Lawyers: Public would be liable for cost in event of LNG accident

Lawyers: Public would be liable for cost in event of LNG accident

Posted: May 3, 2011 - 11:11pm

By Mary Landers

A trio of tort lawyers looking at the issue of who would be liable for the cost of an LNG trucking accident say it’s most likely not the company that imports or trucks the liquid methane.

“The long and short of it is there’s a good chance the public will be hung with the bill,” said Clete Bergen, an attorney and president of Citizens for Clean Air and Water, which sponsored the attorneys’ public forum Tuesday evening at Candler Hospital.

Southern LNG, which operates the massive Elba Island LNG import terminal, petitioned federal regulators in August to reopen its truck-loading facility there. If the petition is approved, plans call for up to 58 tanker truckloads of liquefied natural gas to be hauled out of Elba and across busy DeRenne Avenue passing two major hospitals and numerous schools, businesses and residential neighborhoods.

Currently, LNG arrives at Elba by ship and is piped out as a gas. The supercooled liquid fuel is proposed for use throughout the Southeast as an alternative to diesel in heavy trucks.

Federal law requires LNG tankers and all haz-mat trucks to carry $5 million of insurance coverage, said panelist and attorney George L. Lewis. But that insurance won’t kick in for every accident.

“What that covers is only those losses resulting from a negligent act of those hauling the material,” Lewis said. So a leaky valve, an improperly loaded tank, a tanker driver who runs a red light would be covered, but damage from a drunk driver running into an LNG truck would not be.

A catastrophic accident is at the heart of concerns over the trucking proposal. LNG can’t burn as a liquid, but if a tanker were breached the resulting vapor cloud could burn hot enough to blister exposed skin more than 700 feet away.

Damage to nearby property might be covered by homeowner’s and commercial general liability insurance. But the latter typically won’t cover losses arising from motor vehicle accidents.

And both are restricted to paying to restore property only.

“It’s not going to pay for harms and losses outside of property damage,” said attorney Howard Spiva.

Most insurance, including life insurance, also excludes losses arising from “acts of war,” or “intentional acts,” Bergen said.

“If a terrorist takes out an LNG truck whether it’s a Timothy McVeigh type or a foreign terrorist, we have a problem,” Bergen said.

No one in the audience of about 40 people identified themselves as representing the LNG or trucking industries. A spokeswoman for Southeast LNG, the company formed to truck the fuel out of Elba, said last week that the company planned to get insurance coverage that “significantly exceeds” state and federal requirements, but declined to be more specific.

Chatham Emergency Management Director Clayton Scott did attend Tuesday and made his concerns clear. The U.S. Department of Transportation recommends an evacuation zone of up to a mile around an LNG tanker spill. Such a massive evacuation isn’t possible in the time frame needed in such heavily populated areas, Scott said.

“You can’t insure yourself and you can’t protect yourself,” Scott said.

The attorneys concluded that Savannah’s best protection from a truck accident was preventing the permit for the loading dock at Elba from being issued.

“I don’t want to sound gloom and doom,” Lewis said. “But from the standpoint of insurance you don’t protect yourself. You protect yourself by keeping the trucks off the street.”

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