works. 3. Crisis Management Team (CMT). The Crisis Management Team (CMT) controls those aspects of any incident that threaten the business (commercial) activity or reputation of the Company. In case of an emergency, CMT interacts with outside organisations, shareholders and lenders, the public and non-governmental organisations, relatives of injured Sakhalin Energy and contractors employees, or injured representatives of customers. 11

12 4. For the Prigorodnoye Asset this is the Operations Control Room (located at LNG plant) and Port Control Room (at the port). Site Control Team (SCT) ensures management and performance of work on site involving containment and cleaning of oil and oil product spills at both onshore and offshore facilities of Prigorodnoye Asset. Emergency Response Manpower. Company s has own certified Non-professional ERT (NERT) and contracted Professional ERT (PERT); they are Onshore and Offshore Tier 1 OSR Contractors. Asset ERTs include personnel of NERT and rescuers of PERT. The organization of the SCT of Prigorodnoye Production Complex is shown in Figure 5, and the functions of its basic members are listed in the text below Oil Spill Detection and Notification Detection of oil and oil product spills of any tier is conducted both during routine work/walkthroughs at production facilities by operators and other plant staff, and using tools for automatic control of installations operation. Fig.4. Oil spill notification procedure 12

13 In case of detection of oil products leaks or spills, the scheme is initiated including information transfer to the plant control room and further, depending on incident classification in accordance with the instructions, information is sent to the duty emergency response coordinator of the central department. The person responsible for operations draws up an incident notification by filling in the notification form, and sends it over to GX SEIC LNG-OET Incidents. The notification form includes the following: time, date; incident type; exact location; incident description; and immediate response measures. Information on oil or oil product spills shall be sent to the duty emergency response coordinator and further in accordance with the diagram (refer to Fig. 4 below) shall be communicated to stakeholders Real-time Emergency Assessment Upon receipt of the spill notification, the Shift Superintendent who assumes the role of Site Controller (SC) conducts a preliminary evaluation of the emergency situation and give a preliminary estimation of the possible response tier. The SC set up the Site Control Team (SCT) (main conference hall, room A231 in the main administrative building) for oil spill response (its structure is shown on the diagram, see fig. 5). Fig. 5. Organizational Structure of the Prigorodnoye Production Complex Site Control Team SC ensures management and performance of work on site involving containment and cleaning of oil and oil product spills at both onshore and offshore facilities of Prigorodnoye Production Complex. At onshore facilities, direct response operations are carried out by the Emergency Response Teams (ERT). If necessary, these teams provide support to offshore response teams in shore cleaning activities. SC and emergency response teams mobilisation at the asset begins after receiving alert message from the central control room panel. SCT members gather at the Operations Control Room in the main administrative building. After having received the signal on oil-related emergency, the shift ERT members gather at the established location the area near fire trucks, and wait for instructions from the Onshore On Scene Commander (OSC). SC has to evaluate if OSR resources available at Prigorodnoye Production Complex are adequate or engagement of additional resources is required. The issue has to be discussed with Emergency Coordinator on Duty (EC Yuzhno-Sakhalinsk) who is to either confirm the adequacy of OSR resources 13

14 at the Facility or to increase the level of control over response measures up to the emergency coordination of team (ECT) located in Yuzhno-Sakhalinsk. EC on Duty makes a decision on mobilisation of the ECT and necessity to engage additional resources related to the oil spill response. If a response scale exceeds the capacities of manpower and resources available at the Asset, the ECT in Yuzhno-Sakhalinsk takes over the coordination of implementation of measures related to response to emergency situation. If Sakhalin Energy deems it necessary to engage resources of third parties, OSR is carried out at the Tier 2 level. General coordination remains the task of Sakhalin Energy until appropriate State agency (usually the Ministry of Emergency Situations) makes a decision on taking over the leadership to a higher level, i.e. appropriate Сommittee on Prevention and Response to Emergencies and Fire Safety (KChS and OPB). SC is responsible for safety of personnel and facilities on the site. SC exercises control over all operations related to response to emergency spills at the Facility. In addition to the above, SC s actions include the following: 1. After a message on a land oil spill is received, assess the situation and complete the OSR-01 form. 2. Commence maintaining of a personal registration log. 3. Assign On-Scene Commander at the Site of Emergency (from among a Shift Production Supervisor for auxiliary facilities or operating procedure) and entrust him with investigation of a source / cause of the spill, assessment of potential hazards and taking urgent measures to control the situation. 4. Inform the SCT of Prigorodnoye Production Complex on the spill and make it ready for response, if required. 5. Inform EC on duty of Sakhalin Energy (by radio station, telephone) and then forward the completed OSR-01 form by fax. Faxing of OSR-01 form shall not be delayed even if the information is not full. Updated information shall follow (a new OSR-01 form should be used with the clear mark Updated ). 6. Enter the information into the daily log / incident log. 7. After a consultation with Shift Production Supervisor, assess a demand for the OSR equipment and services; and inform EC. 8. Mobilise the SCT and OSR resources, if required Response Resources Personnel Asset ERT (Emergency Response Team) for tier 1 oil spill response at Prigorodnoye Production Complex consists of specially trained Sakhalin Energy employees engaged at LNG plant and OET facilities. This team will be mobilised at the muster point on the LNG Plant/OET site within twenty minutes after notification. Besides, if required, Tier 1 spill response manpower located in Yuzhno-Sakhalinsk can be engaged into response operations. There are Yuzhno Mobile Team of onshore OSR contractor, this team is at the 24/7 stand-by mode. Offshore OSR contractor also can provide additional manpower upon request. Any leaks of crude oil and condensate mixture at Prigorodnoye Production Complex are associated with a high short-term risk of fire. The Prigorodnoye Production Complex has its own fire brigade consisting of 16 persons 3 operational crews and a Manager of fire fighting operations. In addition, engagement of backup personnel from employees not involved in the work shift is possible. A group of 30 persons can be gathered within one hour on the Production Production Complex territory. At the industrial site, there are 4 fixed carriage hoses with a capacity of 150 m 3 /hour, 4 foam monitors, 3 fire trucks equipped with carriage hoses on the roof and all necessary equipment. Additional professional staff certified in accordance with the established procedure may be provided by Sakhalin Energy Tier 1 OSR Contractor. Asset HSE Manager is responsible for arrangement of OSR activities at Prigorodnoye Asset, including implementation of the Company s standards and policies. He represents the asset team for external parties. HSE Manager implements the requirements of the Company s procedures into the assest documentation, coordinates arrangement and provision of trainings, arranges trainings for the ERT, 14

15 develops equipment maintenance schedule, and is responsible for communication of the OSR Plans to the personnel and their update Response Resources Equipment Equipment placed at the Onshore OSR Warehouse situated directly on the territory of LNG Plant will mainly be used for onshore spill response. Equipment and materials include means for oil spill containment and response. Equipment stored at the Marine Operational Base (MOB) OSR Warehouse can also be used for onshore response. Equipment provided for oil spill response consists of the following: - Offshore and onshore OSR equipment located in the port at MOB; - Oil spill response equipment installed on Ural trucks is used on roads, rivers and marshy lands; - Mobile oil spill response equipment installed in trailer units; - Wildlife Response kit; and - Trailer units which can be attached to the oil spill combating vessel (non-air inflated hull). Full list of the equipment situated in Prigorodnoye is indicated in the asset documents. OSR manpower and resources available at Prigorodnoye Production Complex are sufficient to ensure spill containment in a worst-case scenario within 6 hours. In general, the strategy on usage of the equipment in the Company provides general approach and possibilities to use additional resources located at other Company s facilities as well as involve resources of the companies engaged under corresponding contracts. Where there is need for additional resources, they can be obtained via ECT of other Sakhalin Energy Assets (PMDs). The nearest one is located in Sovetskoye. The complete list of Company manpower and resources which will be used at the Asset if necessary is given in Appendix 8 to the Asset OSR Plan, estimated time for delivery of the equipment to the plant area is shown at Table 4. Table 4.Time for mobilization of additional resources and equipment from the PMDs PMD Mobilization time (hour) Delivery time (hour) Nogliki 4 20 OPF 4 20 Gastello (Booster Station 2) 4 14 Yasnoye 4 10 Sovetskoye 4 4 Kholmsk Preparedness Assurance. Assurance of readiness of OSR manpower and resources is provided in three modes: 1. Day-to-day activity: a. Training of Production Complex Emergency Response Team (ERT) (training requirements, levels and schedules); b. Assurance of regular updating of the OSR Plan; c. Keeping the OSR equipment serviceability and maintenance. 2. Advanced readiness: the respective procedure and allocation of duties are detailed in the Emergency Response Plan for Prigorodnoye Production Complex facilities. 3. Emergency: the respective procedure and allocation of duties are detailed in OSR Plan. The following actions are performed as part of maintaining serviceability of equipment at assets: Studying of production blocks (elements of equipment), where the largest spills may occur or where the spills are most probable; Timely and regular technical inspection of equipment used during spills containment and response, if necessary, its maintenance and capital repairs; Assessment of available manpower and staffing, as necessary; and Conducting trainings and comprehensive exercises on oil spill containment and response. 15

16 The exercises and trainings are based on the results of emergency modelling and can be held with participation of one, several or all the teams ERT, SCT, ECT and CMT sectors. Special tactical training exercises lasting up to 8 hours with involvement of ECT, CMT and asset teams SCT and ERT are conducted once in three years, and once a year with involvement of Professional ERT (specialised OSR contactors of Sakhalin Energy). Exercises related to response to emergencies are conducted annually. Winter season exercises with field deployment of the equipment are conducted at least once every two years. Personnel directly involved in the response activities, has a specialized OSR training and is certified as per RF Government Decree No dated 22 November 1997 On Certification of Emergency and rescue Services, Emergency and Rescue Teams and Rescuers. In case of an emergency oil spill at Prigorodnoye Onshore facilities, the staff of a professional ERT located in Yuzhno-Sakhalinsk can be requested to conduct response operations under a service contract. Time for mobilization and arrival of the ERT with the OSR equipment to Prigorodnoye Asset is 2 hours Third parties resources engaged Governmental manpower and resources In case of oil spill of local or territorial tier, the Main Department of MChS of Russia for the Sakhalin Oblast can engage emergency rescue services and fire brigades based on Oblast territory, as well as staff from public health departments and internal affairs departments of municipalities. Personnel and equipment of Russian MChS and civil defence forces based in the Far East and other regional resources can be engaged in response operations in case of regional tier spills through relevant KChS and OPB. In case of federal tier spills, the resources of Russian MChS, Centre for Emergency, Rescue and Environmental Operations (CREO/Ecospas) situated in Moscow with branches in the Far East, including on Sakhalin Island can be engaged Manpower and resources of oil companies Memorandum of Understanding between Sakhalin Energy, Elvary Naftegaz, NK Rosneft-SMNG, and Petrosakh was signed in January This document is aimed at strengthening the capabilities of all parties in the OSR field by agreement to provide to each other mutual assistance including personnel and equipment in the event of a spill. On the basis of bilateral agreement on mutual assistance with ENL, Sakhalin Energy has access to equipment and services of this company in the field of oil spill response. This equipment is located in Nogliki and at ENL OPF (Chayvo field) International manpower and resources The following international resources of Oil Spill Response Limited (OSRL) may be engaged through STASCO and Shell Response Ltd. companies, which are located: At the base in Southampton, UK, and In Singapore. 6. Sakhalin Energy compliance with RF standards and International best practice Oil and gas industry of the Russian Federation is a well-developed industry with elaborated legal and guidance documents in the part of population and territories safety. Their basic requirements have been included into the corporate standards and procedures and used in the development of Oil Spill Response Plans of Asset and the Company s strategy. In accordance with the legislative requirements a lot of preventive measures have been applied during the design and construction of facilities to reduce the risk 16

17 of oil spills to a minimum. Oil spill response at the facilities is under constant supervision of local authorities and their forces can be involved into the emergency response, if necessary. Information on the most insignificant oil spills is provided to the Sakhalin Oblast MChS, so they could respond to emergency in time. This OSR Plan for the onshore facilities of Prigorodnoye Production Complex has been developed in accordance with the Russian legislation and includes the best approaches in this field. The document is duly approved by the authorized state bodies in accordance with the established procedure. Main Russian regulatory documents are as follows: Federal Law No. 68-FL Concerning the protection of the population and areas against natural and technogenic emergencies dated ; Federal Law No. 116-FL On industrial safety of hazardous production facilities dated ; Executive Order No. 794 of the RF Government On the unified state system for emergency prevention and response dated ; Executive Order No. 613 of the RF Government On immediate measures for prevention and response to emergency oil and oil products spills dated ; Executive Order No. 240 of the RF Government On the procedure for organising measures for prevention of and response to emergency oil and oil products spills on the territory of the Russian Federation dated ; Order No. 156 of the MNR of Russia On approval of guidelines for defining the lower tier of oil and oil products spills to classify them as an emergency dated ; Order No. 621 of the MChS of Russia On approval of Rules for development and approval of plans for oil and oil spills prevention and response on the territory of the Russian Federation dated ; Executive Order No. 189-pa of Sakhalin Oblast Administration On creation of Sakhalin territorial subsystem of the Unified State System for Emergency Prevention and Response dated ; Executive Order No. 203-pa of Sakhalin Oblast Administration On approval of Requirements to development of plans for oil and oil spills prevention and response on the territory of the Russian Federation dated ; Instruction No. 73 of KChS and OPB of Sakhalin Oblast On the procedure of validation and approval of Plans for oil and oil spills prevention and response on the territory of Sakhalin Oblast dated ; and Executive Orders Nos. 613 and 240 of the Government of the Russian Federation, Order No.621 of the MChS of Russia, and Executive Order No. 203-pa of Sakhalin Oblast Administration (as amended by Executive Order No. 31-pa of Sakhalin Oblast Administration dated 16 February 2007) establish a number of requirements for such Plans. In accordance with Executive Order No. 794 of the RF Government dated , for coordination and organisation of measures taken in case of emergencies, including accidental oil spills, industrial enterprises having potentially hazardous facilities must establish appropriate emergency control bodies, as well as have their own resources for oil spill response. In order to manage activities in an emergency, including in oil spill, Sakhalin Energy has created a Unified Integrated Emergency Management System. Description of this system as applied to oil spills is presented in Section 1.5 of OSR Plan for Prigorodnoye Production Complex. During development of the OSR Plan, Sakhalin Energy has taken into account the relevant IMO, Lenders and Shareholders recommendations, Shell corporate standards and International Treaties and Convention requirements ratified by the Russian Federation such as: 1. International Management Code for the Safe Operation of Ships and for Pollution Prevention (International Safety Management (ISM) Code) Adopted on 4 November 1993 by IMO Assembly, Resolution A.741(I8) International Convention on Civil Liability for Oil Pollution Damage i.e. the Civil Liability Convention (1992 CLC) 17

18 International Convention on the Establishment of an International Fund for Oil Pollution Damage (1992 Fund Convention) United Nations Convention on Law of the Sea /78 International Convention for the Prevention of Pollution by Ships (MARPOL 73/78) 6. International Convention for the Safety of Life at Sea (SOLAS), Convention on the Prevention of Marine Pollution by Dumping of Wastes and other Matter (1972 LDC) International Convention Relating to Intervention on the High Seas in Cases of Oil Pollution Casualties 1969 (INTERVENTION) Shell documents: 1. Guidelines for Shell Companies and Business Units on Preparedness, Response and Compensation for Oil and Chemical Spills (as of June 2003) 2. Shell International Exploration & Production HSE Manual: Emergency Response, October 10, 1995) 3. Shell International Exploration & Production HSE Manual: Oil Spill Dispersants (Dispersants and Their Role in Oil Spill Response, International Petroleum Industry Environmental Conservation Association (IPIECA), 2nd edition, November 2001) EP EP

19 Acronym List ATMOS PIPE Pipeline leak detection software BASU Basin Emergency Management Department BS2 Booster Station 2 CLC Civil Liability Convention CM Crisis Manager CMC Crisis Management Centre CMT Crisis Management Team cst Centistokes (viscosity) EA External Affairs EC Emergency Coordinator ECC Emergency Coordination Centre ECT Emergency Coordination Team EMERCOM Ministry of Civil Defense, Emergency Situations and Liquidation of Consequences of Natural Disasters of Russia (MChS) ENL Exxon Neftegas Ltd ESD Emergency Shut Down ESDV Emergency Shutdown (System) Valve GIS Geographic Information System HR Human Resources HSE Health, Safety and Environment IAP Incident Action Plan IBSV Ice Breaker Supply Vessel ICS Incident Command System IMO International Maritime Organization IPIECA International Petroleum Industry Environmental Conservation Association ITOPF International Tanker Owners Pollution Federation IUCN International Union for the Conservation of Nature KChS Сommittee on Prevention and Response to Emergencies and Fire Safety LEL Lower Explosive Limit LNG Liquefied Natural Gas LUN-A Lunskoye-A Platform LUN-B Lunskoye-B Platform (proposed future development) m3 Cubic meters MARPOL Marine Pollution Convention 73/78 MChS Ministry of Civil Defense, Emergency Situations and Liquidation of Consequences of Natural Disasters of Russia (EMERCOM) MDPC (Japanese) Maritime Disaster Prevention Centre MSDS Material Safety Data Sheets MSV Multipurpose Support Vessel NEBA Net Environmental Benefit Analysis NERT Non-professional Emergency Response Team NGO Non Government Organizations OET Oil Export Terminal OPF Oil (Onshore) Production Facility OSR Oil Spill Response OSRL Oil Spill Response Limited (Southampton, UK) OSRP Oil Spill Response Plan OSRV Oil Spill Response Vessel OWR Oiled Wildlife Response PA Piltun Astokh PA-A Piltun-Astokh Platform A (Molikpaq) PA-B Piltun-Astokh Platform B PERT Professional Emergency Response Team PFD Personal Floatation Device PPE Personal Protection Equipment PTS Pipeline Transport System (onshore) QRA Quantitative Risk Assessment 19

20 RDP Rapid Deployment Pack RF Russian Federation RF RDB Russian Federation Red Book of Endangered Species Rostechnadzor Federal Agency on Environmental, Technological and Nuclear Supervision RSChS Russian Unified Emergency Prevention, Preparedness and Response System SC Site Controller SCT Site Control Team SMNG SakhMorNefteGaz SOLAS International Convention for the Safety of Life at Sea, 1974 SOPEP Shipboard Oil Pollution and Emergency Plan STASCO Shell Transport And Shipping Company USCG United States Coast Guard 20