Written - Liquified Natural Gas (LNG)

Following the formal opening of the pipeline, it is appropriate that I make a statement to members

Natural Gas is the cleanest of fossil fuels and will remain the major source of electricity generation in the UK, at least in the medium term.  The LNG terminals in Milford Haven will provide for around 20% of the UK’s gas requirements.  This will help to maintain security of supply as North Sea reserves continue to decline.  

Milford Haven was chosen as a location for an LNG  terminal because of its  sheltered deep-water access, a well developed marine support infrastructure,  expertise in handling hydrocarbons,  land already designated for major energy infrastructure projects, and a significantly shorter sea passage compared with UK locations further east.

The LNG projects, with the associated pipeline, represent one of the biggest investments in the history of South Wales.  The total investment value of the LNG projects in Wales is approximately £2.5 billion. This includes the terminals, pipeline and proposed new power stations.  The pipeline in itself is an investment of £450 million and the employment of around one thousand construction workers.

The South Hook and Dragon LNG terminals went through the formal process of obtaining planning and hazardous substance consent, which requires extensive public consultation.  Harbours used for the unloading of LNG are managed by statutory harbour authorities which have duties under the Dangerous Substances in Harbour Areas Regulations 1987. Harbour authorities control the marine traffic into and through the harbour and the berthing and moving of ships. They are bound by the Port Marine Safety Code, compliance of which is monitored by the Maritime and Coastguard Agency.

Milford Haven Port Authority (MHPA) has  worked closely with the LNG terminal developments for the past four years in planning for the way in which LNG ships will be managed alongside all the other shipping and other users of the port when they start arriving during the first half of 2008.  MHPA has also been directly involved with the local authority,  national park, the Health and Safety Executive (HSE), the Maritime and Coastguard Agency and other bodies in supplying information, advice and comment to assist those organisations in fulfilling their responsibilities.  

I recognise that there are concerns about the safe movement of LNG ships in the Haven.  MHPA has undertaken a comprehensive range of detailed and professional risk assessments.    As well as making use of work carried out or commissioned by others, MHPA has undertaken or commissioned from experts many risk assessments as part of the process of determining the way in which it will regulate and manage LNG ships.  This work has involved its own staff including marine managers and pilots, the use of simulators at the Marine Institute in Holland and in the marine college in Fleetwood, the commissioning of studies and reports from experts and consultants. MHPA has also worked closely with the marine technical teams of both LNG projects.  

MHPA has detailed emergency plans and pollution response plans in place. These are prepared in accordance with the necessary regulation and legislation and are regularly updated and tested.

The specially built ships which will transport LNG from Qatar to Milford Haven have been designed to reduce emissions and to use as much as 40 percent less energy per mile than  a conventional vessel.  All of the ships will be double hulled for additional safety.

New natural gas pipelines transport the gas between Milford Haven and Tirley in Gloucestershire. National Grid  consulted extensively through numerous meetings, information events and project literature with formal consultees, elected representative, local residents, community and representative groups during the preparation of these pipeline projects, and the associated above ground installations which have required local authority planning consent.  National Grid has written to all Assembly Members with constituencies along the pipeline route providing project information and offering meetings with them.

Landowners affected by the project are compensated in accordance with national agreements with their representative bodies, and dedicated agricultural liaison officers ensure that the practical effects of the project on agricultural operations are minimised throughout the construction and reinstatement programme.  

The construction and operation of high pressure gas transmission pipelines in the UK is heavily regulated to ensure the highest safety standards apply. National Grid, and its predecessors, have unparalleled experience in the field of gas transmission, with a UK NTS comprising over 7000km of high pressure gas pipeline which has been operating with an excellent safety record for over 35 years.  Although LNG is new to the UK, it has been transported into New York safely for over 40 years.

The design and construction of gas pipelines is carried out to the highest, internationally recognised standards and is subject to the scrutiny of the HSE under the Pipeline Safety Regulations throughout design, construction and operation.

There are a total of 833 landowners along the pipeline route and National Grid was able to reach voluntary land agreements with the Brecon Beacons National Park and all other individual landowners except two.  These two land interests were confirmed by the Secretary of State in 2006. All landowners are fully compensated for the effect of the pipeline through their land. National Grid has a land agreement endorsed by the major farming and landowner representative groups in the UK, including NUFW, NFU and CLA. All normal farming operations can continue over the pipeline.  

The Milford Haven to Aberdulais pipeline is now filled with gas and available for commercial load. The Felindre to Tirley pipeline is mechanically complete and will be commissioned over the next 2 weeks. The pipelines are important new infrastructure for Wales, putting Wales at the front end rather than the tail end of Britain’s energy network, thus helping to ensure our security of energy supply.

A critical element of the UK government’s support for the pipeline was in relation to the restoration of the affected landscapes. This summer we have had one of the wettest summers on record and this has delayed National Grid’s restoration works.  National Grid has fully reinstated the land in respect of 250km out of 316km route.

The reinstatement of sensitive areas and areas with the potential for runoff to affect watercourses, particularly SAC designated rivers, has been afforded particular care. Method statements for the reinstatement of these locations were prepared and agreed with the environmental consultees, but some of this work has been delayed as a direct consequence of the adverse weather. Final reinstatement of a limited proportion of these locations was delayed into the autumn. The key concern was to stabilise topsoil on steeply sloping land near rivers.  National Grid has worked closely with the environmental consultees to develop additional measures and precautions to stabilise soil and prevent runoff to rivers. These have included reseeding and the use of biodegradeable jute matting. In some four areas, associated with tunnel works under major rivers, National Grid has agreed to reinstate next summer and has "winterised" the area to ensure runoff is prevented.

Expert advice says that it is not appropriate to move topsoil at this time of year and as a consequence further reinstatement is on hold until next year.  Throughout the winter National Grid will have teams in place to monitor the reinstated land and the winterised areas and also to carry out any required care and rectification works.

The reinstatement work is monitored by the CCW. The contractors are working hard to complete all operations within floodplains and all areas at risk of causing sediment runoffs to SACs.  While CCW accepts that the adverse weather conditions have played a role in the delayed restoration of woodlands and connecting hedgerows, it will be ensuring that there is no let up in the reinstatement commitment.

In the longer term, following final reinstatement of all land, National Grid will  work closely with the  CCW and the Brecon Beacons National Park Authority  to ensure reinstatement. Aftercare and maintenance plans are in place for a period up to 10 years, at affected locations, as required by the consent conditions.