REVIEW OF FERC’S FINAL EIS REPORT

BROADWATER LNG PROJECT (“Project”)Broadwater Energy LLC and

Broadwater Pipeline LLCDocket Nos. PF-05-4, CP06-54-000, and

CP06-55-000FERC/EIS – 0196F

FEBRUARY 11, 2008

FERC AND COAST GUARD ROLE

FERC IS THE LEAD AGENCY TO AUTHORIZE CONSTRUCTION AND OPERATION OF ALL LNG TERMINALS. FERC ultimately determines if project should or should not be

approved. Final approval is granted only after consideration is given to both

environmental and non-environmental issues, and if FERC finds that the Project is consistent with Public Interest.

U.S. COAST GUARD HAS THE REGULATORY RESPONSIBILITY TO ASSESS THE POTENTIAL NAVIGATION SAFETY AND MARINE SECURITY RISKS ASSOCIATED WITH THE PROJECT. Identifies strategies to manage risks but not to eliminate risks Addressed suitability of the Project Waterway to support the LNG

Operation

FILING PROCESS TO DATE

• REQUEST TO FERC TO IMPLEMENT THE COMMISSIONS PRE-FILING PROCESS FOR THE PROJECT - NOVEMBER 4, 2004

• LETTER OF INTENT BY BROADWATER TO U.S. COAST GUARD - NOVEMBER 9, 2004 (AMENDED APRIL 4TH 2005)

• PRE-FILE DOCKET ESTABLISHED BY FERC - NOVEMBER 29, 2004

• U.S. COAST GUARD WATERWAY SUITABILITY REPORT – SEPTEMBER 21, 2006

• DRAFT EIS - NOVEMBER 17, 2006 on the website

• FINAL EIS - JANUARY 2008

WHERE PROCESS IS AT THIS POINT IN TIME

• ON NOVEMBER 4, 2004, BROADWATER FILED A REQUEST WITH FERC TO IMPLEMENT THE COMMISSION’S PRE-FILING PROCESS FOR THE PROJECT.

• THE PROCESS BEGAN WITH BROADWATER ISSUING A LETTER OF INTENT TO THE COAST GUARD ON NOVEMBER 9, 2004 (REVISED ON APRIL 26, 2004 FOR A SLIGHTLY MODIFIED LOCATION), WHICH REQUESTED A DETERMINATION REGARDING THE SUITABILITY OF THE PROJECT WATERWAY FOR LNG CARRIER TRAFFIC IN ASSOCIATION WITH THE PROPOSED FSRU.

• ON NOVMBER 29, 2004, FERC GRANTED BROADWATER’S REQUEST AND ESTABLISHED A PRE-FILING DOCKET NUMBER WHICH CONTAINS ALL INFORMATION GATHERED BEFORE JAUARY 30, 2006, WHICH WAS THE DATE OF THE BROADWATER ACTUAL APPLICATION.

• ON FEBRUARY 10, 2005, FERC INTRODUCED THE PRE-FILING PROCESS TO STAKEHOLDERS BY ISSUING NOTICES TO INTERESTED PARTIES THAT WOULD START ITS PROCESS FOR A DRAFT ENVIRONMENTAL STATEMENT. AS PART OF ITS NEPA ANALYSIS, FERC MUST COMPLY WITH CERTAIN STATUTORY REQUIREMENTS:

– The Endangered Species Act– The National Historic Preservation Act;– The Magnuson-Stevens Fishery Conservation and Management Act

• FERC STAFF MUST COORDINATE CLOSELY WITH THE U.S. ARMY CORPS OF ENGINEERS AND THE U.S. EPA IN FULFILLING THE REQUIREMENTS OF THE CLEAN WATER ACT, THE RIVERS AND HARBORS ACT, AND THE CLEAN AIR ACT.

• ON AUGUST 16, 2005, THE COAST GUARD ISSUED A NOTICE THAT THE PROCESS WOULD BEGIN ON THE BROADWATER LETTER OF INTENT.

• ON SEPTEMBER 21, 2006, COAST GUARD ISSUED ITS PROJECT WATER SUITABILITY REPORT.• ON NOVEMBER 17, 2006, FERC POSTED ITS DRAFT EIS ON ITS WEBSITE.• FINAL ENVIRONMENTAL IMPACT STATEMENT RELEASED IN JANUARY 2008.

WHAT’S NEXT• LOCAL APPROVALS FROM NEW YORK:

– NYSDOS will determine whether the proposed Project would be consistent with the New York State:

• Coastal Management Program;• Long Island Coastal Management Plan;• The Local Waterfront Revitalization Programs adopted by Smithtown, Southold, and Greenport; and• The Harbor Management Plan of Port Jefferson.

• U.S. COAST GUARD ISSUES A LETTER OF RECOMMENDATION:– Issuing a Letter of Recommendation finding that the Project Waterway is suitable without the

implementation of additional measures;– Issuing a Letter of Recommendation finding that the Project Waterway is unsuitable (No-Action

Alternative); or– Issuing a Letter of Recommendation finding that, to make the Project Waterway suitable,

additional measures are necessary to responsibly manage risks to navigation safety or maritime security associated with LNG marine traffic.

• AFTER THE COAST GUARD, FERC HAS THE FOLLOWING DECISION:• TO TAKE NO ACTION AND THEREBY DENY THE PROJECT• APPROVE WITHOUT CONDITIONS• APPROVED WITH CONDITIONS

• IF FERC AND U.S. COAST GUARD APPROVE THE PROJECT, THEN THE COAST GUARD WOULD PROPOSE A REGULATED NAVIGATION AREA TO INCLUDE MEASURES OF SAFETY AND SECURITY ZONES FOR THE FSRU AND THE LNG CARRIER.

ANY LOCAL APPROVALS

• BROADWATER DOES NOT REQUIRE ANY APPROVALS FROM CONNECTICUT ADMINISTRATIVE AGENCIES.– Connecticut has asserted its claim that it has standing in the

application process.

• BROADWATER DOES NEED APPROVAL FROM CERTAIN NEW YORK AGENCIES.

NEW YORK APPROVALS• The New York State agencies with responsibilities for reviewing and

permitting the Project consist of the following:

• New York State Department of Environmental Conservation (NYSDEC): – The Clean Water Act– The Clean Air Act– Storm Water Permit– Solid Waste Registration– Temporary Water Use Permit – Consultations regarding state-listed threatened and endangered species

regulations and the Fish and Wildlife Coordination Act– Hazardous Substances Bulk Storage Permit– Petroleum Bulk Storage Permit

• New York State Department of State (NYSDOS):– Responsible for reviewing federal agency actions and activities relative to the

Coastal Zone Management Act– Responsible for the determination of consistency with New York’s Coastal

Management Program and the Long Island Sound Coastal Management Policies

NEW YORK APPROVALS

• New York State Office of General Services:– New York Public Lands Law - Easement or lease for use of state-owned

submerged lands

• New York State Department of Public Services (NYSDPS):– Safety advisory report pursuant to the NGA - already submitted its initial

Safety Advisory Report on February 28, 2006

• Emergency Management Office

• New York State Department of Transportation

• New York State Office of Homeland Security

• Several local governmental entities

(EIS 1-25- 1-27)

PRINCIPAL PURPOSE IN PREPARING FINAL EIS

• IDENTIFY AND ASSESS POTENTIAL IMPACTS ON THE NATURAL AND HUMAN ENVIRONMENT THAT WOULD RESULT FROM IMPLEMENTATION OF THE PROPOSED ACTIONS

• DESCRIBE AND EVALUATE REASONABLE ALTERNATIVES TO THE PROPOSED ACTIONS THAT WOULD MINIMIZE ADVERSE EFFECTS ON THE HUMAN ENVIRONMENT

• IDENTIFY AND RECOMMEND SPECIFIC MITIGATION MEASURES, AS NECESSARY, TO MINIMIZE THE ENVIRONMENTAL IMPACTS

• ADDRESS RELEVANT COMMENTS ON THE DRAFT EIS PROVIDED BY THE PUBLIC

(EIS 1-21 - 1-27)

FERC ENVIRONMENTAL REVIEW

• FOUR LEVELS OF IMPACT:– TEMPORARYSHORT PERIOD OF TIME– SHORT-TERM UP TO 3 YEARS– LONG -TERM MORE THAN 3 YEARS– PERMANENTLIFE OF THE PROJECT

ANALYSIS OF FERC’S REVIEWOVERVIEW

1.Project Purpose and Need 2.Environmental Analysis

a. Geologyb. Water Resourcesc. Biological Resourcesd. Threatened and Endangered Speciese. Land Use, Recreational and Visual Resourcesf. Socioeconomicsg. Marine Transportation and Onshore traffich. Air Quality And Noisei. Reliability and Safetyj. Cumulative Impacts

3. Alternatives

a. Alternative Energy Sources

b. Systems alternatives

c. Alternative LNG Terminals and Locations

d. Pipeline Construction Alternatives

e. Alternative Vaporization

Methods

PROJECT OBJECTIVEAND NEED

“The proposed Project would reduce the region’s future need for additional transportation infrastructure (new or expanded interstate natural gas pipelines), facilities that have been difficult to build in the region.” (EIS 1-4)

CONCLUSION

“BASED ON THE ANALYSIS INCLUDED IN THE FINAL EIS, THE FERC STAFF CONCLUDES THAT APPROVAL OF THE PROPOSED PROJECT WITH APPROPRIATE MITIGATING MEASURES AS RECOMMENDED, WOULD HAVE LIMITED ADVERSE ENVIRONMENTAL IMPACTS.”

COMPARE OUR ANALYSIS WITH THE CONCLUSIONS REACHED BY FERC

• TASK FORCE SHOULD REVIEW FERC CONCLUSION AND:

– Accept FERC’s findings, or– Accept FERC’s findings but add additional safeguards

or mitigation factors, or– Perform more research and further fact finding and

create a supplemental report.

AREAS THAT PERHAPS THIS TASK FORCE SHOULD REVIEW

1. Project Purpose and Need

2. Environmental Analysis

a. Geology

b. Water Resources

c. Biological Resources

d. Threatened and Endangered Species

e. Land Use, Recreational and Visual Resources

f. Socioeconomics

g. Marine Transportation and onshore traffic

h. Air Quality And Noise

i. Reliability and Safety

j. Cumulative Impacts

3. Alternatives

a. Alternative Energy Sources

b. Systems alternatives

c. Pipeline Construction Alternatives

d. Alternative LNG Terminals and Locations

e. Alternative Vaporization Methods

GEOLOGY AND SOILS

• OUR EXPERTS MADE THE FOLLOWING STATEMENTS:

• Peter Auster: “The document was poorly researched, you

know, without suggesting any type of motivation. I thought that the authors kind of glommed over a number of issues using a minimal amount of literature, analysis or synthesis about literature to conclude that there were minimal impacts in some, in many of the areas.”

Public Hearing December 7, 2006

• Ralph Lewis:“My finding is that probably this is at the level of maybe an undergraduate, reasonably bright undergraduate, who’s taken some geology courses, I’m reviewing the geology section, who had some insights but probably went to the library the afternoon before the paper was due, grabbed what was there, and pulled an all nighter and wrote the paper, first draft.”

• Dr. Roman Zajac:“My expectations actually, I’d like to echo some of the things that Ralph said. My expectations were actually a bit higher. I would expect that in these kinds of EIS. We would have it at minimally what we would, some minimal professional level, and unfortunately I must say that my read of this, leads me to conclude that it’s just not there, and I think much of the environmental section suffers from that.”

Public Hearing December 7, 2006

CONCERNS THE EXPERTS RAISED:• The DEIS report relied upon old data, that in some instances

was over 35 years old. Some of DEIS facts regarding the Long Island Sound are simply wrong. For example, the DEIS discusses marble being quarried in the Long Island Sound. Other wrong facts or oversights regarding the geology of the Long Island Sound include:– The Mesozoic rift basin was not discussed;– The Norwalk Shoal complex divides the eastern sound from the middles

of the sound, but Norwalk is in the western sound;– There is no basalt outcrops in Long Island Sound as reported by the

DEIS report;– The report refers to vague clay deposits as existing in the Long Island

Sound when in fact these deposits are up to 600 feet deep;– The DEIS mentions that there are no fault lines, which must be false

because there are earthquakes in Connecticut;– The report is too basic and lacks scientific detail in order to understand

the issue of recovery or potential recovery due to the Broadwater project.– Since there lacks an analysis of the video in their report, this makes their

conclusion suspect. The DEIS report discusses that, in the area, there were no hard clams or surf clams sub sea surface video. First, these generally live in the sediments and wouldn’t be seen on the video. Secondly, they are generally very hard to find on a video.

CONCERNS THE EXPERT RAISED:• ECOLOGICAL CONCERNS:

– As a comparison of disturbance colonization, the report uses European waters, which demonstrates the lack of understanding of the unique waters of Long Island Sound and, in fact, the uniqueness of the different species that live in each area of the Long Island Sound;

– The DEIS Report looked at data from Army Corps of Engineers on dredge spoil mound disposals in Long Island Sound to determine the recovery of a ditch that would be created by the Broadwater Project, such a comparison is invalid;

– Inconsistencies from one section to the next;– A lack of fundamental research on disturbance ecology;– A lack of extensive research on the differences between leaving the

pipe covered or uncovered; – No information on the acceptable acoustics level based upon some

research that is available if one were to look for the answer.

The above are only a few of the comments regarding the lack of study in the DEIS Report and the lack of due diligence of the DEIS Report. If the DEIS Report is wrong factually and wrong substantially, how can its conclusion that there is no environmental impact to the Long Island Sound be sustained? As a result of these glowing errors in the DEIS Report, one must conclude that the requirements as mandated by NEPA have not been satisfied.

AS A RESULT OF OUR REPORT: CHANGES TO THE EIS REPORT

• There were a variety of basic changes made:– Old material:

• Reference to a Williams report of 1981 was removed;• Reduced the reference to Twitchell, which was a summation of other

reports; and• Referenced 2005 reports.

– Quarries:• Removed any reference to quarries

– The Norwalk Shoal complex divides the eastern sound from the middles of the sound, but Norwalk is in the western sound was removed.

– There is no basalt outcrops in Long Island Sound as reported by the DEIS report.

• This was removed.– The report refers to clay deposits as existing in the Long Island

Sound, when in fact these deposits are up to 600 feet deep.• Wording changed slightly. However, major changes to construction of the

YMS were made because of our suggestions.– The EIS now mentions earthquakes and more study on the

construction of the YMS system - a direct result of our report.

CERTAIN CHANGES TO THE PROJECT AS A RESULT OF OUR REPORT

• Stratford Shoal Analysis– As a result of the report, FERC discussed a second way to

lay the pipe in this area, which would require “trenching out material”;

– This second way is exactly what our experts said they need to re-examine.

• This second method may in fact invoke the jurisdiction of our DEP; • FERC states:

– CTDEP points out:» that these disposal sites are located within the waters of the State

of Connecticut, and» the disposal of dredged material at either of the sites would require

a 401 water quality certificate from CTDEP and» possibly require a CZMA consistency review; » We have included a recommendation that would require

Broadwater to work with COE and EPA to locate an acceptable disposal site (possibly onshore), in the event that Broadwater needs to follow the contingency plan for Stratford Shoal.

CERTAIN CHANGES TO THE PROJECT AS A RESULT OF OUR REPORT

• Piles Driven For YMS– As a result of our report, further study on the depth:

FERC agrees it should go about 500 feet to hit the bedrock vs the less than 200 feet that Broadwater suggested;

– And further concern about earthquakes which was not mentioned until our experts talked about it, has required FERC to state:

• Prior to installation activities in Long Island Sound, Broadwater should conduct appropriate geotechnical investigations and analyses to determine the detailed foundation design requirements and the potential for seismic soil liquefaction beneath the proposed YMS.

CHANGES TO THE REPORT

• No backfill of material into the trench– Now trench will be filled-in.

• Our experts raised serious concerns over acoustics in the construction and operation.– The report does seem to more fully address these

concerns, but there is a lack of information on thresholds.

• Lighting was a concern.– FERC addresses this concern.

• Temperature Analysis– A more detailed temperature analysis, coupled with

covering the trench to reduce temp. issues

ISSUES REMAINING

• Mesozoic rift basin:– Is it an issue if it is not mentioned in the report?– Need our experts to fill us in

• Earthquakes are now an issue:– Need more expert review now that it is admitted– Consult with our experts and John Ebel at the

Weston Observatory

• Review of Stratford Shoal Contingency Plan

ISSUES REMAINING

• Pile Driving 500 feet:– What other impacts would that now have?– Is there enough analysis done by FERC on this new

issue?

• FERC Never Addressed The Methane Gas Issue:– We now have more pipeline details, but FERC never

mentioned the ability of the pipe to have a proper foundation.

– Methane gas in the sediments causing lack of stabilization for the soil and therefore the pipe

ISSUES REMAINING

• Filling In The Trench– This new procedure needs to be reviewed.

• Benthic Communities– Did they supply enough new information to alleviate

the concerns of our experts?• The Paint On The Various Components

– No information on when and how the repainting would take place

• Has FERC Improved Its Analysis In The DEIS Regarding The Effect Upon The LIS?– Our experts need to tell us to what degree.

ISSUES REMAINING

• Parts Of The DEIS Are Inconsistent With Other Parts, Is That Still True?– Our experts found this to be an issue.

• Lack Of The Analysis Of Recovery Dynamics (i.e. Disturbance Ecology)– Our experts found this to be a concern.

• “Chumming” Issue Was Not Addressed– Is that still an issue?

ISSUES REMAINING

• Acoustic Concerns Were Raised By Our Experts, Are The Answers By FERC Satisfactory?

• Lighting– Although these concerns were addressed, do their

answers satisfy the issues we raised?

• Temperature Effect– Were the concerns we raised addressed in full?

• Pumping Water Intake Effect Upon Certain Organisms:– NYDOE has concerns over FERC’S analysis.

ISSUES REMAINING

• No Monitoring program– There seems to be a lack of a monitoring

system in place after the project is up and running.

• At The End Of The Project’s Lifespan, There Is No Security To Ensure That The Equipment To Be Taken Out Will Be Removed.

SUGGESTED ACTION BY TASK FORCE:

• TO ASK THE EXPERTS BACK TO OUR MEETING AND HAVE THEM GIVE US THEIR UPDATED ANALYSIS

• CONTACT DR. JOHN EBEL ABOUT THE EARTHQUAKE ISSUES

• ANY OTHER EXPERTS?

• ANY OTHER SUGGESTIONS?

LAND USE, RECREATIONAL, AND VISUAL

POTENTIAL FOR FUTURE INDUSTRIAL OR COMMECERCIAL DEVELOPMENT ON LIS

While this particular issue was discussed in various Task Force meetings and hearings, the Task Force did not choose to include such discussion in their various reports.

Nevertheless, FERC’S reply to this issue may now require a response from the Task Force.

• First, offshore industrial projects require waterborne transportation or subsea infrastructure to provide the materials or supplies to produce products or goods, to take the products or goods to the marketplace, or both. Second, one siting criterion for an industrial project in the offshore waters of the Sound would be “remoteness” – that is, the developer would want to establish the facility far from population centers for safety or other reasons. Although that was one of the siting criteria for the Broadwater Project, very few types of industrial projects require the level of remoteness that can be achieved only by an offshore site, while also requiring waterborne transportation. Thus, a new industrial project would need to include unique requirements (waterborne transportation and remoteness) to justify offshore development. In addition, offshore construction is very expensive, and the financial justification for this evaluation considered the substantially greater costs of offshore development as compared to those of onshore facilities. Because the Broadwater Project is unique, its criteria for development would not be applicable to other industrial applications – particularly the criteria of remoteness and waterborne dependency. In addition, the greater costs of offshore development would be an obstacle to profitable development of other industrial facilities.

Although we recognize that the Project could spur entrepreneurial innovation, new offshore development in the Sound would face the same obstacles listed above for the issue of precedence. Finally, even if new offshore projects are proposed in the future, they would need to be consistent with all existing laws and regulations, and each project would be under the jurisdiction of agencies tasked with protecting the environment and the health and welfare of citizens.

(EIS 3-134 TO 3-135)

DOES THE TASK FORCE AGREE WITH THE RATIONALE OF FERC

• Should we review this statement and comment????

FERC RECREATIONAL BROADWATER STUDY:• Boat traffic is close to shore (EIS 3-138)• Approximately 3.5 miles from shore (EIS 3-138)• Determination Of Boat Traffic

– During the 39 peak-use hours observed at the proposed site, 83 boats transited the waters within 0.6 miles of the proposed YMS location. Images were captured on 3 days in September 2007 (September 1st, 6th, and 9th) and represent boater use on 2 weekend days (one of which was the Saturday before Labor Day) and a weekday. On the Saturday before Labor Day (September 1st), six vessels were observed within 3 miles of the FSRU and a total of 24 vessels were observed within 7 miles. On Thursday, September 6th, one vessel was observed within 3 miles of the FSRU and 10 vessels within 7 miles. On Sunday, September 9th, no vessels were within 3 miles of the FSRU and 15 vessels were within 7 miles. The vessels ranged in size from 18 to 330 feet and in most cases included both commercial and recreational watercraft. (EIS 3-138)

DAY/BOAT # AVG.Degrees F

MAX. LOW WIND(MPH)

WIND (MAX)

SKY

8/31/07

Fri.72 84 63 1 13 AM: Clear

PM: Cloudy

9/1/07 24

Sat.68 78 55 10 13 Clear

9/2/07

Sun.61 72 50 5 13 Clear

9/5/07

Wed.66 75 57 3 12 Clear

9/6/07 10

Thur.68 78 60 3 13 AM: Cloudy

PM: Clear

9/7/07

Fri.76 82 71 7 10 Clear

9/8/07

Sat.77 82 72 6 12 Clear

9/9/07 15

Sun.77 82 72 4 9 AM: Cloudy

PM: Clear

9/10/07

Mon.70 73 63 9 10 Overcast

BROADWATER’S STUDY OF BOAT TRAFFIC

• QUESTIONS TO TASK FORCE:– Is this an acceptable study?– Does the Task Force agree or disagree with

this baseline premise for which FERC launches its analysis to determine Broadwater impact?

– What, if anything, should the Task Force do?

FERC’S ANALYSIS OF THE RECREATIONAL IMPACT

• Recreational boating and fishing could be disrupted by passage of the moving safety and security zones LNG carriers.

• However, with the exception of the portion of the LNG carrier route that traverses the Race, the route does not pass through high-use areas and is surrounded by waters with unrestricted access.

• Overall, the impact of the proposed FSRU, YMS, and LNG carrier transits on waterborne recreation (recreational fishing and boating, tour boats, regattas, and sight-seeing cruises) would be negligible in areas other than the Race. In the Race, minor periodic impacts would occur for the life of the Project. (EIS 3-140,141,171,200,201,202-207)

RECREATIONAL BOATINGDisruptions along all portions of the carrier routes outside of the Race would be minor, since the routes are not in high use areas and are surrounded by waters with unrestricted access. The only area that would not be available to public use along the route would be the 2,040-acre area of the LNG carrier and its proposed moving safety and security zones. Enforcement of the proposed moving safety and security zones around LNG carriers as they transit the Race could result in minor disruptions to recreational boating and fishing, dependent on the time and season of transit. After reviewing the recreational economic literature, we believe that disruptions of this nature are not likely to affect, in any quantifiable manner, participation levels among recreators in the Race. As such, businesses and sectors supporting area waterborne recreation and tourism are unlikely to be affected. (EIS 3-140,141,171,200,201,202-207)

FERC’S CONCLUSIONON RECREATIONAL USE

• The recreational activities described above contribute to the tourism industry of Long Island Sound. Because our assessment indicated that the impacts to recreation would be minor and temporary, we do not expect a measurable impact to the tourism industry.

(EIS 3-141)

MINOR IMPACT TO VESSELS IN RACE

• TIME OF THE IMPACT TO VESSELS ACCORDING TO SAFETY AREA:– 15 min for security zone to pass one point– 25 to 30 min to pass through the Race– For an anchored recreational boat or commercial

fishing boat, from the time to move the vessel and move back, the wait time is about 40 to 60 min.

– For commercial vessels traveling in that area, the wait time can be about 30 min.

(EIS 3-140)

TASK FORCE ISSUES

• 2006 Report:– Based upon a survey, the top three items that would

interfere with a boater from boating in Connecticut would be as follows:

• Swimming water quality (65%)• Congested waterways (63%) • Lack of facilities (53%)

– Those surveyed also sent additional comments regarding the LIS. Some of those comments were as follows: that there was not enough law enforcement (29%), facilities need to be addressed (17%) and access/congestion (16%). (TASK FORCE REPORT 34)

BROADWATER’S STUDY OF RECREATIONAL INTERFERENCE

• QUESTIONS TO TASK FORCE:– Is this an acceptable study?– Does the Task Force agree or disagree with

this baseline premise for which FERC launches its analysis to determine Broadwater impact?

– What, if anything, should the Task Force do?

EFFECT UPON LIS COMMERCE

Long Island Sound generates an estimated $5.5 billion a year to the local economy by supporting such activities as: commercial and recreational fishing; sightseeing; and ferry transport serving Connecticut, New York, and Rhode Island (EPA 2005d). Potential economic adverse impacts on commerce could result from disruption to commercial fisheries, disruption to recreational boating/fishing activity, and disruption to transportation. In addition, the proposed Project could benefit commerce and industry in the region by reducing the rate of increase in energy costs and by reducing the volatility of energy prices in the region.

(EIS 3-167)

FERC ADMITS ADVERSE

• The central and eastern portions of the Sound, including the area near the proposed location of the FSRU and the Race, are heavily used for lobster fishing. Commercial lobster fishing would be affected by both construction of the Project and the imposition of proposed safety and security zones around the FSRU and LNG carriers. This industry has realized below-average returns since a 1998 lobster die-off and has experienced an approximately 75-percent reduction in the number of participants since that time. Annual harvests have dropped from approximately 7 to 12 million pounds to less than 1 million pounds. Long Island Sound lobster landings currently are valued at about $5.1 million per year.

(EIS 3-168)

COMMERCIAL FISHING WILL BE AFFECTED

• Commercial lobster fishing would be affected by both construction of the Project and the imposition of proposed safety and security zones around the FSRU and LNG carriers. (EIS 3-168)

• Commercial Fishermen in the Race will be affected. (EIS 3-168-169)

• Trawling Lanes for fishing will be affected. (Special Use Areas)

• Ferry Service will be affected.

MINIMIZE IMPACT • MINIMIZE IMPACT:

– During construction:• Fishermen will be hired to work as spotters.• Some will receive outright compensation.

– Life of Project:• A 30 year compensation package (EIS 3-168-169)

• Any negative reductions to communities would be minor and individual fishermen would be compensated for financial impacts, including damage to equipment throughout the Project. Consequently, it is highly unlikely that the proposed Project would result in a measurable impact to the economies of local fishing communities

(EIS 3-169-170)• AT THE TIME OF EIS THIS COMPENSATION WAS NOT

WORKED OUT. NEITHER IS THE METHOD FOR FILING THE DAMAGE. (EIS 3-169)

FERRY SYSTEM

• Due to frequent ferry transits on some routes, a delay during one crossing could result in subsequent delays in other crossings. With the LNG carrier transiting from the Race to the FSRU during ferry operating hours in the busy season, there could be up to a 75-percent chance of a route conflict.

• The worst-case delay for an affected ferry would be 15 minutes. That 15-minute delay could cascade into subsequent ferry crossings, on all three ferry routes, throughout that day.

(EIS 3-207)

SPECIAL USE AREASTRAWLING AREA • A trawling lane for commercial fishing is located just north of the

proposed YMS location. A maximum of 12 trawlers would be affected.• Broadwater would reduce the economic impact on trawl fishermen by

providing compensation to the affected fishermen. • Therefore, the overall impact would be minor.

The CTDEP survey sampling:1) Finfish and lobster sampling within survey transects

established throughout the Sound, including within the trawling lane. 2) The Coast Guard may allow the agency to conduct sampling

within the fixed safety and security zone under proper procedures (THIS WAS OUR SUGGESTION WHICH FERC GAVE US CREDIT

FOR AND AGREED TO ACCEPT [EIS 3-200]).3) If sampling is not permitted in the safety and security zone, a

small number of potential transect locations would be eliminated from the pool of potential transect sites. Under these circumstances, the

agency would need to make minor statistical adjustments in its analysis before interpreting the longitudinal data set.

4) This would result in a minor, long-term impact on the State of Connecticut’s survey program. (EIS 3-141)

• In addition, the proposed YMS location is on the southern edge of a commercial trawling lane. Commercial fishermen who use fixed gear have informally set aside this lane and a second lane in Connecticut as areas within Long Island Sound where they do not used fixed gear (particularly lobster pots) to avoid conflicts with fishermen who trawl. However, only 2 to 12 fishermen use the trawl lane East of the Race. Trawling occurs in informally established trawling lanes and those lanes are surrounded by lobster pots set at varying densities.

FERC CONCLUSION ON COMMERCIAL IMPACT

• APPARENTLY, THERE IS AN IMPACT, SOME OF WHICH FERC WILL HAVE BROADWATER OFFSET BY COMPENSATION AND SOME OF WHICH THE INDUSTRY MAY HAVE TO ABSORB, SUCH AS THE IMPACT OF MOVING WHEN THE LNG CARRIER ENTERS THE RACE.

BROADWATER’S STUDY OF COMMERCIAL INTERFERENCE

• QUESTIONS TO TASK FORCE:– Is this an acceptable study?– Does the Task Force agree or disagree with

this baseline premise for which FERC launches its analysis to determine Broadwater impact?

– What, if anything, should the Task Force do?– Is compensation undefined at this time a

proper proposal?

PUBLIC TRUST DOCTRINE• The public trust doctrine is the principle that certain resources

are preserved for public use, and that the government is required to maintain it for the public's reasonable use. Or

• "The Public Trust Doctrine provides that public trust lands, waters, and living resources in a State are held by the State in trust for the benefit of all of the people, and establishes the right of the public to fully enjoy public trust lands, waters and living resources for a wide variety of recognized public uses".

• FERC AGREES:– LIS is an Estuary of National Significance.– A cooperating group of researchers, regulators, user groups, and

individuals is working toward implementing the Sound‘s comprehensive Conservation and Management Plan. Since its inception, over $80 million has been appropriated for nitrogen removal projects, sewage plant upgrades, non-point pollution control efforts, and habitat restoration. In 2004, in combination with several cooperating agencies and organizations, over $1 million dollars in grants were made available to implement projects consistent with the Plan.

• Many commentators expressed concern that the use of Long Island Sound proposed by Broadwater would violate the Public Trust Doctrine. This doctrine is not a promulgated law, but is essentially common law for the Sound. (EIS 3-157)

• We believe that implementation of the proposed Project with our recommended measures would meet the energy needs of the region with minimal impacts and would therefore be in the public interest. However, legal legal issues related to the Public Trust Doctrine are not a part issues related to the Public Trust Doctrine are not a part of our environmental review process and therefore have of our environmental review process and therefore have not been addressed in this final EIS.not been addressed in this final EIS. It is our understanding that NYSDOS and other New York agencies will address those issues. (EIS 3-157)

PUBLIC TRUST DOCTRINE ROLE

• FERC STATES:– “A final approval would be granted by FERC if, after

consideration of both environmental and non-environmental issues, it finds that the proposed Project is consistent with the public interest.”

(EIS ES-3)– FERC defines “The Public Interest” as meeting the

energy needs of the region with minimal impacts.– If you lack a discussion of the “Public Trust

Doctrine” - how can one determine the effect upon the “The Public Interest”?

TASK FORCE

• SHOULD THE COMMITTEE AGREE THAT THE ISSUE BELONGS TO NEW YORK STATE AGENCIES?

• SHOULD WE TAKE ISSUE WITH THE FERC ANALYSIS?

RELIABILITY AND SAFETY

• FERC SEPARATES THIS TOPIC AS FOLLOWS:– The principal properties and hazards associated with

LNG– Preliminary design and a technical review of the

cryogenic aspects of the LNG terminal– An analysis of the thermal radiation and flammable

vapor cloud hazards resulting from an LNG spill from the FSRU

– Transportation by ship– Emergency response and evacuation planning– Security awareness related to terrorism, and pipeline

reliability

FERC REPORT • RECOUNTS HISTORY OF LNG AND THE VARIOUS

LOW RATE OF INCIDENTS. (EIS 3-255)• RECOUNTS TESTS OF 1970’S AND A REPORT BY

SANDIA NATIONAL LABORATORIES IN 2004. (EIS3-258)

• THE REPORTS FERC EXAMINED:– The 2003 ABSG Consulting, Inc. (ABSG) study (FERC

2004b), Consequence Assessment Methods for Incidents Involving Releases from Liquefied Natural Gas Carriers;

– Sandia National Laboratories (Sandia 2004) titled Guidance on Risk Analysis and Safety Implications of a Large Liquefied Natural Gas (LNG) Spill over Water (Sandia Report).

– The Government Accounting Office (GAO) released a report in February 2007 Public Safety Consequences Of A Liquefied Natural Gas Spill Need Clarification (GAO 2007 [GAO Report]). (EIS 3-258)

LNG HAZARDS

• CONCLUSION REACHED BY FERC:– Consequently, the primary hazards to the public from

an LNG spill either on land or water would be from dispersion of the flammable vapors or from radiant heat generated by a pool fire.

(EIS 3-260)

The above is essentially based upon one study which is the Sandia 2004.

AS A RESULT, NO FURTHER STUDIES OR INCREASE IN SAFETY ZONE WAS REQUIRED BY FERC.

CODES AND STANDARDS• The Coast Guard developed Navigation and Inspection Circular (NVIC) 03-

05 Guidance for Oversight of Post-Licensing Activities Associated with Development of Deepwater Ports (Coast Guard 2005b) in order to provide guidance related to design, plan review, fabrication, installation, inspection, maintenance, and oversight of deepwater ports.

• Following this model, Broadwater formally nominated the American Bureau of Shipping (ABS) to fulfill the role of a certifying entity.

• The Interim Report by this Task Force in 2006 suggested that ABS have jurisdiction over the integrity of the vessel throughout its life. (p.28)

• FERC found:– Broadwater should engage and retain a qualified certifying entity

for an independent review of the codes and standards development, detailed design, fabrication, installation, and operation of the proposed FSRU for the life of the facility. Prior to approval of each phase of Project development as described above, a detailed project management plan should be filed with the Secretary, for review and written approval of the Director of OEP. At a minimum, this plan should be in accordance with the Coast Guard Navigation and Inspection Circular 03-05, Guidance for Oversight of Post- Licensing Activities Associated with Development of Deepwater Ports.

CODES AND STANDARDS

• FERC HAS MADE OVER 50 RECOMMENDATIONS OR CONDITIONS TO THE PROJECT. THESE ARE LISTED IN THE EIS REPORT 3-263 TO 3-266.

FSRU THERMAL AND VAPORDISPERSION MODELING

• FERC USED ONE REPORT TO CONCLUDE THAT THERE IS NO HARM TO THE PUBLIC:

Sandia National Laboratories (Sandia 2004) titled Guidance on Risk Analysis and Safety Implications of a Large Liquefied Natural Gas (LNG) Spill over Water (Sandia Report).

• During these experiments, all successful detonations were initiated with an explosive charge in well-mixed vapor clouds at correct …proportions. These are not representative of conditions which would be expected during a large-scale LNG spill. The precise timing, necessary mixing, and required amount of initiating explosives render the possibility for detonation of a large unconfined vapor cloud as unrealistic. Detonation of an unconfined natural gas cloud is extremely difficult to achieve and is generally considered by scientists and researchers to be very unlikely to occur during an LNG spill.

FERC LNG HAZARDS• REPORTS FERC LOOKED AT ARE THE SAME AS

DEIS WITH THE EXCEPTION OF:– The Government Accounting Office (GAO) released a

report in February 2007 (GAO 2007 [GAO Report]) presenting a survey of experts in areas related to LNG risk, hazards, and consequence modeling.(3-257) and the Congressional Research Service report dated April, 2005, entitled “Liquefied Natural Gas (LNG) Import Terminals: Siting, Safety and Regulation”, updated May 1, 2007 (“CRS”)

• FERC CONCLUDES:– In the GAO Report, the 19 LNG risk and

hazard experts unanimously agreed that RPT “would be very unlikely to have a direct effect on the public.” (EIS 3-284;3-276) The CRS was never mentioned in the EIS.

ESTABLISHMENT OF HAZARD ZONES

• In 2003, FERC commissioned a study by ABSG to search and review the literature on experimental LNG spills and on consequence methods that are applicable to modeling incidents of LNG spills on water. The methods described in the ABSG study (FERC 2004b), Consequence Assessment Methods for Incidents Involving Releases from Liquefied Natural Gas Carriers, and revised in FERC staff’s responses to comments on the report (issued June 18, 2004) were used to calculate thermal radiation distances related to a potential spill of 35,560 m3 for several hole sizes (ranging in diameter from 1 to 3.9 meters) for the Broadwater FSRU.

(EIS 3-274)

HAZARD ZONES

• Hazard Zone 1 – impacts on structures and organisms are expected to be significant within 750 yards (2,250 feet). The outer perimeter of Hazard Zone 1 is the distance to thermal hazards of 12,000 BTU/ft2-hr (37.5 kW/m2) from a pool fire.

• Hazard Zone 2 – impacts would be significant but reduced, and damages from radiant heat levels are expected to transition from severe to minimal between 750 yards and 2,100 yards (2,250 to 6,300 feet). The outer perimeter of Hazard Zone 2 is the distance to thermal hazards of 1,600 BTU/ft2-hr (5kW/m2) from a pool fire.

• Hazard Zone 3 – impacts on people and property from a pool fire or an unignited LNG spill that does not ignite are expected to be minimal between 2,100 yards (1.2 miles) and a conservative maximum distance of 4.7 miles. The outer perimeter of Hazard Zone 3 should be considered the vapor cloud dispersion distance to the lower flammable limit from a worst case unignited release. Impacts to people and property could be significant if the vapor cloud reaches an ignition source and burns back to the source.

(EIS 3-275)

HAZARD ZONES ASSOCIATED WITH THE PROPOSED ROUTESAs Determined by FERC:

• Neither Hazard Zone 1 nor Hazard Zone 2 would extend to land from the expected LNG transit route.

• Hazard Zone 3 could extend to land along some portions of the proposed transit route. the anticipated LNG carrier transit routes and associated thermal radiation hazard zones.

• Areas within 4.3 miles of the transit route:The northern tip of Block Island, Rhode Island;The southern tip of Weekapaug Point, Westerly, Rhode Island;The southern tip of Watch Hill, Rhode Island;Fishers Island, New York;Plum Island, New York;The northeastern-most third of the North Fork of eastern Long

Island, New York;A portion of Goshen Point straddling the City of New London,

Connecticut; andThe town of Waterford, Connecticut.

(The above information is summarized from the Coast Guard’s WSR, Section 3.2 LNG Carrier Route Analysis)

LNG CARRIERS• SAFETY ZONES:

– 2.3 MILES FRONT– 1.2 REAR– 750 YARDS EACH SIDE

• TOTAL SAFETY AREA FOR LNG:– 2,040 ACRES

• TIME TO PASS A SINGLE POINT:– 15 MIN.

• TIME TO PASS THROUGH THE RACE:– 25 TO 30 MIN.

• SAFETY ZONE AROUND TH FSRU:– 1,210 YARDS (.7 MILES) AROUND THE YMS

THE TWO REPORTS THAT MAY HAVE AN IMPACT

• Congressional Research Service report dated May 2005, updated May 2007, entitled “Liquefied Natural Gas (LNG) Import Terminals: Siting, Safety and Regulation” (“CRS ”)

AND• The Government Accounting Office (GAO)

released a report in February 2007, Public Safety Consequences Of A Liquefied Natural Gas Spill Need Clarification (GAO 2007)

CRS 2005 A few of the issues raised by that report are as follows:• 1) The CRS Report finds that pool fires, especially on the water, is the

most dangerous LNG hazard. • 2) In addition, the CRS Report, in reviewing the ABS Report finds:

– The ABS Consulting study released by FERC in May 2004, which reviewed existing LNG hazard models, concluded that: No release models are available that take into account the true structure of an LNG carrier.

– No pool spread models are available that account for wave action or currents.

– Relatively few experimental data are available for validation of models involving LNG spills on water, and there are no data available for spills as large as the spills considered in this study.” (CRS-19)

• 3) The CRS Report recognizes FERC’s position not to site LNG facilities for worst case scenarios in light of the lack of reliable models:– Notwithstanding limitations in current LNG hazard modeling

techniques, FERC has stated its intention to use the methods recommended by ABS to calculate vapor and thermal hazards for each LNG terminal application it reviews. In its Freeport LNG siting review, FERC acknowledged that “opportunity exists to refine assumptions and provide a more realistic assessment of the ‘worst case” hazards.” But the Commission also disagreed with the planning implications of “worst case” scenarios put forth by LNG terminal opponents. (CRS 19)

• 4) Moreover, it is abundantly clear from the CRS Report that additional studies are necessary to achieve the required safety regulations:

– The ABS report states, for example, that “additional research will need to be performed to develop more refined models, and additional large-scale spill tests would be useful for providing better data for validation of models.” (P.108) The Sandia study similarly concludes that “obtaining experimental data for large LNG spills over water would provide needed validation and help reduce modeling uncertainty.”(P.109) Physical testing (as opposed to computer simulations) of impacts and explosions on LNG tanker hulls by the USCG could also fill important gaps in engineering knowledge about potential effects of terrorist attacks.

• 5) CRS Report:– But LNG hazards models simulate complex physical phenomena and are inherently

uncertain, relying on calculations and input assumptions about which fair-minded analysts may legitimately disagree. Even small differences in an LNG hazard models have led to significantly different conclusions.

• 6) The CRS Report recognizes FERC’s responsibility to protect the citizens and residents of the United States. This balancing test is spelled out in the CRS:

– A key question for Congress, with respect to the siting of new LNG terminals, is whether the regulation of these terminals appropriately balances the risk to public safety with the need for new natural gas supplies. On one hand, some may view current federal LNG siting requirements and processes as sufficient. Holders of this view would continue to rely on the judgment of LNG experts in federal agencies and standards committees to appropriately balance public safety with public needs. While there have been some concerns about regulatory jurisdiction, marine safety and hazard models, some may believe that the responsible government agencies are actively and cooperatively addressing these concerns. On the other hand, policy makers may believe that some aspects of new LNG terminals do pose excessive public risks, or that there is still too much uncertainty about key risks to make final conclusions about public safety. (CRS 2005 p.22)

SUMMARY OF CRS REPORT

• Because such studies rely upon engineering models, however, with distinct input assumptions and methodological limitations, their projections are only approximate. Substantial uncertainty remains about impact of an LNG incident.

CONCLUSION TASK FORCE REACHED • The CRS Report is critical to the evaluation of the safety

and security of the Broadwater Project and is critical to point out there are no known studies of a large LNG spill on open waters. Many of the concerns raised by the CRS Report are issues which FERC takes for granted as being resolved. FERC should require extensive studies by the Broadwater Project to determine all unresolved issues regarding the impact of a LNG spill in open waters. The consequences of a large LNG spill in open waters are an unknown. As a result, any discussion in the DEIS about safety and security zones are not based upon proven scientific evidence but on conjecture and the need to approve energy projects. As a result, the federal mandate on FERC to protect the public interest cannot be guaranteed when the consequences of a large LNG spill on water is not known. Therefore, Connecticut residents are not being fully protected. (Task Force 2007 p.14)

TASK FORCE CONCLUSION OF CRS

• The CRS Report finds that the full extent of the consequences of a spill in the waters of the Long Island Sound are not known. This fact cannot be anymore clear in the CRS report and cannot be anymore important than with the Broadwater Project. Therefore, FERC must use caution when it analyzes this project and claims to provide adequate safety and security zones. (Task Force 2007 p.14)

GAO REPORT OF 2007• THIS REPORT CAME OUT AFTER TASK FORCE DID

THEIR REPORT.• ESSENCE OF REPORT:

GAO’s panel of experts generally agreed on the public safety impact of an LNG spill caused by a terrorist attack, disagreed on specific conclusions of the Sandia study, and suggested future research priorities. Experts agreed that the most likely public safety impact of an LNG spill is the heat impact of a fire and that explosions are not likely to occur unless LNG vapors are in confined spaces. However, the experts did not all agree with the heat hazard and cascading failure conclusions reached by the Sandia study. Finally, they suggested priorities to guide future research aimed at clarifying uncertainties about heat impact distances and cascading failure. DOE’s recently funded study involving large-scale LNG fire experiments addresses only some of the research priorities the expert panel identified. (GAO Intro)

• Experts agreed on three main points:(1) the most likely public safety impact of an

LNG spill is the heat impact of a fire;

(2) explosions are not likely to occur in the wake of an LNG spill unless the LNG vapors are in confined spaces; and

(3) some hazards, such as freeze burns and asphyxiation, do not pose a hazard to the public.

(GAO p.2)

19 EXPERTS AGREED

DISAGREED ON

• However, the experts disagreed with a few conclusions reached by the Sandia study that the Coast Guard used to assess the suitability of waterways for LNG tankers. Specifically, all experts did not agree on:– The study’s 1-mile estimate of heat impact distance resulting from an

LNG fire: 7 of 15 thought Sandia’s distance was “about right,” 8 were evenly split on whether the distance was “too conservative” or “not conservative enough,” and 4 did not answer this question.

– The Sandia National Laboratories’ conclusion that only three of the five LNG tanks on a tanker would be involved in a cascading failure.

– Finally, experts suggested priorities to guide future research aimed at clarifying uncertainties about heat impact distances and cascading failure, including large-scale fire experiments, large-scale LNG spill experiments on water, the potential for cascading failure of multiple LNG tanks, and improved modeling techniques. DOE’s recently funded study involving large-scale LNG fire experiments addresses some, but not all, of the research priorities the expert panel identified. (GAO p.2)

IMPORTANT CONCERNS RAISED BY THE GAO REPORT

• Access to accurate information about the consequences of LNG spills is crucial for developing accurate risk assessments for LNG siting decisions. While an underestimation of the consequences could expose the public to additional risk in the event of an LNG spill, an overestimation of consequences could result in the use of inappropriate and costly risk litigation strategies. (GAO REPORT P.10)

• Specifically, the studies’ conclusions about the distance at which 30 seconds of exposure to the heat could burn people ranged from about 500 meters (less than 1/3 of a mile) to more than 2,000 meters (about 1-1/4 miles). The Sandia National Laboratories’ study concluded that the most likely distance for a burn is about 1,600 meters (1 mile). These variations occurred because researchers had to make numerous modeling assumptions to scale-up the existing experimental data for large LNG spills since there are no large spill data from actual events.

• Experts agreed that (1) the most likely public safety impact of an LNG spill is the heat impact of a fire; (2) explosions are not likely to occur in the wake of an LNG spill, unless the LNG vapors are in confined spaces; and (3) some hazards, such as freeze burns and asphyxiation, do not pose a hazard to the public.

FERC’S RESPONSE TO CASCADING• Cascading damage due to brittle fracture from exposure to

cryogenic liquid or fire-induced damage to foam insulation was evaluated in the Sandia Report for LNG carriers. Although such damage would be possible under certain conditions, it would not likely involve more than two or three cargo tanks. This analysis would apply to the FSRU as well. Cascading events are not expected to increase the overall fire hazard by more than 20 to 30 percent (2,520 to 2,730 yards [7,560 to 8,190 feet]) but would increase the expected fire duration. (EIS 3-276)

• FERC never addresses the concerns raised by the GAO Report or the CRS Report on the issue of cascading or the effect of the cascading on the various models. As is indicated in the GAO Report, particular attention should be given to cascading failure.

CONCLUSION OF THE GAO REPORT• These assessments create uncertainty for regulators and the public.

Additional research to resolve some key areas of uncertainty could benefit federal agencies responsible for making informed decisions when approving LNG terminals and protecting existing terminals and tankers, as well as providing reliable information to citizens concerned about public safety.

• To provide the most comprehensive and accurate information for assessing the public safety risks posed by tankers transiting to proposed LNG facilities, we recommended that the Secretary of Energy ensure that DOE incorporates the key issues the expert panel identified, particularly the potential for cascading failure, into its current LNG study.

• DOE concurred with our recommendation.• The experts also suggested priorities for future research—some of which

are not fully addressed in DOE’s ongoing LNG research—to clarify uncertainties about heat impact distances and cascading failure. These priorities include large-scale fire experiments, large-scale LNG spill experiments on water, the potential for cascading failure of multiple LNG tanks, and improved modeling techniques.

(GAO p. 6)

FERC’S RESPONSE

• NEVER MENTIONS THE CRS REPORTS• THE RESPONSE TO GAO REPORTS:

– Subsequent to the release of the draft EIS, the U.S. Government Accountability Office (GAO) released a report in February 2007 (GAO 2007) presenting a survey of experts in areas related to LNG risk, hazards, and consequence modeling. While the experts did recommend that testing be considered, they agreed that the primary hazard to the public would be heat from a fire. Eleven of 15 experts considered the current methods for estimating LNG fire heat hazard distances to be “about right” or too conservative. (EIS 3-276)

EMERGENCY RESPONSE PLAN (ERP)

• TASK FORCE RAISED THE FOLLOWING ISSUES:

– Connecticut, Rhode Island and New York should all be a part of any ERP.

– The details of the ERP should include:• Cost sharing issues• Jurisdictional issues

FERC RESPONSE TO ERP• ERP - with state and local agencies (does

not specify Connecticut or any State for that matter)

• FERC needs to detail the ERP• Requires a Cost Sharing Plan to the

benefit of state and local agencies (Conn. not specifically mentioned)

• Recognizes the need for a “memorandum of understanding” regarding enforcement issues

(EIS 3-299)

LNG SAFETY ITEMS THAT FERC STATES ARE STILL UNKNOWN

• Number of tugs to escort, berthing and unberthing the LNG (3-204)

• Number of tugs to escort LNG through the Race and Eastern Block Island

• Emergency Response Plan - with state and local co-ordination

ALTERNATIVES

• FERC ANALYSIS BASED UPON THREE CRITERIA:– Be technically feasible and practical;– Offer significant environmental advantage

over the proposed Project or its components; and

– Meet the objectives of the proposed Project, as described above.

ENERGY OBJECTIVES

• Add diversity to the region’s energy portfolio.• Would increase the volume of natural gas available in the region.• These factors could combine to reduce both price and price volatility that

would occur without the Project. These changes could result in conditions that would be conducive to continued economic growth and regional productivity, which would result in a minor, positive effect on the regional economy that would last for the life of the Project. A report prepared for LIPA (Levitan & Associates 2007) forecasted natural gas supply and demand in the state of New York from 2010 through 2020. These projections were used to estimate potential economic benefits associated with the proposed Broadwater Project that might accrue in New York State. Direct benefits to gas utility customers were estimated to be $4.6 billion, of which 41 percent would be realized by New York City users, 17 percent by Long Island users, and 42 percent by those outside the two regions. Direct benefits to electric utilities were estimated to be $10.2 billion, with New York City realizing 43 percent, Long Island users 19 percent, and those outside the two regions 38 percent.

• No direct analysis of Connecticut

SYSTEM ALTERNATIVES• System alternatives:

– To make use of other existing or proposed LNG or natural gas facilities to meet the stated purpose of the proposed Project.

– Unnecessary to construct all or part of the proposed Project, although some modifications or additions to the existing or proposed facilities may be necessary, could be avoided or reduced while still meeting the Project objectives (EIS 4-7)

• FERC - We considered three basic types of system alternatives in our analysis:

• Expansion of existing or planned natural gas pipeline systems (Section 4.3.1);

• Expansion of existing LNG terminals or construction of new LNG terminals to serve the region (Section 4.3.2); and

• Combinations of existing, proposed, approved, or planned pipelines and LNG terminals with alternative energy projects (Section 4.3.3).

EXISTING PIPELINES

• Algonquin Pipeline System– To supply an additional 1.0 bcfd of natural gas to the market that Broadwater proposes to

serve, the Algonquin system would require significant modification and expansion. These system upgrades would not meet the objective of providing additional integrated storage facilities without major modifications and the associated environmental impacts

• Texas Eastern Pipeline System– The latter would require construction in both the near shore and offshore

environments. Impacts associated with these actions would be greater than those of the proposed Project. Further, the objectives of providing enhanced reliability through diversification of fuel sources and additional integrated storage facilities could not be met without major modifications and the associated environmental impacts.

• Columbia Gas Transmission System– Being incorporated into Northeast-07 and Millennium Pipeline

• Tennessee Pipeline System– These upgrades would be similar to those described for Algonquin and would

result in environmental impacts that would be greater than those anticipated for the Broadwater Project. Further, the purpose of the proposed Broadwater Project to provide enhanced reliability through diversification of fuel sources and additional integrated storage facilities could not be met without major modifications and the associated environmental impacts.

IROQUOIS GAS TRANSMISSION SYSTEM• IGTS is constrained in its ability to supply the additional gas

required to meet the projected increase in demand for natural gas in New York City and on Long Island.

• Long Island and New York City are near the terminus of the IGTS system, and delivery of that volume of gas would require substantial pipeline system upgrades if additional gas is to be provided upstream of Long Island Sound.

• Although the upgrades likely would be smaller than those required for Algonquin and the other systems described above, the upgrades would include increasing the pipeline capacity across Long Island Sound. This would require construction in both the nearshore and offshore environments. As a result, the environmental impacts of implementation of the upgrades would exceed the anticipated environmental impacts of the Broadwater Project. Further, the objectives of providing enhanced reliability through diversification of fuel sources and additional integrated storage facilities could not be met without major modifications to existing and proposed LNG terminals and the associated environmental impacts.

PROPOSED,RECENTLY APPROVED, PLANNED, UNDER CONSTR.

• Northeast-07 Project– Approved in 2006 will provide .3bcf to New York

• Millennium Pipeline– Will serve New York with .5bcf – The target region of the proposed Broadwater Project essentially would require doubling the

capacity of the Millennium Project and could result in more than 4,500 acres of land use impacts, such as those listed for the Algonquin system.

• MarketAccess Project– The MarketAccess Project is a component of the Northeast-07 Project which includes

construction of a new compressor station and natural gas cooling facilities in Brookfield.– The MarketAccess Project does not involve pipeline construction but consists primarily of

adding compression to the existing IGTS pipeline system.• Empire Connector Project

– Project is a component of the Northeast-07 Project that will contribute about 0.25 bcfd of the proposed transmission capacity of the proposed Millennium Project (FERC 2006).

• Ramapo Expansion Project– Providing additional natural gas to the New York City and Long Island markets

would require (1) construction of a new pipeline crossing the Hudson River; or (2) expansion of existing or proposed pipeline crossings of Long Island Sound, or a new pipeline crossing of the Sound. The latter would require construction in both the nearshore and offshore environments. In addition, this project would not meet the Broadwater Project objectives of providing a new source of enhanced reliability through diversification of fuel sources and additional integrated natural gas storage facilities.

• Islander East Pipeline Project– As described for Algonquin, construction and operation of these

upgrades would result in environmental impacts in excess of those associated with the proposed Project. The approximately 50 miles of new pipeline would impact more than 600 acres of existing land use (including extensive construction in nearshore and offshore waters of Long Island Sound). In addition, this project would not meet the Broadwater Project objectives of providing enhanced reliability through diversification of fuel sources and additional integrated natural gas storage facilities.

• Tennessee Pipeline Projects– Implementation of system upgrades would result in impacts that

would be greater than those of the proposed Project. In addition, this project would not meet the Broadwater Project objectives of providing enhanced reliability through diversification of fuel sources and additional integrated natural gas storage facilities.

• Sentinel Expansion Project Dominion Hub Project– Required upgrades would impact environmental areas, including

the need to construct a new pipeline crossing the Hudson River and/or expand the existing Transco pipeline that terminates near the southeastern corner of Long Island. These improvements would require construction in both the nearshore and offshore environments. In addition, this project would not meet the Broadwater Project objectives of providing enhanced reliability through diversification of fuel sources and additional integrated natural gas storage facilities.

• IGTS 08/09 Expansion Project– This project could relieve a portion of the natural gas demand in

Connecticut that would be met by the Broadwater Project. However, the project could not supply additional natural gas to the New York City and Long Island markets without substantially improving both capacity and compression for the portion of the IGTS pipeline that crosses Long Island Sound.

• Algonquin East to West HubLine Expansion– While this project would provide additional natural gas from

new sources to markets in Connecticut, the East to West HubLine Expansion Project would not address existing bottlenecks in transporting natural gas from the northeastern United States and Canada to the New York City and Long Island markets. Providing additional natural gas from Connecticut, New Jersey, or mainland portions of New York State to Long Island and New York City markets would require construction of a new pipeline across the East River; or construction of a new pipeline or expansion of an existing or proposed pipeline across Long Island Sound. Therefore, the transport of gas provided by the East to West HubLine Expansion Project to the New York City and Long Island markets would require construction in both the nearshore and offshore environments. In addition, this project would not meet the Broadwater Project objective of providing additional integrated natural gas storage facilities.

LNG PROJECTS ASSESSED

• There are a number of LNG projects and with exception of Safe Harbor Energy Project, the distance to the proposed markets to be served is between 113 miles and 648 miles. (EIS 4-18)

• Each of these LNG facilities would require improvements to the existing pipeline systems which was discussed earlier and there would still be a need to effect the LIS.

• Safe Harbor Energy Project would require installing a pipe in the Atlantic Ocean waters.

• Use of any of the existing or proposed LNG terminals as a system alternative would include impacts associated with expanding the LNG terminals themselves (potentially adding new berths, tanks, and vaporization equipment); installing replacement pipe, looping, or a new pipeline at the facility; and adding new compressor stations or upgrading existing compressor stations. The environmental impacts associated with those infrastructure improvements would also be greater than the impacts associated with construction and operation of the proposed Project.

SAFE HARBOR ENERGY PROJECT• The Safe Harbor Energy Project would serve some of the same markets as

the proposed Broadwater Project.

• The Safe Harbor Energy Project would result in substantially greater impact to the seafloor compared to the proposed Broadwater Project.

• The Safe Harbor Energy Project would meet the purposes of the proposed Broadwater Project of providing enhanced reliability through diversification of fuel sources and integrated natural gas storage facilities.

• Although the Safe Harbor Energy Project would allow some natural gas to reach the New York City market through the Transco system, this system would need to be substantially upgraded to provide comparable volumes of gas to the New York City and Connecticut markets.

• Consequently, the environmental impacts associated with the Safe Harbor Energy Project would be greater than those of the proposed Broadwater Project.

(EIS 4-25)

NATURAL GAS TO CONNECTICUT

• FERC:– If several of those projects were to provide a

portion of the required volume of gas, it is possible that only minimal infrastructure improvements would be required to transport the gas to the existing interstate pipeline systems in Connecticut. However, additional infrastructure improvements would be necessary to transport the gas from Connecticut to Long Island and New York City

(EIS 4-27)

GAS FROM CONNECTICUT TO LONG ISLAND

• To transport the 0.6 to 0.7 bcfd of natural gas from the interstate pipeline systems in Connecticut to Long Island and New York City, the IGTS pipeline would require major modifications to increase its capacity. The modifications would include constructing a pipeline loop or a new pipeline and adding onshore compression. This would likely require construction of either new or looped pipeline across much of Long Island Sound, including construction through shoreline areas and the sensitive nearshore marine environment. The impacts associated with construction in those areas would be greater than the construction impacts of the proposed Broadwater pipeline. (EIS 4-27)

NATURAL GAS DEMANDS• NEW YORK AND NEW ENGLAND – END OF THE

PIPELINE• DEMAND IS INCREASEING.• THERE IS A PROBLEM GETTING NATURAL GAS TO

THE ABOVE MENTIONED AREA.• NEW YORK IS THE BIGGEST PROBLEM.

– IGTS CAN ONLY SUPPLY 580 MILLION CFD TO NEW YORK CITY AND LONG ISLAND AND IN 2005 THE AVERAGE WAS 380 MILLION CFD

– THEREFORE, EXPECTED INCREASE IN NEW YORK CITY AND LONG ISLAND CANNOT BE HANDLED BYTHE EXISTING IGTS.

• CLEARLY GETTING NATURAL GAS TO NEW YORK CITY AND LONG ISLAND IS THE DRIVING FORCE FOR THE LNG PROJECT. (PAGE 1-13)

CANAPORT LNG

• The Task Force along with Synapse Energy Economics Inc., suggested Canaport was a viable alternative. FERC’S response:– Gas from Canaport not consumed in Canada and New England

potentially could be transported to other markets in the northeastern United States through existing interconnections between the Maritimes & Northeast pipeline and the Tennessee and Algonquin pipelines.

– To provide natural gas to the New York City and Long Island market area through the Algonquin and Tennessee systems would require upgrades along the pipeline routes.

– To transport significantly more natural gas through the IGTS pipeline from Connecticut south to Long Island and New York City, the IGTS pipeline would need to be modified to increase its transport volume. This would require construction of a new pipeline or pipeline loop (with its associated impacts to the seafloor of the Sound), and would involve construction through the sensitive nearshore marine environment.

FERC’S POSITION VS. TASK FORCECANAPORT

• CANADIAN MARITIMES AND OTHER NEW ENGLAND PIPELINES WOULD RESULT IN MORE NATURL GAS TO CONNECTICUT, BY THIS GAS REMAINING IN CONNECTICUT.

• However, there would not enough natural gas through the IGTS pipeline to supply to New York City and Long Island. (1-19)

• The current interstate pipeline constraints - none of the proposed expansions or new terminal proposals can fully meet the demands of the market in the Long Island, New York City, and Southern Connecticut. (1-21)

• Admit that .7 bcfd of natural gas from Canaport , BUT

• To reach Broadwater market there is a need to expand certain pipelines (4-22) which plans have been announced AND TO REACH NEW YORK CITY AND LONG ISLAND more significant construction would be required. (4-22)

The Task Force believes Canaport is a viable alternative to the Broadwater Project for a number of reasons. First, most of the infrastructure is already in place; and second the small amounts of the improvements requested by Canaport have little or virtually no opposition or environmental impact. Second, and most important, Canaport will be transmitting natural gas in the northeast by 2008, whereas the Broadwater Project will not be available until at least 2012, at the earliest.

There seems to be some uncertainty in this area about the effect of Canaport on natural gas in this region and if Canaport operators believe they can supply the natural gas.

The findings by FERC may be in conflict with the letter FERC received from Canaport and FERC failed to shed any light on the issue other than speculation rather than investigation.

FERC’S POSITION VS. TASK FORCENEPTUNE

• NEPTUNE DEEP WATER PORT– FERC did examine Neptune

– FERC may have included the analysis in its general disregard for any ability to move natural gas from the north to the south.

• NEPTUNE DEEP WATER PORT– Task Force pointed

out FERC’s failure to examine the issues.

FERC FAILED TO ADDRESS

• The Task Force does recognize that FERC’s report, on the energy issues, failed to address the issue of the ability of electric generation companies’ power to sell off their gas reserves in raising gas market place in order to achieve a significant profit. This “corporate market speculation” by generation facilities clearly results in the decrease of natural gas being available to this region resulting in driving the price of natural gas upward thereby increasing the overall cost of energy. There are regulatory actions required by FERC to alleviate this problem.

• Clean burning coal• Lack of Coast Guard funds or equipment to perform the

security function

SUMMARY

• Construction and operation of the proposed Project would have a minimal impact on geologic resources in the area, and the potential for geologic hazards or other natural events to significantly impact the Project would be low.

• The 2 mi. conversion fill around the YMS will be permanent and would likely result in adverse impacts to some biological resources (such as benthic organisms) and benefit other organisms (such as some bivalves and crabs).

• The temperature of the discharged water from the FSRU would be comparable to ambient conditions because most of the water volume taken in would be used as ballast. The frequency, rate, volume, and chlorine concentrations of the FSRU discharges would be monitored according to SPDES Permit requirements to minimize potential impacts to ambient water quality.

• Modeling indicated that the average distance at which discharged water would be cooled to within 1.5°F of ambient temperature would be about 75 feet. These discharges would cause a minimal, localized impact on water quality conditions; however, impacts would last for the life of the proposed Project.

SUMMARY• Impacts to recreational vessels transiting the Race would be minimized, but would

occur periodically as long as the authorized activities continue.• The effect of LNG carrier transit on regattas would be minor and occasional but would

occur for the life of the Project.• Broadwater would not appreciably affect dissolved oxygen levels, increase pathogen

contamination, generate floating debris, or result in a net degradation of habitat.• The Project would result in shorter trawl distances east and west of the safety and

security zone.• Trawlers and fishermen located along the LNG carrier route could experience gear

damage or use conflicts.• Interference in DEP survey would result in a minor long-term impact to the State of

Connecticut’s survey program.• Impact is not expected to change the public value of the viewshed or alter the value

of shorefront property or recreation.• Potential impacts of LNG carrier traffic to ferry operations would continue for the life

of the Project, but would be minor.

FERC RECOMMENDATIONS

• There are 86 FERC recommendations for the Broadwater Project.

FERC RECOMMENDATIONS

• Broadwater undertake appropriate geotechnical investigations and analyses to determine the potential for seismic soil liquefaction beneath the proposed YMS, and identify any appropriate mitigation measures to avoid or minimize potential impacts

• Broadwater use mid-line buoys on all anchor cables of construction vessels to avoid and minimize potential impacts to the seafloor by reducing the seafloor disturbance associated with the anchor cale sweep from Broadwater’s estimate of 2,020 acres to an expected 61.7 acres

• The potential use of a dynamically positioned vessel instead of an anchored lay barge, which would completely eliminate seafloor disturbance associated with anchoring and cable sweep

• Broadwater develop plans in coordination with appropriate federal and state resource agencies to actively backfill the entire length of the pipeline trench and to conduct post-construction monitoring

• Broadwater to develop plans to backfill this portion of the pipeline in a manner that limits the permanent conversion of the surface substrate type. The long-term or permanent impact to sediment during construction would be reduced to a total of approximately 1.4 acres of softbottom sediment to hard substrate, including concrete (utility crossings), and metal (YMS footings).

FERC RECOMMENDATIONS• Broadwater provide a detailed contingency plan that identifies the specific alternative

construction method, potential impacts, and mitigation measures that would be implemented to avoid and minimize potential impacts associated with pipeline installation across Stratford Shoal in the event that the proposed subsea plow is unable to excavate the trench. Further, if Broadwater pursues contingency dredging methods across Stratford Shoal, we recommend that Broadwater coordinate with EPA and COE to determine a suitable disposal site for dredge spoil.

• Broadwater use a silicon-based anti-fouling paint on the FSRU• Broadwater develop an offshore SPCC Plan to minimize the likelihood of a spill as

well as to minimize environmental impacts in the event that a spill were to occur during construction or operation of the Proposed Project

• Broadwater to coordinate with NMFS and FWS to develop a detailed lighting plan that would be protective of avian species, fish species, and marine mammals

• Overall, impacts to marine biological resources from construction and operation of the proposed Project would not be expected to be significant. Construction impacts would be minor and generally temporary, although seafloor substrate conversion would be permanent. Operational impacts would be minor, but would continue throughout the life of the proposed Project. Impacts to biological resources associated with the onshore facility would be negligible since the onshore facility would consist of the continued use of an existing dock, warehouse, and office space.

FERC RECOMMENDATIONS• Broadwater file the final compensation agreement that they develop with lobster and

trawl fishermen.– Moderate, long-term impact to the fishing efforts of the commercial trawlers affected by the

existence of the proposed fixed safety and security zone.

• Broadwater file its final plan for the color scheme for the FSRU and YMS for review and approval prior to construction.

• Broadwater file the NYSDOS consistency determination prior to installation activities in Long Island Sound.

• The tug and other support vessel departures and returns during operation would be consistent with existing vessel traffic, therefore the impact to marine transportation at these ports is considered minor but would last for the duration of the Project.

• Onshore traffic during operation, at either the Greenport or the Port Jefferson waterfront sites, would be minor and would continue for the life of the Project.

• SO2 from combined facility and FSRU emissions with the LNG carriers using 4.5 percent sulfur fuel. Based upon this analysis, we are recommending that Broadwater develop a plan to limit the sulfur content of the fuel to a 2.7 percent annual rolling average as well as a 3.2 percent maximum. This mitigation should minimize the SO2 and PM2.5 impacts from the facility.

ONE LAST ITEM

MARITIME SECURITY:

FEDERAL EFFORTS TO ADDRESS CHALLENGES IN PREVENTING AND

RESPONDING TO TERRORIST ATTACKS ON ENERGY COMMODITY TANKERS

GAO DECEMBER 2007 (“GAO 2007”)

GAO-08-141

GAO 2007• The global LNG fleet is expected to double from 200 in 2006 to over 400 by

2010. (p.14)• Successful attack on an energy commodity tanker could have substantial

public safety, environmental, and economic consequences. Public safety and environmental consequences vary by commodity. LNG and LPG are highly combustible and pose a risk to public safety of fire and explosions, but their environmental impact would be minimal since they dissipate in a short period of time. (p. 29)

• Economic consequences of an attack could be substantial, not so much because of the loss of a tanker or its cargo, but because of the greater shock to the economy, particularly if major transit routes, key facilities, or ports are closed. Price spikes that reflect fears or expectations about the price and supply of energy commodities could also be significant. (p. 29)

• An attack on a key port in the northeastern United States, such as Boston, could result in energy commodity shortages or price spikes. (p. 34)

LIMITED RESOURCES• The Coast Guard’s primary challenge is utilizing its limited

resources to meet its security workload.(p. 42)• Coast Guard field units at some ports have not always been able to

meet their maritime security activity requirements. Moreover, the Coast Guard’s resource demands are expected to grow as more facilities for importing LNG come on line, increasing the number of shipments requiring Coast Guard protection. (p. 42)

• Two energy commodities, LNG and LPG, are on the list of what the Coast Guard has traditionally called Certain Dangerous Cargo (CDC). (The Coast Guard developed a subset list of the CDC commodities—called Especially Hazardous Cargo— that it determined as posing the greatest safety and security risks. This list included both LNG and LPG, meaning that the activities required to protect them remain unchanged). (p. 43,47)

• According to senior Coast Guard field officials with LNG security responsibilities, LNG tanker transits have received the greatest attention of the two, due in large part to the much greater size of LNG tankers, the amount of hazardous cargo they are carrying, and the public perception of the danger of LNG shipments. (p. 44)

• Several field units plan to rely on state and local agencies to conduct a considerable share of the new LNG workloads. (p. 51)

• Despite considerable efforts to protect ports and the energy traffic in them, the level of protection is not where the Coast Guard believes it should be. (p. 77)

• Finally, DHS has just begun to focus more on providing funding for response resources through the Port Security Grant program. However, DHS cannot be assured that it will appropriately target funding to the projects that most reduce overall risk because it has not developed quantitative performance measures.

• The Report list some 5 recommendations to help protect the LNG tankers.

ALTHOUGH THIS REPORT CAME OUT AFTER THE FERC EIS, CERTAINLY THIS ISSUE COULD HAVE BEEN MORE FULLY ADDRESSED IN THE REPORT AND IT WAS NOT.