Nova Scotia Utility and Review Board

DECISION                                                                              NSUARB-LNG-MAP-PC-01

2008 NSUARB 64

NOVA SCOTIA UTILITY AND REVIEW BOARD

IN  THE  MATTER  OF  THE  PIPELINE  ACT  AND  THE  GAS  PLANT  FACILITY REGULATIONS

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IN THE MATTER OF AN APPLICATION by MapleLNG LTD. (“MapleLNG”) for a PERMIT TO CONSTRUCT a LIQUEFIED NATURAL GAS (“LNG”) PLANT at Goldboro, Guysborough County, Nova Scotia

BEFORE:                              Peter W. Gurnham, Q.C., Chair Margaret A. M. Shears, Q.C., Vice-chair Kulvinder S. Dhillon, P. Eng., Member

APPLICANT:                        MapleLNG LTD. APPLICATION DATE:       March 11, 2008

SCHEDULE "A"                Individual Submissions and MapleLNG Responses

SCHEDULE "B"                Permit to Construct

DECISION DATE:             June 11, 2008

DECISION:                           Pursuant   to   Section   14   of   the   Gas   Plant   Facility Regulations, the Board hereby issues to MapleLNG Ltd. a Permit to Construct a Liquefied Natural Gas Plant at Goldboro, Guysborough County, Nova Scotia subject to conditions.

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I         THE PROJECT

[1]                 This decision is in respect of an application filed with the Board by MapleLNG LTD. ("MapleLNG") for a Permit to Construct ("PTC") a liquefied natural gas ("LNG") plant at Goldboro, Nova Scotia.  The application, dated March 11, 2008, included this project description:

MapleLNG is developing a terminal for the import and storage of Liquefied Natural Gas (LNG)

at a site in Goldboro, Nova Scotia, Canada. The project is named MapleLNG.

The location is adjacent to the existing ExxonMobil Sable gas plant (SOEI plant) and the

Maritimes and Northeast Pipeline (M&NP).

The LNG import terminal will consist of a jetty, LNG storage, an LNG regasification section, nitrogen production and injection and distribution of the product natural gas to the customers, and a co-generation units.

LNG will be supplied by LNG carriers (LNGC), which will berth at a new jetty to be constructed in Betty’s Cove adjacent to the MapleLNG site and pump the LNG cargo into storage tanks located on the site’s shoreline.

The liquefied gas will be pumped from the storage tanks to the LNG regasification system. In the regasification section the LNG is regasified to the pipeline conditions of the M&NP. Subsequently, the natural gas product is sent through a metering system and is distributed to the M&NP pipeline and the co-generation unit.

If required, the LNG composition will be adjusted to meet the M&NP natural gas specifications by nitrogen injection.

The total nominal send-out capacity of the import terminal in the initial phase is up to 9 BCM/a maximum with possible extension to 18 BCM/a (second phase).

The terminal will operate continuously on a 24 hours per day, 365 days per year basis. Three full containment storage tanks each of 162,500 m3  gross capacity will be constructed, providing the terminal with a total of 487,500 m3 gross capacity of LNG storage.

The MapleLNG site development includes marine docking and unloading facilities with two berths at a single jetty. In the first phase one of these berths will be equipped with unloading facilities. In the second phase (extension of storage capacity and send-out rate) the second berth will be equipped with unloading facilities. The development includes the construction of these facilities for use as a LNG carrier berth with pipelines and other facilities as necessary for unloading LNG and transporting it to storage.

(MapleLNG Application, March 11, 2008, Vol. 1, p. 1)

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II        THE BOARD'S ROLE

[2]                 The Board's role under the Pipeline Act, R.S.N.S. 1989, c. 345 (the "Act") in connection with this application is to ensure that, from a public safety perspective, the LNG plant is designed, constructed, operated and ultimately abandoned in accordance with the Gas Plant Facility Regulations (Nova Scotia) (“Regulations”) and Nova Scotia Code of Practice for LNG Plants. The Board’s role does not include consideration of environmental or occupational health and safety matters, except to the extent they are addressed in the Regulations, nor does the Board’s role include any form of commercial regulation of the LNG plant.

[3]                 Under the Regulations, the Board can engage a certifying authority (“CA”), an independent person or a group with expertise in LNG plants, to state whether in its opinion the Regulations and associated standards will be met during all phases of the LNG project. The Board engaged the services of Lloyd's Register North America Inc. ("Lloyd's Register") to act as its CA and provide recommendations to the Board with respect to the MapleLNG application.

[4]                 To date, the Board has carried out the following activities with respect to the project:

•           engaged the CA;

•           issued Directions on Procedure setting out the Permit to Construct application process;

•           held a public information session in Goldboro;

•           invited, received and reviewed public submissions on the application; and

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•           received and reviewed the CA’s recommendations with respect to the application.

Public Information Session

[6]                 In its Directions on Procedure, the Board determined that a public information session would be held to provide an opportunity for interested parties to receive information about the LNG project and to make comments on same. The information session was held on April 7, 2008 at the Goldboro Interpretive Centre, Guysborough County after due public notice. Approximately 30 people, Board staff and a representative of the CA attended the session.

[7]                 Board staff gave an overview of the Board’s role in connection with the MapleLNG application. Lloyd’s Register’s representative provided background information on the company and the services it would provide as CA to the Board.

[8]                 Questions  from  the  audience  were  encouraged  at  the  end  of  the presentations. The comments and questions were generally supportive of the application. Some questions related to specifics of the MapleLNG application regarding security and environmental matters, and those were referred to the representatives of MapleLNG who were present in the audience.  There were no questions regarding the Board’s role in connection with the application and no opposition to the project was indicated during the course of the session.

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The Board’s Continuing Role

[9]                 It is important to note that the Board’s responsibility to oversee the project does not end with the issuance of a PTC. Rather, the Board, with the ongoing assistance of the CA, will continue to monitor the design and construction phases of the project to ensure conformance with the Regulations. Upon construction completion, but prior to start up, MapleLNG will be required to file a Licence to Operate ("Licence") application.  That Licence will only be issued once the CA has satisfied itself and the Board that the plant has been designed, constructed and tested in accordance with the Regulations, and that MapleLNG has in place appropriate quality control, quality assurance and process safety management programs such that the plant may be safely put in to service.  The Licence will include conditions to ensure ongoing compliance with the Regulations.

[10]               Once the LNG plant is operating, the Board’s supervision will continue to ensure that MapleLNG complies with the Regulations and the conditions in its Licence. In that regard, the CA will conduct regular inspections and audits, reporting their findings to the Board.  Should the plant be found to be operating in a manner which is not in compliance, the Board will take such actions as are necessary up to, and including, suspension or revocation of the Licence.

III       THE CERTIFYING AUTHORITY'S ROLE

[11]               Under the Regulations, the CA’s role is primarily to determine whether the

LNG  plant  is  being  constructed,  operated  or  abandoned  in  accordance  with  the

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Regulations, and to make recommendations to the Board regarding any terms and conditions which should accompany a PTC or Licence issued by the Board.

[12]                 To date the CA's activities have included:

•           reviewing the application for completeness and conformance to the

Regulations;

•           reviewing additional information and clarification provided by MapleLNG;

•           reviewing public comments, and MapleLNG’s responses to those comments; and

•           preparing a recommendation that a Permit to Construct be issued, subject to certain terms and conditions.

[13]                 The CA's recommendation was:

Lloyd's Register North America Inc (LRNA) as Certifying Authority recommends that a Permit to Construct the Maple LNG Terminal can be issued, subject to the proposed conditions listed in the aforementioned letter, together with such others that may be imposed by the Board.

Based on the submitted application, with noted exceptions, the plant will be designed, constructed and ultimately operated in accordance with the regulations and the "Nova Scotia Code of Practice for Liquefied Natural Gas Facilities" dated July 13th 2005.

[14]                 The CA made the following recommendations for PTC conditions:

•           Maple LNG to ensure that the proposed works are carried out and completed in accordance with all federal, provincial and municipal laws, and in particular the Pipeline Act, the Gas Plant Facility Regulations, CSA Z726-07 and the Code of Practice, as amended from time to time; all other applicable codes and standards, as amended from time to time; the Permit, as may be amended; and the application.

•           Maple LNG to submit to Certifying Authority, on a timely basis and in complete system packages, all design and materials information relating to components and systems required by the Gas Plant Facility Regulations, the Code of Practice and applicable codes and standards referenced therein.

•           Components or systems of the Proposed Works requiring design appraisal to be identified by Maple LNG or its Independent Contractor and agreed to by the

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Certifying   Authority   prior   to   commencement  of   construction   (the   “Identified

Components”).

•           Maple LNG to deliver to the Certifying Authority all design and materials information pertaining to the Identified Components as soon as possible and, in any event, before commencing field installation of each such Identified Component. If after review of such information, the Certifying Authority determines that an Identified Component does not or will not comply with the Gas Plant Facility Regulations, the Code of Practice or the applicable codes and standards referenced therein, the Certifying Authority shall notify Maple LNG and upon receipt of such notice Maple LNG shall, promptly (and in any event prior to the submission of an application for a License to Operate) remedy any such non-compliance.

•           Maple LNG to provide reasonable notice to the Certifying Authority of its intended schedule of activities for the proposed works and shall permit a representative from the Certifying Authority to be on site to observe the construction.

[15]               The  Board  has  accepted  the  CA's  recommendations.    The  proposed conditions are incorporated in the PTC.

[16]               As noted above, the CA will continue to assist the Board in its supervision of the plant through all phases of design, construction, operation and ultimately, shut down and abandonment.

IV       PUBLIC COMMENT

[17]               Written submissions were received from seven parties:

•           Kevin McAllister

•           Gordon MacDonald - Guysborough County Regional Development

Authority

•           Gary Cleary - Municipality of the District of Guysborough

•           EnCana Corporation

•           Bethany Keddy

•           Arthur McLaughlin, P.Eng.

•           Trudi Rhynold

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[18]               Issues raised in the public submissions included:

•           possible locations of faults and other geological structures (natural and man- made) in the vicinity of the project;

•           use of groundwater and the impact on nearby residential water supply;

•           jetty size compared to regasification vessel size;

•           adequacy of meteorological data used for risk calculations;

•           need for containment along the jetty structure;

•           risk associated with containment calculations;

•           risk associated with routing of highways 344 and 316;

•           need for additional assessment for the early regasification option;

•           road traffic management and safety, including school bus safety;

•           impact of climate change, particularly with respect to sea level rise;

•           consideration in the risk assessment of Encana’s Deep Panuke onshore pipeline, which will be adjacent to the LNG plant;

•           safety considerations for the Meadow Lake dam;

•           gold mine tailings management;

•           air emissions impacts;

•           risk associated with LNG tanker navigation;

•           safety issues with respect to the marine unloading terminal;

•           fire fighting preparedness;

•           impacts of future design changes;

•           storage tank dimensions and over-pressure considerations; and

•           risk associated with sabotage, terrorism or accidents.

[19]               Individual submissions, and MapleLNG’s responses, are included in Schedule “A” to this Decision.  The CA and the Board have carefully reviewed MapleLNG's responses to these submissions.

[20]               The  Board  understands  the  concerns  expressed  by  the  public  and appreciates the time and effort taken to make the Board aware of them.  However, the Board’s supervision responsibilities under the Act and Regulations do not include a number of these matters. The Board is satisfied with MapleLNG's responses to the issues which have been raised by the public and notes that those concerns which do fall under the Board's mandate will be fully addressed and considered as the project progresses through

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the preliminary and detailed design stages. MapleLNG, in its responses, has indicated its intent to do so.

[21]               The Board is satisfied that the ongoing monitoring and reporting by the CA will ensure that compliance with the safety and operational requirements under the Board’s jurisdiction will be maintained.

V        PIPELINE PERMIT APPLICATION

[22]               In addition to the application which is the subject of this Decision, MapleLNG also applied for a PTC for a send-out pipeline. The 1.67 km long, 762 mm outside diameter pipeline would receive the gas from the MapleLNG plant and transport it to a point of connection on the Maritimes and Northeast Pipeline.

[23]               Subsequent to filing the pipeline permit application, MapleLNG advised the Board that the pipeline route would require significant alteration from the route originally proposed.  At the time of this Decision, MapleLNG has yet to revise its pipeline permit application to incorporate details of the new routing. Thus, the Board is not yet in a position to complete its review of the pipeline permit application.

[24]               While the Board does not see this as a reason to delay the issuance of the PTC for the LNG plant, it reminds MapleLNG that no inferences should be drawn with respect to the issuance of a PTC for the pipeline as that application will be judged on its own merits.

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VI       PERMIT TO CONSTRUCT

[25]             The  Board  has  carefully  considered  the  application,  the  CA recommendations, public submissions and MapleLNG responses. The Board believes that it is in the public interest to issue a PTC to MapleLNG.  A copy of the PTC, including the conditions to be met by MapleLNG, is attached as Schedule “B” to this Decision.

DATED at Halifax, Nova Scotia, this 11th day of June, 2008.

Peter W. Gurnham

Margaret A. M. Shears

Kulvinder S. Dhillon

May 22, 2008

Nova Scotia Utility and Review Board

1601 Lower Water Street P.O. Box 1692, Unit “M” Halifax, Nova Scotia

Schedule "A"

Attention:  Ms. Nancy McNeil

Regulatory Affairs Officer/Clerk

Subject: Application for Permit to Construct – Response to Public Comments

Dear Ms. McNeil:

Please find enclosed our responses to the public comments received from the NSUARB during the public review period that ended May 7, 2008.

If  you  have  any  questions  or  require  clarification,  please  to  do  not  hesitate  to  call  the undersigned.

Yours truly,

R. Derek Owen

General Manager

MapleLNG Ltd. Suite 1030, 1801 Hollis Street, Halifax, Nova Scotia, B3J 3N4

Phone + 902 482 0028 Fax + 902 482 0029 Web www.maplelng.com

Information Request:

The area of the proposed LNG has been extensively used for Gold mining since 1868 and has very detailed maps and research of the Geological Faults that are known to exist and can be found by accessing the Natural Resources website or library.  What I find very disturbing is that after comparing Maples site plan with the geology of the area it

appears that they intend to construct their Pipeline and one of their storage tanks directly on top of these Geological Faults.  After reviewing all of the submissions and evidence supplied by Maple I can not find any mention of these Faults in there geological exploration section in Volume 2 and none of their maps show any of the faults in the

area.

Under the Pipeline Act- Pipeline Regulations (Nova Scotia) section 16 (a) states [A Bulk plant or storage facility shall (b) be located in an area that is known to be free from flooding, landslides, rock falls, and geological faults.]  Given that the Act clearly prohibits their project from being built in this area the board must clearly reject Maples application for its Permit To Construct their LNG at Goldboro.

I will be sending some of the evidence with this letter to verify my research along with a section of a map from the Geological Survey of Canada (G S C Map 832) showing the location of the Geological Faults in relation of Maples infrastructure.  Also included are

2 pages from the Geological Survey of Canada (MEMOIR 385) (GOLD FIELDS OF NOVA SCOTIA) that provide details of the known geology in the Issac Harbour gold district, that area of the proposed project.  The Department of Natural Resources has compiled a great deal of information dealing with this area due to it being one of the largest gold producers in Nova Scotia and have stated in their report (EASTERN SHORE COMPILATION PROJECT) that (LOCAL FAULTS ARE FOUND IN ALL GOLD DISTRICTS) and specifically refer to Isaacs Harbour, (sheets included with

submissions).

MapleLNG Response:

Location of faults and other geological structures are an important part of design considerations for the MapleLNG facility. Currently, MapleLNG will be proceeding with a seismic hazard assessment for the next phase of project development. This assessment will be consistent with seismic hazard assessments completed for other Canadian LNG facilities and will include the following: A desktop study of seismological, tectonic, geological, geophysical, geotechnical, photometric data of the study region; a field reconnaissance to map and quantify the movement (present activity) of nearby geologic faults; and probabilistic analyses carried out to derive site-specific OBE and SSE seismic

parameters for structural tank design, including peak ground acceleration (PGA) and spectral acceleration (Sa) values, for the appropriate ground conditions and design return periods.

In the seismic hazard assessment completed for the Bear Head LNG site, Jacques

Whitford summarized the regional seismic setting as follows:

Other than the west coast of British Columbia, the vast majority of Canada (including Nova Scotia) lies within a mid-plate tectonic regime. In eastern Canada, the nearest plate boundary is the mid-Atlantic ridge located more than 1,000 km beyond Canada’s east coast. At this distance, the mid-Atlantic ridge is too far away to cause direct seismicity in eastern Canada, but it is believed that ongoing widening of the ridge results in continual high horizontal compressive stress throughout the eastern North America. Seismic activity has been observed to be concentrated along a series of deep-seated rift faults along the St. Lawrence, Saguenay and Ottawa valleys that were formed several hundred millions years ago during early attempts to open the Atlantic Ocean. It is believed that seismic activity in these areas is caused by fault movement induced by high compressive stresses from the mid-Atlantic ridge. Seismic activity along the St. Lawrence (as shown on Drawing 1) is too distant to cause any significant seismic hazard contribution to the

Port Hawkesbury LNG site. Therefore, the seismic hazard at Port Hawkesbury will be dominated by contributions from local seismicity.

Jacques Whitford reviewed the available seismological, tectonic, geological data of the study region. Based on this review, Jacques Whitford confirmed the absence of any information pertaining to the existence of earthquake-induced surface rupture or active faulting in Nova Scotia. (Jacques Whitford and Associates Limited, Seismic Hazard Assessment, Bear Head LNG Terminal Site, May 14, 2004).

The MapleLNG provincial EA described the available seismic information and mapping of fault locations (See attached EA Figure 8.13-3 and text from EA Sections 8 and 9). This information was  summarized in the permit to construct submission Volume 3, Section 3b (Design Seismic Data – 2.3 page 8).  MapleLNG recognizes further seismic work  is  required  and  will  be  proceeding with  a  seismic hazard  risk  assessment  as indicated  in  the  above  paragraph.    Based  on  the  provincial  EA,  earthquakes  are considered to have little if any effect on the proposed plant site.

For clarification of a statement made in this submission, it is assumed that the reference to ‘pipeline’ in the submitted comments is actually the cryogenic lines supported by the trestle and not the send-out gas pipelines exiting the facility. Based on the Geological Survey Mapping for the area, the trestle runs perpendicular to the Harbour fault crossing it in the vicinity of Dung Cove.

Also, regarding the reported fault located beneath one of the LNG storage tanks as depicted  and  circled  on  the  geological  mapping  figure  on  page  3  of  the  public submission, Maple has  reviewed an  original copy of  the  same mapping as  well as mapping prepared by professional geologists for the provincial EA and conclude that the LNG tanks do not overlie geological faults (See attached Figure 8.13-3 from the Provincial EA and an original copy of the Geological Survey Map of Canada (Map 832)).

ATTACHMENTS FOR KEVIN MCALLISTER RESPONSE

(EXCERPTS FROM PROVINCIAL EA)

Attachments

8.13.2.5 Proposed Keltic Site

The remainder of this discussion will focus on the proposed Keltic Site and its immediate environs, since this part of the Keltic Study Area is slated to become industrial and subject to greater potential environmental risks overall. Thus, a greater knowledge of its geology is needed to better understand existing groundwater conditions, possible groundwater flow control characteristics, and mitigation needs. The major F2 fold axis at the proposed Keltic Site and environs strike east-west and plunge east, with 3.5 km generally between anticlinal axis. Locally from south to north, the major anticlines and synclines shown by Fletcher and Faribault (1981, 1893a, 1893b, 1893c, 1893d),

Schiller (1961) and Hill (1991) east of the Country Harbour and Isaac’s Harbour Faults include: the Isaac’s Harbour Anticline at Dung Cove; the Long Lake Syncline at roughly the south boundary of the proposed Keltic Site; the Upper Seal Harbour Anticline at the south end of Gold Brook Lake; the Little Lake Syncline at the south end of Ocean Lake and Meadow Lake; an unnamed anticline at the north end of Ocean Lake; and the Loon Lake Synclinorium at Big Stillwater within the Isaac’s Harbour River watershed.

In larger scale (smaller area) mapping south of the Seal Harbour Lake area, Faribault (1904) shows the South, Middle and North Anticlines, and their associated synclines. These are smaller folds superimposed onto the Isaac’s Harbour Anticline, where the distance between secondary anticlinal axis averages about 0.5 km. The nearby Country Harbour Fault is the most prominent strike-slip fault on Nova Scotia's eastern shore. Roland (1982) suggests that there has been upwards of 8 km of sinistral displacement along it, although drag folding and shearing in strata of the Loon Lake Synclinorium (Hill, 1991) suggests that there has been more than 10 km, and perhaps as much as 18

km, of sinistral displacement along this fault. It extends up into Horton Group deposits to the north. The Isaac’s Harbour Fault, which is another major regional fault, defines the east shore of Isaac’s Harbour and may extend up to 4 km northwest of Stewart Lake. Sinistral displacement along the Isaac’s Harbour Fault at Dung Cove was in the order of

600 m to 800 m (Faribault, 1904). There is an apparent displacement of about 1 km along the New Harbour Fault located about 10 km east. Due to the large displacements that have occurred along the nearby regional faults, the structural geology within the proposed boundaries of the Keltic Site is expected to be complex. Faribault (1904) shows a fault along Dung Cove Brook, which is likely to be a synthetic fault to the Isaac’s Harbour Fault and along which there has been 75 m to 125 m of sinistral displacement. Other faults parallel the Isaac’s Harbour and Dung Cove Brook Faults to the south and north of the proposed Keltic Site (Faribault, 1899 and 1904), and there is severe faulting in underground workings at Gold Brook Lake (P. Smith, pers. comm., 2001). Field mapping by a geoscientist along the gas plant access road has revealed yet another, north-south trending fault along which there may have been up to 50 m of strike slip displacement

and also perhaps some normal displacement. The many lineaments identified by Tilsley (1996b) and which parallel the Isaac’s Harbour and Dung Cove Brook Faults, such as those along parts of Betty's Cove Brook and Gold Brook, suggest a broad shear zone and/or other faults that are likely to be related to the Isaac’s Harbour Fault. These cannot be directly mapped due to the thick till present.

9.22.7 Faults/Shear Zones, Seismic Events and Tsunamis

9.22.7.2 Seismic Considerations

Notwithstanding Nova Scotia's location within the stable continental part of the North American tectonic Plate, within Canada's eastern seismic region, large earthquakes have occurred in the past and will inevitably occur in the future. These are likely to have little effect, if any, on the proposed plant site only and may (or may not) occur at any time during its construction and/or operation. Tanks and other structures on site will be designed for the seismic rating in the region, as required under CSA Z276-01. In

addition, all structures at the site will be built to meet or exceed the new design criteria as set out in the 2005 edition of the NBCC. Appropriate contingency planning will also address the possibility of structural failure which may result from such an event. With proper mitigation measures in place, the residual effects, although improbable are expected to be of major significance (see Table 11.0-1 in Section 11.0).  Considerations for mitigation are presented in Section 10.

Seismic Hazard

Figures 9.22-1 to 9.22-5 contain the new seismic hazard maps that will be used in the

2005 edition of the NBCC to replace the 1985 maps presently in use in the 1995 NBCC (Adams and Atkinson, 2003). The 2005 edition of the NBCC was adopted by Nova Scotia on May 1, 2006 (T. Ross, pers. comm., 2006). The 2005 edition of the NBCC contains significant changes in the provisions for seismic loading and design (Heidebrecht, 2003). The 1995 NBCC employed seven “zones” (0 to 6) to describe

peak ground velocity and acceleration, determined at a probability of 10% in 50 years. In the 2005 edition of the NBCC, the Geological Survey of Canada is now using a probability of exceedance of 2% in 50 years, and calculating hazard in the form of uniform hazard spectra, which provides a much better period-dependent representation of earthquake effects on structures. The implication is that the design forces in short-period structures relative to those in long-period structures would be much larger than is the case for structures designed in accordance with the 1995 NBCC provisions.

Table 9.22-1 presents the seismic hazard for various spectral acceleration time periods as given by Adams and Halchuk (2003) for site category C (very dense soil and soft rock,

360 < V30 ≤ 760 m per second (m/s)), and seismic hazard with appropriate ground motion amplification factors as defined by Liam Finn and Wightman (2003) applied for site categories B (rock, 760 < V30 ≤ 1,500 m/s) and A (hard rock, V30 > 1,500 m/s) for three localities along Nova Scotia's Eastern Shore, compared to three urban areas with low to high levels of seismic hazard, i.e. Toronto, Montreal, and Vancouver (Heidebrecht, 2003).  The seismic hazard at the proposed Keltic plant site would fall somewhere between that for Halifax and Canso, and since all important structures will have foundations built directly onto bedrock, it could be defined as a class A to B site. Even when taking into account the nearby magnitude 7.2 Grand Banks event of 1929, Figure 8.13-7 shows the seismic hazard for the Keltic plant site to be generally low;

similar to or less than site class A to B criteria for Toronto for time periods of 0.2 and 0.5 seconds, and only slightly above that for Toronto and significantly less than for Montreal for 1.0 second period events.

Faults

Symbol not represented on legend – appears to be a watercourse

Blow  up  of  the  Geological  Survey

Map of Canada (Map 832)

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FORMATION

-     Devonian Granite

D Halifax Formation

-     Goldenville Formation

FIGURE No  8 13 3

-- Fau t  (asmapped byewC)               KELTIC PETROCHEMICALS IN .

-- Antci line axis (as mapped by ewC)                  BEDROCK GEOLOGY

JULY 2006

8 of8

Information Request:

Safety of Nearby Residential Groundwater

Figure 2.1 Battery Limit scheme of the Utilities of the LNG Import Terminal, Page 3

BOD Utility Systems

Figure 2.1 indicates groundwater as a source of water.  Surface water was identified as the potential source of water for industrial requirements in the environmental assessment review process.  Although there is a condition of environmental approval that groundwater be monitored during construction and operation of the projects, groundwater was not seriously considered as a potential source of industrial or potable water. Had the proponents identified this there would have been a request from the Municipality that the volumes of water required be identified and a groundwater compensation plan be put in place to cover nearby residences should a safety/health

issue arise as a result of groundwater withdrawal and impending hydrological changes in the groundwater flow.

MapleLNG Response:

A well water mitigation plan has been developed in accordance with Condition 3.3 of the Nova Scotia Environmental Assessment Approval and accepted by Nova Scotia Environment.  Attached is the NSE approved Standard Operating Procedure for dealing with Water Well Complaints.

Information Request:

Regasification Vessel Specifications

5.2 Vessel sizes

Table 4.1: Selection of LNG carrier fleet used for the design of marine facilities does not have dimensions for potential vessel that regasifies on board and docks to send regasified vessel to an onshore pipeline.

MapleLNG Response:

The jetty will be designed for the handling of vessels with dimensions outlined in Table

4.1 (i.e. capacities of 75,000 m3 up to 250,000 m3 and vessel lengths ranging from 260m to 345m).  Current regasification vessels fall within the dimensions outlined in Table 4.1, capacities ranging from 138,000 m3 up to 150,900 m3 (Reference: http://excelerateenergy.com/downloads/Excelerate_vessels.pdf).

Information Request:

QRA

QRA MapleLNG Draft Report, Table 5.3, page 63

The individual risk has been calculated based on meteorological data from Halifax for a single year. This does not accurately reflect the conditions at the site, nor does a 2-year period come close to capturing the average wind speeds and directions. 100 yr averages and site specific data should be used to recalculate the risk in all cases once the final design and site layout has been competed.

MapleLNG Response:

For a QRA, not only is wind direction and wind speed needed but also Pasquill stability class.  The nearest geographical location having all these required data was Halifax, Nova Scotia.  Shorter time periods are commonly used in individual risk calculations and there is a preference for the use of recent and complete data sets.

Information Request:

MapleLNG Impounding, page 12

“For determining the evaporation rate the TNO Effects model shows difficulties to calculate a pool evaporation from water.  Therefore the evaporation has been determined by assuming an average subsoil on land with a maximum pool height of 0.1 m”

How applicable then is this model for accurate representation of the risk?  As proposed in this application, there will be no containment for spills at the terminal or along the pipeline trestle which travels over water.

MapleLNG Response:

The TNO Effects model is considered applicable to accurately represent risk and has been used to calculate effects from unlikely LNG releases at other LNG facilities in the world.  This model is based on assumptions (like all models) and in general is believed to generate conservative results.

Furthermore, of primary importance are the following assumptions:

1.   The maximum effect distances for natural gas dispersions have been calculated up to ½ LFL (Lower Flammability Limit). Vapour clouds can only be ignited when

between LFL and UFL (Upper Flammability Limit) (i.e. ½ LFL can not be ignited), thus ½ LFL contours must be considered to be conservative.

2.   In addition the natural gas dispersions have been based on neutral gas dispersion models. As described in the studies, the actual dispersion of natural gas from a pool of LNG will be a combination of initially dense gas dispersion (cold natural gas), followed by neutral gas dispersion (partly warmed up natural gas) and finally light gas dispersion (normal temperature natural gas). Thus, using neutral

gas dispersion models, the effect distances must be considered to be conservative.

Containment of spills at the facility was considered based on the requirements of the NS Department of Energy Code of Practice (CoP) for LNG facilities and the CSA Z276-07. In summary, there will be containment for spills at the terminal, specifically in the vicinity of LNG Booster pumps, submerged combustion vaporizers and the boil off gas (recondensor) area.  Containment is not considered on the jetty as the unloading arms in the transfer area over the waters edge will be made of solid metal piping.  Containment on the trestle is also not considered as the trestle simply supports the solid metal cryogenic lines transporting the LNG to the tanks.   Furthermore, impoundment on the jetty/trestle is considered not feasible and technically difficult to collect about 150 - 200

m3 (or even more) of LNG at a relatively small area (jetty head) and at such a distance to shore.  If the LNG collected at the jetty would be routed to shore, the majority of LNG will likely vaporize before reaching shore.

NB: Please note that a conservative calculation of the ½ LFL effect distance in case of a 2 minute outflow from one LNG unloading arm (full bore rupture) was completed.

Information Request:

QRA MapleLNG Draft Report Figure 6.2, page 84

It appears from this figure that the rerouting of highway 316 falls within the Individual risk LNG Import Terminal of 10-3 and 10-4.  “From the risk source to the 1 in 10, 000

(10-4) annual chance of fatality risk contour the risk to the public is deeded unacceptable and no other land uses except the sources facility, page 82 QRA Maple LNG, section 6.1”

It is not acceptable to reroute highway 344 at this location.  There is no warning system proposed or system to shut off this portion of the highway at this location should an accident occur however unlikely the model suggests.

MapleLNG Response:

The individual risk as defined in the QRA is the likelihood or probability per year that a person who is continuously present and unprotected at a particular location will die as a consequence of an accident at the site. Therefore, on roadways where individuals are only occasionally present, the fatality risk is considered to be significantly less because it is

not continuously occupied.

A road is thus not normally considered land use in relation to a QRA and as such it is not unacceptable to run the road through areas with risk contours above 10-4.

Information Request:

Conceptual Design: Process Systems

Early regasification and LNG transshipment

2.8.1          Early Regasification

The environmental assessment for this concept has not been reviewed by the regulator or the public; it constitutes a material change in project development and direction. It is the first time that the concept has been introduced to the public and municipality.  The QRA has not assessed regasification at the terminal.

MapleLNG Response:

The on-board regasification of LNG is being investigated to provide further opportunities for the operation of the LNG facility such as the ability to provide natural gas to the market before the terminal has completed commissioning and the ability to provide additional send-out capacity for the terminal if future spot cargoes are available.

MapleLNG does not consider the inclusion of the early regasification option as a formal request in the Permit to Construct to move forward with the execution of this work. Early regasification was included in the submitted Permit to Construct application to inform the UARB that this alternative could be studied in further detail. Should MapleLNG decide

to pursue this option, an evaluation of the impact on current permits, QRA and regulatory approvals would be completed from a project development and timing perspective.

Information Request:

Traffic Safety

Scope of Work, page 18

6.0       Installation and Construction

6.1       Construction Execution Plan

The construction execution plan should cover Management of Traffic and safety to surrounding communities.  This should link to the Traffic study conducted as part of the conditions for EA approval.  Traffic safety was an issue during the SOEP construction phase particularly children and school buses.

MapleLNG Response:

A Transportation Management Plan has been prepared in accordance with Condition 1.9 of the Environmental Assessment Approval and has been approved by Nova Scotia Transportation and Infrastructure Renewal.  This plan is linked to the traffic impact study completed under Condition 1.3 of the EA approval. The plan covers the following items: identification of primary and secondary transportation routes; details of all required road realignments and upgrades; transportation schedules; dust management measures; safety management measures; methods to ensure contractor compliance; monitoring measures; and communication policies.

Information Request:

Sea Level Rise and Climate Change

Conceptual Design Marine Facilities, page 10

The design has not taken into consideration potential sea level rise as predicted by the International Panel on Climate Change (IPCC) a figure of 60 cm.  The application is void on any discussion of the safety aspect of sea level rise and the impact on the jetty and pipeline trestle.

MapleLNG Response:

As per the attached figure, the minimum elevation of the structure is CD+8.62 m. For the trestle, the lowest level of the superstructure is chosen at CD +9.00 m and for the loading platform, the lowest level is CD +10.35 m.  Considering a sea level rise of 0.60 m, the elevation of the loading platform is still sufficient; see attached Drawing 0381-004: Typical Cross Sections and Side Views.

The trestle cross beams slope up at the underside (see attached Drawing 0381-004) leaving a small area of exposed concrete.   The additional load due to wave crests contacting the concrete cross beam support is small compared to the total wave load.  As the ice load is significant higher than the wave load on a pile, there is ample safety left for wave conditions (overall safety factor of approximately 5.0) and therefore some additional load on the underside of the concrete cross beam will have no effect.

ATTACHMENTS FOR GORDON MACDONALD RESPONSE

Attachment 1

Standard Operating Procedures

Domestic Water Well Complaints

Standard Operating Procedure

Domestic Water Well Complaints

Maple LNG will establish a filing system and designate an individual responsible for receiving domestic water well complaints.

Designate will document the following information during initial conversation with complainant:

ƒ    Homeowner name, address (civic and mailing) and contact information.

ƒ    Type of water supply (i.e., drilled well, dug well or spring).

ƒ    Nature of the problem (i.e., quantity and/or quality issues).

If the complaint is managed at this time, Designate will simply file the information and provide notification to Nova Scotia Environment and Labour (NSEL).

If the complaint warrants investigation, Designate will initiate action immediately. This will involve:

ƒ    Contact to NSEL who will choose whether or not to get involved.

ƒ    Determination of the need to contact an independent “qualified person (QP)” to

handle the investigation. The QP will be asked to respond in a timely manner satisfactory to the homeowner.

Depending on the nature of the complaint, an investigation may include one or more of the following activities:

ƒ    Physical assessment:

o Measurement of water level in the well

o Removal and assessment of the pump and; noting that only persons

licensed to do so under the NSEL Well Construction Regulations will

remove or alter the position of a pump located in a well.

o Video log of the well

o Flow test

ƒ    Chemical assessment:

o Collection/submission of a water sample to a Canadian Association of

Analytical Environmental Laboratory (CAAEL) certified facility

ƒ    Comparison of physical and/or chemical results with baseline survey information.

ƒ    Preparation and submission of a report to the homeowner and NSEL.

Depending on the results of the investigation, mitigation may include:

ƒ    Provision of a temporary water supply.

ƒ    Well replacement.

ƒ    Follow-up testing.

ƒ    Preparation and submission of a final report to the homeowner and NSEL.

Designate will file all relevant information pertaining to the complaint.

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