CITGO Still Insists That Sempra's Cameron LNG Docks Have Unanswered Questions and Present Significa

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The Text of CITGO’s Minority Report is as follows:

The first step to reduce risk is to avoid risk. For risk that can not be avoided the issue then becomes risk mitigation. Our position continues to be that the unique V-shaped design of the Sempra dock possesses undue risk to channel users because (a) the V-shape design creates a greater chance of a 90 degree allision from passing vessels, and (b) the dock is located directly on the channel and too close to passing vessels. This creates and undue risk of both allision and danger of docked LNG vessels being pulled from the dock potentially while unloading. Any approval from FERC does not prove a safe berth. We feel more can be done to avoid such risk before the first LNG vessels arrive to the Sempra dock. The real issue is why the Sempra dock does not utilize the commonly accepted slip berth that most LNG facilities on narrow waterways employ. In the end, the final decision and responsibility to keep the channel safe remains with the USCG.
The purpose of the Minority Report/Position Paper is to consolidate various reports, summaries and analysis into one location, encourage the HSC to take greater steps to address the Sempra dock design and for use in the Standards of Care.

1. Oceanic Study

The Oceanic Study was over 1000 pages which was then condensed into a few hundred pages. It did not draw any conclusions. The HSC relied upon Capt. Mowbray to summarize the Oceanic Study. We believe the summary provided by Capt. Mowbray to the HSC understated the results of the study. Additionally, the HSC’s abbreviated review of the Oceanic Study and refusal to review the CITGO runs ignored serious concerns arising from the study. We feel that further analysis shows multiple failures. Additionally, the study showed that even with mitigation forces such as wind, current and tugs, multiple failure still occurred.

2. CITGO Test Runs

The 15 CITGO test runs were conducted to supplement the 29 HSC study team runs. The CITGO runs focused more on worst case scenario and near worst case scenario -- all of which we feel represent actual channel conditions. They were conducted by a licensed pilot who has experience piloting vessels over 200,000 m3. Those runs show serious allision risks can occur during actual channel conditions.

3. Infinity Report

The Infinity Engineering analysis determined resultant mooring stresses on docked LNG tankers that occurred as a result of the passing vessels. We had several issues with the Infinity report: a) it did not use the data prepared by Oceanic but instead chose to estimate several factors, b) the size and speed of passing vessel were reduced, c) currents were reduced, d) the size of docked LNG vessels were reduced, and e) twenty mooring lines were used instead of sixteen. These modifications reduced forces on the docked LNG vessel and yet these results were still borderline at best. The following factors which were not considered as part of the tests will only increase the forces on a docked LNG vessel: a) current may be greater than 1.8 knots, b) passing vessel speed may be greater (which it currently is), c) larger LNG vessels up to 217,000 m3 will be used, d) two of the larger vessels can be docked at the same time, e) only 16 mooring lines will be used and not all will keep the 5% pretension as assumed in the report. Finally, there are plans to deepen the channel to allow even larger vessels into the channel.

4. Standards of Care

CITGO does support the use of Standards of Care to help make the channel safer, however, we are still of the opinion that the real issue is avoiding risk first. The unique V-shape design of the Sempra dock and the location of the dock so close to the channel should still be the focus of the attention. Mitigation efforts in the previous reports did not adequately prevent an allision or prevent extreme forces on docked LNG vessels.

• CITGO will support efforts of the Standards of Care by its Minority Report/Position Paper, reports and summaries that it has provided to date.

• CITGO will continue to support safety efforts by providing its assistance and expertise in marine issues. In fact, we feel that no other channel user (besides Sempra) has spent the time and money and provided the expertise to the HSC as CITGO has on these safety issues.

• We have not directly commented on this draft on the Standards of Care since we feel the SOC exercise will not adequately mitigate risks caused the Sempra dock design. We feel we should still be focusing on avoiding risk by recommending the Sempra dock change its design first.

• In the past, we felt our concerns did not get the proper attention or were ignored. It seems that when CITGO opposed the Sempra dock design, the resulting documents from the HSC or USCG often evidenced that CITGO was part of the process that supported the dock design. That is mischaracterization of our involvement.

• CITGO does support a Standards of Care for the entire channel, however, the first step should be addressing the Sempra dock as was originally envisioned by the HSC when it approved the allision and passing ship studies. We feel the current attempts to address a channel-wide standards of care is stalling tactic. We should address the Sempra dock issues first and then proceed with the rest of the channel.

5. LCDR Reams Letter of April 4, 2007

We appreciate the USCG recognizing the credentials of the CITGO pilot who conducted the CITGO runs and recommending the CITGO runs to be included in the Standards of Care discussion. We feel this is a good first step. We feel that the design of the Sempra berth does encourage a passing vessel to pull towards the dock. We have also provided more examples that steering systems, after failure, can and do suddenly cycles the rudder to an extreme position and such should be considered when analyzing the risk of the Sempra dock. Tug assistance can not be considered an adequate mitigation factor since the fairlead and bollards on existing vessel are not capable of handling the forces needed for adequate tug assistance.

CONCLUSION
In summary, the test results show that an extremely hazardous condition for both passing ships and the docked LNG tankers has been created by the unique V-shaped design of the Sempra LNG facility docks on this narrow waterway. It should be noted that approval by FERC and USCG or even the imposition of mitigating actions by the Harbor Safety Committee under the Standards of Care does not constitute a finding that the Sempra dock design is safe. In the end, the final analysis is going to be simply whether the dock design imposes undue risk to others. A few things to keep in mind are (a) whether a safer design exists - which it does and is in use on the Calcasieu Channel, (b) whether the risks were known - which they have been well before construction was commenced, and (c) and why a safer dock design was not used. Fortunately, we are still at a point where these are only potential risks since no LNG vessels are currently accessing the Sempra docks. There is still time to focus on risk avoidance and not just after-the-fact risk shifting and risk management.
In conclusion, The Oceanic Study and the CITGO runs have shown significant problems in the ability of passing ships to avoid collision with the moored LNG ships in the present dock configuration and location. These studies and tests deserve more attention and reaction than they have given them.
 

MarEx Analysis: The controversy surrounding Sempra’s controversial dock design at its Cameron (Lake Charles) LNG facility on the Calcasieu River is not likely to go away any time soon. Despite efforts by local authorities to put the matter to bed once and for all, CITGO Petroleum persists in its criticism of the nascent terminal’s docking arrangements. The preceding document was forwarded to MarEx this week and according to its authors, it is intended to address issues and risk not properly illuminated by the Oceanic Consulting study commissioned by the CRHSC. According to Ron Foster, a consultant acting on behalf of CITGO Petroleum Corporation, neither this document nor the voluminous Oceanic / CRWHSC study will be forwarded to any federal regulatory bodies by the CRWHS for consideration. According to Foster, almost $300,000 in funds was expended to study the potential risks that might be inherent in the design of the Sempra “V-shaped” berths. Last Tuesday (June19) the quarterly board meeting of the CRWHSC was held in Lake Charles, during which a wide range of stakeholders testified on the conditions in the waterway, risks involved with the Sempra Facility and how those risks would be handled going forward. Coming soon: the full text of testimony at that meeting and MarEx analysis of the positions of the parties involved. We think that the maritime community will find this to be of enormous interest -- with national implications. Stay tuned.