LNG Shipping Safety

LNG shipping – a strong safety record
Liquefied Natural Gas (LNG) has been safely produced and
transported across the world since the 1960s - over 135,000
voyages have been completed covering over 100 million
kilometres, without there ever being a significant spill, loss of
cargo, or environmental incident.
There are hundreds of LNG carriers transporting LNG from
production facilities to gas terminals and markets worldwide.
LNG carriers are built to very strict international design standards,
and feature sophisticated equipment to enhance safe navigation.
LNG import terminals operate in many places around the world in
close proximity to cities and urban populations. For example, there
is an LNG Terminal located in the centre of Boston Harbour, with
LNG carriers safely transiting a busy port on a regular basis close
to the Boston CBD.
Even if the outer hull was damaged during a major collision or
during a serious grounding accident, there is more than 2 metres
between the outer hull and the second inner steel hull.
LNG is stored in four or five separate tanks or compartments on
board the ship. This means that even if one compartment was
somehow breached, the cargo in the other tanks would not be at
risk - limiting the volume of LNG which could potentially escape.
The design of this system maintains the very low temperature of
LNG, enabling LNG to stay cold (-161°C) without the need for
pressurisation. LNG is a liquid and is not carried under pressure.
As such, it is not flammable or explosive on board the ship. Only
when the vapours of LNG are mixed with oxygen (fresh air) does it
become flammable – and the storage system is designed to
prevent this occurring.
The absence of pressurisation significantly reduces the chances of
an incident, and further contributes to the safe transportation and
storage of LNG.

Liquefied Natural Gas (LNG)

LNG is natural gas (mostly methane) that has
been turned into a liquid by cooling it to -161°C.
As a liquid, it takes up a lot less space and
does not have to be stored under pressure - so
it is easier to transport and can be safely
shipped to markets around the world.
As a liquid, LNG is odourless, colourless and is
not flammable. It will vaporise quickly if
exposed to air. It is non-corrosive and non-
toxic, and quickly evaporates if released to
water - so it won’t pollute land or water in the
unlikely event it escapes.
When LNG reaches its destination at the
receiving terminal such as a floating gas
terminal, it is warmed up using seawater and
converted from a liquid back into gas, and sent
through pipelines for delivery to end users.

LNG ships are specially designed for safety

LNG carriers are modern ships specially designed and
constructed to prevent leakage or rupture.
LNG is stored in a special containment system within the inner
hull of the vessel, designed to protect the cargo in case of an
accident. The double hull design means that in order for a leak of
LNG to occur from a tank on board the ship, two steel hulls would
need to be pierced, as well as the tank insulation and inner
containment system.
Ship Vetting
Strict vetting procedures would apply to the charter of LNG ships
for use at the proposed terminal. This is to ensure that only high
quality, modern ships with a good safety record can access the
terminal.
All ships used by Viva Energy are inspected prior to being
chartered to ensure they meet strict vetting criteria and all
relevant laws, regulations and standards for ships entering

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Australian waters. This includes a requirement for a recent
inspection under the international Ship Inspection Report
Programme (SIRE) by an independent and experienced surveyor.
Ports Victoria
The age, history, condition and certification of the ship are Restrictions and Regulations
examined, and the ship’s crew must meet minimum requirements
regarding qualifications, experience and pay.
o Vessels navigating within, into or out of port
waters must be under the direction of a marine
pilot.
o The main Geelong shipping channels are used
for one-way traffic only unless prior agreement
given.
o For the four main channels the maximum
allowable draft is 11.9 metres
o The under-keel clearance for deep draft vessels
navigating the channels to be verified through
the use of dynamic under keel clearance
(DUKC).
o Maximum speed restrictions are established for
all commercial vessels at different points
o Wind speed limits for vessels entering the port
Safe transit through Corio Bay channel are 30-35 knots (20-25 knots for
LNGCs)
Ports Victoria is the regulatory body responsible for ensuring the
o Weather events continuously monitored on
safe transit of all ships in Port Phillip including Geelong and Corio
Bay. Up to 40 LNG carriers each year are expected to visit
board, at the terminal and by Marine Control.
Refinery Pier under plans for the new terminal. o A minimum of two tugs currently required for
A navigational risk assessment has been carried out to ensure
arrival and departure from Refinery Pier
the safe navigation of the additional ships into the Port of berths.
Geelong. Simulations and modelling of LNG vessel movements o Small vessels (< 50 metres in length) must keep
have been undertaken in conjunction with Ports Victoria and clear of big vessels (> 50 metres in length) and
pilotage providers. The transit route for the LNG carriers has a tug or launch assisting another vessel.
been carefully surveyed to ensure there are no grounding risks
such as shallow water or rocks along the proposed shipping
route.
All LNG ships will have to comply with strict requirements
imposed by Ports Victoria to mitigate risk, including of grounding
or collision – for example, the LNG ships will require an escort by
tugboats in the Geelong Channels, and will have to travel slowly,
at around 8 knots. Maritime restrictions and port regulations
apply, including rules aimed at preventing smaller vessels from
coming too close.
LNG carriers will use dynamic under-keel clearance (DUKC) to
monitor conditions in real time, including water depth and draft, to
provide accurate under-keel clearance predictions for the channel
transit.
Experienced and licenced marine pilots familiar with local
conditions will navigate the ships inside Port Phillip and Corio Bay
and guide them safely to the berth.
It is worth noting that large tankers carrying gas (LPG or Liquefied
Petroleum Gas) have safely operated in Victorian ports for over
50 years.

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Floating Gas Terminal Operation
As part of the approvals process for the project, a comprehensive
hazard and risk analysis is being undertaken covering the floating
gas terminal operation as well as the visiting LNG carriers and
jetty facilities. Modelling and quantitative risk assessment (QRA)
will look at whether the proposed Floating Gas Terminal would
create any additional risks to the refinery, and how these risks
can be mitigated.
Safety and risk studies will be summarised and incorporated into
the Safety Case for the Gas Terminal. This forms an important
part of the application to WorkSafe Victoria for an operating
licence, which is required as the Floating Gas Terminal will be
classified as a Major Hazard Facility (MHF). The terminal
operation will be subject to strict operational parameters and
conditions that are stipulated by the regulators and detailed in the
operational license. Viva Energy is experienced in the safe
operation of MHFs including the Geelong Refinery.

Floating Gas Terminal Safety Features

A Floating Gas Terminal (also known as a Floating Storage and
Regasification Unit or FSRU) is basically an LNG ship with extra
facilities on board to re-gasify the LNG – that is, to warm up the
cold liquid and turn it back into a gas.
It is a relatively simple operation. LNG is warmed up by circulating
seawater through pipes – there are no boilers or electric heaters
involved in this process.
It is worth noting that LNG is stored on board the floating terminal
as a cold liquid. In this state it is not flammable. Natural gas is not
stored on board (there are no gas storage tanks) - as the liquid
LNG gets turned back into gas it would be exported from the
terminal via pipeline. LNG is not stored under pressure.
Our floating gas terminal will be a modern ship supplied by an
experienced international FSRU operator, with sophisticated
technology supporting safe operations.
A number of safety features are built into the gas terminal design
to avoid, mitigate and manage hazardous events. The primary
and secondary containment system within the double-hull means
it is very unlikely that a leak could occur. Fire and gas detection
systems are installed on all FSRUs, and manual and automatic
shutdown systems would quickly isolate and shutdown operations
if any abnormalities were to be detected in operations.
Safe Port operations
The existing operation at Refinery Pier currently handles around
240 ships each year, as Viva Energy brings in crude oil for
processing and exports fuel as part of our day-to-day operations.
The Refinery works closely with a range of external parties such as
Ports Victoria to ensure safe shipping operations, including
appropriate mitigation and safety precautions for loading and
unloading ships.
We expect up to 40 LNG ships each year to visit the Gas
Terminal – which is a small percentage increase in the 1000+
ships forecast to visit the Port of Geelong each year.
Waterside Restricted Zone at Refinery Pier
There is a waterside restricted zone currently in place at Refinery
Pier at all times. No unauthorised people or vessels are allowed
inside the restricted zone. This restricts access by fishing boats
and all other vessels as a safety precaution.
The waterside restricted zone has been re-assessed as part of
the Project assessments, to take into account the Pier extension
and new Gas Terminal operations including LNG ships berthing.
An expanded exclusion zone for unauthorised vessels would
apply around Refinery Pier after completion of the new jetty.

Prepared to respond to an emergency

As with existing refinery and jetty operations, we plan to be well
prepared and well-practiced in case of an emergency. Evacuation
and rescue systems and procedures would be in place, with all
the appropriate protocols and training. Fire protection and fire-
fighting systems will be installed, including on the floating terminal
and the wharf. Additional support would be available from the port
fire-fighting tugboats. Emergency response preparedness is
closely regulated and required for our shipping licence.
Although moored in port, the Floating Gas Terminal remains a
seaworthy vessel, with a marine crew living on board, so it could
be sailed out of port if required.

If you have any questions or feedback please contact us on:

1800 515 093
energyhub@vivaenergy.com.au
vivaenergy.com.au/gas-terminal

Did You Know?
There are many global examples of LNG
receiving terminals close to urban centres in
Europe, North America and Asia – safely
operating to meet the energy needs of local
markets.
A Focus on Security
While Australia is a very safe place to do business, as an
experienced hazardous facility operator, Viva Energy is ever-
vigilant and focused on ensuring that we take all possible
practical measures to keep our facilities secure.
Viva Energy works closely with law enforcement agencies,
security intelligence agencies, Federal and State Government
departments and industry groups -on an ongoing basis, in order
to monitor and manage any potential threats to our business.
We have safely and securely operated the Geelong Refinery,
including shipping operations at Refinery Pier, for nearly 70
years.
It is subject to regular audits which are conducted by independent
experts, the Government and other authorities such as Ports
Victoria.
An independent security risk and vulnerability assessment has
been carried out on the proposed gas terminal and the LNG
import operation. This is an important input to the planning
process for the proposed terminal, and the study will inform both
the terminal design, operation and security plans. The scope of
the review included LNG ship transit and mooring, the proposed
Floating Gas Terminal operation and the new pipeline.
This comprehensive external study found existing security
measures would be appropriate and adequate for the proposed
Floating Gas Terminal and LNG import operations, and no major
changes are required to existing security arrangements. It
concluded that Viva Energy is well prepared to monitor the
security environment and respond to any risks identified.
Australia - a low risk security environment
Australia is overall a low-risk environment and a very safe place
to do business. In relation to Maritime security, the official threat
level has not changed since its inception.
Each Port is different, and requirements will be imposed on
shipping operations here and around the world in line with local
conditions and hazards, based on risk assessment specific to the
location.

Security – protecting the gas terminal For example Australia has a very different security profile to the
USA, which leads to different restrictions and requirements for
Security measures currently deployed at the Geelong Refinery shipping and port operations. One consideration is the availability
and Refinery Pier will be extended to the new gas terminal. and accessibility of dangerous firearms and explosives, which in
Refinery Pier is surrounded by a regulated security zone. There Australia is highly regulated and restricted.
are strict controls over who has access to the pier, and
unauthorised personnel or craft are not permitted within this area.
These controls would apply to the new facility. Federal
Government Security background checks would be mandatory for
all personnel including contractors requiring access.

In addition to specific requirements for the gas terminal operation,

the Geelong Refinery Pier facility and the port are heavily
regulated by the Commonwealth Government. The port also has
its own strict security protocols and procedures in place to ensure
the safe transit of over 1000 ships that are projected each year.

Regular security meetings are held to ensure a coordinated

approach with key external authorities, such as the Police, Water
Police, Australian Border Force, Parks Victoria, Ports Victoria ,
Department of Home Affairs - Aviation and Maritime Security
Department and the City of Greater Geelong.

Risk Assessment and the Maritime Security Plan

Viva Energy must prepare an updated Maritime Security Plan

(MSP) covering both the current and new operations, and setting
out security control measures and mitigations in detail. Prepared
in consultation with a range of experts, the MSP must be
approved by the Federal Government.

Once the proposed terminal is operational, the MSP would be

regularly reviewed, actively managed and updated as required.

If you have any questions or feedback please contact us on:

1800 515 093
energyhub@vivaenergy.com.au
vivaenergy.com.au/gas-terminal
 LNG Shipping and Ships in Transit - Frequently Asked Questions (FAQs)
Do LNG ships present an unacceptable safety
risk?
The short answer is – no. As noted in our Fact Sheet, LNG ships
have a very safe history of operations in Australia and around
the world.
Of course, natural gas vapours are flammable and present safety
hazards which must be managed, as with the arguably higher
hazards associated with gasoline, diesel and crude oil that have
been successfully managed in Corio Bay throughout the 60
years of refinery shipping operations.
Our job is to consider the worst-case scenarios and take actions
to minimize and mitigate any risks identified. Safety and risk
assessments have been carried out on behalf of the Project on
“ships in transit” in Corio Bay. The risk assessments take into
account a range of potential hazards and model the risk and
potential consequences of a leak, fire and/or explosion.
The studies found that the risk to an individual of serious injury or
fatality from an incident involving a ship in transit as extremely
low, assessed as “negligible”.
Risk analysis is an essential part of planning and designing a
safe operation. There are many factors which mitigate risk and
contribute to safe shipping operations, as laid out in the Fact
Sheet. This includes the use of modern LNG carriers with
sophisticated navigation equipment, strictly vetted to ensure that
all ships chartered by Viva Energy are of high quality with an
experienced captain and crew.
What is preventing a major explosion on board
the ship or as a result of a spill?
Let’s take a look at some of the considerations when assessing
the chance of a major explosion.
The LNG itself is not explosive. Only when the vapours of LNG
are combined with oxygen (fresh air) does it become flammable.
LNG is not stored under pressure. On the ship, LNG is stored as
a very cold liquid at atmospheric pressure, in a sealed storage
tanks with no air present. As such, it is not flammable, and
would not catch fire even if a source of ignition was introduced
into the sealed storage compartment.
Could an explosion result from a loss of containment –
a major leak of either gas or liquid LNG?
 A leak of gas on-board is highly unlikely. LNG is not stored
under pressure or as a gas in storage tanks on board. The
specially designed LNG tanks are fitted with monitoring and
vapour detection systems, on the deck and in the
surrounding insulation.
 A leak of liquid LNG is highly unlikely. The double-hull
design provides strong protection for the LNG cargo - two
steel hulls 2 metres apart would need to be pierced, as well
as the tank insulation and inner containment system to allow
any liquid to escape to the water.
 In the unlikely event there was an LNG leak, leak detection
and automatic shutdown systems would prevent any
significant volume escaping.
 The LNG is stored in four or five separate and
independently isolated tanks, which limits the volume which
could be lost if a single tank was breached.
What about the risk of grounding or a collision –
couldn’t that cause a major leak or spill?
Independent simulations and modelling of LNG carrier channel
transit has been undertaken in conjunction with Ports Victoria
and pilotage providers, in a variety of weather conditions,
including abnormal scenarios such as engine or steering failure.
The transit route has been carefully surveyed to ensure there are
no grounding risks such as shallow water or obstructions within
the designated channels and fairways.
Safeguards will be in place to mitigate risks including grounding
or collision, including:
 Experienced and licenced marine pilots familiar with local
conditions will navigate the ships inside Port Phillip and
Corio Bay and guide them safely to the berth
 Tugboats will escort the LNG carriers from Portarlington
and four tugs will be used to assist the ships to manoeuvre
in Corio Bay
 Ships will travel slowly at around 8 knots (15km/h)
 Dynamic under-keel clearance (DUKC) is required, to
model the movement of the ships through the Geelong
Channels in conjunction with real-time tide and metocean
conditions to provide accurate under-keel clearance
predictions
 Wind forecasting and 24 hour weather monitoring on
board, and at the terminal and marine control
What about a targeted attack on the ship?
It would take a very serious attack with a major weapon to
breach the steel double hulls of the LNG ship and cause a major
spill. Australia is overall a low risk environment and a very safe
place to do business. One factor to consider is the availability
and accessibility of dangerous firearms and explosives, which is
highly regulated and very limited here. In relation to Maritime
security, the official threat level has not changed since its
inception.
As an experienced major hazard facility operator, Viva Energy is
ever-vigilant and focused on ensuring that we take all possible
practical measures to keep our operations secure. We work
closely with Australian Border Security and local authorities
including those responsible for Port safety and security. We are
not aware of any reason why an LNG tanker or a floating gas
terminal would be a particular target of terrorism. LNG shipping
has an excellent safety record with over 135,000 voyages
completed around the world without a major incident or loss of
cargo.
But if there was somehow a major spill of LNG into the
water – what would happen?
LNG is odourless, colourless and non-toxic. It will not pollute
land or water in the unlikely event it escapes. As a liquid, is not
flammable.
When cold LNG comes in contact with warmer air, it evaporates
and becomes a visible vapour cloud. It is non-corrosive and non-
toxic, and quickly evaporates if released to water. As it
continues to get warmer, the vapour cloud becomes lighter than
air and rises.
The conditions that would be required for LNG vapour to ignite
and explode are very specific and not easily achieved, especially
in the open air. When LNG vapour mixes with air it is only
flammable if the concentration is within 5-15% natural gas. More
than this it is too rich. Less than this it is to lean and it will not
ignite.
The US Coastguard provides an armed escort for
LNG carriers in some ports in the USA - why
wouldn’t we use them here?
In Australia, armed escorts for shipping are not required nor
deemed justified. In fact armed escorts are not typically utilised
in much of the world including Europe, Asia and Australia.
Each port is different, and each jurisdiction around the world
makes their own safety and security risk assessments based on
local conditions. Overall Australia is a low-risk environment with
a very different security and threat profile to the USA. One
important factor to consider is the availability and accessibility of
firearms and explosives, which is highly regulated in Australia as
opposed to the USA.
LNG has been safely and securely shipped around the world for
over 60 years, and we believe the proposed operation in Corio
Bay can and will be conducted safely.
It should also be noted that LPG (liquefied petroleum gas) has
been safely and securely exported in Very Large Gas Carriers
(VLGCs) in Westernport, Victoria for over 50 years.
Australian Federal and State Government Regulators such the
Australian Border Force and local Port authorities are
responsible for the safe operation of Australia’s ports and the
safe transit and berthing of ships. We will follow their advice and
comply with all restrictions and regulations in line with our
commitment to safe operations.
Will there be a “safety buffer zone” limiting the
distance between an LNG ship in transit and
residential areas?
The risk of an incident from a passing ship which could result in
serious injury or fatality to residents is extremely low, assessed
as “negligible”. This means that there is no requirement for a
“buffer zone” on safety grounds.
Loaded crude oil tankers and tankers carrying fuel and
chemicals currently move through the shipping channel on a
daily basis, with similar conditions imposed as anticipated for
LNG ships.
A major LNG shipping incident which had the potential to impact
the nearest residents located about 250 metres away, would
require a series of very unlikely events to take place (as
discussed above).
One consideration is the limited window in which an incident
would have to occur to impact residents. Up to 40 LNG ships
are expected to transit through Corio Bay to berth at the new
terminal each year, or around one every 10-15 days. Loaded
LNG carriers berthing at Refinery Pier will have four tugs
attached when transiting Corio Channel and will take around 10
minutes to pass Moorpanyal Park on the North Shore.
Why are there different restrictions like
exclusion zones in place in other locations/for
other LNG Projects like Gladstone & Darwin?
Port Authorities and state/territory marine safety agencies are
responsible for the safe operation of Australia’s ports and the
safe transit and berthing of ships.
Each port is different, and requirements will be imposed on
shipping operations in line with risk assessment of local
conditions and hazards carried out by the Port Authority and
regulators. These include such things as
 tides and currents
 prevailing winds
 navigation hazards (underwater obstructions, shallow
water)
 local security profile
We have worked with Ports Victoria, the port authority for
Geelong and Melbourne, and have undertaken simulations and
risk analysis to identify potential risks. Mitigations identified
include:
 passing restrictions between LNG carriers and other
ships
 wind limits for channel transit and manoeuvring
 tidal stream limits for transit through Port Phillip Heads
 the number and type of tug boats to assist LNG carrier
manoeuvring
 Use of DUKC to model LNG carrier under-keel clearance
during channel transits
The floating gas terminal and LNG carriers at Refinery Pier
would be protected by a waterside restriction zone. No
unauthorised people or vessels are allowed inside the restricted
zone. This restricts access by fishing boats and all other vessels
as a safety precaution.
Comparison to Gladstone LNG facilities
Comparisons of the proposed Viva gas import terminal to the
Gladstone LNG complex in Queensland are misleading. Our
proposed floating gas import terminal is a relatively simple
operation to unload, warm and re-gasify LNG - especially when
compared to the three plants which make up the Gladstone LNG
hub at Curtis Island in Queensland.
The Port of Gladstone is a significant export hub for LNG, home
to three major onshore LNG processing plants which receive
natural gas via high-pressure pipeline, process and liquefy the
gas before storing and loading LNG onto ships for export.
LNG ships pass through Gladstone Harbour daily to berth at one
of the three LNG plants (300 ships p.a.), through a busy harbour
that handles around 1,800 ships p.a.
 Large storage tanks and processing units are located
onshore at each facility
 There is no regulated “safety buffer zone” to
residential areas. The Gladstone LNG plants are situated
on Curtis Island, a designated LNG hub near Gladstone.
 Maritime Safety Queensland does not impose an exclusion
zone for LNG ships transiting the Port of Gladstone. There
is an exclusion zone in place when the LNG ships are
loading – similar to the waterside restriction zone that will
apply for LNG ship operations at Refinery Pier
 The same level of control will be in place for LNG ship
transit, LNG cargo transfer, and FSRU operation within
Corio Bay. Noting that Gladstone has completed several
years of safe and secure operation with a much larger
volume of LNG ships transiting through a busier port, the
comparison with Gladstone does not make a case for a
higher level of restrictions in Corio Bay.