FAQS AND FACT SHEETS

Quick Facts

• The Project will entail a $310 million investment by AGL into the NSW gas industry
• The Project will create up to 300 construction jobs and 15 operational jobs
• AGL aims to be ready to deliver gas to market from the Project in 2015
• To meet this target, construction began in 2012

You can read the project fact sheet here.

Questions & Answers

Project Context

Q: Why do we need gas storage?

A: The Project will provide a reserve of natural gas which will play a critical role in ensuring the security of supply during periods of peak energy demand or during periods of supply disruption. It will also support the development of gas-fired power generation which can be used to back up renewable energy supplies such as wind power. This is consistent with the New South Wales Government's future energy planning needs. The Project will help prevent supply constraints, particularly on cold winter days, with its capacity to store the equivalent of about two weeks' gas for the greater Newcastle region.

Q: How are we storing the gas?

A: The Project includes an above ground insulated tank kept at atmospheric pressure, along with associated plant infrastructure. The natural gas is cooled to about minus 162°C and stored as a liquid known as Liquefied Natural Gas (LNG). When LNG is needed, it is warmed up and converted back into natural gas.

Q: Why is AGL building a gas storage facility at Tomago?

A: The Tomago industrial area is appropriately zoned for this type of development and is close to a major demand centre. The site is adjacent to the Tomago aluminium smelter, a significant industrial operation with high standards of safety consistent with those of AGL. The site is large enough to provide the buffer zone as required by the Department of Planning and Infrastructure.

Q: What makes up the Project?

A: The Project comprises three components:

• A gas pipeline will join the gas plant to the Hexham receiving station
• A gas plant including a refrigeration plant to liquefy natural gas, an LNG storage tank, and a vaporisation system to convert the stored LNG back to natural gas for delivery into the pipeline. This will include an access road and utility corridor to allow utilities access from Old Punt Road
• Hexham receiving station to transfer the natural gas to and from the Jemena distribution network.

Q: How much is AGL investing?

A: The development will result in an investment by AGL of about $310 million.

Q: How many jobs will be created?

A: During construction of the GSF, up to 300 people will be employed. Once constructed, up to 15 permanent full-time employees will be required.

Q: When will consultation about the Project begin?

A: AGL has consulted extensively with relevant State and local government agencies, as well as local residents, landowners and local businesses. AGL will continue to liaise with stakeholders and the local community throughout construction completion and operations.

Q: What is the current status of the Project?

A: AGL aims to be ready to deliver gas to market from the Project in 2015. To meet this target, construction began in early 2012.

Q: What are the benefits of the Project?

A: There are a number of key project benefits at national, state and local levels. These include:

• Supporting the NSW State Government initiative to reduce greenhouse gas emission targets
• Reducing NSW's dependence on gas imported from interstate, providing a more secure and continuous supply
• Creating flow-on economic benefits to the region during the construction, commissioning and operational phases, such as employment opportunities.
• Providing greater security of gas supply, particularly during peak load periods
• Providing infrastructure support for the growing gas supply industry in NSW

Q: How will the community be kept informed?

A: AGL will keep the local community updated throughout the planning and construction phases to ensure residents and local businesses are fully informed. AGL will update this website as relevant information becomes available. We also have a Community Consultative Committee (CCC) in place. Alternatively, the community can contact members of the project team directly. Our contact information can be found on the contact us page.

Hazards and Risks

Q: Is LNG hazardous?

A: LNG is natural gas which has been cooled down sufficiently to form a liquid at atmospheric pressure. LNG is not like LPG (liquefied petroleum gas) which has to be stored under pressure.

As a liquid, the risk of LNG burning is extremely low. It is colourless, odourless and non-toxic. It does not mix with water and leaves no residue.

The hazards associated with LNG are similar to those of natural gas except that it is much cooler and therefore forms a much smaller gas cloud for the same size release.

If LNG did escape from its storage containment to the environment, it would form a pool and begin warming immediately and returning to its gaseous form. As the gas warms up, the vapours become lighter than air and rise into the atmosphere and dissipate.

LNG and natural gas are mainly composed of methane gas. Methane vapour is only flammable if it is within the concentration range of 5-15% gas in air, otherwise it is non-flammable.

Q: What are the risks associated with the Gas Storage Facility?

A: The Gas Storage Facility will process, handle and store substantial quantities of LNG. The facility will be designed to Australian and International standards to minimise the risk of an incident happening and provide mitigation measures in the event an incident does occur.

More than 100 small and large scale LNG storage facilities are in operation in the United States and Europe. A similar facility to this Project was built in Dandenong, Victoria, in 1980 and has experienced no adverse incidents.

The construction, commissioning and operation of the Project will be subject to Government approvals processes, including the Work Cover Safety Case process, minimising risk to workers and the community.

The safety, efficiency and stability of the Project will be achieved through the use of high-integrity safety systems, regular preventative maintenance programs, detection and protective measures. Security measures will include security patrols, protective enclosures, lighting and monitoring equipment.

The site and plant layout will ensure that any operational issues are contained within the site boundaries, including an appropriate buffer zone as required under legislation.

Q: Is there a risk of fire at the facility and therefore bush fires?

A: Any spill of flammable material will be contained within the site area. If there is a fire subsequent to a spill, then the fire will be allowed to burn - LNG will vaporise and burn itself out.

AGL is building the gas storage facility on a 28 ha parcel of land within the larger 250 ha industrial site at Tomago. This land is subject to bushfire threat. The required buffer zone will be maintained around the gas plant, the processing plant and storage tank to minimise the bushfire risk. The facility has been designed to operate with low potential bush fire threat. As is the case for all major fires, people around the site will need to evacuate the area to prevent injury from heat radiation. The buffer to the boundary fence will prevent immediate injury from radiation.

Q: Will the required buffer zone be contained within AGL's property boundary?

A: The buffer zone is within the property boundary.

Q: Do you expect plume rise to occur from the proposal?

A: No. A small amount of gas will be burnt via the flare.

Q: Are there health risks to the community such as air contamination, and what actions is AGL taking to reduce these risks?

A: Health risks to the community will be negligible.

The design and construction of the facility will be in line with energy-efficient technology. There will be some gas emissions as part of standard operations created through the liquefaction process (i.e. the process to make liquefied natural gas). As is standard practice in gas facilities, the plant will have a flare to release gas build up from time to time.

Environmental Impacts

Q: Will vegetation and trees need to be removed?

A: Up to approximately 20 ha of vegetation will be removed within the primary Project area. An extensive range of environmental safeguards, mitigation measures and monitoring and management programs will be implemented to avoid or minimise impacts. Offset land will be provided and a strategy developed in consultation with the Office of Environment and Heritage (OEH), and the Department of Planning and Infrastructure (DP&I). AGL will also closely consult with local stakeholders who have community expertise in restoration and habitat protection (including the Hunter Botanic Gardens at Tomago) to develop long term sustainable community partnership programs.

Q: What will happen to the Earps gum trees?

A: Of the approximate 20 ha of vegetation to be cleared, up to 15 Earps gums will need to be removed. These gums were planted following sand mining activities between 1970s and the 1990s. AGL is working closely with the Hunter Botanic Gardens to develop an offset strategy that ensures longer term minimal impact can be achieved. One of these initiatives is to replant seeds of these gums.

Q: Can you relocate the access road to avoid the high value Koala habitat?

A: The locations of the gas storage facility, pipeline and access routes have been identified as the most suitable taking into consideration a number of constraints. These include physical location, hazard management, environmental impacts, engineering aspects and future site development. The intersection of the access road has been designed to accommodate the existing Ausgrid easement that runs within the site.

Q: Is there a risk of contaminating the community's water supply?

A: Construction and ongoing operation of the gas facility is not considered to be a high risk to the shallow underlying groundwater used as raw water for Newcastle's drinking water supply. Most facilities will be above ground, and surface water and groundwater monitoring systems will be in place to ensure early detection of any impacts. In the highly unlikely event of any spill/leak, LNG will evaporate so there is no risk to groundwater from the stored gas.

Several layers of protection measures are proposed to protect the groundwater against the risks of contamination, including:

• controlling all stormwater runoff from construction sites
• providing sedimentation basins for all surface water runoff from disturbed areas
• separating clean water (water from undisturbed areas) from potentially impacted water from construction activities
• building temporary and permanent infrastructure to capture any spills or leaks
• collecting and storing waste water before transporting offsite for treatment or disposal
• pumping stormwater from the site to the Port Stephens Council drainage system at Old Punt Road
• ongoing water monitoring to ensure water quality is maintained.

Protecting Cultural Heritage

Q: Will Aboriginal cultural heritage be impacted?

A: The Project is on the boundary of two Local Aboriginal Land Councils (LALC), Awabakal LALC (south of the Hunter River) and Worimi LALC (north of the Hunter). The Hexham portion of the project is predominantly associated with the Awabakal clan subgroups, the Pambulong and the Ash Island Clan. There is potential for the Project related activities to disturb Aboriginal cultural heritage sites. Management procedures will be developed in consultation with the appropriate LALCs to ensure that in the event that any Aboriginal cultural heritage sites, features or artefacts are unearthed during construction, there will be a process to ensure they are protected.

Geotechnical, Construction and Operational Issues

Q: Will the gas storage facility be noisy and dirty and cause more traffic?

A: Due to the distance of the primary project area (about 1km) from the main Tomago town, any associated visual, traffic and noise impacts should be minimal during construction. Ongoing plant operation will have little impact on the local community. The pipeline along Old Punt Road will be installed below ground so local impacts will be minimal.

The anticipated road tanker traffic is three trucks per day and a transport hazard study will be undertaken to assess any risks associated with this.

Q: Will you be drilling for gas at the project site?

A: No. We are building a gas storage facility. It is not a coal seam gas (CSG) project. The only drilling being undertaken is for geotechnical and groundwater monitoring purposes.

Q: What will be the anticipated length of the horizontal directional drilling (HDD) beneath the Hunter River?

A: The HDD length is anticipated to be approximately 600 metres.

Q: Why is the facility not located closer to Old Punt Road?

A: This proposed site was offered to AGL by Tomago Aluminum Company, and is suitable both environmentally and operationally.

Q: How long is the pipeline from Hexham to the gas storage facility?

A: The pipeline is approximately 5.5km long.

Q: What will AGL do with discarded water during the operation of the facility?

A: AGL proposes to truck wastewater from the Project site to an appropriate treatment facility.

Q: What will happen to the stormwater?

A: Stormwater from the active plant areas of the site will be captured and stored in an onsite holding pond prior to water quality testing, and then pumped via a dedicated stormwater pipeline along the access road to the Port Stephens Council stormwater system at Old Punt Road.

Q: What will happen to the surface water?

A: Surface water in potentially contaminated areas will be collected in sumps. The quality of water in the sumps will be checked for contamination. If contaminated, it will be pumped to trucks and removed from the site. If uncontaminated, it will be manually released to the holding pond and discharged to stormwater.

Q: Has AGL taken into account sea level rises?

A: Yes. Flooding studies considered a rise in sea level. The site is not at risk of rising sea levels.

Q: Why was the access road not co-located with the emergency road?

A: We have identified the pipeline corridor (the emergency road) as a secondary means of escape from the plant site, should there be an incident that prevents escape along the access road.

General Gas Questions

Q: What happens to the Facility if there is a power failure?

A: The main power for the facility is being provided from AusGrid's high voltage (33kV) network at a point in the network where two independent power networks meet, thereby providing redundant power supply. Should both sources of power fail, the gas storage facility has an emergency diesel power generation system designed to maintain all safety and integrity systems operational in case of a complete power failure.

Q: How big will the LNG storage tank be?

A: The tank height from the ground to the roof apex will be up to 56 metres.

Q: Why not reduce the height of the storage tanks and increase the number (e.g. have two tanks @25-30m high) to reduce the visual impact?

A: The facility will not be visible to the public as it is set back more than 1km from the closest public road. The closest neighbours, the Botanic Gardens, some 500 metres from the site will not be visible to the site because of the bushland buffer zone.