SUMMARY ENVIRONMENTAL IMPACT ASSESSMENT

LIQUEFIED NATURAL GAS TERMINAL PROJECT

IN INDIA

June 2003

ABBREVIATIONS

ADB – Asian Development Bank BOD – biochemical oxygen demand COD – chemical oxygen demand CPP – captive power plant EIA – environmental impact assessment GMB – Gujarat Maritime Board GPCB – Gujarat Pollution Control Board LNG – liquefied natural gas MOEF – Ministry of Environment and Forest NOx – nitrogen oxide NOC – no objection certificate PLL – Petronet LNG Limited SO2 – sulfur dioxide STV – shell and tube vaporizer TSPM – total suspended particulate matter

WEIGHTS AND MEASURES

°C – degree Celsius dB(A) – decibel acoustic m3 – cubic meter MW – megawatt s – second

NOTE

In this report, “$” refers to the US dollar.

CONTENTS

Page

I. INTRODUCTION 1 II. PROJECT DESCRIPTION 1 III. DESCRIPTION OF THE ENVIRONMENT 5

A. Physical Environment 5 B. Biological Environment 7 C. Sociocultural Environment 8

IV. ALTERNATIVES 8

A. No Project 8 B. Alternative Locations 8 C. Alternative Technology 9

V. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES 9

A. Physical Environment 9 B. Biological Environment 11 C. Socioeconomic Impacts 12 D. Risk Analysis 13

VI. ECONOMIC ASSESSMENT 13 VII. INSTITUTIONAL REQUIREMENTS AND MONITORING PROGRAM 14 VIII. PUBLIC INVOLVEMENT 14 IX. CONCLUSIONS 15 APPENDIXES 1. Major Environmental Impacts, Mitigation Measures, and Monitoring Program 16 2. Main Environmental Requirements and General Standards for Discharge

of Environmental Pollutants 18

I. INTRODUCTION

1. As India progresses into the 21st century, oil and gas supplies are going to play important roles in the country’s economic development. India’s energy demand is one of the fastest growing in the world, and energy management is one of the country’s prime concerns. Pressure is mounting to reduce air pollution from sources such as diesel vehicles and power plants, and increased awareness is prompting a switch to cleaner fuels such as natural gas or low-sulfur diesel. Recognizing this trend, the Government of India decided to form a group named “India Hydrocarbon Vision–2025,” whose mandate included promoting the development and use of natural gas—including other liquefied natural gas (LNG)—and other alternative fuels. The panel’s analysis recommended that 20–30% of total gas imports be in the form of LNG. The Government has chosen Petronet LNG Limited (PLL), with Gaz de France as an equity holder, to set up LNG receiving terminals in India through four public-sector projects. PLL has decided to set up one terminal at Dahej, Gujarat (the Project), followed by another terminal at Kochi, Kerala. The Gas Authority of India Limited will transport and market the regasified LNG to consumers. In July 1999, PLL struck a long-term sale and purchase agreement for Ras Laffan Liquefied Natural Gas Company (RasGas) of Qatar to supply the country with LNG. 2. As stated in the environmental impact assessment (EIA) notification in 1994, India’s Environmental Protection Act of 1986 requires a project such as this to produce an EIA before it obtains statutory environmental clearance from the Ministry of Environment and Forest (MOEF). The Institute of Petroleum Safety and Environment Management, the Oil and Natural Gas Corporation, and Water and Power Consultancy Services (India) Limited prepared an EIA for the Dahej LNG terminal in 2000, while the National Institute of Oceanography prepared an EIA for the marine facilities in 1999. The reports were submitted to the Gujarat Pollution Control Board (GPCB) and MOEF. GPCB granted a no-objection certificate (NOC) for the Project on 2 February 2000. MOEF approved the environmental clearance on 27 December 2000. 3. The Project was classified by the Asian Development Bank (ADB) under category A, which means it could have significant environmental impact if proper mitigating measures are not implemented. This summary EIA is circulated to ADB’s Board of Director’s 120 days prior to loan consideration. The main EIA reports are available from the ADB project office and PLL. PLL produced this summary EIA, and ADB has not evaluated it. ADB’s evaluation of the Project’s impacts will include relevant public comments and suggestions, all of which will be included in the loan document submitted to ADB’s Board of Directors.

II. PROJECT DESCRIPTION 4. PLL intends to develop, construct, own, and operate an LNG import and regasification terminal with a first-phase throughput capacity of 5 million metric tons (t) per annum. This amount can be doubled in a second phase. The Project will be located at Dahej in the state of Gujarat. The location is shown on the map, and the land uses are shown in Figure 1. The indicative layout of the Project is shown in Figure 2, and Figure 3 shows the process diagram. The Project’s chief components are (i) a LNG receiving and regasification terminal, henceforth called the terminal; and (ii) a marine work loading/unloading facility, hereafter called the unloading facility.

2

3

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Figure 3: LNG Terminal Plant–Process Diagram

Send out LNG storage

tanks & LP pumps

LNG HP pumps

HP submerged combustion vaporizers

Fuel gas meteringa

NG to pipeline

Gas metering stations

Recondenser

Utilityb

Boil-off Gas Compressor

HP shell & tube

vaporizer

HP = high pressure, LNG = liquefied natural gas, LP = low pressure, NG = natural gas. a For captive power plant. b Power, industrial water, demineralized water and ethylene glycol (other utility requirements are met by captive

generation).

5. The terminal consists of (i) two full-containment LNG storage tanks, each with a gross capacity of 160,000 cubic meters (m3); (ii) a gas-recovery system to recondense the evaporated gas; (iii) dispatching facilities, including vaporizers; and (iv) auxiliary facilities, which include a captive power plant, electrical and control systems, utility production, metering, systems for fire and gas detection and protection, as well as other buildings and structures. 6. The size of the LNG storage tanks is based on (i) the size and unloading capacity of the LNG tankers, (ii) the dispatch flow rate, and (iii) possible delivery delays because of poor weather. PLL proposes to construct two tanks to ensure uninterrupted supply, even with a maximum delivery delay. Each of the storage tanks will have a net storage capacity of 148,000 m3 and a gross capacity of 160,000 m3. The storage tanks will be full-containment tanks, which consist of a primary layer of 9% nickel stainless-steel plate and a secondary layer of reinforced cement. 7. The evaporated gas recovery system is designed to recondense the gas in the storage tanks during both normal operations and unloading from the ship. This will ensure that there are no gas flares. Three cryogenic compressors—each with a flow rate of 11,500 m3/hour—and one recondensor have been proposed.

from LNG carrier

LNG unloading

arm

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8. PLL has decided to install shell and tube vaporizers (STVs) for regasification, in view of high levels of suspended solids in the seawater at Dahej and possible impact on marine life. STVs use glycol and water solution and ambient air heat to regasify LNG, which is sent to customers at a pressure of 90–92 kilograms per square centimeter. 9. The dispatching facilities are designed to handle 1,550 m3 per hour, with provision to expand to 3,100 m3 per hour in the second phase. Design parameters permit modulation of the dispatch flow rate from 50–120% of the nominal flow rate, depending on customers’ requirements. The dispatching facilities include (i) three low-pressure pumps per storage tank, with provision of a well for installation of an additional pump; (ii) four high-pressure pumps, including one pump as standby, for the first phase; (iii) a vaporization system; (iv) seven STVs, each with a loop of glycol and water solution heated by air heaters; and (v) two submerged combustion vaporizers. PLL intends to maximize the use of one such vaporizer by using the heat recovered from the exhaust of the captive power plant. 10. The auxiliary facilities consist of power and water supplies. The power requirement for the terminal is estimated at 12 megawatts (MW) or as much as 14 MW during unloading from the tankers. The power will come from two independent sources: (i) the captive power plant, consisting of three gas turbines each of 7.8 MW; and (ii) a 220 kilovolt-ampere connection from the state power grid. Water usage in the terminal is mainly for drinking, fire protection, and maintenance of a greenbelt. The terminal will be connected to Gujarat Industrial Development Corporation’s main water supply. No other outside utility supplies are needed. Instrumentation air, plant air, nitrogen, and fuel gas will be generated within the Project. 11. The marine works will comprise (i) an all-weather, deep-sea, single-berth jetty with a 2,430-meter (m) approach trestle and jetty head; (ii) a C-shaped breakwater approximately 700 m long and southwest of the jetty; and (iii) unloading facilities, which include three unloading arms, one vapor return arm, two unloading lines with flow rates of 10,000 m3 per hour, and one vapor return line. 12. The port facilities will consist of a single berth to accommodate LNG tankers of 65,000–138,000 m3 capacity, with a provision after possible adaptations for tankers up to 160,000 m3 in capacity. Three LNG unloading arms of 16” diameter each, and two unloading lines of 30” diameter each, are proposed to facilitate unloading operations. In addition, one loading arm and one vapor return line will be installed to transfer the evaporated gas during unloading operations. Unloading time will be about 14 hours, and the berthing time of the tanker will be 20–22 hours. The unloading facility will comprise an approach trestle including the jetty head with a total length of 2,430 m. The jetty will be a deep-sea jetty, extending 15 m below mean sea level. 13. A breakwater will create tranquil conditions for tankers and increase the availability of the jetty head during the monsoon season. The design of the breakwater would provide sufficient sheltered water to (i) enable harbor tugs to maneuver alongside tankers and secure their towing lines, (ii) allow tankers to come to a complete stop before docking, and (iii) help tankers berth and discharge their cargoes safely during monsoon season.

III. DESCRIPTION OF THE ENVIRONMENT 14. The site is in the Gulf of Khambhat, Bharuch District, in the state of Gujarat on the west coast of India. The site is about 45 kilometers (km) from Bharuch, the nearest major town. The terminal area is at 210 41’ latitude and 720 32’ longitude. A trestle will extend to the LNG berth,

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which will be in deep water. The site is part of an existing industrial complex, with two operational jetties, and a third under construction, to serve nearby industries. The site occupies 50 hectares (ha). 15. The site is north of the confluence of the Narmada River with the Gulf of Khambat. The site is an industrial area and is not environmentally sensitive. It already has the infrastructure necessary for heavy industries, and the Project will use many existing facilities. 16. Industrial units and a few small villages surround the site. The major industries nearby are Birla Copper (Indo Gulf), about 2.1 km to the north; Indian Petrochemicals Ltd, about 1.3 km east; BASF Styrene Ltd, about 2.8 km northeast; and Gujarat Alkali and Chemicals Ltd, 6.0 km away and also to the northeast. 17. To the north of the terminal site is an empty area separating it from the Gujarat Chemical Port Trust Company Ltd. For the purposes of the EIA, the core area lies within a 10 km radius of the project site. The core area includes five villages: Ambheta, Dahej, Jageshwar, Lakhigam, and Lurare. A. Physical Environment 18. Terrestrial Environment. The climate in the project area has four distinct seasons: (i) winter (December to March), (ii) summer (April to June), (iii) rainy season (July to September), and (iv) monsoon season (October to November). The maximum temperature is usually in April–May (about 40oC), and the mean daily minimum temperature during winter is about 13oC. Humidity exceeds 70% during the rainy season. The skies are mostly heavily clouded during the rainy season but clear up quickly after the monsoon months. During the rest of the year, skies are generally clear. Groundwater analysis showed low biochemical (BOD) and chemical (COD) oxygen demand demands, which indicated little domestic or industrial pollution. The absence or low readings of phenol compounds, cyanide, and heavy metals—such as chromium, zinc, copper, nickel, and cadmium—indicated an absence of industrial pollution. 19. Ambient air quality was monitored at four stations in the core area for three seasons. Higher levels of total suspended particulate matter (TSPM) were within the prescribed limit for industrial and mixed uses, i.e., 500 milligrams per cubic meter (mg/m3). The ambient sulfur dioxide (SO2) concentration was well below the prescribed limit of 120 mg/m3. The maximum nitrogen oxide (NOx) level of 26.2 mg/m3 observed at Dahej was well below the prescribed limit of 120mg/m3 for industrial and mixed-use areas. Carbon monoxide and hydrocarbon concentrations were below detectable limits. 20. Noise readings ranged from 47.7 to 70.4 decibels acoustic (dB[A)]. High noise levels came from construction and associated vehicular movement. 21. Groundwater samples were taken during winter, summer, monsoon, and post-monsoon seasons. The water temperature remained more or less constant throughout the year, and acidity, ranging from pH 7.7 to 8.4, showed no significant seasonal variation. The total dissolved solids ranged from 200 to 5,300 mg per liter (l). This data showed a marginal increase in dissolved solids from winter to summer, followed by a marginal reduction during monsoon season. The BOD and COD values at all locations were low. 22. Marine Environment. The site adopted for the port facility is in the Gulf of Khambat. The gulf connects several major Indian rivers to the northeastern Arabian Sea. The project site

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is a flat stretch of sandy soil along the gulf’s east coast, bordered by the Narmada River to the south and Dhadha Creek to the north. The wide, shallow Narmada estuary meets the gulf at Luhara. Extensive sand banks, many of them exposed during low tide, are present in the estuary. Bharuch Channel is the principal entrance to the estuary. The river floods during the rainy season in July and August. The shallow Dahej creek along the coast north of Luhara has a wide, bar-strewn mouth and nearly dries up during low tide. With its tidal port, however, it forms an important commercial link across the gulf. Several saltpans and stretches of marsh with isolated mangroves fringe the southern side. The north side of the creek supports some mangrove forest. 23. Tides, currents, circulation, and stratification influence the marine environment. The tides at Lakhigam are semidiurnal, with a considerable diurnal inequality. Tides are 6.2–7.7 m 34% of the time. Large tidal flows generate strong currents, and speeds of 0.8–2 meters per second (m/s) have been recorded in the interior gulf. Farther from the shore, where the water is 27 m deep, the current has been measured as fast as 2.8 m/s at a distance of 1 m below the surface. Near shore, the surface speeds are less than 1 m/s, except during spring tide, when the peak speed rises to 1.6 m/s. The data indicates that offshore currents have a small but definite effect on water circulation. 24. The salinity and temperature measurements at different locations showed an absence of stratification in the coastal water both before and after the monsoon season, even in the presence of large amounts of discharge from the Narmada River. This was because the dynamic tides and strong currents did not allow the water to stratify. The coastal water of Dahej is muddy and turbid, with high and variable amounts of suspended matter. Along the near shore, mean values of suspended matter at the surface ranged from 108 to 5,628 milligrams per liter (mg/l). Dissolved oxygen levels in the water were fairly high, varying from 4.1–8.5 mg/l in near-shore water to 4.0–7.8 mg/l in open-shore areas. The BOD values of the near-shore (0.1–5.3 mg/l) and open-shore waters (0.1–3.3 mg/l) were as expected for this dynamic environment. The observed BOD data indicated that the anthropogenic organic matter entering the coastal water was effectively oxidized. Data on nitrates and phosphates was high and varied widely, likely because fertilizers drain from nearby agricultural land. The concentrations of nitrites and ammonium salts are low in the near shore, as well as in the open shore, suggesting good oxidizing conditions. B. Biological Environment 25. Terrestrial Environment. There are no reserve forests or national parks in the core area. For administrative purposes, the core area is under the jurisdiction of the Rajpipla West Forest Division, which will be responsible for any compensatory tree planting required. 26. The core area has no endangered plant or animal species, because it is already industrial and agricultural land. 27. Marine Environment. The EIA of the marine environment indicated very high levels of aerobic heterotrophic bacteria, about two times more in sediment than in water. In general, bacterial counts, except total coliforms, were marginally higher during ebb than flood periods. This indicated that onshore activities influenced the marine ecosystem. Aerobic bacteria were common and played an active role in mineralizing organic matter in the gulf. Levels of fecal coliform in the Dahej-Jogeshwar segment of the gulf were higher than the limits set down in the United States Environmental Protection Agency’s criteria for water quality. The levels of phytopigments varied in a narrow range, and the observed values were low, indicating poor-to-

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moderate primary production in the gulf. The quantity and variety of zooplankton varied widely and indicated poor-to-moderate secondary production potential in the gulf. The zooplankton were primarily copepods, chaetognaths, and decapod larvae. The studies revealed very poor annual benthic production potential among macrofauna. 28. High tides and turbidity, coupled with strong tidal currents, made trawling and gill netting difficult and risky. The gulf had only limited shore-based net fishing. Experimental trawling by the National Institute of Oceanography also indicated a very low potential catch. The gulf was not suitable for commercial fishing in any season. C. Sociocultural Environment 29. The population density in the study area was about 82 people per square km, with about 890 females per 1000 males. The overall literacy rate was fairly high: 65.5% for males and 39.0% for females. 30. Each of the five villages in the core area had at least one primary school. Dahej village had one primary health center and one veterinary hospital. The area in general faced a shortage of drinking water. In the core area, only Dahej village had piped-in water supply. The others relied on water from tankers. 31. Around 50 project personnel and their families are expected to settle in the core area. These people are likely to be reasonably affluent; to fill their needs, ancillary services are likely to grow and have a positive impact in the area. At present, about 10–15 unauthorized occupants are on the project land. 32. Fishing is prohibited near the unloading facilities because of heavy chemical industries.

IV. ALTERNATIVES A. No Project 33. Energy demand is increasing rapidly in India. India’s proven hydrocarbon reserves were approximately 5,390 million t in 1999. Coal continues to be the country’s main energy source, but the use of natural gas is increasing gradually. India’s natural gas production has been stable in recent years. Gas demand may exceed supply by about 280 billion m3 per day by 2009–2010, and reserves at the end of 1999 were estimated at only 1,340 billion m3. India needs to import natural gas to meet future energy needs. LNG is being promoted as a reliable alternative fuel. The “India Hydrocarbon Vision–2025” report concluded that 20–30% of total gas imports could be LNG, taking into account various factors including energy security. The demand for an additional 2.0 million t of LNG every year indicates that a project like the one at Dahej will be needed every 2 years. B. Alternative Locations 34. The project location was determined by proximity to consumers and suppliers; suitability of port facilities; proximity to an existing pipeline network; and availability of existing infrastructure such as power, roads, telecommunications, and water. M/s Engineers’ India Limited studied alternative locations in Gujarat and concluded that Dahej offers the most advantages because of its ready consumer access and availability of infrastructure. Capital costs for a port facility at Dahej were minimum. Costs for extra pipelines to transport gas to

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consumers were also relatively low. The Gujarat Maritime Board (GMB), an authority responsible for developing port facilities in the state, had shown keen interest, and land was available close to shore for the terminal. 35. The location has many advantages, such as (i) a large back-up transmission facility thanks to the nearby 2,700 km Hazira, Bijapur, Jagdishpur pipeline, which runs from western to northern India; (ii) proximity to major gas consuming industries, both in Gujarat and along the aforementioned pipeline; (iii) relative proximity to the identified LNG source in Qatar; (iv) natural water depth of more than 12 m, facilitating berthing of large tankers and eliminating the need for dredging; (v) moderate wind and climatic conditions; (vi) a sparse population and no permanent structures to act as safety hazards; and (vii) readily available infrastructure in an existing industrial park. C. Alternative Technology 36. The technology for an LNG terminal is fairly simple and well established. Various national and international codes are available for design, including the Oil Industry Safety Directorate’s OISD–194, the European EN–1473, and the United States’ National Fire Protection Association’s NFPA–59A. These codes formed the basis for the Dahej design, with certain modifications tailored to the site. 37. Containment. Risk analysis for major hazards such as a major spill or fire indicated that single-containment tanks would not be safe for amounts of LNG this large. The double-containment tank was not recommended, either, because it needs a large protection system and extensive vapor clouds could form in the event of a spill. The net difference in price between double-containment and full-containment tanks is not significant when compared with the safety advantages of a full-containment tank. Full-containment tanks also offer (i) a higher operating pressure, which would reduce boil-off during unloading; (ii) a design that separates the weight of the piping, structure, and accessories from the primary container; (iii) no risk of leakage; (iv) excellent protection against external impact; and (v) additional space to store LNG in the secondary container. 38. Unloading Facilities. Two systems for transferring LNG from ships were considered during the EIA. First was a conventional jetty where ships would berth. The second involved submerged port moorings that could be installed and operating much faster. Although coaxial pipes were being investigated internationally, no commercial use of these pipes for LNG was known. A conventional jetty was chosen. The approach bridge would be approximately 2.4 km long, connecting the jetty head to the shore. The design of the unloading facilities was optimized. Modifications included passing bays at regular intervals to narrow the road on the approach bridge.

V. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATING MEASURES A. Physical Environment

1. Construction Phase 39. Terminal. The Project’s main impacts during construction will be noise and dust during excavation and construction. The soil texture is sandy, and particles are not expected to drift. Even in the worst weather, dust pollution should remain within 200–300 m of the road in the direction of the wind. During construction, runoff from the quarry could increase

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soil erosion, and rainwater could form pools that would breed mosquitoes. Contractors will be instructed to provide drainage, as per standard engineering practice, so that runoff does not accumulate. About 400 workers will be needed during construction. While most workers will commute from local villages, a few will stay in temporary facilities near the site. This could create problems such as pollution from sewage; water runoff; and use of local wood for domestic fuel, especially during the nonmonsoon months. Trenches will absorb excess water during construction, and the contractor will be required to provide adequate facilities for the construction workers. 40. The major airborne pollutants during construction will come from diesel-burning construction equipment. Fuel analysis of various construction equipment indicated that the maximum short-term increase in SO2 will be 0.029 mg/m3 at a distance of 200 m from the emission source. The increase in airborne particles will be about 0.0003 mg/m3, an amount so small it will not require any specific control measures. 41. Loading Facility. Construction is expected to (i) destroy some marine habitats through physical disturbance, and (ii) indirectly affect other marine habitats by modifying prevailing water movements, landforms, and erosion patterns on the nearby coast. Large-scale rock dumping during breakwater construction would disturb the bottom sediment, and the particles would remain in the water column because swift currents would discourage them from settling. An increase in suspended sediment would reduce algae proliferation. Digging, filling, and resettling of sediment may change sediment texture in localized areas, particularly in the intertidal zone. To ensure the least disturbance to land and water, the length of breakwater and its orientation were decided based on the model studies.

2. During Operation 42. Terminal. LNG storage and regasification do not involve combustion of any synthetic fuel, so the Project is not expected to affect air quality. The terminal will be equipped with a power plant of approximately 15.0 MW capacity, as well as gas vaporizers for LNG regasification during winter. These two components will be the terminal’s main consumers of fuel gas, which will be regasified LNG. Based on a standard model, emissions of NOx and SO2 should be insignificant 100 m from the power plant, and those from the gas vaporizers should be negligible. 43. LNG storage and regasification do not generate much noise, and project design has restricted machinery noise by imposing stringent controls on suppliers and contractors. Minimal noise is anticipated during operation.

44. The terminal is not expected to have any adverse impact on land, water, or air quality after completion. During construction, there might be marginal impact, and mitigation procedures will be imposed on the contractor. A low-pressure flame will burn incidental gas. Based on radiation analysis, the flame needs to be 10.4 m above ground, and the minimum height recommended under emission regulations is 30 m. PLL has decided to burn the gases at 40 m. The terminal will not use processes that generate significant noise. The engineering design will limit machinery noise. 45. Unloading Facility. Potential hazards to the marine environment during operation include spills of LNG or dry bulk cargo; wastes generated by ships/port terminals; and large-scale release of cargo, fuel, and chemicals in the event of an accident or collision. Air and water temperatures at the site are very high compared with the boiling point of LNG, which

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evaporates as soon as it leaks. LNG is very light—with a density of 0.45 grams per cubic centimeter—so if a leak occurs under water, it will surface very quickly. An LNG spill would have negligible impact on the water column. 46. The proposed C-shaped breakwater will facilitate ship movements and berthing, particularly for LNG tankers. Natural water currents and waves will be reduced in an area three to four times the length of breakwater, but currents should return to normal beyond that.

47. Currents are expected to decrease on the north side of the breakwater during rising tides and on the south side during falling tides. Waves from the south and southwest will also be reduced, creating a calm zone in the lee of the breakwater where sediment levels could rise. In extreme conditions, a sand spit could even form. Erosion will likely deepen the bottom on western side of the breakwater. 48. During operation, the breakwater’s impact on water quality should be negligible. It should not affect the plankton, but bottom-dwelling organisms could be affected by sediment buildup. 49. General Impact. With the development of the terminal, nearby industry will likely switch to regasified LNG for fuel. LNG has the obvious advantages of low carbon dioxide and NOx emissions, negligible release of SO2 and TSPM, and no ash or other hazardous wastes. This terminal should have a significant positive impact on air quality. The facility requires water only for heating, drinking, and washing, with no discharge of cold water into the marine environment. Runoff water will be channeled and removed through storm drains during monsoons. B. Biological Environment

1. Construction Phase 50. Terminal. The proposed site is generally barren, but does have a few mesquite. About 200 people are expected to stay near the site during construction, and their domestic fuel needs will amount to about 1 kg of wood per person per day. They will likely try to meet their fuel needs by cutting the trees, a problem that should be solved by requiring the contractor to supply an alternate fuel such as kerosene. 51. There were no major animal species observed in or near the project area. The Project’s impact on fauna is not expected to be significant. 52. Unloading Facility. The construction of the jetties and the breakwater will have an impact on marine life on the ocean floor. The damage should be localized but irreversible along the proposed marine structures, except in the case of the bridge, where the seabed could recover in 2–3 years. Construction will destroy about 16 ha of the coastal marine ecosystem. The proposed structures should, however, provide an additional surface area of about 19.96 ha. This will result in a net gain of 6.64 ha of intertidal habitat and a net loss of 2.68 ha of subtidal habitat. Overall, project implementation will result in a net gain of 3.96 ha of bottom habitat. The proposed development may kill an estimated 1.52 x 107 bottom-dwelling creatures such as crabs, insects, shellfish, shrimp, and worms with a total wet weight of about 79.4 kilograms. Overall, the impact of proposed development on the gulf’s bottom-dwelling communities should be minor.

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53. Construction should be optimized and well-coordinated to minimize negative impacts and complete the Project on schedule. The fabrication yard should be sufficiently far from the high-tide mark, and transfer of materials to the site should follow a predetermined path. The pipeline should be buried at a safe depth in the intertidal areas, near-shore subtidal areas, and estuary crossings. Cyclone-induced turbulence should also be accounted for in the pipeline design.

2. Operational Phase 54. Terminal. The project area is not known to contain any rare or endangered species, and the terminal is not expected to disturb the ecology of the core area. The Project is not expected to release any pollutants during normal operations. Its location and operation are not expected to affect the breeding habitats or migratory paths of any species. No adverse impacts on fauna are anticipated during construction or operation. 55. Unloading Facility. Deep-sea vessel traffic is confined to a 72 km navigational channel between the mouth of the gulf and the entrance to Dahej port. Traffic density in the gulf will rise 139% by 2005 because of the terminal. The probability of a collision will rise to once every 16.2 years, with accidents involving a tanker happening an average of once in 74.9 years. Boats will run aground an average of once every 3.2 years for all ships, with tankers meeting the same fate once in 14.9 years. A petroleum spill in the gulf is a distinct possibility. Major diesel spills caused by tanker accidents would contaminate the environment and harm marine life. A high-speed diesel spill’s impact on the marine ecology would depend on the type of product and the quantity spilled, which could be as much as 5–10 t. Maximum stress would fall on bottom-living organisms if a spill reached shore. Ecological impact would be confined to the ecosystem around a spill zone, and the effects would dissipate after a short period. 56. PLL should develop a strategy to combat spills. It should maintain an in-house capability to fight spills of about 50 t. PLL has prepared a local disaster contingency plan, particularly for oil spills, which should be integrated with the regional disaster plan. A traffic scheme—adequately separating shipping lanes and monitoring traffic directly or remotely—would minimize the risk of tanker collisions or groundings. Navigational aids should clearly mark channels and indicate separation distances. Positions of the markers should be noted on navigational charts. As a part of an overall environmental strategy, policing should be introduced to prevent vessels from discharging wastewater, tanker washings, and oily slop into the marine waters. C. Socioeconomic Impacts

1. Construction Phase 57. Terminal. Peak construction periods could involve as many as 400 laborers. Although the contractor is expected to employ as many locals as possible, some migrant labor could change the sex and age ratios in the area. Migrants might stay with the Project during operation, but the impact of their numbers on the community is not expected to be significant. The Project is expected to include community facilities at the project site, such as water supply and sanitation, transportation, and solid waste disposal. These will limit negative effects from construction. GMB has already acquired land for the terminal, and no

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private land will be acquired. At present, 10–15 unauthorized occupants live and have planted crops on the project site. GMB has agreed to resettle and compensate them. 58. Unloading Facility. Temporary workers should be housed with proper sanitation sufficiently far from the high-tide line. Sewage and other wastes from workers’ settlements should not be released to the sea.

2. Operation Phase 59. Terminal. About 50 project personnel, along with their families, are expected to settle in the core area. They are likely to be relatively affluent, and secondary services are expected to develop to meet their needs. This will create some local jobs. 60. Unloading Facility. The area is not used for fishing because of nearby heavy chemical industries. No fishers will be displaced. D. Risk Analysis 61. Integrated risk analysis was carried out by ERM Hong Kong, with input from Tokyo Gas Engineering. Modeling studies for the breakwater, mooring, and unloading facilities were conducted by SOGREAH, a French company, and reviewed by Frederick Harris of the United Kingdom. The risk analysis showed that the risks to the public and to workers are very low, provided that (i) internationally accepted standards are used in the design; and (ii) the plant remains separated from the control room, administration block, and off-site areas. The study calculated that the off-site individual risk is less than 1x10-6 outside the site boundary. The control room, administration building, and other inhabited buildings should be constructed with few or no windows, and the overall window area should be minimized. Air conditioners should be protected on the roofs of buildings, or placed at ground level away from the process area, to prevent them from acting as missiles in the event of an explosion. Fire tanks and pumps should be located as far from process areas as possible.

VI. ECONOMIC ASSESSMENT 62. The Project’s quantifiable costs are (i) capital, (ii) LNG, (iii) shipping, (iv) regasification, (v) financial items, and (vi) taxes and duties. The total project cost is estimated at $540 million, of which the equity contribution is $160 million by the sponsors. A 50% equity share is earmarked for private and foreign companies. The Project is expected to generate substantial revenue for the national and state governments over 25 years. Costs for additional instruments, stand-by equipment, and personnel to assure safe and environmentally sound operation are estimated at $8.5 million. The Project will have a financial internal rate of return of 16%. 63. PLL has also spent money on the following: (i) road development, (ii) a contribution to local development through funds for the district collectorate1, (iii) relief for earthquake victims, and (iv) a place of worship for the local community. District authorities have also advised PLL to participate in local community welfare activities. The company has also appointed a consultant for the development of a greenbelt at a cost of 20 million rupees, complying with local environmental and statutory requirements. Efforts have been made to

1 District collectorate is a local government unit in India. It is headed by the District Magistrate and Collector,

and is the nerve center of district administration.

14

conserve natural resources. PLL has also included in the capital expenditure the cost for processing sewage and recovering treated water for use in the greenbelt. No separate cost estimates are available for such facilities.

VII. INSTITUTIONAL REQUIREMENTS AND MONITORING PROGRAM 64. Residual environmental impacts will be systematically monitored and reported during construction and operation, in accordance with the agreements during the review by GPCB and MOEF. The Project is designed to comply with the requirements of GPCB and MOEF on air emissions, water inflows and outflows, and noise standards. PLL is duty-bound to follow the conditions imposed in the GPCB and MOEF clearance. Appendix 2 shows the parameters, frequency of sampling, location, and number of sampling stations. PLL’s environmental and safety unit will be responsible for monitoring and reporting. 65. PLL will pay close attention at all stages of the Project to environmental performance. It will consult regularly with the responsible authorities and the community. PLL will participate in any local environmental monitoring committee constituted by state/local authorities. The plant organization will include a specialist responsible for environmental management and monitoring, and PLL’s training programs will include environmental management activities for all operational staff. 66. PLL will submit to ADB every year a copy of all government licenses, permits, and certificates related to safety and the environment. In the event that the Project is cited for violations of environmental or safety regulations, the annual report will include a certification either that the defect has been corrected, or that an acceptable plan has been submitted to correct the defects.

VIII. PUBLIC INVOLVEMENT 67. In any large-scale infrastructure project, the impact on local communities is significant in terms of employment, the environment, infrastructure, and activity. The Government has recognized this and involved the public when granting clearances for the Project. 68. Formal public involvement has taken place via public consultations, newspaper announcements, and advertisements to inform the public that such a large-scale project is under consideration. 69. The first public consultation was conducted on 19 November 1999 under the stewardship of local authorities, as a part of the GPCB review process. PLL made a presentation during the first public hearing, after which the public asked questions. There were 37 participants. The attendance and discussion were documented, and PLL has kept copies. Local authorities customarily ask attendees for their opinions before they issue the NOC, to establish whether they are satisfied with the answers from project proponents. 70. PLL applied to MOEF for the final clearance after obtaining an NOC. MOEF convened a review panel to examine the EIA, visit the site, and consult the public. The first presentation to the panel was made on 24 November 2000, and a second presentation answering the questions from the first meeting was made on 20 December 2000. Copies of the presentation material and discussion notes are available at PLL. After MOEF issued the NOC, PLL had to publish statements in the local newspaper and on the MOEF website for

15

public comments before the NOC became final and effective. Notices were published on 14 February 2001 in the Western Times of Ahmedabad, Gujarat and in the Gujarat Mitra of Surat, Gujarat. No objections were raised. 71. PLL confirms that all presentation material during the first public hearing was presented in Gujarati, the local language. All formal and informal discussions also took place in that language. Efforts were made to present the facts in a form comprehensible to laypeople.

IX. CONCLUSIONS 72. The site is already industrial and is not environmentally sensitive, and much of the necessary infrastructure already exists. The Project is designed to comply with India’s environmental standards, especially those related to air emission, air quality, wastewater effluent, received water quality, and noise. It will help reduce the gap between demand and supply of natural gas. It will not interfere with human settlements and does not require displacement of the local population. 73. The Project will encourage industry, not only in the nearby area but in other parts of the country, to switch to natural gas. The Project will greatly improve air quality, because natural gas burns more efficiently than coal or fuel oil and contains fewer impurities. 74. The main risk from the Project is accident. The design, construction, and operation opted for (i) total containment of gas storage tanks; (ii) standby and redundancy of sensitive parts, to prevent accident in case of equipment failure; (iii) online monitoring of process variables; (iv) automatic emergency cutoff; and (v) segregation of the tankers.

16 Appendix 1

MAJOR ENVIRONMENTAL IMPACTS, MITIGATION MEASURES, AND MONITORING PROGRAM

Table A1.1: Construction Phase

Impacts and Mitigation Measures

Environmental Component

Potential Impacts

Impact Source

Mitigation Measures

Remarks

Land Construction waste / trenches / borrows

Construction activity

Sloping to be provided as per standard engineering practices

Short-term and negative

Surface water - An increase in suspended solids and BOD - Public health problems, especially during monsoons

Construction activity

Construction of ‘Sulabh Shauchalayas’ septic tanks and absorption trenches

Short-term and negative

Groundwater No impact No impact No impact No withdrawal Air quality Marginal increase in

TSPM and RPM due to vehicular movement

Vehicular movement

Vehicles with PAC to be deployed, water sprayed, roads to be paved

Short-term and negative

Noise Increased noise level Construction activities / vehicles

Equipment selection

Short-term and negative

Socioeconomic environment

Immigration of labor, increase in stress on the natural resource and infrastructure

Construction activity

Deploy more locals in construction activities

Positive and long-term, negative and short-term

BOD = biochemical oxygen demand, PAC = pollution abatement control, RPM = respirable particulate matter, TSPM = total suspended particulate matter. Note: Petronet LNG Limited is responsible for implementing the mitigating measures.

17Appendix 1

Table A1.2: Operation Phase Impact and Mitigation Measures

Environmental Component

Potential Impacts

Source

Mitigation

Remarks

Water balance Water to be supplied by GIDC

No impact envisaged

Surface water Disposal of accidental

oil spill Accidental spill Physical removal of oil

and disposal None

Groundwater None None None Withdrawal Ambient air quality

Marginal increase in NOx levels in ambient air

-Flaring unabsorbed/ depressurized natural gas -Captive power emergency generation

-The dispersion model indicates occasional flaring will be dispersed quickly, before reaching human settlements. -Generators will be maintained as per emissions standards.

Negative and marginal

Reduction in TSPM and NOx levels in the industrial area due to switching over to LNG for captive power generation by nearby industries, long-term and positive

Noise Increased noise level

due to vehicular movement

Engine / compressor / human activity

Greenbelt as noise barrier

Negative and marginal

Land use Industrial land to be

developed; no acquisition of private land

No impact

Vegetation Plant cover to increase

with greenbelt development

Greenbelt development

Positive impact Increase in plant cover; long-term and positive

Employment Secondary services

such as transport will generate jobs.

Secondary employment

Long-term and positive

Population There will be an

increase in the floating and fixed populations. Demand for houses and other products and services will increase villagers’ income. Some laborers may quit their regular jobs in favor of higher wages with the Project.

Mechanization of labor-oriented jobs through cooperative societies

Project Long-term and positive

GIDC = Gujarat Industrial Development Corporation, LNG = liquefied natural gas, NOx = nitrogen oxide, TSPM = total suspended particulate matter. Note: Petronet LNG Limited is responsible for implementing the mitigating measures.

18 Appendix 2

MAIN ENVIRONMENTAL REQUIREMENTS AND GENERAL STANDARDS FOR DISCHARGE OF ENVIRONMENTAL POLLUTANTS

Table A2.1: Effluent Standards

Parameter (units)

Inland Surface Water

Public Sewer

Land for irrigation

Marine coastal areas

Color and odor Non-objectionable

Non-objectionable

Non-objectionable

Suspended solids (mg/l) max

100 600 200 -For process wastewater–100

-For cooling water effluent–10% above total suspended matter of influent

Particulate size of suspended solids

Shall pass 850 micron IS sieve

-Floating solids–max 3mm -Settling solids–max 850 mm

pH 5.5–9.0 5.5–9.0 5.5–9.0 5.5–9.0

Temperature max (°C) Shall not exceed the receiving water temperature by more than 5°C

Shall not exceed the receiving water temperature by more than 5°C

Oil and grease (mg/l) max

10.0 20.0 10.0 20.0

Total residual chlorine, (mg/l) max

10.0 1.0

Ammonia nitrogen (as N) (mg/l) max

50.0 50.0 50.0

Total Kjeldahl nitrogen (as NH3) (mg/l) max

100.0 100.0

Free ammonia (as NH3) (mg/l) max

5.0 5.0

BOD (5 days at 20°C) (mg/l) max

30.0 250.0

COD (mg/l) max

250.0 250.0

Arsenic (elemental) (mg/l) max

0.2 0.2 0.2 0.2

Mercury (elemental) (mg/l) max

0.01 0.01 0.01

°C = degree Celsius, BOD = biochemical oxygen demand, COD = chemical oxygen demand, IS = international standard, mg = milligram, mg/l = milligram per liter, mm = millimeter, NH3 = ammonia, pH = measure of acidity. Note: One monitoring station will be established at the main effluent line and samples will be taken weekly.

Additional sampling points maybe required by the authorities: specifically, GPCB.

19Appendix 2

Table A2.2: General Emission Standards

Parameters

Standards

Concentration-based standard Particulate matter 150 mg /mm3 Equipment-based standards Sulfur dioxide 60 mg/scm Power generating capacity 500 MW and more 275 m 200 / 210 MW and above to less than 500 MW 200 m less than 200 / 210 MW

H=14 (Q) 0.3

H = physical height of the stack in meters, m = meter, mg/mm3 = milligram per cubic millimeter, mg/scm = milligram per standard cubic meter, MW = megawatt, Q = emission of SO2 in kilogram per hour, SO2 = sulfur dioxide. Note: Continuous stack monitoring equipment will be installed to measure the particulate matter and SO2. Source: Ministry of Environment and Forest. 1986. Environment (protection) Rules. India.

20 Appendix 2

Table A2.3: National Ambient Air Quality Standards

Pollutant

Average

(Time Weighted)

Concentration in Ambient Air

µg/m3

Method

Industrial

Residential

Sensitive

SO2 Annuala

24 hours

80 120

60 80

15 30

Improved West and Gaeke ultraviolet fluorescence

NO2 Annual 24 hours

80 120

60 80

15 30

Jacob and Hochheiser (arsenite gas phase chemiluminescence)

TSPM Annual 24 hours

360 500

140 200

70 100

HVS avg > 1.1 m3/min. Same as annual

RPM, size<10 µm)1

Annual 24 hours

120 150

60 100

50 75

RPM sample Same as annual

Lead (elemental)

Annual 24 hours

1.0 1.5

0.75 1.00

0.50 0.75

HVS Same as annual

CO 8 hoursb 1 hour

5.0 10.0

2.0 4.0

1.0 2.0

NDIR spectroscopy Same as 8 hours

µg/m3 = microgram per cubic meter, µm = micrometer, CO = carbon monoxide, HVS = high volume sampler, m3 = cubic meter, NDIR = nondispersive infrared, NO2 = nitrogen dioxide, RPM = respirable particulate matter, SO2 = sulfur dioxide, TSPM = total suspended particulate matter. a Annual arithmetic mean of at least 104 measurements per year, taken twice a week, hourly, at uniform

intervals. b 24-hourly/8-hourly values should meet criteria 98% of the time in a given year. In the remaining 2% of the time,

they may exceed the criteria, but not on 2 consecutive days.

Note: Four monitoring stations are initially planned. Measurements will be taken every month for the first year of operation, then every 3 months subsequently.

Source: Gazette Notification. 1994. CPCB. Part II, Sec 3 (ii).

21Appendix 2

Table A2.4: Ambient Noise Standards

Area Code

Category of Area

Limits in dB(A)

Day Night

A Industrial area 75 70 B Commercial area 65 55 C Residential area 55 45 D Silence zone 50 40

dB(A) = decibel acoustic. Notes: (i) Day time is 6 am to 9 pm. (ii) Night time is 9 pm to 6 am. (iii) A silence zone is an area up to 100 m around hospitals, educational institutions, and courts of law. The

silence zones are to be declared by the competent authority. Vehicular horns, loudspeakers, and firecrackers are banned in these zones.

(iv) Mixed-use areas should be placed under one of the four above-mentioned categories by the competent authority, and the corresponding standards will apply.

(v) Noise monitoring will be carried out at different locations, inside and outside the plant, using portable noise-measuring equipment.

Source: Ministry of Environment and Forest. 1986. Environment (protection) Rules. India.