LNG insider criticizes trucking plan

LNG insider criticizes trucking plan
Former employee contacts federal regulators about trucking proposal

Posted: May 21, 2011 - 11:18pm | Updated: May 22, 2011 - 8:31am

By Mary Landers Copyright 2011 .

A former Southern LNG employee has filed a critical analysis with federal regulators about plans to truck liquefied methane across Savannah.

DaWayne Penberthy, who was the principal for marine operations at Southern’s Elba Island import facility, concludes that LNG trucking exposes the public to “additional and substantial risk,” that the oft-touted safety record for LNG trucking is “at best incomplete,” and that the company is promoting trucking to avoid costly upgrades in liquefaction equipment for one of its large customers.

In an 11-page document filed last week with the Federal Energy Regulatory Commission, Penberthy also draws a direct parallel between trucking and the country’s worst accident with LNG — an explosion and fire in 1944 that killed 128 people and injured 225 others in Cleveland.

Chatham Emergency Management Agency Director Clayton Scott took note of Penberthy’s
filing immediately.

“The comments are very astute, and to the best of my knowledge very accurate,” he said. “He is certainly speaking from a position of
great knowledge having worked at Southern LNG four years. I don’t think his comments can be taken lightly.”

A corporate spokesman dismissed the comments.

“El Paso and AGL do not agree with Mr. Penberthy,” said El Paso spokesman Bill Baerg.

Southern LNG, a subsidiary of gas giant El Paso Corp., is seeking permission from FERC to re-start its truck-loading facility. Its petition, first filed in August, anticipates 58 tanker truckloads of LNG crossing Savannah daily.

A FERC spokeswoman declined to comment on the filing.

“There’s really nothing we can say,” Mary O’Driscoll said. “This is in the Environmental Assessment process. We don’t discuss filings when they come in. The Commission addresses them in their findings.”

Company man

Penberthy served in the U.S. Coast Guard for 29 years and retired as a commander based in Savannah before taking a position at the Elba facility in 2004. By the time he left in 2009 he was the principal of marine operations and had helped secure a $1.66 million grant from the U.S. Department of Homeland Security for the facility.

Elba visitors may remember him as the man who demonstrated with a match and a small container of LNG how hard it was to ignite the liquid or the gas boiling off it. He left Elba “with a nice compensation package” after the recession led to a downsizing that had Southern LNG eliminate his and other positions, he said. Baerg said Penberthy was "terminated" and "his duties and responsibilities continue to be carried out by other staff."

Penberthy had already begun a consulting company before Southern LNG let him go and he continues that business, Assurance Security & Response Consultants, out of his Pooler home.

He was and is a proponent of LNG. Elba is safe, he said, specifically because of the precautions taken, such as siting the facility far from other property, building robust tanks and digging containment dikes around the tanks to catch the liquid methane in the unlikely event of a spill. LNG tanker ships require a Coast Guard escort and a one-mile forward and two-mile rearward exclusion zone that prevents other vessels from nearing them when they are moving in the Savannah River.

But trucking eliminates most of those precautions. The driver will have to make rest stops, presumably leaving the truck unprotected. There’s no plan for a military or police escort like there is with the ships. Trucks would drive through heavily populated areas.

“You can talk about safety designed into the system but that doesn’t mean you’ll get where you want and won’t be hijacked,” he said.

Record incomplete

LNG industry representatives tout LNG trucking’s stellar record. Typical is this statement from Paul Herrgesell of Southeast LNG written in a February op-ed in the Savannah Morning News: “There have been no recorded fatalities due to LNG tanker trucks, and no incidences of explosion or large uncontrolled spill.”

Or this also in a Morning News op-ed in April from Bill Cooper, the president of the Center for Liquefied Natural Gas, a trade association: “Despite the fact that there have been serious accidents involving LNG tankers, there has never been a release of LNG.”

LNG’s trucking record may look good superficially, but it’s incomplete, Penberthy argues. Carriers operating within a state, as most LNG carriers do, were not required to file hazardous materials incident reports until 1998. A report written by CH-IV International, a private engineering and consulting company, documents
20 domestic trucking accidents dating back to 1971. One death, one injury and at least one LNG fire are reported. Seven of the incidents resulted in releases of up to 20 percent of the cargo, Penberthy writes.

“Clearly either the pro-trucking sources are curiously unaware of the history of their chosen industry and the often-quoted-by-the-LNG -Industry reference, are being misreported, or are being intentionally misleading,” he wrote to FERC.

The one death, while in an LNG tanker truck, was due to a diesel fire from the truck’s fuel tank. No LNG in that incident spilled despite the fire.

El Paso spokesman Baerg was unimpressed with Penberthy’s accounting.

“The safety record of transporting LNG by truck is outstanding,” he wrote in an email. “The study performed by Arthur D. Little and filed with the Southern LNG Section 3 application documents this record.”

Clean vehicles a red herring

Southern LNG has maintained that its reasons for trucking are two-fold: To supply an emerging market of heavy trucks powered by LNG as a cleaner alternative to diesel and to supply peak-shaving facilities, where natural gas is stored for use when demand peaks.

Penberthy suggests the former is a red herring. Southern’s partner in the trucking venture, AGL Resources, has already committed to supporting a different gas market for vehicles: Compressed natural gas, or CNG. A plan filed with the Public Service Commission envisions construction of up to eight CNG fueling stations at a cost of $10 million this year.

None of those planned facilities includes LNG storage or distribution capacity. Moreover, big fleets in Atlanta are already committed to CNG. In late March, Clean Energy Fuels announced it had signed a 15-year agreement with PS Energy for fueling stations in the metro Atlanta area. CNG is a more practical choice than LNG because it can be taken off existing pipelines and doesn’t require trucking, Penberthy writes.

Southern’s second reason for trucking — to supply peak shaving facilities — is only necessary if the companies involved are trying to avoid costly upgrades to their equipment, Penberthy said. These facilities, owned by AGL Resources, are already receiving natural gas through pipelines, and reliquefying it for storage and reuse.

“In short, no trucking is required to get LNG to these storage facilities,” he writes.

Instead, he suspects Southern LNG wants to store and deliver LNG that arrives at Elba with a higher heating value, which the industry measures in British Thermal Units. Doing so would open Elba to a wider range of imports; Nigerian LNG is typically high BTU, he said. To do so and stay within regulatory limits of 1075 BTU, Southern could inject nitrogen into the natural gas to reduce its heating value. Southern commissioned a liquid nitrogen injection system on Sept. 4, 2010.

But gas with too high a nitrogen content could present a problem to Southern’s good customer and trucking partner AGL Resources. Its liquefaction equipment likely couldn’t handle it, Penberthy said. Other peak shavers have complained to regulators to keep from having to change out liquefaction equipment in this situation.

“These FERC filings are full of objections from peak shavers who note that their liquefaction equipment ... would be unable to operate with higher nitrogen levels without major modification or replacement,” Penberthy writes.

Baerg dismissed Penberthy’s theory.

“The nitrogen injection facilities at Elba Island have no impact on or are not related in any way to the proposed truck loading facilities and trucking of LNG from Elba Island,” he wrote.

To Penberthy, enabling AGL to avoid the cost of these equipment upgrades doesn’t merit risking Savannahians’ safety.

“The acceptance of any increased risk for supplying LNG peak-shavers is unnecessary and should be avoided entirely,” he writes.

Cleveland revisited

Penberthy lays out that risk by comparing it to a known incident — the LNG accident that leveled a 30-acre area of Cleveland when a tank burst at a peak-shaving facility.

The accident led to redesigns of the tanks with a material that doesn't get brittle when cold. But the thing that caught Penberthy's attention about Cleveland was that the damage was caused by LNG flowing into sewers.

On their way through an urban area like Savannah, LNG trucks would never be far from a storm drain. If a truck spilled its cargo the LNG wouldn’t all gassify at once. The liquid portion could run downhill into a storm drain on streets like DeRenne Avenue where it would then expand 600-fold, and could ignite and explode, like it did in Cleveland.

Penberthy doesn’t calculate a burn zone or try to model an incident. Instead, he lets history be the guide.

“In the event of a release of LNG in an area that has storm drains, it is reasonable to expect consequences similar to the Cleveland Incident,” he writes.

Again, El Paso spokesman Bill Baerg said the company does not agree with Penberthy or his assumptions.

“There are many differences between the 1944 Cleveland accident and the risks of a potential spill transporting LNG via tanker truck,” he said. “As demonstrated by the industry safety record, equipment design, industry regulations, training requirements for operators, drivers, and first responders have all improved significantly since the Cleveland accident.”

He added that "in Cleveland there were two tank failures and more than a million gallons of LNG released."

A typical tanker trucks holds about 12,000 gallons.

Penberthy said the published reports vary widely on how much was released in Cleveland, but the amount doesn't change his basic argument.

“They can debate the quantity of liquid in Cleveland but really that's not the point,” he said. “The point is that the same laws of physics apply. If 12,000 gallons destroys half an acre is that an insignificant public impact? Given the question about public need they'd have a hard time describing how much of an explosion is an insignificant explosion.”

Why now?

Penberthy said he filed his report with FERC after realizing the state Legislature wasn’t prepared to try to force the regulators to take a more detailed look at the risks. He had already provided the Chatham County Commission with an earlier draft of his document upon learning it was planning to vote in April on a similar resolution. Like the General Assembly, the commission failed to request an environmental impact statement from FERC.

He lays out alternatives to trucking in his document, modeling what he thinks federal regulators need to do.

“Nobody is paying me,” Penberthy said. “This is my way to make sure this discussion takes place. I want to make sure the policy makers have the information they need to make the policy decision.”

Penberthy talks in a measured, direct manner, with a military bearing befitting the retired Coast Guard commander he is.

“I’m not a sky-is-falling kind of guy,” he said. “There’s a likelihood LNG trucking could take place for many years with no problem.”

But there’s also some probability, albeit small, that there could be an incident.

“We need to understand those risks beforehand to determine if we want to subject the public to those consequences,” he said.