Proposed LNG production/storage increase and export from jetty at Tilbury Island: Building the perfect storm

Article by Peter van der Velden. See bottom for info about July 30.

Photo: Aftermath of explosion at LNG storage site in Plymouth, Washington, in 2014. Photo from “Failure Investigation Report,” PHMSA, 2016.

Building the perfect storm: Are our governments once again set to fail us?

Proposed LNG production/storage increase and export of LNG from Tilbury Island proposed jetty

  1. Two separate proposals: -Expansion of the LNG operations and the construction of the jetty
  2. Current Assessment Acts and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP)
  3. Canada’s commitment to the Paris Agreement
  4. Fortis plans to build a shipping terminal (jetty) directly across from the Richmond Jet Fuel terminal
  5. Location and international safety standards
  6. Bunkering and the viability of export
  7. Costs: Government subsidies to the LNG industry
  8. The environment: City of Richmond council opposes proposal
  9. The application to BCUC to charge ratepayers for $780 million tank enlargement costs
  10. Some conclusions
  11. How do we proceed

**********

1. Two separate proposals: Expansion of the LNG operations and construction of the jetty

FortisBC has two separate proposals registered under the Canadian Environmental Assessment Act; expansion of the LNG terminal on the Fraser River and construction of an LNG shipping terminal (called a jetty). Both proposals will put the communities of Richmond and Delta in harm’s way.

 A Fortis LNG terminal has been in existence at Tilbury Island since 1971. There has been some recent expansion and Fortis is once again applying to increase their operation.

The first proposal is to:

Multiply storage capacity more than seven-fold

Increase production to 2.5 million tonnes of LNG annually

These increases are massive. In this location the proposals are a perfect storm waiting to happen. (https://www.youtube.com/watch?v=uBAgvXPw1aI)

Fortis wants to increase the production of LNG for the purposes of Export and Bunkering. This includes the logistics of loading fuel as well as distributing it to bunker tanks and exporting the product. Hence the need for the second proposal to:

Build a jetty to load tankers with LNG for export

An integral part of the expansion proposal is the construction of a shipping terminal -called a jetty- for loading LNG ships for export. Though very much related, the LNG Jetty Project and the expansion of the FortisBC Tilbury LNG Plant are being reviewed as independent projects.

There are so many issues with these proposals, it is hard to know where to start. At the forefront are issues of health and safety, and environment.

(a) Health and Safety

The health and safety risks involved in the handling and storage of LNG are well documented. The Pembina institute states that as much as 30% of the production losses of LNG happen at the terminal. The damage caused to the environment by the lost gas is almost as damaging as that of burning the fuel.

The dangers in handling, storing and loading LNG onto ships are extremely high in this location. The location of the plant does not meet international safety guidelines. Worse yet, the jetty is located directly across the Fraser from the jet fuel storage facility in Richmond. The LNG freighters will have to pass close to the populated areas of Delta and Richmond as well as the Tsawwassen First Nation. Turning these giant vessels once filled will have them pass dangerously close to the jet fuel tanks located on the Richmond side of the Fraser. This channel is considered too narrow and unsafe by LNG industry group SIGTTO (The Society of International Gas Tanker and Terminal Operators). This channel will not allow these ships to stay clear of populated areas nor of other marine traffic.

(b) Environment

Environmentally, the terminal puts the communities of Delta and Richmond as well as Burns Bog and the Fraser River and Delta at risk (see article in Georgia Straight). The damage that will occur to the Fraser, not the least of which will be caused by the Jetty and Jetty construction, is drawing considerable attention. The Fraser River is once again being more industrialized without the appropriate environmental scrutiny.

The FortisBC Tilbury LNG Plant, did not undergo an environmental assessment at all in spite of the fact that there will be environmental effects on a grand scale.

The National environmental issue is methane emissions from the LNG industry and how this and other fossil fuel projects relate to Canada’s commitment to reducing our greenhouse gas (GHG) emissions.

The Governments of Canada and B.C. continue to allow FortisBC to phase in expansions and split projects in this way. This avoids triggering the legal requirement of a complete and cumulative effects assessment of the full-scale plans.

2. Current Assessment Acts and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP)

Both Canada and B.C. are failing to credibly apply current Assessment Acts and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). This is clearly a violation of due process.

The Lower Fraser River has been fished for millennia by First Nations people. Both the LNG traffic and dredging of a large area of foreshore for the jetty will further damage the already-endangered Fraser fishery. It will interfere operationally, and with indigenous rights and title.

The size and implications of these two LNG Projects should be one environmental assessment by a federal Review Panel under the revised Environmental Assessment Acts of 2019. In actual fact, there should be a credible cumulative effects assessment of all past, current and planned projects in the lower Fraser River and the estuary. This would ensure that all past development built without a proper environmental assessment (EA) is taken into account when more damage is being proposed to this world class river and estuary.

Under Canadian and BC Assessment Acts, and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), the federal government has specific requirements. The assessments are federal and provincial under the out-of-date environmental assessment Acts (BC, 2002 and CEAA 2012). The federal government has inappropriately delegated both assessment processes to the BC Environmental Assessment Office (EAO). The outcome of this would appear to be very biased; the BC government has already given conditional support as well as lavish subsidies to LNG export projects.

The B.C. Government, through an Order-in-Council, has given conditional support to Fortis to export 3 million tonnes of LNG per year for 25 years – ignoring international safety standards and Canada’s climate commitments. This begs the question, are these planned proposals a foregone conclusion?

3. Canada’s commitment to the Paris Agreement

Under the 2015 Paris Agreement, Canada committed to reducing its GHG emissions by 30% below 2005 levels by 2030. This means a reduction of 503 megatonnes (MT) from our current level of 730 megatonnes of carbon dioxide equivalent (CO2e) by 2030 (Govt of Canada link for reference).

Many science-based reports been have written for the industry that predict massive increases in GHG emissions if we further expand our fossil-fuel infrastructure. The impacts of upstream fracked gas wells that are the source of the Lower Mainland’s gas supply are a major factor in this increase – leaky wells, flaring or venting of the non- methane components of the raw gas and pipeline leakages (“fugitive emissions”) all along its 1,000 km. length add to the total climate footprint of FortisBC’s gas operations.

The expanded Tilbury plant alone is expected to emit over 230,000 tonnes of GHGs each year. A May 9th, 2019 presentation by WesPac (now FortisBC) Marine Jetty consultant Golder & Associates stated that upstream GHG emissions associated with producing, treating and transporting the gas to the expanded Tilbury plant would be in the range of 1.7 -2.4 million tonnes per annum. That would add between 2.6% -3.8% to BC’s current 64 megatonnes of annual emissions, making it all the more difficult to meet BC’s legislated CleanBC emissions targets (see Reuters article).

The B.C. government has legislated targets for reducing greenhouse gas emissions 40% below 2007 levels by 2030. According to the 2020 Climate Change Accountability Report, “net carbon dioxide equivalents rose by 7.3 million tonnes from 2010 to 2017.” Is this realistic while developing the LNG industry?

Angela Carter, an associate professor in the department of political science at the University of Waterloo says “Canada’s oil and gas industry is the largest and fastest-growing source of emissions in the country, and government projections show that production will continue to increase for the next two decades. It is very difficult to imagine meeting those targets if we don’t do anything about the pace of production.”

Government complicity in this process exposes the falsehood of Canada’s stated policy of addressing climate change. Reports like the Reuter report show that we cannot possibly meet our Paris treaty GHG emission goals while actively supporting LNG projects. This project flies directly in the face of government claims to be addressing this existential issue. Gas industry claims that shipping LNG to Asia will help us meet our climate goals are patently false, self-serving and not consistent with agreed international emission attribution rules.

“Canada’s climate strategy may be based on false science” (Global News link). Is the information the Federal government provides accurate? How is our government planning to meet our stated goals when we continue to increase our GHG output?

4. Fortis plans to build a shipping terminal (jetty) directly across from the Jet Fuel terminal

The jetty, required to export the BC LNG will introduce dangerous LNG shipping traffic onto the busy Fraser River corridor. This brings up serious concerns for the Fraser River.

According to BCIT instructor Dr. Marvin Rosenau :”In order to build the facility, WesPac would have to dredge up to 18.7 hectares at the vessel’s loading berth. That could impact the main channel habitats from invertebrate species that are high-quality white sturgeon food. The Fraser River is home to some of the last stocks of wild sturgeon in the world.”

Separately the jetty is yet another project that will harm the already declining salmon population and the salmon fishing industry. The resident Orca pods, J and K, have shown signs of malnourishment due to the declining chinook salmon stocks. As well, the additional shipping traffic and ensuing noise will do more harm to the -already- endangered Southern-resident killer whale population.

Loading an LNG tanker can only be done from one side of the vessel. To exit the Fraser the tanker or bunkering barge must turn to face down stream. Doing this in a busy, narrow river channel will be problematic. SIGTTO recommends a turning circle of at least 5 times the ship’s length (about 1,500m. for a full-sized LNG tanker). This is not possible in the narrow, busy Fraser navigation channel.

More importantly, as shown by the following graphic, the LNG carriers will be dangerously and unacceptably close to the Jet fuel facility on the Richmond side of the Fraser. This is where this proposal starts to build “The perfect storm.”

As the earlier video illustrates, the jet fuel facility is within at least two of the danger zones. This sets the stage for the perfect (disastrous) storm. A fuel facility located within the blast radius of the LNG plant: A blast strong enough to endanger the jet fuel facility. As mentioned, the narrow channel of the South Arm of the Lower Fraser River around Tilbury Island does not allow such a “safe” zone.

5. Location and international safety standards

The LNG Terminal Siting Standards suggested by the industry group SIGTTO advises that LNG plants should have a 3.5 km safe zone all around them, (the safe zone is defined as no inhabited dwellings). This is for good reason as the handling of LNG is incredibly dangerous.

In the U.S., Sandia National Laboratories has researched safety aspects of where/ where not to locate LNG terminals. It has published its findings “Risk analysis for LNG tankers,” which have been incorporated into U.S. regulatory procedures (report link). Canada has, as yet, no corresponding regulations – LNG terminals can be put anywhere, no matter the risks to human and marine life.

Fortis will have us believe that their history to date will protect us. We know the dangers that these facilities present (see Sightline article). We have seen the resulting destruction, the pollution and loss of life and infrastructure (see RT article). A naive “feel good” approach to these dangers doesn’t serve anyone. The facility is too close to the river, the jet fuel tanks and the two communities to be allowed any enlargement, let alone one of this caliber (see Vancouver Sun article).

We need to ensure that Fortis follows the guidelines of SIGGTO and ISO. These agencies have set internationally accepted safety standards. They have world-wide experience and have helped develop these standards through that experience. Why has Canada not required the LNG industry to institute these standards?

This can only be ensured when the controlling bodies that are in place to protect us actually protect us. The controlling bodies in this case are our 3 levels of government, the environmental assessment office and the British Columbia Utility Commission (BCUC).

How Safe is LNG? Not as Safe as the BC Government Has Claimed (see The Tyee article).

6. Bunkering and the viability of export

As stated, there are two reasons for a 10- fold increase in the storage capacity for this facility. Fortis plans to export the gas produced by the fracking industry as LNG. Most of the customers for this would be in the Asia- Pacific region. This prospect for a burgeoning Asian LNG trade is in stark contrast to the recent report of the International Energy Agency (IEA), which expects world LNG demand to plummet in the years past 2025 (largely because of international efforts to limit climate change).

Secondly, Fortis expects that, in the future, LNG-powered container and cruise ships visiting the Port of Vancouver (PoV) will need to bunker (refuel) here. This despite a 2017 report by Lloyd’s for PoV that threw much cold water on that prospect. Currently there are three smaller BC ferries vessels that use LNG as fuel and there seems to be little incentive to convert or build ships to be powered by LNG.

This leaves the incentive for proposed expansion largely predicated on income from future LNG export.

The current financial situation is this. The spot price of LNG in a glutted market has averaged below $6 USD over the past 5 years. It currently sits at an approximately (dismal) $2.10 USD. According to the Canadian Energy Research Institute (CERI), the full cost of BC-produced LNG is over $8 USD (all priced per million British Thermal Units (mmBTU)). Clearly the industry is operating at huge losses and is heavily subsidized.

If profit is not possible how will the industry be financed? After all the capital cost subsidies will this require yet more government subsidies? Will the public be asked to subsidize the fossil fuel industry indefinitely?

FortisBC is a regulated utility whose charges to customers are based on recovering its expenses for service. Building a 5 megatonne LNG plant will cost in excess of $5 Billion. How will that affect the ratepayers in British Columbia? The Australian experience is instructive. In Australia, LNG developments led to tripling gas bills for locals.

7. Costs: Government subsidies to the LNG industry

The subsidy of capital (development/construction) cost is very visible. A study released last month from the International Institute for Sustainable Development (IISD) and Environmental Defence Canada found BC gave out

-at least CAD $830 million in fossil fuel subsidies in the 2017-2018 fiscal year

-has amassed at least CAD $3.1 billion in outstanding royalty credits (these are royalties that are to be paid back to industry rather than funding public services).

The bulk of these supports have been designed specifically to boost the province’s liquid natural gas (LNG) sector, the vast majority of which is fracked gas. The provincial government introduced many of them this April, and they are handily the most generous among Canadian provinces.”

Last year, Canada spent $2 billion on fossil fuel subsidies, while agencies like Export Development Canada provide roughly $13 billion more for domestic and international fossil fuel production and exploration. “Canada, unfortunately, is one of the worst in the G7 countries on many climate indicators — including our levels of international climate finance, our fossil fuel subsidies … and our emissions per capita” (see CBC article).

8. The environment: City of Richmond council opposes proposal

The city of Richmond has opposed this expansion proposal for a number of very valid reasons.

One of the concerns expressed by Councillor Carol Day express was that: “We are industrializing (the) Fraser River and putting Richmondites at extreme risk with having LNG directly across from jet fuel – surely there’s more we can do to make the ministers understand what grave consequences could happen if ever there was an accident or spill.”

Richmond city staff also notes that the project doesn’t align with Metro Vancouver air quality objectives and cites concerns about nitrogen oxide, carbon dioxide, sulfur dioxide, hydrocarbons and other particulates. Light, noise and atmospheric pollution from the expanded plant are also a concern for local wildlife and the community, the report explains.

“This project does not align with local, provincial (or) national strategies to reduce greenhouse gas emissions and reduce B.C.’s economic reliance on fossil fuels,” the city staff report states.

Delta city council has not been nearly as unequivocal about the project.

Despite claims that LNG production is safe, the standards for the LNG industry are permissive and numerous accidents are not reported. According to the Pembina institute 30% of gas lost along the production chain is at the terminal. With a production output of 2.5 million tonnes per year, the citizens of both Richmond and Delta will live in a constant source of air pollution. How will the air pollution affect the migratory bird population of the Delta region? Has this even been considered or can it even be quantified?

9. The British Columbia Utilities commission (BCUC) application to charge ratepayers for $780 million tank enlargement costs

“We are responsible for ensuring you receive safe, reliable energy and basic auto insurance services at fair rates from the businesses we regulate.” So says the BCUC website. “We facilitate fair, transparent and inclusive processes that encourage well-represented input from relevant stakeholders who possess the information required to present their views effectively.”

The BCUC is currently reviewing a FortisBC application to charge the BC ratepayers $780 million for the cost of the tank enlargement. Fortis argues that in case of emergencies/shortages, the stored LNG will supply the necessary back-up gas. This has only happened once when the northern supply pipeline was damaged in 2018. The information that was provided in the application shows that we are highly unlikely to need a tank to cope with any future outage that would last as long as 2 days.

The reality is that this tank is primarily for handling the volume of export LNG. The fact that Fortis is also building a jetty for LNG export and proposing to supply fuel to the shipping industry makes one thing clear: The 10-fold increase in storage capacity is not for the ratepayers. Some of the capacity could be used if at all necessary but it is essentially for bunkering and export. This alone should make the application a non-starter. However, the BCUC is entertaining it. And the BC Government is allowing it.

The application is an 800-page document that has 90 pages heavily redacted. Needless to say, the document is sadly lacking from a public perspective. The public will be affected by this proposal in many ways and yet, transparency is either dismissed or appears to be a relative term (see BCUC report).

The BCUC panel reviewing this application is currently comprised of three members, two of whom have been, for many years, executives of FortisBC. One was a 34-year regulator for Fortis and another was a long-time lawyer for Fortis. Is it reasonable to assume there is a conflict of interest? Certainly, it has the appearance of a conflict. One of the first lessons taught in politics is that “if it looks like a conflict of interest, it should be treated like a conflict of interest.” It is not reasonable to have these people in charge of this decision and this position is echoed by the city of Richmond.

10. Some conclusions

What we’ve witnessed in the past generation appears to be a general weakening of our critical thinking skills. We’ve been fed an economic perspective by the press and polities that enforces the fear of losing jobs and negates environmental and social “costs.” As with these two proposals we are constantly inundated by false or incomplete information that really only serves industry and government. As a result, our environment has suffered and our social fabric is dissolving into a polarized existence: Our opinions have fused into a binary state supporting -or not supporting- a current political narrative.

Our environment needs a collective consciousness that “emphasizes social solidarity and the organic interdependence of people and communities” (Emile Durkheim). These two proposals don’t serve either of the elements necessary for healthy living and prosperity.

We can only create this with a new political paradigm: Management of our resources that is completely transparent and based on science. Unbiased and non-politicised science. Information that can be accessed and critically analyzed to determine short-term gain versus long-term consequence. If this information is posed without an economic or political agenda people could assess all ideas or proposals to ensure that only the best would succeed. If people felt included communities would thrive and politics would likely see more respect and -perhaps- a greater desire for involvement.

LNG is not a viable solution to our economic needs. The subsidies given to the fossil fuel industry are massive. This money could have been far more effectively used to incentivise our economy to alternative energy and employment sources. Our environment would be better served and our communities could prosper into a more balanced future.

11. How do we proceed

PLEASE use the following link to contact provincial Legislative members. Let them know you are unhappy!

https://www.wildernesscommittee.org/take-action/tell-your-mla-stop-tilbury-lng

Should you want to respond to the British Columbia Utility Commission regarding the Fortis application to have the ratepayers (you and I) paying for the tank; the process is open until early November. If you wish to be an “Interested Party” you have to register with BCUC (see link below).

 (https://www.bcuc.com/ApplicationView.aspx?ApplicationId=843 )

There is no public input to the Environmental Assessment process until/if Fortis submits its detailed Project Description. This is due by mid August if Fortis wants to avoid having to re-start.

12. More background

https://canadians.org/webinar/tilbury-lng-terminal-expansion-alternative-open-house

https://www.vancouverobserver.com/news/lng-plant-proposal-fraser-river-raises-serious-questions.html

http://priceofoil.org/2019/12/21/british-columbia-is-trying-to-fuel-an-lng-boom-with-billions-in-handouts/

https://www.richmond-news.com/local-news/richmond-council-voices-opposition-to-tilbury-lng-expansion-3124748

https://www.cbc.ca/news/politics/fossil-fuel-subsidy-canada-1.5987392

https://www.canada.ca/en/environment-climate-change/services/environmental-indicators/progress-towards-canada-greenhouse-gas-emissions-reduction-target.html

************

Protest against Tilbury LNG expansion Friday, July 30th at 11 a.m.

When: Friday, July 30 from 11 a.m. – 12 p.m. PT
Where: FortisBC Tilbury LNG Plant, 7651 Hopcott Rd #7425, Delta, B.C. (Map)
You can take bus #640, get off at 72 St. and River Rd. and walk 15 minutes north to the protest. Please respect any public health COVID-19 prevention recommendations.

Tilbury wants to expand 8 to 10 times larger to export LNG with tankers on 21 kilometres of the Fraser River, through the estuary and the Salish Sea.

The LNG massive expansion will destroy critical habitat and endanger lives along the transport route.

The Project will fail to meet international LNG safety standards because the river is narrow and winding.  The transport route is too close to numerous communities.

Canada has no credible safety regulations or enforcement on transporting LNG.

The following map will be updated.

Potential impact zone

References for further reading about the blast and impact zone.

Excerpts: “That sort of explosion would pack the power to kill anybody within a radius of up to three-quarters of a mile” (Source). In Plymouth in 2014, “All residents living within a two-mile radius of the plant were evacuated” (Source). And “Nearby residents saw flames shoot into the air, and people living three to six miles from the plant could feel the explosion” (Source). (6 miles would be 9.6 km)

LINKS

Blast at Liquified Natural Gas Site Casts Spotlight on Industry Safety (April 6, 2014) By Joshua Schneyer, Timothy Gardner and Richard Valdmanis. Link – Scientific American – https://www.scientificamerican.com/article/blast-at-liquified-natural-gas-site-casts-spotlight-on-industry-safety/

HOW INDUSTRY AND REGULATORS KEPT PUBLIC IN THE DARK AFTER 2014 LNG EXPLOSION IN WASHINGTON
Lax industry oversight and incomplete reporting leave us with questions still today (2016). Link – https://www.sightline.org/2016/02/08/how-industry-and-regulators-kept-public-in-the-dark-after-2014-lng-explosion-in-washington/

How Safe Is LNG? Not as Safe as the BC Government Has Claimed
New studies and past incidents raise questions about location standards and safety. By Andrew Nikiforuk 28 Apr 2017. Link – https://thetyee.ca/News/2017/04/28/How-Safe-is-LNG/

Big, gray — and safe? Facts behind Tacoma’s LNG plant
By Derrick Nunnally (JULY 02, 2016). Link – https://www.thenewstribune.com/news/local/article87326512.html

Large LNG Explosion Displaces Hundreds in Washington (by Brandon Baker, 1-Apr-2014). Link – https://www.ecowatch.com/large-lng-explosion-displaces-hundreds-in-washington-1881882095.html

Engineers raise alarms over the risk of major explosions at LNG plants: As the Trump administration pushed hard for new LNG export terminals, federal regulators were slow to respond to warnings (3-Jun-2021). Link – https://www.washingtonpost.com/business/2021/06/03/lng-export-explosion-vce/

2012 International Symposium on Safety Science and Technology
Fire and explosion risk analysis and evaluation for LNG ships
LI Jianhuaa, HUANG Zhenghuab (2012). Link – https://www.sciencedirect.com/science/article/pii/S1877705812031359

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