Baltimore County Liquefied Natural Gas Task Force. AES Sparrows Point LNG Mid-Atlantic Express Project Presentation

Transcription

1 Batimore County Liquefied Natura Gas Task Force AES Sparrows Point LNG Mid-Atantic Express Project Presentation September 5, 2006

2 AES Provides Power Word Wide Wind Hydro Soar Natura Gas Oi Coa AES operates Maryand s ceanest coa-fired power pant in Cumberand, caed Warrior Run; the pant has been operating for five years.

3 Legisation Preambe Demand in U.S. for natura gas for residentia and industria use and for power generation is increasing rapidy. U.S. now reies on natura gas for neary one quarter of its energy use. Projections indicate that consumption wi soon outpace domestic production. Technoogy makes importation of natura gas in iquefied form feasibe + cost effective, and imports of LNG are expected to sharpy increase in the next decade. Pubic has compeing interest in obtaining COMPREHENSIVE, FACTUAL, AND OBJECTIVE INFORMATION about LNG faciity proposed at Sparrows Point. Task Force sha be formed to obtain OBJECTIVE AND ACCURATE INFORMATION about proposed LNG project, incuding safety and other important aspects surrounding siting decisions.

4 Task Force Mission To study and report on the foowing: Risks and hazards of LNG faciity Kind and use of faciity Popuation and demographic characteristics of the community Land use Natura and physica aspects of proposed ocation Emergency response capabiities Need and distance for remote siting Effect of faciity on recreationa and commercia boating, fishing, crabbing Impact on environment / water quaity due to dredging Waterway access for residentia property owners

5 2005 Energy Poicy Act Section 311(d) of the Energy Poicy Act added a new Section 3A(b) to the Natura Gas Act that requires FERC to review: Kind and use of the faciity Existing and projected popuation and demographic characteristics of the ocation Existing and proposed and use near the ocation Natura and physica aspects of the ocation Emergency response capabiities near the faciity ocation Need to encourage remote siting

6 Project Timing Vountary Community Outreach Pre-Appication Process Eected Officias Community Leaders Pubic Presentation January 17, 2006 Pubic / Community presentations January through May 2006 Apri 3, 2006 FERC issued notice of commencement of prefiing review process Minimum 180 day period to initiate and compete studies and prepare reports that present site-specific resuts Scoping meetings and continued outreach Forma Appication Submitted after competion of studies and reports Expected to be fied December 2006

7 FERC Process FERC has excusive authority to approve or deny appication Encourages cooperation with state and oca officias and eary pubic invovement Anticipated schedue Submit first drafts of resource reports: August / September 2006 Respond to data requests and revise resource reports: September / October / November 2006 Forma appication: December 2006 Draft EIS: 2Q 2007 Fina EIS: 3Q 2007 Authorization and certificate: 4Q 2007

8 FERC Process Resource reports (1) water use and quaity (2) fish, widife, and vegetation (3) cutura resources (4) socio-economics (5) geoogica resources (6) sois (7) and use, recreation, and aesthetics (8) air quaity & noise (9) aternatives (10) safety, security, and reiabiity (11) potentia contamination issues (12) PCB contamination (13) engineering design

9 Sparrows Point Project Federa Energy Reguatory Commission Environmenta Review P Federa Energy Reguatory Commission (FERC) Actions rocess AES Sparrows Point Actions AES Sparrows Point assesses market need and considers project feasibiity. FERC receives AES Sparrows Point s request to conduct its review of the project within the FERC s Pre fiing Process. AES Sparrow Point studies potentia site ocations. AES Sparrows Point FERC formay approves Pre -fiing Process, issues PF Docket No. to AES Sparrows Point, and begins project review. AES Sparrows Point requests use of the FERC s Pre -fiing process FERC participates in AES Sparrows Point pubic meetings. Issue Notice of Intent for Preparation of an Environmenta Impact Statement (EIS). Open NEPA scoping period to seek pubic comments on the project. identifies stakehoders. AES Sparrows Point sp onsors pubic workshops. Pubic Input Opportunities Hod NEPA sco ping meetings in the project area. Consut with interested agencies. AES Sparrows Point FERC receives forma appication from AES Sparrows Point. Issue Preiminary Draft Environmenta Impact Statement (EIS) to cooperating agencies for review. Issue Draft EIS and open comment period. Pubic Input Opportunities Hod meetings in the project area to hear pubic comments on the Draft EIS. Respond to comments and revise the Draft EIS. Issue Fina EIS. FERC determines whether or not to approve the project. fies forma appication with the FERC.

10 USCG Process Preiminary Waterway Suitabiity Anaysis Port characterization Risk assessment (safety and security) Risk management strategies, incuding safety and security zones (current restrictions in Chesapeake Bay appy to cruise ships and a ships transporting cargos defined as hazardous), notice to mariners, and/or information hotine Required resources and payment responsibiity Foow-on Waterway Suitabiity Anaysis Letter of Intent Letter of Recommendation Cooperating agency under FERC process ESTIMATED TIME OF DISLOCATION AS LNG SHIP PASSES ENROUTE TO SPARROWS POINT 5 MINUTES ESTIMATED TIME IN APPROACH CHANNEL AND TURNING BASIN 45 MINUTES NO WATERWAY CLOSURES

11 Project Overview IMPORT TERMINAL. Owner: AES Sparrows Point LNG, LLC Three 160,000 cubic meter storage tanks; expandabe to four tanks depending on market demand Unoading pier capabe of receiving two LNG ships Send-out capacity of 1.5 biion cubic feet of natura gas per day (BCFD), expandabe to 2.25 BCFD $400 miion investment PIPELINE Owner: Mid-Atantic Express, LLC. 87-mie route, mosty aong existing utiity corridors Connection to regiona natura gas infrastructure with potentia for connections to BGE $250 miion investment

12 PROJECT BENEFITS Regiona Benefits Natura gas is environmentay preferred energy source A CLEAN INDUSTRY Provides for diversity and stabiity of gas suppy to the region Provides additiona suppy to oca area and region to hep stabiize or reduce price of natura gas and eectric power Reduces costs by 15 to 30% over piped gas, according to June 12, 2006 WSJ artice

13 PROJECT BENEFITS Loca Benefits State and oca government tax revenue: $5+ miion per year average union construction jobs Direct and indirect / induced construction expenditures over 3 years: $130+ miion 50 to 60 permanent jobs Direct operating expenditures and indirect / induced business supports oca vendors: $20+ miion per year Spin- off or compatibe industry opportunities

14 Natura Gas New sources of natura gas needed to meet rising regiona and nationa consumption; North American production cannot keep pace with increased demand for cean eectric power, home heating and cooking, and industria growth Diversity of energy suppy; exporting countries primariy non-opec. Natura gas sets price for eectric power In 2003, natura gas set the price for whoesae eectricity in Mid-Atantic Region 48 % of a hours. (Office of Market Oversight & Investigations) Natura gas pants are expected to set margin during most on-peak periods. (Patts Power Markets Week Apri 2005)

15 Natura Gas Use

16 Natura Gas Pricing

17 Natura Gas Introducing new suppies at point of demand avoids significant pipeine transportation charges and environmenta impacts associated with mutipe pipeine expansions Interstate pipeine systems at or near capacity Batimore neary as far away from sources as possibe Maryand receives most natura gas from the Guf Coast and Canada Peak-shaving Extra energy during cod snaps Three peak-shaving tanks in Batimore since 1970s Parts of Inner Harbor, Ravens and Camden Yards Stadiums, and much of Batimore s business community within 1 mie of LNG tanks MDE is 1.2 mies from the LNG tanks

18 Sources of Gas Region-to-Region Pipeine Capacities (Voumes in miion cubic feet per day)

19 Project Location

20 Shipping Route

21 Shipping Route

22 Existing Site

23 Termina Rendering

24 Termina Rendering

25 Preiminary Site Pan 3

26 What is LNG? Liquefied natura gas is simpy natura gas (primariy methane) cooed into a iquid by reducing temperature to 260oF beow zero 600 cubic meters gas = 1 cubic meter LNG Cooress Odoress Non-toxic Very safe and inert at sub-freezing temperature Aows for economica ong-distance transport Aows for economica storage About one-haf weight of water Lighter than air at 160oF beow zero Existing stateside LNG import projects in Massachusetts, Louisiana, Georgia, and Cove Point, Maryand

27 LNG Safety LNG in its iquid state is NOT exposive or fammabe; natura gas burns ony in fue-to-air ratio of 5 to 15% LNG is transported and stored in un-pressurized vesses Strict standards for materias, design, construction & operations Cryogenic materias Doube containment (tripe containment for Sparrows Point) Set-back distances Project is reviewed by oca, state, and federa agencies and experts such as oca safety and fire officias, Federa Energy Reguatory Com-mission, U.S. Coast Guard, Maryand Department of Natura Resources, and many others

28 LNG Safety According to Nationa Firefighters Association web site (For comparison), since 1940s more than 60 firefighter deaths from LPG fires, commony seen on our highways in trucks NO firefighter deaths from LNG fires LNG industry has an exceptiona safety record

29 LNG Storage Tank

30 LNG Ship Construction

31 Ship Construction Typica membrane ship construction with detaied cut-away of cargo containment system

32 Water Spray System Required on a LNG ships per IMO IGC Code and Cassification Rues Seawater is discharged to tank domes, manifods, contro vaves, deckhouses, contro rooms, and superstructure

33 E Paso Pau Kayser

34 Set-Back Zones Peer-reviewed studies have been performed to determine the atera extent of therma hazards of arge-scae reeases of LNG on water Cacuated distances to the point where unobstructed exposure for 30 seconds may resut in second degree burns (heat fux vaue = 5 kw/m 2) Quest 1,617 feet Lehr 1,650 feet Fay 3,630 feet per March 26, 2003 report Vaejo (Koopman) 4,257 feet Sandia Nationa Laboratories evauated these studies and concuded that none of them provided a characterization of how to manage risks to peope and property of a arge-scae spi over water None identified the probabiity of the postuated events None discussed the mechanisms or strategies that coud be impemented to reduce the potentia risk of such a spi LNG Opposition Team 5,000 feet for site and 1,500 feet for vesse transit (Environmenta Impact Assay for Sparrows Point: Voume III, Section 1, Document 2)

35 Site Aeria View 1.3 mies

36 Foating Barrier

37 Environmenta Considerations Dredging Air Emissions Extensive testing prior to decision on proper remova technique Estimated quantity 3 to 4 miion cubic yards Mitigation programs during and after construction Disposa management options being expored, incuding innovative re-use (recycing) opportunities Use of ow-nox burners and seective cataytic reduction (SCR) in vaporization system that consists of boier and gyco oop no use of seawater or discharge of cod water Potentia to reduce burner use by using heat from adjacent industries win-win situation Air emissions from the faciity wi be beow the requirements for new source review Rehabiitation of existing Brownfied site

38 Dredging Dredging is a necessary part of the LNG Termina as determined by: LNG tanker vesse design capacities and size Channe design guidance references Current speed and direction, seabed type, wind speed and direction and other outside factors Vesse design draft, ship squat and kee cearance, water density effects on ship, and other factors Fina shipping simuations (MITAGS)

39 Dredge Sediment Boring Locations

40 Sediment Testing Summary Anayses performed for VOCs, SVOCs, metas, PCBs, pesticides, tributy tin (TBT), hex-cr, dioxin Resuts Non-detect: pesticides, PCBs; trace: VOCs 3 TBT detections, a ow PPB range Dioxins in ow PPT range, consistent with atmospheric sources Principa detections were poycycic aromatic hydrocarbons (PAHs) and metas, PPB to PPM range, consistent with historic oca data

41 Sediment Quaity Trends of sediment data Concentrations decrease - shaow (highest) to intermediate and deep (owest) sampes Aso apparent correation between fow direction (SE), organic carbon content, and grain size Potentia infuence on dredge approach Shaowest 15% (approximate) of materia contains highest concentrations and wi be removed Deeper sediments sandier, ower to non- detect concentrations Segregation approaches being considered for management

42 Dredge Techniques Mechanica dredging (camshe) and imited backhoe dredging in inshore areas In preparation of processing, dredged materia wi be paced into seaed hopper scows (barges) No barge overfow of water or soids Initia sediment quaity indicates simiar to characteristics of other projects in Batimore Harbor Dredges are readiy adaptabe to environmenta dredging techniques with use of an environmenta bucket and expanded positioning contros if necessary due to further sediment characterization or as required by permit conditions

43 Environmenta Dredge Camshe Bucket

44 Innovative Re-Use Abandoned mine and and quarry recamation Brownfieds redeveopment Landfi capping and cosure Manufactured top soi Genera structura and non-structura fi for commercia / industria deveopment Buk construction fi Aternate grading materias Low permeabiity cap ayer in ieu of geo-membrane systems Site grading materia Highway embankments A uses are commerciay feasibe

45 Processing Faciity

46 Sparrows Point Recap LNG imports can save consumers up to 15 to 30% in direct cost over piped natura gas (WSJ) and more when added suppy offsets increasing demand LNG safety record is outstanding Natura gas ceanest-burning fossi fues; energy production using natura gas is consistent with Maryand s Heathy Air Act Recyce dredge materias in safe, cean way Sparrows Point considered remote site AES s history of community invovement Significant oca and state taxes Union jobs and indirect benefits during construction High paying permanent jobs and indirect opportunities during operations NO government subsidies of any kind needed, entirey sefsustaining

47 Thank You On behaf of entire AES team Thanks for opportunity to show detais of proposed LNG site s safety and benefits Visit AESsparrowspointLNG.com for more detais Visit the FERC website