The Perception of Insecurity
January 1, 2007
Dennis L. Bryant- New York
Introduction
The cover article in the December 4, 2006 issue of Time magazine was entitled “Why We Worry about the Wrong Things.” The article explained that humans commonly miscalculate risk due to what is called probability neglect. When we dread something, we tend to greatly exaggerate its risk. For example, there is in the United States a great dread of AIDS. The idea of a heart attack is less fearful, and yet heart disease is by far a greater risk factor. In 2003, 685,089 Americans died of heart disease, while 13,658 died of AIDS/HIV. West Nile virus is another disease that causes anxiety, but only 264 deaths in the United States have been attributed to that mosquito-borne illness. Newspapers carry stories regarding the dangers of avian flu and mad cow disease, but no one in the United States has contracted these diseases.
Probability neglect is equally prevalent with regard to accidental injury or death. Flying as a passenger on a commercial airline in the United States is one of the safest methods of travel. Driving or riding in an automobile is one of the most dangerous. In 2003, there were 44,757 deaths from motor vehicle accidents, while only 22 people were killed commercial airline accidents. Between October and December 2001, Americans largely avoided airlines for fear of a repetition of the horrific terrorist attacks of September 11. Instead, they tended to drive. During those three months, traffic deaths in the United States rose by more than 1,000 over the same three months the previous year.
In 2003, there were 11,212 deaths in the United States from drug overdose; 594 from falling out of bed; 332 from drowning in the bathtub; 66 from bee or wasp stings; 47 from lightning; 22 from being crushed in a human stampede; 3 from playground equipment accidents; and 1 from shark attack.[1] As everyone here knows, there were no deaths in the United States during 2003 related to liquefied natural gas (LNG). And yet, fear of LNG facilities is a common condition, particularly in the northeastern states and in California. Californians don’t seem to fear anything except LNG facilities!
President Franklin Delano Roosevelt said it best when, in his 1933 inaugural address, he stated: So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself – nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.
Perception
Numerous studies have been undertaken of the safety and security issues inherent in the marine transportation of liquefied natural gas. The best known of these studies is the Sandia Report.[2] Rather than original research and experimentation, this report consisted of: (1) an in-depth literature search of evaluations of the safety and hazards of an LNG spill from an LNG carrier: (2) a detailed review of four specific spill modeling studies; (3) an evaluation of the potential for breaching an LNG carrier cargo tank, both accidentally and intentionally; and (4) development of guidance on a risk-based approach to analyze and manage the threats, hazards, and consequences of an LNG spill over water to reduce the overall risks to levels that are protective of public safety and property.[3] Given all the material available for consideration, it is unclear how the US Department of Energy and the prestigious Sandia National Laboratories selected these particular reports. One of the reports was authored by an individual who is publicly opposed to LNG development, particularly onshore.[4] Another report was generated at the direction of a community in California concerned about an LNG project that had been proposed in its vicinity.[5] The third report focuses on conditions at a particular location and may not be fully applicable elsewhere.[6] The fourth report was never finalized and is not readily available for public review.[7]
The Congressional Research Service (CRS) is an arm of the United States Congress. It mission is to provide Congress with comprehensive and reliable analysis, information, and research services that are timely, objective, nonpartisan, and confidential, thereby contributing to an informed national legislature.[8] The CRS has produced at least four separate reports in recent years on LNG issues.[9] Each of these studies regularly raises safety issues and cites the hazardous nature of LNG.[10] A recent CRS report on the increasing imports of gasoline into the United States, though, never once uses the words “safety” or “hazardous”.[11] While it is unlikely that the CRS has an inherent bias against LNG, it does appear that it has fallen into the common misperception that LNG is inherently dangerous, while other fuels, such as gasoline, are not.
Background
The United States has a moderate but growing appetite for imported natural gas. The United States also has the most robust maritime security program in the world. The intersection of these two developments makes life complex for LNG carriers and for the LNG import facilities in the United States to which they make deliveries.
The Energy Information Administration (EIA) projects North American demand for natural gas to increase at an average annual rate of 1.1% through 2030. While LNG imports currently only provide about 2% of the nation’s natural gas supply, that share is expected to grow to as much as 21% by 2030, as US and Canadian supplies become depleted. By 2030, the demand for regasified LNG is projected to be about 16.164 Bcf/d.[12]
In the United States, there are five operational onshore marine LNG import terminals (Lake Charles, LA; Everett, MA; Cove Point, MD, Elba Island, SC; and Peñuelas, Puerto Rico) and one LNG deepwater port [DWP] (Gulf Gateway located in the Gulf of Mexico). These operational facilities have a total regasification capacity of 5.235 Bcf/d. There is also one marine LNG export terminal (Kenai Peninsula, Alaska). Approvals have been granted for construction of twelve new shoreside LNG import terminals, the expansion of two existing terminals, and construction of two more LNG DWPs. Foreign LNG terminals that may provide supplies to the United States are planned in Canada, Mexico, and the Bahamas. A number of applications for additional LNG facilities and DWPs are undergoing consideration by federal agencies. No one expects all of these proposed facilities to actually be constructed, but it is certain that in the not too distant future there will be significantly greater LNG import capability in the United States than exists today.
History
Natural gas, in its common commercial form, is a fossil fuel derived from organic material buried in the earth millions of years ago (think of dinosaurs and tropical forests). The main component of natural gas is methane, but it may also contain small percentages of ethane, propane, and butane. Natural gas can be transported in pipelines, but (in its normal gaseous form) occupies too much space to be economically transported long distances by other means.
British scientist Michael Faraday conducted the first experiments in liquefying various gases, including natural gas. In 1873, the first practical compressor refrigeration device for liquefaction of natural gas was developed by German engineer Karl von Linde. Liquefaction reduces the space occupied by LNG to one-six hundredth of the same amount of natural gas. A prototype LNG plant was constructed in West Virginia in 1912, but the first commercial liquefaction plant was built in Cleveland, Ohio in 1941.
In January 1959, the first maritime LNG shipment took place when the METHANE PIONEER transported LNG from Lake Charles, Louisiana to Canvey Island in the Thames Estuary, United Kingdom. The METHANE PIONEER was a converted World War II Liberty tanker fitted with five 7,000 barrel aluminum prismatic tanks. Balsa wood was used for support and insulation was provided by plywood and urethane foam.
Maritime transport of LNG in commercial quantities began in 1964 when the British Gas Council began importing the cargo from Algeria. After the concept was proven, additional marine LNG liquefaction facilities and import terminals were constructed worldwide.
Experience and evidence show that LNG is no more dangerous than many other cargoes routinely carried by ships and that LNG carriers are some of the most robust commercial ships ever constructed. Even critics of the marine carriage of LNG concede the exemplary safety record of the industry.[13] Public perception, though, is otherwise. Thus, in our increasingly threat-conscious world, the security demands placed on the LNG industry generally exceed those placed on similar commercial activities.
Maritime Security
Most of the detailed maritime security requirements applicable to the LNG industry are a direct result of the horrific terrorist attacks of September 11, 2001. The international maritime security requirements have been developed largely by the International Maritime Organization (IMO), a specialized agency of the United Nations. The US requirements have been developed largely by the US Coast Guard.
An international conference sponsored by the IMO in December 2002 adopted a significant amendment to the International Convention for the Safety of Life at Sea (SOLAS Convention). The amendment established standards for an international maritime security regime, imposing responsibilities on flag states, port states, ship owners and operators, and operators of port facilities. The standards are generic but scalable. In other words, the requisite level of security in certain cases depends on the perceived vulnerability, threat, and consequences.[14]
In accordance with the International Ship and Port Facility Security (ISPS) Code, ships subject to the SOLAS Convention (including LNG carriers) must adopt a variety of security measures, including development and implementation of ship security plans; installation of ship security alarm systems; and affixing of permanent ship identification numbers. Facilities at which these ships call (such as LNG import terminals and LNG deepwater ports) likewise must adopt security measures, including development and implementation of facility security plans, access control, lighting, and monitoring capability.
These measures are enforced by nations that are party to the SOLAS Convention. Among other things, these nations (referred to as “port states”) are authorized to require ships intending to call at their ports to notify the nation in advance what ports they have recently visited. The nations may board and examine these ships to ensure compliance with the security requirements and may exclude from entry ships found to pose an immediate security threat.
The United States adopted the Maritime Transportation Security Act of 2002[15] (MTSA) and other measures to enhance maritime security in US ports and waterways. In addition, federal agencies such as the Coast Guard and the Customs and Border Protection (CBP) amended their regulations and operating practices for the same purpose. The Coast Guard promulgated security regulations applicable to most vessels (including LNG carriers) calling at US ports.[16] It also promulgated security regulations applicable to US onshore and offshore facilities at which these vessels call.[17]
The MTSA also amended the Deepwater Port Act to expand its coverage to include certain offshore facilities used to import LNG.[18] Subsequently, the Coast Guard promulgated revised regulations for US deepwater ports (DWPs).[19] These revised regulations focus on DWPs that handle LNG imports. The security provisions in the revised DWP regulations, on their face, largely mirror those found in the more-general vessel and facility maritime security regulations. As with the international requirements mentioned previously, however, the actual security requirements imposed by the Coast Guard on a particular vessel or facility are scalable and based on the perceived vulnerability, threat, and consequences.[20]
Many of the special security precautions the Coast Guard has established for LNG carriers derive from analyses of “conventional” navigation safety risks, such as groundings, collisions, and propulsion or steering system failures. These precautions pre-date the September 11, 2001, terrorist attacks and include:
Ø Special vessel traffic control measures that are implemented when an LNG carrier is transiting the port or its approaches.
Ø Safety zones around the ship to prevent other vessels from approaching.
Ø Escorts by Coast Guard patrol craft.
Ø Coordination, as local conditions warrant, with other federal, state, and local transportation, law enforcement, or emergency management agencies to reduce the risks to, or minimize the interference from, other port area infrastructure or activities.
Since the terrorist attacks, the Coast Guard has implemented additional security measures, including the requirement that all vessels calling in the U.S. provide the Coast Guard with a 96-hour advance notice of arrival (increased from the previously-required 24-hour advance notice).[21] The Coast Guard now subjects LNG carriers to at-sea boardings, in which Coast Guard personnel conduct special security sweeps of the vessel and ensure “positive control” of the ship is maintained throughout its port transit.
The end result is that, for a variety of reasons, LNG carriers and facilities are subject to some of the most intense maritime safety and security measures in the marine industry. It should be noted that tankers carrying and facilities handling gasoline or liquefied petroleum gas (LPG) are not subject to review and regulations of the same level of intensity as are LNG carriers and facilities.
Safety and security issues re LNG deepwater ports (DWPs)
While conventional crude oil DWPs have been in operation around the world for many years, LNG DWPs are an emerging concept. The first LNG DWP began operating in March 2005. This is the Gulf Gateway Energy Bridge DWP in the Gulf of Mexico about 116 miles off the south coast of Louisiana.
Several different designs are under development. Proposals include ship-form hull designs similar to existing floating production, storage, and offloading (FPSO) units, platform-based storage and regasification units, gravity-based structures, and innovative docking structures that attach directly to the LNG carrier as it ties off to a single-point mooring. These proposals will be subject to safety and security reviews by the Coast Guard before approval.
As noted above, after federal law was amended to address LNG DWPs, the Coast Guard promulgated an extensive amendment to its DWP regulations to accommodate this situation. The revised regulations address processing of applications, site evaluation, design, construction, and operation, among other issues. Primary jurisdiction over licensing and siting of LNG DWPs in waters subject to US jurisdiction and more than three nautical miles offshore is vested jointly in the Coast Guard and the US Maritime Administration (MARAD). The Coast Guard works with Federal Energy Regulatory Commission (FERC), the National Ocean Service of the National Oceanic and Atmospheric Administration (NOAA), the Environmental Protection Agency (EPA), and other federal agencies to ensure that the LNG DWP license application complies with all applicable federal requirements.
In addition to DWP regulations, the Coast Guard has issued guidance for oversight of post-licensing activities associated with development of deepwater ports. This guidance is heavily oriented toward safety and addresses the design, fabrication, and installation phases of the LNG DWP project, as well as maintenance and inspection after the facility commences operation.[22]
Safety and security issues re LNG import facilities ashore and in state waters
Until recently, it appeared that companies planning to construct and operate LNG facilities ashore (and in state waters up to three nautical miles offshore) had to comply with both federal and state safety requirements. In 2005, though, Congress amended the Natural Gas Act to provide that the Federal Energy Regulatory Commission (FERC) has exclusive authority to approve or deny an application for the siting, construction, expansion, or operation of an LNG terminal.[23] In making its decision, though, FERC is required with consult with the state regarding state and local safety considerations. These safety considerations include:
a) the kind and use of the facility;
b) the existing and projected population and demographic characteristics of the location;
c) the existing and proposed land use near the location;
d) the natural and physical aspects of the location;
e) the emergency response capabilities near the facility location; and
f) the need to encourage remote siting.
FERC is required to review and specifically respond to issues raised by the state. Once the LNG terminal enters into operation, the state is authorized to conduct safety inspections in conformance with federal regulations and guidelines.
As part of its review process, FERC also consults with the U.S. Coast Guard with regard to safety and security aspects of the maritime portion of the proposed LNG import facility.
An owner or operator that intends to build a new LNG facility or that plans new construction on an existing facility ashore or within territorial waters, must submit a “Letter of Intent” to the Coast Guard Captain of the Port (COTP) in whose zone the facility is to be located. This letter is submitted shortly after the owner or operator initiates its “pre-filing” process with the FERC and must provide information on:
Ø The physical location of the facility.
Ø A description of the facility.
Ø The characteristics of the vessels intended to visit the facility and the frequency of visits.
Ø Charts that show waterway channels and identify commercial, industrial, environmentally sensitive, and residential areas in and near the waterway to be used by vessels en route to the facility, within 15.5 miles of it.[24]
The COTP reviews the information provided by the applicant and determines the suitability of the waterway for LNG vessels. Factors considered include:
Ø Density and characteristics of marine traffic in the waterway.
Ø Locks, bridges, or other man-made obstructions in the waterway.
Ø Hydrologic features of the waterway (e.g., water depth, channel width, currents, tides).
Ø Natural hazards, such as reefs and sand bars.
Ø Underwater pipelines and cables.
The FERC and Coast Guard also cooperate to address the port security component of the environmental impact statement (EIS) for the facility. In addition to an evaluation of conventional navigation safety risks, EISs include a security assessment that takes account of the risks of the marine transportation component of the proposal, using the hazard distances established by the spill consequence models described in the recently published Sandia Report.
One part of the assessment will be to identify the level of Coast Guard, and other federal, state, and local resources necessary to ensure the risks of the operation can be managed responsibly. This means providing a deterrent presence sufficient to reduce the risks of an incident to a level acceptable to federal, state, and local port stakeholders, as well as ensuring sufficient resources are available to deal with the consequences of an incident, however unlikely. The assessment will identify both current resource levels and the resources necessary to mitigate the risks to the appropriate level of acceptability.
The Coast Guard has issued guidance on assessing the suitability of a waterway for LNG marine traffic.[25] The Coast Guard’s assessment covers the following broad topics: (a) port characterization; (b) characterization of the LNG facility and the LNG tanker route: (c) risk assessments [both safety and security]; (d) risk management strategies; and (e) resource needs for safety, security, and response. Upon completion of the assessment (which includes input from the applicant and from various stakeholders), the Coast Guard submits its conclusions and recommendations to FERC for consideration.[26]
A recent example of how this collaborative effort between FERC and the Coast Guard operates is found in the proposal for construction and operation of a floating storage and regasification unit (FSRU) in waters of Long Island Sound. The proponent, Broadwater Energy LLC, submitted its application to FERC and its letter of intent to the Coast Guard. The Coast Guard analyzed navigation, environment, safety, and security issues and issued its Waterways Suitability Report on September 21, 2006. FERC incorporated this into its Draft Environmental Impact Statement, issued on November 17, 2006. Public meetings will be held in New York and Connecticut in January 2007.[27]
The GAZ FOUNTAIN incident
A number of studies have been undertaken of the safety and security issues inherent in the marine transportation of liquefied natural gas. Ironically, due to the safety record of the industry, there are few real-world examples to which these studies can turn to validate their assumptions and conclusions. Unfortunately, the one analogous example has been totally overlooked in all of these studies.
On the morning of October 12, 1984, the liquefied gas tanker GAZ FOUNTAIN fell prey to an armed attack by three “Maverick” TV-guided, air-to-ground armor-piercing missiles. The missiles were fired by an Iranian fighter plane during the Iran-Iraq “tanker wars” in the Arabian Gulf. One missile hit and damaged the deck area forward. The other two missiles hit the area around the aftermost tank (Number 3). One penetrated the cargo tank resulting in a severe fire that eventually engulfed the superstructure. The cargo of butane in the tank ignited, but did not explode. Flames from the burning butane were thrust as high as 600 feet into the sky.
A conventional LPG carrier built in 1969, with three fully refrigerated, free-standing prismatic cargo tanks surrounded by loose perlite insulation, all the GAZ FOUNTAIN’s safety controls and fire-fighting equipment were either partially or wholly destroyed in the explosions or ensuing fires. After being hit, the GAZ FOUNTAIN crew tripped the cargo emergency shut-down system, stopped its engines, and then abandoned ship. A salvage tug arrived on scene shortly thereafter and successfully extinguished the fire using traditional water and foam techniques. Jury-rigged patches were placed over the hole in the cargo tank in order to restore some measure of gas-tight integrity and the ship was towed to Dubai, where it was subsequently successfully salvaged and put back into service.[28]
The attack and its consequences were largely ignored until recently. In fact, the incident is not mentioned in any of the numerous studies performed on the safety of LNG. The incident did receive brief mention in the latest revision to a Congressional Research Service (CRS) report, which devotes two paragraphs to this singular incident of a military attack on a liquefied gas carrier. The first paragraph recounts the basic facts. The second paragraph, reproduced in full below, does not do merit to the agency’s reputation for comprehensive, objective, and reliable analysis.
The Gaz Fountain attack and salvage provides some evidence as to the robustness of double-hulled gas tankers like those that carry LNG. But the relatively benign outcome in the Gaz Fountain attack does not necessarily demonstrate that attacks on LNG tankers would have similarly limited impacts. The Gaz Fountain was fortunate that its storage tank was breached only at the top. If missiles had been targeted at the hull of the ship rather than the deck, one might have penetrated the side of the storage tank, causing a major spill on water and an inextinguishable pool fire. Furthermore, if the gas involved had been LNG rather than butane, the Gaz Fountain might have been subject to cryogenic damage since LNG is transported at a much lower temperature than butane (‑260°F vs. +25°F). According to the Sandia report, such a combination could lead to cascading failure of adjacent storage tanks and, presumably, an even larger fire.[29]
Relative risk
Other than crude oil (which, while potentially polluting, poses little risk of explosion or fire), the major energy sources imported into the United States by ship are LNG, liquefied petroleum gas (LPG), and refined petroleum products (e.g., gasoline). One would expect that safety and security regulatory schemes for these three imports to be proportional, based on their relative risks.
LPG is a mixture of propane, butane, isobutane, propene, and butenes. While propane is usually the main component of LPG, followed by butane, the composition of LPG varies from supplier to supplier and from season to season. Petroleum gas has an energy content of approximately 99,000 BTU per gallon, while natural gas has an energy content of approximately 62,000 BTU per gallon. The main hazard of LPG is its flammability. As a rule of thumb, the lower explosive limit (LEL) of LPG is about 2%. When the concentration of LPG vapor in air is between the lower and upper explosive limits and an ignition source is introduced, the vapor will ignite, sometimes by powerful explosion. An LPG leak in a confined space is especially hazardous, because the vapor concentration can rapidly surpass the LEL, and LPG ignited within a confined space usually explodes. Because LPG vapor is heavier than air when at typical ambient temperatures, at high concentrations it tends to remain near the ground and settle in low areas. For this reason, it may mix with air and disperse relatively slowly, prolonging the explosive hazards.[30]
Gasoline is a petroleum-derived liquid consisting mostly of hydrocarbons and is enhanced with benzene or iso-octane to increase octane ratings. It is used mostly as a fuel in internal combustion engines, particularly in automobiles and trucks. Regular gasoline has an energy content of approximately 126,000 BTU per gallon.
Federal government data show that imports of LNG have decreased have decreased slightly during 2006. During 2006, imports of LPG and finished motor gasoline have both increased.
The Coast Guard has been somewhat candid, but shy, about its view of the relative risk of LNG. In its Marine Safety Manual (MSM), an internal publication on marine safety and security issues, it states: “Although concern about LNG hazards is justified, it should be remembered that most other liquefied gases are just as dangerous as LNG, some even more so.”[31]
Following the horrific terrorist attacks of September 11, 2001, rumors started that LNG imports presented an overwhelming safety and security risk in the United States. Allegations arose that “condo commandos” situated in high-rise condominiums and other buildings in Boston could fire rocket-propelled grenades at transiting LNG carriers, causing explosions and fires that would incinerate all persons and structures within several miles. The US Coast Guard temporarily banned LNG carriers from Boston Harbor while it undertook a review of safety and security issues. When the Coast Guard rescinded its ban, litigation ensued to permanently stop the maritime importation of LNG through Boston. The lawsuit was quickly dismissed.
Rear Admiral George Naccara was the Commander, First Coast Guard District, and was in operational command of Coast Guard assets and in charge of Coast Guard missions in the New England states during this period. Subsequent to these events, after LNG shipments into Boston and other US ports again became routine, Admiral Naccara acknowledged that LNG carriers were much more of a public relations problem than a safety or security threat. While the ships are some of the most robust ever constructed, they are big and highly visible.[32]
One of the most forthcoming analyses of relative risks of LNG, LPG, and gasoline was contained in a background paper prepared by the National Commission on Energy Policy (NCEP), an nonpartisan think tank based in Washington, DC.[33] In this regard, the paper states:
While crude oil does not combust as readily or with the same intensity as natural gas, refined products of oil, which are also routinely transported in large tankers, can be just as flammable (or more so) than LNG vapors. In fact, LNG vapors have a higher auto-ignition temperature than gasoline or propane vapors, meaning that a higher temperature is necessary for spontaneous ignition. In addition, the lower flammability limit for LNG is higher than that for gasoline, meaning that a greater concentration of fuel is necessary for combustion. The point of this comparison is not to suggest that tankers carrying petroleum products are unsafe. The important differences in the properties of these fuels combined with the manner in which they are handled and transported allow their risk profiles to be site-specific and case-specific. However, it is not clear that LNG poses a significantly greater hazard to society than, say, gasoline or propane.[34]
The NCEP paper discusses the historical safety record of the LNG industry, the risk of malicious attack, and regulation of the industry. It then concludes with the following:
It is clear t