LNG Facilities Assessment – Focusing on Environment, Social Impact, and Safety

LNG Facilities Assessment is crucial for ensuring the safety and efficiency of liquefied natural gas operations. This evaluation involves examining infrastructure, equipment, and processes to identify potential risks and areas for improvement. By conducting a thorough assessment, companies can comply with industry regulations and enhance operational performance.

Furthermore, effective LNG facilities assessment helps in mitigating environmental impacts and optimizing energy use. Ultimately, regular assessments contribute to the long-term sustainability and reliability of LNG supply chains.

Introduction

Natural gas and LNG development projects can have a significant environmental and social impact in the communities where they are located, both positive and negative. These impacts can be managed through appropriate laws, regulations, and compliance balanced with corporate social responsibility, which becomes part of the social compact called the «social license to operate». In recent years, LNG project developers in partnership with central and local governments have included a wider constituency of stakeholders at an earlier stage of planning and as a result, this social compact has become a critical success factor of any major LNG project.

Environmental Impacts of LNG Facilities

The construction of LNG facilities, whether liquefaction or regasification/import terminals, gives rise to numerous potential environmental impacts. The potential impacts and associated necessary regulations vary depending on the project and the country. These general guidelines should be tailored to the hazards and risks established for each project on the basis of the results of an environmental impact assessment in which site-specific variables are taken into account. In general, the following types of impacts should be considered:

• Threats to aquatic and shoreline environments: Construction and maintenance dredging, disposal of dredged soil, construction of piers, wharves, breakwaters and other structures, and erosion, may lead to short and long-term impacts on aquatic and shoreline habitats. Additionally, the discharge of ballast water and sediment from ships during LNG terminal loading operations may result in the introduction of invasive aquatic species.
• Marine Environmental Impacts: The coastal/nearshore area, is composed of several marine coastal habitats, such as the sandy and rocky shores, mangroves, estuaries and deltas and seagrass meadows. An enormous diversity of associated fauna and flora congregates in these habitats, providing important goods and services for the local human population. The following are some of the potential environmental impacts on marine habitats of operations:
  • Colonization of subsea structures – subsea structures can be recognized as drivers for aggregation of ocean life and they will provide surfaces for colonization by encrusting fauna and flora. Depending on the source of colonists, the impact could be positive (increasing of biodiversity consistent with the geographical area) or negative (invasive alien species threaten local species).
  • Impact on subsea and on benthic (ocean bottom dwelling) fauna during installation.
  • Impact on the marine habitat due to the discharge of cooling water.
  • Impact on the biodiversity from ballast water.
  • Impact on the water quality and marine fauna from liquid effluents.
  • Disturbance of marine environment, flora, and fauna from the offshore operations.
• Hazardous Materials Management: Storage, transfer, and transport of LNG may result in leaks or accidental release from tanks, pipes, hoses, and pumps at land installations and on LNG transport vessels. The storage and transfer of LNG also poses a risk of fire and, if under pressure, explosion due to the flammable characteristics of its boil-off gas.

Some recommended measures to manage these types of hazards include:

• LNG storage tanks and components (e. g. pipes, valves, and pumps) should meet international standards for structural design integrity and operational performance to avoid catastrophic failures and to prevent fires and explosions during normal operations and during exposure to natural hazards. Applicable international standards may include provisions for overfill protection, secondary containment, metering and flow control, fire protection (including flame arresting devices), and grounding (to prevent electrostatic charge)
• Storage tanks and components (e. g. roofs and seals) should undergo periodic inspection for corrosion and structural integrity and be subject to regular maintenance and replacement of equipment (e. g. pipes, seals, connectors, and valves). A cathodic protection system should be installed to prevent or minimize corrosion, as necessary.
• Loading / unloading activities (e. g. transfer of cargo between Propulsion Trends in LNG Carriers: The Shift from Steam to Dual-Fuel Diesel and Electric SystemsLNG carriers and terminals) should be conducted by properly trained personnel according to pre-established formal procedures to prevent accidental releases and fire / explosion hazards. Procedures should include all aspects of the delivery or loading operation from arrival to departure, secure connection of grounding systems, verification of proper hose connection and disconnection, adherence to no smoking and no naked light policies for personnel and visitors.

• Air emissions: Air emissions from LNG facilities include combustion sources for power and heat generation in addition to the use of compressors, pumps, and reciprocating engines. Emissions resulting from flaring and venting may result from activities at both LNG liquefaction and regasification terminals. Principal gases from these sources include nitrogen oxides (NO_x), carbon monoxide (CO), carbon dioxide (CO₂), and in the case of sour gases, sulfur dioxide (SO₂).
• Waste management: Waste materials should be segregated into non-hazardous and hazardous wastes and a waste management plan should be developed that contains a waste tracking mechanism from the originating location to the final waste reception location.
• Noise: The main noise emission sources in LNG facilities include pumps, compressors, generators and drivers, compressor suction/discharge, recycle piping, air dryers, heaters, air coolers at liquefaction facilities, vaporizers used during regasification and general loading/unloading operations of LNG carriers/vessels.
• LNG transport: Common environmental issues related to vessels and shipping are relevant for LNG import and export facilities. For example, emissions from tugs and LNG vessels, especially where the jetty is within close proximity to the coast may also represent an important source affecting air quality.

Environmental Impact Statements

Project developers must comply with all environmental laws and regulations of the host country. This will often require the preparation of a detailed Environmental Impact Statement (EIS).

The principal purposes for preparing an EIS are to:

• identify and assess potential impacts on the human environment that
  would result from implementation of the proposed action;
• identify and assess reasonable alternatives to the proposed action that would avoid or minimize adverse effects on the human environment;
• facilitate public involvement in identifying significant environmental impacts; and
• identify and recommend specific mitigation measures to avoid or minimize environmental impacts.

The topics typically addressed in an EIS include:

• geology;
• soils;
• water use and quality;
• wetlands;
• vegetation;
• wildlife;
• fisheries and essential fish habitat (EFH);
• threatened, endangered, and special status species;
• land use, recreation, and visual resources;
• socioeconomics;
• transportation;
• cultural resources;
• air quality;
• noise;
• reliability and safety;
• cumulative impacts; and alternatives.

The EIS describes the affected environment as it currently exists and the potential environmental consequences of the project and compares the project’s potential impacts to those of alternatives. The EIS also presents the conclusions and recommended mitigation measures of the regulatory agency in charge of preparing the EIS and conducting the environmental and regulatory review of the project.

Climate Change

LNG (Liquefied Natural Gas) as FuelNatural gas and LNG are generally viewed as cleaner-burning fuels that might contribute to a lower carbon future. Climate change negotiations have noted that natural gas can be used as a bridge to a renewable energy future in countries currently using higher-carbon fuels, including coal, oil, and diesel for cooking, power generation, or heating and cooling. As African economies develop, the need for energy will continue to grow not only for base natural gas but for natural gas derivative products, such as fertilizers, for agriculture.

However, there is controversy in the methane and carbon emissions life cycle and contradictions that result from:

• LNG project development;
• liquefaction;
• transportation;
• storage;
• regasification;
• distribution;
• and end-use of LNG.

Methane and carbon dioxide emissions are powerful greenhouse gases. Throughout the value chain, natural gas and LNG development should seek to minimize and reduce emissions. In an LNG facility, small gas flares are needed for operational safety but flaring should be minimized. Methane emissions must be measured and mitigated against throughout the value chain, including:

• processing equipment;
• pipelines;
• storage tanks;
• valves;
• compressors, and other fugitive sources.

Rising sea levels require general consideration while designing ports and berths and a special consideration for weather modification both on-shore and offshore.

Safety

Safety is critical in any industrial project, but LNG export or import projects can introduce specific safety considerations, mainly owing to the sheer size of the energy storage facilities involved. The LNG sector has been operating now for over 50 years, with a good safety record, mainly as a result of diligence and planning to ensure that very high standards are maintained in project planning, design, procurement, construction, and operating phases of the project. While liquefied gas is inherently a safe substance which does not burn directly, the vapor that it generates, effectively natural gas, is flammable, and care must be taken in handling vapor to avoid a release. In many countries, LNG is classified as a hazardous material (depite the industry’s excellent safety record and the stability of LNG until it starts vaporizing), and rigorous standards often apply to its storage and transportation. Various international or trade bodies also publish safety standards, some of which are used internationally.

How LNG containment is considered by the industry is summarized in this illustration from the industry trade body Groupe International d’Importeurs de Gaz Natural (GIIGNL).

The whole design basis for an LNG facility is built around minimizing the chances of a containment failure. However, in the unlikely event that this may occur, an uncontrolled release of LNG could lead to jet or pool fires if an ignition source is present, or a methane vapor cloud which is potentially flammable (flash fire) under unconfined or confined conditions if an ignition source is present. LNG spilled directly onto a warm surface (such as water) could result in a sudden phase change known as a Rapid Phase Transition (RPT), which can also cause damage to nearby structures.

The following features are typically among the recommended measures to prevent and respond to LNG spills:

• Conduct a spill risk assessment for the facilities and related transport/shipping activities;
• Develop a formal spill prevention and control plan that addresses significant scenarios and magnitude of releases. The plan should be supported by the necessary resources and training. Spill response equipment should be conveniently available to address all types of spills, including small spills;
• Spill control response plans should be developed in coordination with
  the relevant local regulatory agencies;
• Facilities should be equipped with a system for the early detection of gas releases, designed to identify the existence of a gas release and to help pinpoint its source so that operator-initiated ESDs can be rapidly activated, thereby minimizing the inventory of gas releases.
• An Emergency Shutdown and Detection (ESD/D) system should be available to initiate automatic transfer shutdown actions in case of a significant LNG leak;
• Clear and well-rehearsed procedures governing the loading and unloading of vessels, should have a focus on ensuring appropriate coordination between the Master or the vessel and any shore-based operations.
• Ensuring that onshore LNG storage tanks comply with the double containment principle involves a completely redundant layer of LNG containment, only used in the unlikely event of primary containment failure.
• Facilities should provide grading, drainage, or impoundment for vaporization process, or transfer areas able to contain the largest total quantity of LNG or other flammable liquid that could be released from a single transfer line in 10 minutes;
• Material selection for piping and equipment that can be exposed to cryogenic temperatures should follow international design standards;
• In the case of a gas release, safe dispersion of the released gas should be allowed, maximizing ventilation of areas and minimizing the possibility that gas can accumulate in closed or partially closed spaces. Spilled LNG should be left to evaporate and the evaporation rate should be reduced, if possible, e. g. covering with expanding foam.
• The facility drainage system should be designed such that accidental releases of hazardous substances are collected to reduce the fire and explosion risk and environmental discharge.
• Hydrocarbon leak detection must be situated throughout the facility.
  Another design feature which has been shown to be of critical importance is the suitable separation of offices/accommodation from the potentially hazardous plant.

Finally, the emergence of new LNG technology categories, such as FSRUs or FLNG facilities, may require additional features broadly comparable with the guidelines above, adapted to a marine environment.

The HSE requirements for the FLNG projects should:

• cover drilling and completion;
• construction;
• installation;
• commission;
• start-up;
• production;
• maintenance, and decommissioning operations.

The design philosophy should be based mostly on the concept of personnel-safety first, due to the fact that there is a limitation of space within the platform.

The project development is supported by a HSE design based on a formal risk-based assessment process, through the following relevant studies:

• Hazard identification by analysis (HAZID, HAZOP) is performed to find out the relevant HSE concerns associated with the project.
• Specific HSE studies to validate the layout and define all necessary measures and protections to put in place (i. e. Fire and Explosion Risk Analysis, Emission and Gas Dispersion Studies, such as heat radiation, etc.).
• Quantitative Risk Analysis.
• Verification of the measures to prevent, control or mitigate the consequences of these hazards.
• Identification of changes or additions to the design in order to improve the prevention, control or mitigation of the consequences of the identified hazards.
• Demonstration that personnel risks are, at worst, ALARP (as low as reasonably practicable).

Security Considerations

The concentration of very high-value plant and equipment with a large, potentially hazardous energy store creates unique security concerns for national governments. The host government will be concerned about the strategic nature of the assets and the related petroleum revenues, investors/lenders will focus on the security of their invested capital in the asset, whereas natural gas customers may have security of supply concerns, particularly where a particular facility supplies a significant portion of a third country’s energy supply.

Because of these factors, safety and security of LNG facilities are rarely discussed in a public forum but nevertheless attract considerable attention internationally. The security agencies of many countries where LNG import or export facilities exist, or who receive strategic LNG supplies from elsewhere, all have very well-developed arrangements, procedures and emergency plans in hand, and this expertise is best accessed through government-to-government dialogue.

Marine security for LNG tankers entering or leaving a facility can be provided by the national government through their Coast Guard or Navy. Adequate equipment and personnel are needed to ensure safety. Typically, all crew must be cleared by national government officials, not only by the companies who employ them. In some regions, piracy may be a concern for ocean-going LNG carriers, and various special measures may be required to address this threat.

Social and Economic Impact

The social and economic impact of major gas developments has taken greater significance within the last decade as the global gas industry has reached a scale and impact such that local communities are requiring more transparency and using media to hold operators accountable. Social and Economic Impact Assessments are important to provide a baseline of the local community prior to the project development and to facilitate monitoring the potential changes on the local communities during the project. These studies ensure responsible operations as well as environmental safety.

Read also: Environment, Social Impact and Safety

Some of the communities where gas projects are being considered are economically disadvantaged and the impact of the project will be designed to improve the economic conditions of both the host communities and the state. Under the sustainability condition, the community may remain in their current location and way of life, but project development may result in relocation or possible disruption of community standards which will be addressed by a social development plan.

The ultimate goal of the social impact assessment is:

• Provide a social development plan which will amongst other things provide mitigation measures to deal with any potential adverse community economic impacts.
• Reduce company risk of operational disruption by collecting baseline data and undertaking continuous monitoring.

Main social impacts. The social development plan orchestrates the positive economic impact and aims to eliminate the potential negative social and economic impacts that may result from the development of gas projects. Some of these impacts are:

• Job creation: increased income generation opportunities from direct and indirect job creation at local, regional and national levels.
• Reduced income-generation opportunities related to fishing. The ocean is for these communities an important natural resource for community living, used for main purposes such as fishing and transportation of goods from one to other economic areas.
• Resettlement of local communities including potential physical displacement along pipeline corridors.
• Loss of subsistence crops within the right of way.
• Impact on traditional governance mechanisms and structures.
• Loss of local «Sense of Place» and decreased social and cultural cohesion.
• Potential increase in anti-social behaviors.
• An increase in vector-borne and communicable diseases.
• Increased injuries and mortality from traffic accidents.
• Reduced access, pressure and overburdening of physical and social infrastructure.
• Improvements related to community development initiatives.
• Impact on landscape and visual environment during construction.
• Construction exposure of workforce to insufficient health and safety standards.

Social and Economic Development Plan – «Social License To Operate»

There are numerous regulatory and licensing processes required to fully permit the project, however obtaining and maintaining a «social license-to-operate» for the project requires focused and targeted effort, engaging with the host communities and the state to create a robust social and Comprehensive Guide to LNG Project Development – Key Phases and Success Factorseconomic development plan to cover the anticipated life of the project. This has challenged the extractive industry for a long time and has negatively impacted many projects. An example of how this can play out if inadequate benefits filter down to local communities is the chronic troubles in the Niger Delta in Nigeria where frequent pipeline attacks cripple large portions of Nigeria’s oil and gas infrastructure. The cost associated with the social and economic development plan to mitigate against social risk and disruptions may be between 1 %-5 % of total capital expenditure. Project developers, as part of their social responsibility or «Social License To Operate» may take on additional tasks that are not specifically required to ensure project completion but which are important to the community in which they operate. The robust development plan may link the economic interest of the plant and the communities thereby creating an alignment of interest for mutual benefits. This is a pragmatic economic and ethical framework in which the project company has an obligation to act for the benefit of society at large for the broad commitment to the host community and to the well-being of the investment.

The social and economic development plan may be influenced by four main factors:

• legislation;
• licensing process;
• land acquisitions and stakeholders.

• Rigorous, complex, and dynamic legislation: regulation tends to change, increase, and to be improved in most countries, not only driving companies towards increased compliance but also creating the need for anticipating changes.
• Complex licensing process/Strict licenses: the licensing process can be large and fragmented, which increases the number of decision-making entities involved and the frequency of interactions required.
• Need of land acquisitions and management: licensing often includes expropriations and, consequently, complex land management and acquisition processes which create internal challenges in terms of coordination of actions.
• Multiples and diverse stakeholders: a large number of institutions (public or private), authorities, communities, and so on, are affected by licensing processes, and their interests are not always aligned to those of the operating company.

The Social License to Operate remains highly important for these countries to maintain internal stability, reduction in armed conflict, and, most importantly, cooperation regionally such as within the Economic Community of West African States (ECOWAS) or East African power markets.