NON-TECHNICAL SUMMARY INTRODUCTION/media/Nanoq/Files/Hearings/2010/Offentlig hoering af...The...

ENVIRONMENTAL RESOURCES MANAGEMENT CAPRICORN GREENLAND EXPLORATION-1

i

NON-TECHNICAL SUMMARY

INTRODUCTION

This is the Non Technical Summary of a Social Impact Assessment (SIA) for an

offshore multiple well exploration drilling programme (the Project). The

programme will be conducted within the Sigguk exclusive licence 2008/10

(Sigguk Licence) off the north west coast of Greenland between June and

October 2010, with a two month contingency window over November and

December, in case relief well drilling is required. It is important to note that

Project drilling activities may require all or only part of this period.

This SIA considers issues as they relate to the exploration drilling programme

in the Sigguk License area. Further revisions of the SIA, with additional data

collection and stakeholder consultation, will therefore be produced for any

further exploratory drilling outside of the Sigguk 2010 campaign, or for any

future stages of the exploration and potential development phases of work.

This SIA has been produced by Environmental Resources Management (ERM)

on behalf of Capricorn Greenland Exploration-1 Ltd (Capricorn), a subsidiary

of Cairn Energy PLC (Cairn). It has been undertaken in accordance with

applicable Greenland legislation and standards, international guidance and

the corporate policies and expectations of Cairn.

SIA STANDARDS AND PERMITTING

The regulatory framework for offshore oil and gas activities in Greenland is

currently being revised. The Bureau of Minerals and Petroleum (BMP) is the

main implementing agency for laws relating to hydrocarbon exploration, and

has been consulted throughout this SIA process.

SCOPE

As well as the SIA, a separate Environmental Impact Assessment (EIA) has

been produced for the Project by ERM on behalf of Capricorn. Physical and

biological environmental factors are therefore excluded from the SIA and

covered by the EIA.

The geographical scope of the SIA includes the municipality of Qaasuitsup,

with particular attention paid to the towns of Ilulissat and Aasiaat, where

some on-shore Project facilities may be located. Where information is

available, it is also included for the towns of Qeqertarsuaq, Kangaatsiaq,

Uummannaq, Upernavik, and Qasigiannguit.

The municipality of Qeqqata is also considered in this report, in terms of

impacts to Sisimiut, from where significant quantities of Greenland-based

services and materials will be sourced, and Kangerlussuaq, which will be the

transit gateway for rotational workers entering and leaving Greenland.


ii

Figure 1 (below) illustrates the Project area considered as part of this SIA.

Figure 1 Project-Affected Area

Source: nunagis.gl (2010)

PROJECT PROPONENT AND SIA PRACTITIONER

Project Proponent

Capricorn Greenland Exploration-1 is a subsidiary of Cairn Energy PLC based

in Edinburgh, UK. Cairn is an independent, public oil and gas exploration

and production company quoted on the London Stock Exchange.

SIA Practitioner

ERM is a leading global provider of environmental, health and safety, risk,

and social consulting services, with 137 offices in 39 countries employing

approximately 3,300 staff. ERM has worldwide expertise in environmental

and social impact assessment for offshore oil and gas projects, including

operations in Arctic waters.


iii

ASSESSMENT METHODOLOGY

Overview of the Impact Assessment Process

This SIA has been undertaken following a systematic process that predicts and

evaluates the probable impacts of the Project on aspects of the socio-economic

environment; it identifies measures to mitigate adverse impacts, and to

maximise benefits, as far as is reasonably practicable.

The overall approach is shown in Figure 2. Screening and Scoping for the SIA

(and EIA) has been underway throughout Project planning and has involved

consultation with the Greenland Government and key stakeholders, review of

legislation and international standards and examination of previous studies.

Engagement with the authorities and key stakeholders, affected populations

in the Project area and Non-Governmental Organisations (NGOs) has

continued throughout this process, as has interaction with the Capricorn

Project Team.

Figure 2 Overview of IA Approach

Baseline Data Collection

To provide a social baseline against which potential impacts can be assessed,

the SIA provides a description of the conditions that exist in the absence of the

Project. The baseline identifies and assesses all stakeholders (also called

“receptors”), as well as resources identified as having the potential to be

significantly affected by the proposed Project.

In preparing this SIA, a range of existing information sources and existing

studies have been used. A comprehensive literature review has been

conducted using reports prepared by government agencies; Greenlandic and

Screening

Scoping

Sta

ke

ho

lder e

ng

ag

em

en

t

Inte

racti

on

wit

h p

roje

ct

pla

nn

ing

an

d d

es

ign

Baseli

ne s

tud

ies (

exis

tin

g d

ata

co

lle

cti

on

an

d n

ew

su

rve

ys)

Predict magnitude of impacts

Evaluate their significance

Investigate options for mitigation

Reassess residual impact (as required)

Assessment

Management Plans/

Mitigation Register

Reporting and Disclosure

Screening

Scoping

Sta

ke

ho

lder e

ng

ag

em

en

t

Inte

racti

on

wit

h p

roje

ct

pla

nn

ing

an

d d

es

ign

Baseli

ne s

tud

ies (

exis

tin

g d

ata

co

lle

cti

on

an

d n

ew

su

rve

ys)

Predict magnitude of impacts

Evaluate their significance

Investigate options for mitigation

Reassess residual impact (as required)

Assessment

Management Plans/

Mitigation Register

Reporting and Disclosure


iv

Danish research organizations, results from previously conducted studies in

Greenland, and other published sources.

In order to supplement published information and data, a social baseline data

gathering mission was undertaken in February 2010. Consultations

undertaken as part of this mission are summarised in Table 1 below.

Table 1 Summary of Stakeholder Engagement

Location Stakeholders Engaged

Nuuk

• GA, NuSuKa, SIK

• Greenland Travel Companies

• Greenland Training Institutions

• Air Greenland

• Royal Arctic Line

• Local Non-Government Organizations

• Beredskabskomiteen

• KANUKOKA

• Fishing Associations

• Ministries of Internal Affairs; Environment and Nature; Financial Issues; Infrastructure; Housing and Traffic; Fishing, Hunting and Agriculture; Health and Social Affairs; Industry and Labour; Education, Culture, Church and Science; BMP

Sisimiut

• Town administration

• Port Authority

• Airport Authority (GLV)

• Chamber of Commerce

• Fire and Police

• Training Institutions

Ilulissat

• Municipal Administration and Offshore Group

• Police station

• GA and Chamber of Commerce

• INI

• Small business owners

• Local tourism operators

Aasiaat • Chamber of Commerce

• Local unemployed residents

• Local fishermen and hunters

Uummannaq • Town administration


• Citizens

Qasigiannguit • Town administration

• Head of Culture

Qeqertarsuaq • Town administration



v

Figure 3 Public Consultation in Uummannaq (February 2010)

Source: ERM 2010

Following publication this non-technical summary (NTS), as well as the

summary for the EIA, the findings of the Social and Environmental Impact

Assessments will be communicated and verified through a public hearing

process, during which time stakeholders will have the opportunity to query

and comment on the report. This is expected to take place in mid-March 2010.

Assessment of Impacts

The assessment describes what will happen by predicting and quantifying as

far as possible the magnitude of impacts. The term ‘magnitude’ is used as

shorthand to encompass all the dimensions of the predicted impact including:

• the nature of the change (what is affected and how);

• its size, scale or intensity;

• its geographical extent and distribution;

• its duration, frequency, reversibility, etc; and

• where relevant, the probability of the impact occurring.

Magnitude also includes any uncertainty about the occurrence or scale of the

impact. An overall grading is provided to determine whether an impact is of

negligible, small, medium or large magnitude.

The next step in the assessment process is to explain what the magnitude of an

impact means in terms of its importance to people and the environment. This

is referred to as Evaluation of Significance.


vi

Magnitude and sensitivity are considered in combination to evaluate whether

an impact is significant and if so its degree of significance (see Figure 4).

Figure 4 Evaluation of Significance

Mitigation and Residual Impacts

Impacts from both routine and non-routine Project activities are considered,

taking into consideration existing mitigation measures within Project design.

Where the assessment results in significant impacts, methods for practical and

affordable mitigation are identified.

SOCIAL SETTING

Employment and Training

Employment and training of the population is considered to be a key priority

by the Government of Greenland, and this was reflected in consultations with

all stakeholder groups.

A range of training facilities exist in the Project area, including local

Piareersarfiit, targeted training programmes provided through employee and

business associations, as well as highly developed facilities such as the

Sisimiut Building and Construction School (Figure 5). At the national level,

other training facilities for training opportunities include the Metalwork and

Industry school (in Nuuk), the Food Service and Preparation School (in Inuili),

and the School for Merchant Mariners (in Paamiut).

Magnitude of Impact

Va

lue

/Se

nsiti

vity

of

Reso

urc

e/R

ece

pto

r

Small Medium Large

Hig

hM

ediu

m

Low

Not Significant

Minor

Moderate

Major


vii

Figure 5 Sisimiut Building and Construction School

Source: ERM 2009

Access to education and training opportunities is challenged by poor

attendance, low availability of trained teachers, and challenges in the social

background of students. Students who are unable to access education and

training and are therefore unable to acquire basic qualifications and skills face

greater difficulties in qualifying for and maintaining stable employment.

Hunting and Fishing Activities

Hunting and fishing remain the dominant livelihood activities in the Project

area, and provide an important source of income and subsistence as well as a

critical aspect of Greenlandic cultural identity. Changes in climate, economy

and aspirations of young people are resulting in progressive decline in

hunting and fishing as the primary economic activity for families.

The majority of local fishing vessels are small-scale operations, though large

commercial companies also work in the waters off the Project area. As

demonstrated in Figure 6, fishing activities are focussed primarily along the

inshore areas, which are accessible to both commercial and small-scale

fishermen. Deeper waters are fished by commercial trawlers, and the area near

the drilling licence is fished for halibut and, to a lesser extent, shrimp.


viii

Figure 6 Fishing in Project Area

Source: ERM 2010

Although less significant as a commercial activity, hunting is an important

source of income, through sale of meat and skins, as well as subsistence and

culture in Greenland. Significant species include muskox, reindeer, seabirds,

seals, walrus and whales.

Local Business Activity

The largest companies in Greenland tend to be Government-owned (such as

Royal Arctic Line, Air Greenland, Royal Greenland and KNI A/S) – with some

exceptions (such as Polar Seafood). Generally, however, the majority of

private businesses in Greenland are small, with few medium-sized

enterprises. Within the project area, the main sectors of business are

construction and repair. Tourism is also important locally, although its

contribution to the national economy is so far modest at the national scale.

Within the project-affected area, tourism activities include dogsledding and

skiing in the winter, hiking, whale watching, kayaking and sailing in the


ix

fjords in the summer, along with sports fishing and excursions to historical

settlements and archaeological sites. Higher-level tourism infrastructure has

been developed in the larger towns of Sisimiut, Ilulissat and Kangerlussuaq.

The majority of businesses are associated within Chambers of Commerce or

similar businesses organizations. These structures promote economic and

industrial development in the municipalities, through training and capacity

building, encouraging collaboration.

Infrastructure

Towns and settlements in Greenland are not commonly connected by road.

Instead, passenger and goods are transported by sea or air. Because of the

importance of ports and airports as hubs of transport and commercial activity

in Greenland, impacts to these are carefully considered.

Ports are an important gateway for marine traffic in Greenland; the larger

ports, in particular, receive passenger vessels, cargo vessels, fishing trawlers,

cruise vessels, small scale fishing boats, foreign vessels and vessels that need

tank water and fuelling.

All towns and settlements will have a port of some level; however the main

commercial ports in the Project area are located in the largest towns of

Sisimiut, Ilulissat and Aasiaat.

Figure 7 Port of Sisimiut

Source: ERM 2009


x

The port of Sisimiut (Figure 7) is the major port of the region, and will be used

by the Project for storage and loading of supplies for the drill ships (through a

contract with Royal Arctic Line). Currently, it is used by commercial fishing

fleets, supply vessels, passenger ferries, and international cruise ships.

Stakeholders have reported that traffic through this port is a serious issue, and

raised concerns that Project activities might create further congestion. Port

Authorities in Sisimiut reported that there is already a high likelihood of

delays to port access at all times of the week (including Sundays), with delays

reaching 12- 24 hours. Because the port is run by Royal Arctic Line, the issue

raised was less about meeting the Project needs, and more about potential

challenges faced by other port users.

Air Greenland is the only air carrier in Greenland. As the national aviation

company, Air Greenland provides both commercial flight services and well as

social transport needs for the country, including transport of goods and

supplies and medical response/ transport.

Nearly all towns and settlements will have at least a helicopter pad, while

most towns have at least a small airport. Airports in Greenland are managed

by the Airport Authorities, which are responsible for the staffing and

scheduling of national airports. In some towns, limited air tower controllers

restrict the opening hours of airports, which can affect air travel to and from

those areas.

The Aasiaat airport, which currently operates a six hour window, will have its

capacity supplemented to meet Project needs for crew transport and

emergency response. The airport authorities have indicated that they plan to

reallocate four tower controllers from elsewhere in Greenland during the

period of exploration drilling, to allow the airport to operate 24/7. There are

no plans to develop airport infrastructure specifically for this Project; staff at

airports from which supplemental operators have been drawn will be

expected to compensate for the reduced manpower with overtime.

Greenland lacks the equipment and infrastructure necessary for high level

emergency response or SAR. In recognition of this, Capricorn will establish oil

spill equipment adequate to respond to a significant oil spill on the west coast.

This means that in the already unlikely event of an oil spill, response could be

immediately initiated, and access to response equipment would not be

delayed.

Any significant non-routine event, including both oil spills and emergencies,

would require a coordinated response among national authorities, who would

need full awareness of Project-specific emergency planning provisions. In

recognition of this, a contingency committee was created in 2000 to oversee

emergency planning in mineral and petroleum projects. The committee

represents the key organizations that would be implicated in the event of an

emergency, including the police, Danish High Commission, Department of

Health, Department of Environment, the national contingency committee, the

Danish Maritime Authority, and the navy. In the context of a major event, the


xi

committee ensures that relevant parties remain updated on the situation and

that response is undertaken in a coordinated way, incorporating the capacities

of all parties.

The contingency committee would be provided with the opportunity to

review and comment on the health and safety plan of the Project. Training

and emergency response simulations will ensure that the relevant personnel at

both state and company level understand procedures in the event of an

emergency, and gaps in capacity can be identified and addressed in advance

of an actual event.

THE PROJECT

Capricorn has a working interest in a total of eight exploration licences off the

south and west coasts of Greenland, although the current drilling programme

and the remit of this SIA is concerned solely with the planned exploration

programme in Block 1, Sigguk. The drilling programme is planned to take

place over four months, with a two month contingency for relief well drilling

in case of a major unplanned event (see Table 2 below).

Table 2 Outline Drilling Schedule

2010 May June July August Sept Oct Nov Dec

Mobilisation

Drilling (4 wells)

Relief Well

The programme will involve the drilling of four wells, with the possibility of

drilling up to a further two wells in the same block within the existing project

schedule should initial drilling go faster than expected and if it proves

operationally worthwhile, and pending additional environmental approvals.

The drilling programme itself will employ a range of state-of-the-art

technology and operating standards to meet the challenges of drilling in the

offshore Arctic environment. Two mobile offshore drill units (MODUs)

(Figure 8) will be employed in order to provide a high degree of operational

and safety contingency. A number of vessels will be employed to provide

support and emergency cover for the operations, including supply boats,

support vessels and ice breakers. A ‘wareship’ will provide offshore storage

and contingency accommodation off the coast at Aasiaat, with helicopters and

fixed wing aircraft used to transfer personnel to and from the field area, the

support facilities and the international airport at Kangerlussuaq. Existing

onshore facilities at Nuuk, Aasiaat, Sisimiut and Ilulissat will be utilised for

material lay down, helicopter operating base, handling of some wastes, supply

of fuel, water and materials and limited onshore accommodation for up to 12

project personnel.


xii

The two MODUs are the Stena Forth, a modern drill ship designed to work in

deep water and harsh conditions including broken ice, and the Stena Don, a

dynamically-positioned semi-submersible drilling unit also designed for work

in harsh environments. As both MODUs remain on station using thrusters

there is no requirement for anchoring during normal operations.

Figure 8 Stena Forth Drillship and Stena Don Semi-Submersible Drilling Rig

Source: Photo courtesy of Stena

The planned drilling depths are between 3,000 and 4,000m below seabed. The

drilling process uses drilling bits of different sizes to drill a series of holes

from the seabed to the planned well depth. The Project plans to use only

substances categorised as those which Pose Little Or No Risk (PLONOR) to

the Marine Environment, or that are ranked in the least potentially harmful

hazard band (Gold or E).

Rock cuttings from the drilling process will be circulated back to the drilling

unit where the muds are separated for reuse and the treated cuttings are

discharged to sea. Between 500 and 740m3 of cuttings are expected to be

produced from each well. Once each section of the hole has been drilled, the

drill string will be lifted out and casing will be lowered into the hole and

cemented into place.

If drilling results indicate the presence of hydrocarbons, the wells may be

tested. Testing is used to establish reservoir and fluid characteristics such as

pressure and flow rate. If required, there will be a controlled flow of

hydrocarbons back to the drill unit where they will be tested and flared, which

would involve periodic flaring over approximately 5 days. The likelihood of

flaring being undertaken is estimated at less than 6% per well. Any flaring

will require permitting by the Greenland authorities. A monitoring

programme and an oil recovery vessel with full dispersant capability will be

on standby throughout the process in case incomplete combustion of the flare

leads to ‘drop out’ of any unburnt oil onto the sea surface.


xiii

Following completion, the wells will be plugged and activities suspended.

Each well will have an industry standard wellhead at the surface, with a

protective cover to prevent damage to or from the wellhead due to snagging

or collision with vessels, trawling equipment or icebergs. Once all wells have

been drilled, the MODUs and support vessels will demobilise to their next job

or home base and leave Greenland waters.

SUMMARY OF IMPACTS AND MITIGATION

The proposed exploration activity has the potential to create a variety of social

impacts during the five months that it will be active. The sources identified in

this assessment are typical of offshore exploration operations around the

world.

As currently proposed, there are no unusual or unique sources of social

impacts associated with the drilling programme. An overview of the main

areas of impact, related operations and mitigation measures is shown in Table

3 below.

Overall, the drilling programme is predicted to have a slightly positive social

impact for Greenland. Negative social impacts are predicted to be not

significant or minor, and most of these impacts will be managed through

standard operating procedures.

The main reasons that the drilling programme is predicted to have minimal

negative social impacts are that

• Most of the drilling activities are located at significant distance

(approximately 150 kilometres offshore) from existing Greenlandic

communities; and

• The Programme is of a very short duration (five months).

For many of the same reasons, the Programme is not anticipated to have a

large and positive social impact. Although some economic benefits are

anticipated for Greenlandic enterprises, notably for Air Greenland, Royal

Arctic Line and their suppliers, local employment effects will be muted

because the ships and crews will be mobilised from outside Greenland. Other

opportunities for business development are likely to be limited to purchases of

fuel, water, food and some consumables to support the drilling operations.

Opportunities to enhance the positive social impacts of the exploration

programme, for example through training, are limited by its short time frame

and the specialist nature of the work. These limitations could change if the

current exploration programme is successful and leads to long-term

development of offshore hydrocarbon resources, which is outside the remit of

this current assessment.


xiv

Table 3 Summary of Main Impacts, Significance and Management Measures

Potential

Impact

Source/significance of

impact

Management Measures

Local

employment

One direct recruit and

support for existing

Greenlandic jobs in

transportation and

services.

• Consideration given to recruiting Greenlandic labour if

current staffing arrangements change.

• Recommend undertaking preliminary workforce

assessment during this phase of work to understand

existing workforce capacity and gaps to be addressed

Skills and

training

No formal knowledge

transfer activities are

currently being

planned.

• Recommend undertaking an assessment of Greenlandic

training programmes and institutions to develop

understanding of training capacity and where support

could be provided if the Project proceeds to

development.

Commercial

fishing.

The 500m exclusion

zone around drilling

operations and vessel

movements to and from

the exploration area.

• Location and movements of drill rigs and associated

vessels will be communicated to fishing and other

vessels in the area with a dedicated communication

programme;

• Designated vessels will monitor the exclusion zones and

ensure that any approaching vessels are guided away

from the rigs;

• The drill ships and support vessels will be illuminated

as required under the Navigation Act

• Safety protocols will be established for radio

communication with vessels entering the safety and

security zone around the drill ships.

• Recommend that Project vessels that could come into

contact with local boaters have access to a Greenlandic

speaker to ensure effective communication.

Whale

Hunting

Drilling activities could

disrupt whale

movements in the area

• Area within which whales could be affected is expected

to be limited

• Further consultation will be undertaken to determine if

the potential impact on whales can be monitored during

the period of operations.

Greenlandic

enterprises

Purchases of goods and

services from

Greenlandic enterprises

• Air Greenland and Royal Arctic Line are expected to be

contracted to provide transportation, supply, storage

and support services to the exploration operation.

• Local purchases of accommodation, foodstuffs, water,

fuel and other supplies will be prioritised.

Tourism Exploration related

activities in tourist

areas.

• No exploration related activities to take place in tourist

areas.

• Accommodation of onshore workers will provide

business to tourism and hospitality enterprises

Housing Living and

accommodation

arrangements for

drilling crews

• Drilling crews will be accommodated offshore with no

impact on municipal housing.

• Onshore workers (up to 30 aircrew in Ilulissat and 12

operations personnel in Aasiaat) will stay in hotels, with

no added pressure on municipal housing.

• Contingency accommodation arrangements for delays in

transfer of offshore workers will be provided by the

wareship moored in Aasiaat and existing

accommodation facilities in Kangerlussuaq, preventing

unplanned presence of large numbers of offshore

workers in Greenlandic communities.


xv

Potential

Impact

Source/significance of

impact

Management Measures

Port

facilities

Supply boats entering

port at Sisimiut may

displace other shipping

• Early and ongoing consultation with local authorities

and other key stakeholders.

• A schedule of regular vessel movements to and from the

port and drill ships will be provided to port

administration

• Recommend that the Project consider alternatives to

Sisimiut port where appropriate

Airport

services

Requirement for

increased capacity at

Aasiaat could deprive

other towns of air

traffic controllers,

needed to keep airports

open and operating

• Early and ongoing consultation with local air traffic

authorities and other key stakeholders

• A schedule of regular scheduled flights to and from key

airports in Kangerlussuaq, Ilulissat and drill ships will

be provided to air transport authorities

Emergency

response

structures

Limited local capacity

for emergency

response, potential that

services could be

overwhelmed

• Oil spill response equipment will be stored in Greenland

to allow immediate mobilisation to respond to a

significant spill offshore west Greenland.

• National structures will be engaged in health and safety

planning for the Project, including drills.

Local

culture and

community

Interaction with drilling

crews

• Contact between drilling crews and Greenlanders will

be minimised by maintaining crews at sea for the

duration of the drilling programme.

• Crews will be transferred directly between drill ships

and airport at Kangerlussuaq

The management measures outlined in the SIA have been developed from

extensive industry experience with offshore exploration drilling, and are tried

and tested. Furthermore, the management systems required to implement the

measures are well understood and known to be effective. Every attempt has

been made to ensure positive social impacts for Greenland from the

exploration programme and there is a high level of confidence that potential

negative social impacts can be successfully minimised through the

implementation of the management measures outlined above.

NON-TECHNICAL SUMMARY INTRODUCTION/media/Nanoq/Files/Hearings/2010/Offentlig hoering af...The...

Documents

Transcript of NON-TECHNICAL SUMMARY INTRODUCTION/media/Nanoq/Files/Hearings/2010/Offentlig hoering af...The...