PHMSA Response Letter

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July 7, 2010

Mr. John C. Keppel
4234 North Main Street, Unit 502
Fall River, MA 02720

Mr. Michael L. Miozza
84 Holland Street
Fall River, MA 02720

RE: Request for Written Interpretation on the Applicability of 49 C.F.R. Part 193 to Proposed Waterfront Liquefied Natural Gas Plant in the City of Fall River, Massachusetts

Dear Mr. Keppel and Mr. Miozza:

You have asked for a written interpretation on three questions related to Weaver's Cove Energy, LLC's (Weaver's Cove or the Company) proposal to build a waterfront liquefied natural gas (LNG) plant (Fall River Plant or the Plant) in the City of Fall River, Massachusetts (Fall River). In particular, you ask whether the Company's use of the SOURCES source term model to calculate the flammable vapor gas dispersion exclusion zone for the onshore portion of the Fall River Plant complies with 49 C.F.R. § 193.2059. You also ask whether its use ofa certain thermal radiation flux value to calculate the thermal radiation exclusion zone for that same portion of the Plant complies with 49 C.F.R. § 193.2057. Finally, you ask whether Weaver's Cove's failure to submit an Emergency Response Plan (ERP) is a violation of 49 C.F.R. Part 193.

While our regulations do not mandate the use of a particular source term model, we conclude that SOURCES can no longer be used to comply with our vapor gas dispersion exclusion zone requirements. We further conclude that the Company used the proper thermal radiation flux value to calculate the thermal radiation exclusion zone for the onshore portion of the Plant, and that it is not yet required to submit an ERP.

Background

In December 2003, Weaver's Cove Energy filed an application with the Federal Energy Regulatory Commission (FERC) to build the Fall River Plant. 1 In that application, the Company certified that it would comply with 49 C.F .R. Part 193 in siting, designing, constructing, operating, and maintaining the Plant. Weaver's Cove also used SOURCES and the thermal radiation flux values specified in the NFPA 59A: Standard for the Production, Storage, and Handling of LNG, 2001 Edition (2001 NFPA 59A) to determine the dimensions of the thermal radiation and vapor gas dispersion exclusion zones for the Fall River Plant. On July 15,2005, FERC issued an order conditionally approving the project?

In January 2009, Weaver's Cove filed another application with FERC to modify the design of the Fall River Plant by replacing its shoreline marine berth and cargo transfer system with the Mount Hope Bay (MHB) Transfer System, an offshore marine berth and 4.25-mile subsea PIP LNG Transfer System. As none of your questions relate to that proposal, this letter does not address the MHB Transfer System.

Question 1

You first ask whether Weaver's Cove's use of SOURCES to calculate the flammable vapor gas dispersion exclusion zone for the onshore portion of the Fall River Plant complies with the requirements in 49 C.F.R. § 193.2059. Before answering that question, we will briefly examine the history of our siting requirements and discuss some recent developments in the field of consequence modeling.

In 1980, the U.S. Department of Transportation's (USDOT) Materials Transportation Bureau (MTB) issued the original federal minimum standards for siting LNG facilities.3 Those standards required an operator or governmental authority to control the property within an "exclusion zone" to protect the public from the adverse effects of thermal radiation and flammable vapor gas dispersion in the event of an LNG release.4 They also specified the mathematical models that had to be used in calculating the dimensions of these exclusion zones.5 In the case of vapor gas dispersion, our 1980 regulations incorporated the Gaussian line-source (GLS) model described in appendix B of a 1974 technical report, "Evaluation of LNG Vapor Control Methods,,,6 and prescribed the conditions that had to be followed in executing that model. A method for determining the vaporization design rate, or source term, for input into the 1974 GLS model was one of those conditions.7

In February 1997, MTB's successor and our predecessor, the Research and Special Programs Administration (RSPA), replaced the 1974 GLS model with the current vapor gas dispersion model, the DEGADIS Dense Gas Dispersion Model (DEGADIS),8 and modified our regulations to allow operators to satisfy our vaporization design rate requirements by using an "equivalent personal computer program,,,9 which led to the widespread use of SOURCES by the U.S. LNG industry. 10 In March 2000, RSPA also repealed our vaporization design rate requirements "to allow operators more flexibility in computing" the formation of the source term, i.e., the physical phenomena that occur immediately after an LNG release, but prior to atmospheric dispersion. II

There have been some significant technical studies on source term and vapor gas dispersion modeling in the past five years. Specifically, at the request of the National Fire Protection Association's (NFPA) Fire Protection Research Foundation (FPRF), the United Kingdom Health & Safety Executive's Health & Safety Laboratory prepared a pair of reports on these sUbjects. The authors of those reports, a group with expertise in consequence modeling evaluation, concluded that SOURCES suffers from two deficiencies-i.e., it does not accurately represent the likely effects of (1) pool spreading and the resulting flammable vapor flashing or (2) vapor accumulation within impoundments. 12 According to the FPRF report, those deficiencies could lead to an under-prediction of the distance of a vapor gas exclusion zone for an LNG plant.

Turning to your question, our siting requirements no longer specify the vaporization design rates that must be used as the input for DEGADIS. We eliminated that regulation a decade ago "to allow operators more flexibility in computing" the formation of the source term, subject to our continuing obligation to evaluate the suitability of those models based on the best available scientific and technical evidence.

In that regard, our regulations state that "[f]lammable vapor-gas dispersion distances must be determined in accordance with the model described in the Gas Research Institute report GRI- 89/0242 ... 'LNG Vapor Dispersion Prediction with the DEGADIS Dense Gas Dispersion Model.",J3 GRI-89/042 further states that DEGADIS is subject to certain "limitations," including that it "models vapor disp,ersion only" and, by necessity, "requires the user to specify vaporization rates for liquid spills." 4

To comply with our vapor gas exclusion zone requirements, the vaporization rates specified as the input for DEGADIS must have a credible scientific basis. 15 Otherwise, a user could select whatever source term is likely to produce the most favorable outcome, e.g., the smallest or largest possible exclusion zone, or even at random. That would not be consistent with the limitations described in GRI-89/042, as incorporated into our siting requirements by reference, or our statutory obligation to protect the public from the hazards associated with operating an LNG plant. 16

The authors of the FPRF reports found that using SOURCES as the input for DEGADIS may lead to non-conservative hazard predictions. That finding, rendered by a group of experts in consequence modeling evaluation, should be given the utmost consideration, and we must respond by doing what is necessary to ensure public safety. Accordingly, we conclude that SOURCE5 can no longer be used to determine the vapor gas exclusion zone for an LNG plant, without taking appropriate actions to address the deficiencies identified in the FRPF reports. 17

We cannot say how this conclusion might affect any particular proceeding,18 but note that LNG facilities must be "designed" and "constructed" in accordance with our siting requirements, and that our interpretation of what is needed to satisfy those requirements applies to any LNG facility that is not yet in existence or under construction. 19

Question 2

You next ask whether Weaver's Cove used the proper thermal radiation flux value to calculate the dimensions of the thermal radiation exclusion zone for the onshore portion of the Fall River LNG Plant. The 2001 NFPA 59A is incorporated into our siting requirements by reference, subject to regulatory preemption in the event of conflict.2o The former standard lists a series of thermal radiation flux values for use in calculating the dimensions of an LNG plant's thermal radiation exclusion zone,21 and there is no similar provision in our regulations.2 Accordingly, the Company's use of the thermal radiation flux values from the 2001 NFPA 59A complies with 49 C.F.R. § 193.2057.

Question 3

Your final question is whether Weaver's Cove has violated 49 C.F.R. Part 193 by not submitting an ERP for the Fall River LNG Plant. Our regulations do not prescribe a specific deadline for submitting an ERP,23 and there is no such requirement in the 2001 NFPA 59A.24 Therefore, Weaver's Cove is not yet required to submit an ERP.

Conclusions

In conclusion, SOURCES can no longer be used to comply with our vapor gas dispersion exclusion zone requirements, the Company used the appropriate thermal radiation flux value to determine the thermal radiation exclusion zone for the onshore portion of the Fall River LNG Plant, and it is not yet required to submit an ERP.

Sincerely,

Jeffrey D. Wiese
Associate Administrator
for Pipeline Safety