K&L GATES LLP - Port Isabel-South Padre Press

K&L GATES LLP 1601 K STREET, N.W. WASHINGTON, DC 20006 T +1 202 778 9000 F +1 202 778 9100 klgates.com

May 14, 2015 David L. Wochner [email protected]

T 202.778.9014

Kimberly D. Bose Office of the Secretary Federal Energy Regulatory Commission 888 First Street, NE Washington, DC 20426 Re: Texas LNG Brownsville, LLC, Docket No. PF15-14-000

Texas LNG Liquefied Natural Gas Project Draft Resource Report 1 and 10

Dear Ms. Bose,

On April 14, 2015, the Commission issued an Approval of Texas LNG Brownsville, LLC’s (“Texas LNG”) request to initiate the Pre-Filing Process for its Texas LNG Project in the Port of Brownsville, Texas. Pursuant to the Commission’s regulations, 18 C.F.R. § 157.21(f)(5), Texas LNG hereby submits preliminary drafts of its Resource Report 1, including a landowner mailing list, and Resource Report 10.

Texas LNG is submitting both a Public Version and a Confidential Version of Resource Report 1. Texas LNG requests that the Commission deem the information in the Confidential Version of Attachment 1.B to draft Resource Report 1, which includes landowner information, to be privileged and confidential in accordance with 18 C.F.R. § 388.112.

If you have any questions, please do not hesitate to contact me at 202.778.9014 or via email at [email protected].

Best regards,

David L. Wochner Counsel for Texas LNG Brownsville, LLC Enclosures cc: Kareem Monib, FERC

20150514-5223 FERC PDF (Unofficial) 5/14/2015 4:40:00 PM

mailto:[email protected]

TEXAS LNG BROWNSVILLE LLC

TEXAS LNG PROJECT

Resource Report 1

General Project Description

Preliminary Draft

Docket No. PF15-14-000

Prepared by

May 2015


1-i May 2015

TEXAS LNG BROWNSVILLE LLC TEXAS LNG PROJECT

RESOURCE REPORT 1 – GENERAL PROJECT DESCRIPTION

Federal Energy Regulatory Commission Environmental Checklist Minimum Filing Requirements: Report Section Reference Provide a detailed description and location map of the Project facilities. (§380.12(c)(1))

Include all pipeline and aboveground facilities. Include support areas for construction or operation. Identify facilities to be abandoned.

Section 1.3 and Figures 1.3-1 through 1.3-4

Describe any nonjurisdictional facilities that would be built in association with the Project. (§380.12(c)(2)) Include auxiliary facilities. Describe the relationship to the jurisdictional facilities. Include ownership, land requirements, gas consumption, megawatt size, construction

status, and an update of the latest status of federal, state, and local permits/approvals. Include the length and diameter of any interconnecting pipeline. Apply the four-factor test to each facility.

Section 1.10

Provide current original U.S. Geological Survey 7.5-minute series topographic maps with mileposts showing the Project facilities. (§380.12(c)(3)) Maps of equivalent details are acceptable if legible (check with staff). Show locations of all linear project elements, and label them. Show locations of all significant aboveground facilities, and label them.

Figure 1.3-4

Provide aerial images or photographs or alignment sheets based on these sources with mileposts showing the Project facilities. (§380.12(c)(3)) No more than 1-year old. Scale no smaller than 1:6,000.

Figure 1.3-3

Provide plot/site plans of compressor stations showing the location of the nearest noise-sensitive areas (NSA) within 1 mile. (§380.12(c)(3,4)) Scale no smaller than 1:3,600. Show reference to topographic maps and aerial alignments provided above.

Not applicable

Describe construction and restoration methods. (§380.12(c) (6)) Section 1.7.2 Identify the permits required for construction across surface waters. (§380.12(c)(9))

Include the status of all permits. For construction in the federal offshore area be sure to include consultation with the

MMS. File with the MMS for rights-of-way grants at the same time or before you file with the

FERC.

Section 1.11

Provide the names and addresses of all affected landowners and certify that all affected landowners will be notified as required in §157.6(d). (§380.12(a)(4) and (c)(10)) Affected landowners are defined in §157.6(d)(2). Provide an electronic copy directly to the environmental staff.

Appendix 1B (filed as Privileged Information – Do Not Release)

Additional Information Often Missing and Resulting in Data Requests: Report Section Reference Describe all authorizations required to complete the proposed action and the status of

applications for such authorizations. Section 1.11

Provide plot/site plans of all other aboveground facilities that are not completely within the right-of-way.

Figures 1.3-1 through 1.3-4

Provide detailed typical construction right-of-way cross-section diagrams showing information such as widths and relative locations of existing rights-of-way, new permanent right-of-way, and temporary construction right-of-way.

Not Applicable

Summarize the total acreage of land affected by construction and operation of the project Section 1.6 and Table 1.6.1-1 If Resource Report 5, Socioeconomics is not provided, provide the start and end dates of

construction, the number of pipeline spreads that would be used, and the workforce per spread.

Section 1.7.1 and Resource Report 5.

Send two (2) additional copies of topographic maps and aerial images/photographs directly to the environmental staff of the Office of Energy Projects (OEP).

Included with this submittal


Texas LNG Project Resource Report 1 – General Project Description

1-ii May 2015


RESOURCE REPORT 1 – GENERAL PROJECT DESCRIPTION

TABLE OF CONTENTS

1.0 RESOURCE REPORT 1 – GENERAL PROJECT DESCRIPTION ............................... 1-1 1.1 Introduction ......................................................................................................... 1-1 1.2 Purpose and Need ............................................................................................. 1-1 1.3 Proposed Project Facilities ................................................................................. 1-2

1.3.1 Gas Gate Station and Interconnect Facility ............................................ 1-9 1.3.2 Liquefaction Plant ................................................................................... 1-9 1.3.3 LNG Storage ........................................................................................... 1-9 1.3.4 LNG Vessel Loading ............................................................................. 1-10 1.3.5 Buildings ............................................................................................... 1-10 1.3.6 Water, Power, and Communications .................................................... 1-12 1.3.7 Ancillary Facilities ................................................................................. 1-12

1.4 Deepwater Access to Gulf of Mexico ................................................................ 1-12 1.5 Process Description ......................................................................................... 1-13

1.5.1 Pretreatment Process Description ........................................................ 1-13 1.5.2 Liquefaction Process Description ......................................................... 1-16

1.6 Land Requirements .......................................................................................... 1-18 1.6.1 Project Facilities.................................................................................... 1-18 1.6.2 Temporary Workspace and Laydown Areas ......................................... 1-19 1.6.3 Dredged Material Placement ................................................................ 1-19

1.7 Construction Schedule and Procedures ........................................................... 1-21 1.7.1 Construction Schedule .......................................................................... 1-21 1.7.2 Construction Procedures ...................................................................... 1-21 1.7.3 Site Access and Traffic ......................................................................... 1-25

1.8 Operations, Maintenance, and Safety .............................................................. 1-25 1.9 Future Expansion and Abandonment Plans ..................................................... 1-27 1.10 Non-Jurisdictional Facilities .............................................................................. 1-27

1.10.1 Intrastate Natural Gas Pipeline ............................................................. 1-28 1.10.2 Electric Transmission Line .................................................................... 1-28

1.11 Permits and Approvals ..................................................................................... 1-28 1.12 Agency, Public, and Other Stakeholder Communications ................................ 1-30 1.13 References ....................................................................................................... 1-31

LIST OF FIGURES

Figure 1.3-1 Proposed Project Facilities – Regional Location (Topographic Map) Figure 1.3-2 Proposed Project Facilities – Regional Location (Aerial Photo Map) Figure 1.3-3 Proposed Facilities at Project Site (Aerial Map) Figure 1.3-4 Proposed Facilities at Project Site (Topographic Map) Figure 1.3-5 Proposed Workspace Layout at Project Site (Aerial Map) Figure 1.3-6 Proposed LNG Storage Tank Design Figure 1.4-1 LNG Carrier Transit Route Figure 1.5-1 Basic Schematic of the C3MR Process Figure 1.6-1 Potential Dredged Material Placement Areas



1-iii May 2015

LIST OF TABLES

Table 1.6.1-1 Summary of Land Requirements for Proposed Facilities at the Terminal Site ................................................................................................................. 1-18

Table 1.9-1 Permits, Approvals, and Clearances .............................................................. 1-29 LIST OF APPENDICES

Appendix 1A Additional Figures

Figure 1A-1 Construction Workforce Graph – Phase 1 Figure 1A-2 Construction Workforce Graph – Phase 2

Appendix 1B Landowner List (Filed as Privileged Information – Do Not Release):

(i) Landowners within 0.5 mile of the Proposed Project Site



1-iv May 2015

ACRONYMS AND ABBREVIATIONS

AEP American Electric Power amsl Above mean sea level APCI Air Products and Chemicals, Inc. BLDP Battery limit design pressure BND Brownsville Navigation District of Cameron County Bcf/d Billion standard cubic feet per day C5+ Pentane and heavier hydrocarbons (collectively referred to as

Heavy Hydrocarbons) CFR Code of Federal Regulations CO2 Carbon dioxide COE U.S. Army Corps of Engineers DOE/FE U.S. Department of Energy’s Office of Fossil Energy DOT U.S. Department of Transportation EI Environmental Inspector ER Environmental Report ESD Emergency shutdown oF degrees Fahrenheit FERC or Commission Federal Energy Regulatory Commission FTA Free Trade Agreement HTF Heat Transfer Fluid Lbs Pounds LNG Liquefied natural gas m3 Cubic meter MCHE Main cryogenic heat exchanger MLW Mean Low Water MOF Materials Offloading Facility MR Mixed refrigerant MTA Million tonnes per annum mW Megawatts NEPA National Environmental Policy Act NFPA National Fire Protection Association NPDES National Pollutant Discharge Elimination System PA Placement Area Ppm part per million Project Facilities Proposed complete Texas LNG terminal with all facilities on

the Brownsville Ship Channel in Cameron County Texas psig Pounds per square inch gauge SWPPP Storm Water Pollution Prevention Plan Tcf Trillion Cubic Feet Texas LNG Texas LNG Brownsville LLC UECRM Plan Upland Erosion Control, Revegetation, and Maintenance Plan USGS U.S. Geological Survey WWCM Procedures Wetland and Waterbody Construction and Mitigation

Procedures


1-1 May 2015


1.0 RESOURCE REPORT 1 – GENERAL PROJECT DESCRIPTION

1.1 Introduction

Resource Reports 1 through 13 collectively make up the Environmental Report (“ER”) submitted to the Federal Energy Regulatory Commission (“FERC” or the “Commission”) as part of the application of Texas LNG Brownsville LLC (“Texas LNG”), a subsidiary of Texas LNG LLC, for authorization to site, construct, and operate natural gas liquefaction and export facilities at a proposed liquefied natural gas (“LNG”) terminal on the Brownsville Ship Channel located in Cameron County, Texas (“Project”). This Resource Report 1 is submitted in accordance with Title 18 Code of Federal Regulations (“CFR”) section 380.12 and section 3(a) of the Natural Gas Act.

On March 9, 2015, Texas LNG requested that the FERC initiate the Pre-Filing process for review of the Project under the National Environmental Policy Act (“NEPA”). This request was approved by the FERC on April 14, 2015, and assigned Pre-Filing docket number PF-15-14-000.

This Resource Report 1 provides a description of the proposed Project and its purpose and need from a local, regional, national, and global perspective. In accordance with 18 CFR § 380.12, this Resource Report 1 also includes a description of the Project Facilities and certain non-jurisdictional facilities; the proposed construction schedule; land requirements; operation, and maintenance procedures; and an update of the applicable regulatory approvals and coordination with the applicable local, state, and federal agencies.

1.2 Purpose and Need

The Project will allow Texas LNG to convert domestically produced natural gas to LNG for storage and export, promoting global trade and diversification of global gas supplies. Texas LNG is developing the Project to enable it to produce up to 4 million tonnes per annum (“MTA”) of LNG for export. Based on various recent economic studies of the United States’ current and projected patterns of supply and demand of domestically produced natural gas, the Project will provide benefits that will outweigh any impacts on gas consumption and costs.

As a result of technological advances, the positive outlook for natural gas supply and production in the United States has been continually improving. The Potential Gas Committee estimates that the “United States possesses a total technically recoverable resource base of 2,515 trillion cubic feet (“Tcf”) as of year-end 2014.”1 In its Annual Energy Outlook 2015, the U.S. Energy Information Administration explained that “[t]otal dry natural gas production in the United States increased by 35% from 2005 to 2013, with the natural gas share of total U.S. energy consumption rising from 23% to 28%.”2 The proposed Project will provide international markets with access to this abundant natural gas supply. The Texas LNG Project also will help

1 Press Release, Potential Gas Committee, Potential Gas Committee Reports Increase in Magnitude of

U.S. Natural Gas Resource Base (Apr. 8, 2015), available at http://potentialgas.org/press-release (last visited Apr. 29, 2015).

2 U.S. Energy Information Administration, Annual Energy Outlook 2015, available at http://www.eia.gov/forecasts/aeo/ (last visited Apr. 29, 2015).



1-2 May 2015

create jobs in Cameron County and South Texas in a portion of the state that has not yet received the employment benefits from development of these new sources of natural gas.

In addition to the global benefits discussed above, the Project is consistent with the public interest on a local, regional, and national level. The main benefits associated with the Project are summarized below.

Direct Job Creation/Employment Sustainability: This benefit is reflected in the need for an average of 600 construction workers for Phase 1 of the Project during 3 years of the construction and 80 permanent full-time staff for its operation. Phase 2 of the Project will require an average of 400 construction workers during construction and approximately 40 additional permanent full-time staff. Both phases of the project would result in many indirect jobs to support the construction and operation of the facility.

Environmental Benefits: Importation of LNG by foreign countries and its availability as fuel for power generation and transportation will permit the displacement of existing and future coal, heavy fuel oil and diesel power generation, and displacement of heavy fuel oil, diesel, and gasoline for vehicles and marine engines, thereby reducing global greenhouse gas, sulfur oxides, nitrogen oxides, particulates, and other environmentally harmful emissions.

National Security and Foreign Relations: By promoting a global, liquid, and robust market for natural gas, the United States will increase economic trade and ties with foreign nations by providing them with access to a clean, reliable, and less expensive alternative fuel. This trade will enhance the national security of the United States by encouraging positive foreign relations with our trading partners.

Economic Benefits: In addition to job creation and employment sustainability, the Project will generate substantial tax revenues and improve the United States’ balance of trade.

1.3 Proposed Project Facilities

The proposed Project Facilities will be constructed on an approximately 625-acre site (“Project Site” or “Site”) available through a long-term lease with the Brownsville Navigation District of Cameron County (the “BND”) and located on the north side of the Brownsville Ship Channel, approximately 5 miles southwest of the Gulf of Mexico in Cameron County, Texas. The Site extends for approximately 3,000 feet along the Brownsville Ship Channel. The site is located approximately 19 miles northeast of the City of Brownsville, Texas population center on State Highway 48 with site coordinates of 26° 2'27 N latitude and 97°13'57 W longitude.

The Project will be constructed in two phases. Texas LNG plans to initiate construction of Phase 1 upon receipt of all required authorizations and Phase 2 will be constructed based upon market demand. Each phase is designed to process approximately 0.309 billion standard cubic feet per day (“Bcf/d”) of pipeline quality natural gas, which is approximately equivalent to 2.2 MTA of LNG based on average gas composition, average ambient temperature and



1-3 May 2015

operation 365 days per year.3 While each train accordingly will have a Nameplate Capacity of 2.2 MTA, Texas LNG estimates that each train will produce 2 MTA of LNG for export.4 The additional design output compensates for unplanned downtime, maintenance downtime, and losses due to heat leak boil-off enabling Texas LNG to deliver its authorized export quantities. Phase 1 and Phase 2 each will include a single liquefaction train and a single containment storage tank with a capacity of 210,000 m3 of LNG, as described in greater detail below.

The proposed Project Facilities are illustrated in Figures 1.3-1 and 1.3-2 which show the regional location of the facilities on a U.S. Geological Survey (“USGS”) topographic map and aerial map, respectively. A more detailed layout of the Project Facilities is provided on Figures 1.3-3 (aerial map) and 1.3-4 (USGS 7.5 Minute Series topographic map).

Figure 1.3-5 illustrates workspace layouts for the Project Facilities. Additional maps, illustrations, and plans of Project components are found throughout the ER, including the detailed design plans contained in Resource Report 13 (Engineering and Design Material) to be filed at a later date.

All proposed Texas LNG’s Project components will be sited, constructed, operated, and maintained in accordance with all applicable federal and state regulations. The LNG Project Site will include the following facilities:

Natural Gas Pipeline Receiving Interface;

Natural Gas Pretreatment Process;

LNG Liquefaction Process;

LNG Loading Marine Terminal;

LNG Transfer Lines;

LNG Storage Tanks;

Vapor Handling System;

Control Systems, and Safety Systems; and

Utilities, Infrastructure, and Support Systems.

The major proposed LNG facilities at the Project Site are summarized below:

Gas Gate Station and Interconnect Facility.

3 The LNG production rate varies with the ambient temperature. In the winter each train will produce

2.30 MTA and require 0.355 Bcf/d of feed gas to support the production rate. During the summer the production rate will be lower due to increased ambient temperatures and subsequently the feed gas rate will be lower. The summer and winter production rates are still under evaluation and are subject to change as the design matures.

4 Texas LNG’s March 9, 2015 Pre-Filing request letter stated that each liquefaction train had a Nameplate Capacity of 2 MTA. After further design work and analysis, Texas LNG now expects that each train will have a Nameplate Capacity of 2.2 MTA.


Laguna AtascosaNational Wildlife

Refuge

Lower Rio GrandeValley NationalWildlife Refuge

Boca ChicaState Park

Lower Rio GrandeValley NationalWildlife Refuge

£¤100

£¤48

£¤4

ProposedTerminal

Site

This information is for environmental review purposes only.

0 1 2Miles

Proposed Terminal SiteFederal & State Land

U.S. or State Highways pan ERM Group company

Figure 1.3-1Proposed Project Facilities

Regional LocationPort of Brownsville, Texas

1:130,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Project_Regional_Location.mxd | REVISED: 05/14/2015 | SCALE: 1:130,000 DRAWN BY: THohn


£¤48

625Acres

Laguna AtascosaNational

Wildlife Refuge


0 1,000 2,000Feet

Proposed Terminal SiteEndangered Species Act Critical Habitat

Federal Land

Brownsville Ship Channel pan ERM Group company

Figure 1.3-2Proposed Project SitePort of Brownsville, Texas

1:20,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Project_Site_Aerial.mxd | REVISED: 05/14/2015 | SCALE: 1:20,000 DRAWN BY: THohn


MarineBerth

"

Phase 1Liquefaction Train

"

Administration Area

"

UtilitySubstation

Phase 1 LNG Storage

Tank

Phase 2 LNG Storage

Tank

"GasMeteringStation

"

Access Roads

Barge

LNG Carrier

"

Material OffloadingFacility

Phase 2 Liquefaction

Train

MainFlare

£¤ 48


0 0.1 0.2Miles

Proposed Terminal Site

Pipeline

Docking Area

15-ft Elevated Facility Footprint

U.S. or State Highways Zan ERM Group company

Figure 1.3-3Proposed Facilities at Terminal Site

Port of Brownsville, Texas

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Project_Facilities_Aerial.mxd | REVISED: 05/14/2015 | SCALE: 1:7,000 DRAWN BY: THohn


MarineBerth

"

Phase 1Liquefaction Train

"

Administration Area

"

UtilitySubstation

Phase 1 LNG Storage

Tank

Phase 2 LNG Storage

Tank

"GasMeteringStation

"


Barge

LNG Carrier

"

Access Roads

Phase 2 Liquefaction

Train

MainFlare

£¤ 48


0 0.1 0.2Miles


Pipeline

Docking Area

15-ft Elevated Facility Footprint

U.S. or State Highways Zan ERM Group company

Figure 1.3-4Proposed Facilities at Terminal Site


FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Project_Facilities_Topo.mxd | REVISED: 05/14/2015 | SCALE: 1:7,000 DRAWN BY: THohn


Water Tank &Sewage Tank

Barge

LNG Carrier

Aggregates BatchPlant

GeneratorShelter

ContractorOwnerOffice

SubcontractorOffice

Laydownfor Flare

Stack

ParkingLot

Laydownfor Civil &

ArchitecturalWorkshops Warehouse

CranePad

Laydown forJetty Work

Laydownfor Tank

Laydown for Module,Piping, Mechanical,

Electric, & Steel

£¤ 48


0 500 1,000Feet

Proposed Terminal SiteSite Pipeline15-ft Elevated Facility FootprintDocking Area

U.S. or State HighwaysAccess Roads Wetlands

Laydown AreaPhase

Phase 1 & 2Phase 2

Zan ERM Group company

Figure 1.3-5Proposed Temporary Workspace and Laydown Areas


FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Temp_Workspace_Layout.mxd | REVISED: 05/14/2015 | SCALE: 1:7,000 DRAWN BY: THohn



1-9 May 2015

Liquefaction Plant – consisting of two (2) liquefaction trains utilizing Air Products and Chemicals, Inc. (“APCI”) C3MR technology and ancillary support facilities.

Two (2) - 210,000 m3 LNG aboveground single containment LNG storage tanks with cryogenic pipeline connections to the Liquefaction Plant and berthing dock.

An LNG carrier berthing dock and recessed berthing area - capable of receiving LNG carriers between approximately 130,000 m3 and approximately 180,000 m3 capacity.

A Materials Offloading Facility (“MOF”) to allow waterborne deliveries of equipment and material during construction and mooring of tug boats after startup and commissioning.

A turning basin with an approximate diameter of 1,400 feet extending into the Brownsville Ship Channel with deepwater access to the above referenced LNG berthing dock.

Incinerator, Process Flare, Acid Gas Flare, and Marine Flare.

Administration, control, maintenance and warehouse buildings, and related parking lots, etc.

Electrical substation.

1.3.1 Gas Gate Station and Interconnect Facility

The Project will receive natural gas from a non-jurisdictional intrastate natural gas pipeline at the Gas Gate Station to be constructed onsite near the north boundary of the site. The non-jurisdictional intrastate pipeline Gas Gate Station will contain intrastate pipeline equipment, a filter/separator, custody transfer meter(s), an emergency shut down (“ESD”) valve, and a gas analyzer. The Interconnect Facility located at the LNG Project-end of the Gas Gate Station will tie-in to the inlet flange of the LNG terminal custody meter, and include pig receiving facilities, ESD valve, flange insulating kit, and a gas analyzer that will be located within an area of the Project footprint. The intrastate pipeline receiving facilities will be contained within an approximate 150-foot by 100-foot fenced area.

1.3.2 Liquefaction Plant

The main process components that are located at the Project Site, and their support facilities, include a gas pretreatment facility to remove unwanted gas components from the supply gas stream and an LNG train using the proven APCI C3MR propane precooled mixed refrigerant technology, as described in Section 1.5 below. These facilities collectively are referred to as the “Liquefaction Plant.” The current design of the Liquefaction Plant is based on a feed gas delivery pressure of approximately 600 psig at the inlet of the Gas Gate Station on the Project Site.

1.3.3 LNG Storage

The LNG storage tanks will be approximately 290 feet in outer tank diameter and 190 feet in height from grade to the top of the dome roof, with a net usable capacity of approximately



1-10 May 2015

210,000 m3 of LNG. The tanks will be a single containment design featuring a 9 percent nickel inner tank surrounded with a carbon steel outer tank to contain the LNG vapors. The tanks will sit within earth berms that will provide secondary containment (see Figure 1.3-6). The storage tanks, like other LNG facilities at the Project Site, will be built to the requirements of National Fire Protection Association (“NFPA”) Standard 59A, U.S. Department of Transportation (“DOT”) regulations at 49 CFR Part 193, and all other applicable regulations, codes, and standards.

1.3.4 LNG Vessel Loading

As indicated on Figures 1.3-3, 1.3-4, and 1.3-5, the LNG carrier berthing area will be recessed into the Project Site’s shoreline on the Brownsville Ship Channel. Excavation and dredging to create the recess will extend over an area with a length of approximately 2,200 feet and a maximum width of approximately 2,000 feet or about 65 acres. The berthing area will also include a turning basin with a radius of approximately 1,400 feet. The LNG carrier berthing dock will feature a 140-foot by 150-foot concrete jetty head platform, which will be supported on piles. The platform will support three loading arms and one vapor return arm, to allow LNG transfer to berthed carriers. The three liquid loading arms are composed of two dedicated liquid loading arms and one hybrid capable of unloading vapor. The hybrid arm is a backup to the vapor return arm and is normally used to load LNG. Each arm will be fitted with a hydraulically interlocked double ball valve and powered emergency release coupling to isolate the arm and the ship in the event of any condition requiring rapid disconnection. Each arm will be fully balanced in the empty condition by a counterweight system and maneuvered by hydraulic cylinder drives.

During LNG carrier loading, LNG will be pumped from the LNG storage tank(s) to the LNG berthing dock using in-tank pumps, where it will be transferred to ocean-going carriers and exported. The LNG transfer rate to the LNG carrier will be up to 12,000 m3 per hour. At the berthing dock, transfer to the carrier will be achieved through hydraulic-operated LNG loading arms. The vapor return arm is provided to route displaced gas back to the LNG storage tanks. LNG carrier unloading and receiving capabilities are not included in the Project design.

Current projections indicate that one LNG carrier per 10 to 11 days will make port calls at the Project when operating at the completion of Phase 1 and twice that frequency at the completion of Phase 2. The actual number of port calls will depend upon the export volume and the capacity of the specific vessels.

The berth and turning basin will be dredged and maintained to -42 feet mean low tide datum with a 3 ft over dredge to accommodate LNG carriers with capacities up to approximately 180,000 m3 of LNG. The berthing area will be dredged with side-walls sloped to a 3:1 ratio in order to match the sidewall slope of the shipping channel. Portions of the slopes will be armored with riprap to prevent erosion or slumping of the slopes during operation of vessels. During operations, the MOF will serve as a tug berth.

1.3.5 Buildings

The facility will include separate buildings for administration, control room, warehousing, and workshop functions. The administration building would be located adjacent to State



an ERM Group company

Figure 1.3-6Proposed LNG Storage Tank Design

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Storage_Tank_Design.mxd | REVISED: 05/14/2015 | SCALE: 1:45 DRAWN BY: THohn



1-12 May 2015

Highway 48 near the entrance to the facility. The control room and workshop would be located near the liquefaction plant.

1.3.6 Water, Power, and Communications

Texas LNG anticipates that water supply during construction will be imported from offsite and sanitary waste will be handled by self-contained portable facilities. Texas LNG anticipates that water for industrial process uses and domestic water supply will be appropriated from the Brownsville Ship Channel and treated by reverse osmosis as the primary process to remove salt and other contaminants prior to use. Potable water would likely be delivered to the Project Site by a vendor. Sanitary waste water is expected to be treated on site and discharged as permitted effluent to the Brownsville Ship Channel. A freshwater firewater tank will be used to charge the firewater main and will be used as a first response should firewater be needed. The firewater tank is designed to provide firewater at the design supply rate for at least two hours. A seawater firewater back-up system is also included in the design. The seawater system will automatically activate on detection of a low water level in the freshwater firewater tank.

Electric power for the Project will be supplied by a non-jurisdictional transmission line connected to the local electric transmission grid. A substation will be constructed near the utility area of the Project. The main power load will be the electric motor drivers coupled to refrigeration compressors. Other primary plant electrical loads will include in-tank LNG pumps, boil-off gas compressors, and residue compressors, and the multiple fin-fan motors that will be used for air cooling of the process during liquefaction. Additional detail regarding non-jurisdictional facilities related to the Project is provided in Section 1.10.

The telecommunication systems for the Project will include a telephone connection, internet connection, radio system, computer network, plant telecommunications network, electronic mail system, and closed-circuit television system. Plant operations will be viewable by password protected website. In addition, marine band very-high-frequency radios will provide for communication with the LNG carriers.

1.3.7 Ancillary Facilities

Ancillary facilities and structures at the LNG Project Site will include the following: a firewater system; process and marine flares; flare knock-out drums; an incinerator; boil-off gas compressors; control rooms; hot oil heaters; instrument air system; desalination system; truck loading and unloading; a substation; a utility area; an administrative center; a warehouse; an oily water treatment unit; miscellaneous piping, racks, sumps, and spill containment system; parking areas; and plant roads.

1.4 Deepwater Access to Gulf of Mexico

LNG carriers will access the Project from the Gulf of Mexico through the Brownsville Ship Channel. The Brownsville Ship Channel is currently maintained to a depth of 42 feet and width of 250 feet. The channel is essentially a straight waterway with no bridges or other air-draft obstructions for its entire 19 mile length. Due to its width, the channel is operated for single-lane, one-way traffic with vessel traffic managed by the Brownsville Navigational District. The U.S. Army Corps of Engineers (“COE”) recently has authorized the deepening of the channel to 52 feet (COE 2014). The existing and future channel will be maintained with a minimum side slope of 1 foot vertical over 3 feet horizontal for that portion necessary to access



1-13 May 2015

the Project Site (COE 2014). Once the channel is deepened, Texas LNG estimates that the channel will be effectively 310 feet wide at a depth of 42 feet assuming a 3:1 side slope.

LNG carriers calling on the Project will turn in an approximately 1,400-foot-diameter turning basin that Texas LNG will develop as part of the project. This will allow a carrier to be moored at the LNG berthing dock with its bow facing toward the channel. Texas LNG is designing the Project Site to accommodate LNG carriers up to a loaded draft of approximately 39 feet and maximum beam and length of approximately 165 and 1,000 feet respectively.

The LNG carriers will navigate into the Gulf of Mexico from their point of origination, entering the Santiago Pass from the Brazos Santiago Pass Fairway of the Gulf of Mexico, then turn into the Brownsville Ship Channel. Inland navigation will be about 5 miles from the Fairway to the Project Site. Figure 1.4-1 identifies the LNG carrier route to the Gulf of Mexico.

Texas LNG currently is working with the Port of Brownsville to study the adequacy of the channel under both the existing and future conditions to allow safe passage of LNG carriers of various dimensions and under various environmental conditions.

1.5 Process Description

1.5.1 Pretreatment Process Description

Pipeline-quality feed gas arriving at the Project Site will require the removal of various constituents ahead of the liquefaction process, including mercury, CO2, water and heavy hydrocarbons (pentane and heavier). The natural gas delivered to the site will be composed primarily of methane (between 91 and 98 percent), but will also contain other gas components; ethane, propane, butane, and other heavy end hydrocarbons (between 2 and 3 percent), in addition to small quantities of nitrogen, oxygen, carbon dioxide (CO2), and water. Generally, pipeline-quality natural gas supplies contain less than 7 lbs of water per million standard cubic feet and less than 2 percent CO2. Pipeline quality natural gas characteristically contains very small quantities of these constituents, the presence of which has no significant effect on operational efficiency when the gas is used as an energy source for domestic, commercial, or industrial applications. However, these constituents can negatively affect liquefaction equipment when the same gas is used as feed stock for LNG production. The pretreatment process is designed to remove a range of unwanted components from the feed gas to enable the liquefaction process to operate reliably.

The pretreatment process involves five sequential steps:

1. Inlet facilities to remove pipeline debris (dirt, scale, dust, and oil) 2. Treatment to remove mercury in mercury guard bed; 3. Treatment to remove CO2 in an amine acid gas removal system; 4. Treatment to remove water in molecular sieve dehydration vessels; and 5. Treatment to remove heavy hydrocarbons in a heavy hydrocarbon removal

system.

From the Project Gate Station, feed gas will be piped to the pretreatment facilities. The gas will flow first through the inlet facilities, then a mercury guard bed, an acid gas removal unit, a dehydration unit, and finally a heavy hydrocarbon removal unit, as described in further detail below. The water and CO2 present in natural gas would freeze in the cryogenic liquefaction process if not removed.


£¤100£¤4

8


0 0.5 1Miles


Navigation RoutesLNG Carrier Route p


Figure 1.4-1LNG Carrier Transit Route


1:55,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Figure1_4_1.mxd | REVISED: 05/11/2015 | SCALE: 1:55,000 DRAWN BY: THohn



1-15 May 2015

The inlet facilities consist of a shell and tube heat exchanger, a pressure control station and an inlet filter coalescer. The heat exchanger heats the feed gas by exchanging heat with hot oil. The feed gas exiting the heat exchanger flows to the pressure control station that controls the inlet pressure to the plant. The feed gas is heated to compensate for the Joules-Thompson effect that would otherwise cool the gas below the optimal amine operating temperature, thus reducing the ability of the amine to remove CO2. From the pressure control station the gas flows through the inlet filter coalescer to remove any debris that might be entrained in the pipeline gas.

From the coalescer the gas flows to the Mercury Removal Bed. Mercury naturally occurs in natural gas and may be present in very small quantities. Mercury will form an amalgam with aluminum and thereby weaken the strength of the metallic aluminum in plant equipment such as the main cryogenic heat exchanger (“MCHE”). As insurance to avoid this possibility, the natural gas is passed through a bed of non-regenerable metallic sulfides wherein the mercury is removed from the natural gas stream.

In the acid gas removal unit, acid gases (primarily CO2 with small quantities of hydrogen sulfide) are removed from the feed gas. The feed gas flows upward through a packed tower and is contacted by an amine solution flowing downward through the packing. The amine solution absorbs the acid gases from the feed gas. Rich (saturated) amine solution from the bottom of the contactor is depressurized and heated for regeneration in a separate stripping tower. Water vapor, hydrogen sulfide, CO2, and trace hydrocarbons are removed in the stripping tower is sent from the top of the vessel to an acid gas incinerator where the hydrogen sulfide is oxidized to sulfur dioxide and the trace hydrocarbons are oxidized to CO2 and water. The incinerated gas is vented to the atmosphere. Clean, lean amine solution from the stripping tower is cooled and then pumped back to the contactor absorbing tower in a closed loop. The “sweet” water-saturated feed gas from the top of the contactor is cooled and sent to the dehydration unit. The amine system is designed to reduce the CO2 content in the feed gas to 50 parts per million or less by volume. The CO2 stream exiting the stripping tower is saturated with water that cannot be recovered. To account for the lost water, a demineralized water treatment system provides purified makeup water for the amine system.

The dehydration unit will be located downstream of the acid gas removal unit and is designed to remove water from the saturated feed gas that would otherwise freeze during natural gas liquefaction. The gas dehydration system will consist of three (3) vertical molecular sieve process vessels (also called molecular sieve beds). At any given time, two (2) molecular sieve beds will be in water adsorption mode, while the third will be in regeneration mode. The water content of the feed gas is reduced to less than 1 part per million (ppm) by volume. Regeneration mode consists of a heating cycle followed by a cooling cycle. Each bed is designed to operate for about 16 hours prior to being switched to regeneration. At the end of a 16-hour adsorption cycle the molecular sieve bed in dehydration mode is placed into regeneration mode and the bed that has completed the regeneration mode is place into dehydration mode. One bed is regenerated every eight (8) hours without interruption of the dehydration process. The regeneration gas is heated with hot oil in a heat exchanger. The dehydration pretreatment process is controlled from the plant control system that sequences valves and equipment based on a time cycle. For regeneration, a small reverse flow of dry hot gas from a regeneration gas heat exchanger flows through the water saturated bed to heat the molecular sieve material. As the molecular sieve is heated the water adsorbed onto the bed during the dehydration cycle is released. The water vapor is carried out of the bed being regenerated by the hot regeneration gas. Hot regeneration gas discharged from the vessel being regenerated is cooled by an air cooler causing the water vapor to condense. The



1-16 May 2015

condensed water is separated from the regeneration gas in a separator located downstream of the air cooler. The water discharged from the separator will be treated by the process water recovery system and reused as amine make-up water. The process water recovery system removes any condensed hydrocarbons contained in the water discharged from the regeneration gas separator. The hydrocarbons recovered from the process water are sent to the waste oil tank to await disposal off site. The regeneration gas system is a closed loop requiring only small amounts of dehydrated feed gas for make-up. During the heating cycle the regeneration gas expands and a small amount of regeneration gas is vented to the fuel gas system to maintain the regeneration system pressure. Dry purified feed gas from the molecular sieve beds, operating in dehydration mode, is filtered to remove any molecular sieve dust. The bulk of the dry feed gas exiting the molecular sieve dust filters is sent to the heavy hydrocarbon removal unit and the balance is used as make-up for the regeneration gas system.

The last step in the pretreatment process is to remove the heavy hydrocarbons (pentane and heavier or C5+), some components of which would freeze during the liquefaction process if not removed. The feed gas enters the heavy hydrocarbon removal unit where it is chilled to a point where most of these heavy components condense and are then separated. As part of the heavy hydrocarbon extraction process, light hydrocarbons are condensed along with the heavy hydrocarbons. A distillation process separates the lighter hydrocarbons and produces a C5+ mixture that has a low vapor pressure. The small quantities of C5+ product are temporarily collected in C5+ storage tanks with secondary containment. The C5+ will be trucked to an offsite buyer. The light hydrocarbons separated during distillation are injected into the gas entering the liquefaction process as residue gas. When the feed gas is lean, some of the light hydrocarbons are also mixed with the feed gas to the heavy hydrocarbon removal unit to balance the liquid loads in the distillation towers.

Following pretreatment, the residue gas is routed to a residue gas compressor to raise the pressure to the inlet conditions required by the liquefaction units.

1.5.2 Liquefaction Process Description

As discussed previously, pipeline-quality natural gas will be shipped to the Project through a non-jurisdictional pipeline that is owned and operated by others. Treated gas pressure will be boosted as necessary by electric motor-driven residue gas compressor to achieve the necessary operating pressure at the inlet to the liquefaction system. Air-cooled heat exchangers will cool the gas to remove the heat of compression. In each train, gas leaving the residue gas compressor will be processed in the liquefaction train to produce LNG.

Once both phases of the project are operational the average production rate will be 4 MTA.



1-17 May 2015

Figure 1.5-1 Basic Schematic of the C3MR Process5

When the pretreated gas enters the liquefaction unit, it is cooled by propane refrigerant in four kettle type shell and tube heat exchangers. Each of the kettle exchangers will contain propane refrigeration on the shell side and feed gas on the tube side. The heat removed from the feed gas will vaporize propane. The propane compressors will compress the vaporized propane to the condensing pressure. The propane discharged from the propane compressors will be condensed by air coolers.

The feed gas discharged from the tube side will flow to the MCHE. The MCHE is a spiral wound heat exchanger. The feed gas flows through the tube side of the MCHE and exits the heat exchanger as LNG. Mixed refrigerant (“MR”) consisting of nitrogen, methane, ethylene, and propane will flow from the top to the bottom of the shell side of the MCHE. As the MR flows through the MCHE, the MR cools the natural gas on the tube side of the exchanger. The MR is vaporized as a result of cooling the feed gas to produce LNG.

The LNG exits the MCHE as a subcooled liquid and flows to the LNG hydraulic turbine. The turbine extracts work from the high pressure sub-cooled LNG exiting the MCHE and produces electrical power that is consumed on site. The LNG discharged from the hydraulic turbine is sent to the LNG storage tank for storage where it is stored until export. The LNG stored in the LNG tank then can be pumped from the storage tanks through cryogenic transfer piping to the LNG berthing dock, to be loaded onto LNG carriers for export.

Each liquefaction unit will contain a refrigerant make-up system with gas analyzers and controls that allow plant operations to keep the refrigerant components in proper proportion. The propane refrigerant make-up system is also designed to recover refrigerant during equipment shutdown. Distribution piping will connect vessels in the common refrigerant storage

5 LNG= liquefied natural gas; MRV=mixed refrigerant vapor; MRL=mixed refrigerant liquid



1-18 May 2015

area to each liquefaction unit. Except for certain safety systems, one distributed control system in the Liquefaction Plant control building will be used for all process control.

1.6 Land Requirements

Sections 1.1 through 1.3 describe the proposed Project Facilities, which are also illustrated on Figures 1.3-3, 1.3-4, and 1.3-5. Land requirements in terms of construction workspace and operational footprint acreages are addressed in Section 1.6.1.

1.6.1 Project Facilities

Texas LNG selected the proposed Project Site location because the site offered several key advantages over the other sites considered. The selection was based on various criteria including distance from channel entrance, dredging cost and impact, elevation, shoreline frontage, and site size and shape. A detailed description of the selection criteria is provided in Section 10.5 of Resource Report 10.

The Project Facilities will occupy an approximately 625-acre property secured via a lease option and subsequent amendment from the BND by Texas LNG. The Option Agreement and Option Agreement Second Amendment were included in Texas LNG’s March 9, 2015, Pre-Filing request as Attachment B. The proposed configuration of the facility is illustrated on Figures 1.3-3 and 1.3-4. Texas LNG designed the facility to minimize impacts on wetlands to the extent practical. Of the approximately 625 acres, approximately 185 acres will support permanent operational facilities, approximately 75 acres will be temporarily disturbed during construction activities, and the remaining approximately 365 acres will be undisturbed. Of the approximately 185 acres supporting permanent operational facilities, approximately 46 acres will be converted to open water through excavation and dredging to create the LNG carrier berthing area. An additional approximately 19 acres of impact located outside of the site boundaries would be associated with dredging of the turning basin within the Brownsville Ship Channel. Approximate acreages for individual facility and workspace areas are provided in Table 1.6.1-1.

TABLE 1.6.1-1

Texas LNG Project Summary of Land Requirements for Proposed Facilities at the Project Site

Facilities Footprint (acres)a Project Site

Permanent Facilities

Liquefaction Process Area and LNG Storage Tanks b 125 Marine Berth and Docks 46 Main Flare 1 Administration Area Utility Substation Pipeline Gate Station Permanent Access Roads

1 7 5

Temporary Workspace and Staging Areas c Phase 1 and 2 Phase 2 Only

58 17

Brownsville Ship Channel Site Access d

19

Total 278



1-19 May 2015

TABLE 1.6.1-1

Texas LNG Project Summary of Land Requirements for Proposed Facilities at the Project Site

Facilities Footprint (acres)a ____________________ a All acreages are approximate pending completion of civil and topographical surveys. b Includes all areas contained within the liquefaction and storage tank area of the project that would

be graded or elevated to 15 feet above mean sea level excluding the main flare. c Includes all temporary workspace necessary for construction including facilities required for plant

construction (dock construction temporary concrete batch plant, construction site offices, warehouse and covered storage sites, open laydown for storage, workshops for pre-assembly areas, and parking, canteen and sanitary facilities for construction personnel).

d Site access refers to area to be dredged within the Brownsville Ship Channel to connect the Project Site to the navigational channel.

1.6.2 Temporary Workspace and Laydown Areas

To minimize clearing of the site, Texas LNG intends to place a portion of its temporary workspace and laydown areas during Phase 1 in areas where Phase 2 equipment eventually will be constructed. Prior to use as temporary workspace and laydown, these areas will be filled and graded for preparation of Phase 2 of the Project.

Most temporary workspace areas will be used during both Phase 1 and Phase 2 of the project (see Figure 1.3-5). The temporary workspace will include the mobile offices, sanitary facilities, parking, and spoil storage during preliminary site preparation activities. Additional temporary facilities include sanitary facilities, first-aid facilities, workshops, pre-assembly areas, a quality control laboratory, a warehouse, and a concrete batch plant. These areas will remain as open ground following construction of Phase 1 until construction of Phase 2 is initiated.

Construction of Phase 2 will require an additional approximately 17 acres of temporary workspace for lay down and staging associated with the second storage tank and liquefaction train. Preparation of this laydown area will be delayed until construction of Phase 2 commences.

1.6.3 Dredged Material Placement

Texas LNG is currently evaluating various potential placement options for the excavated and dredged material including placement in nearby upland dredged material placement areas.

Texas LNG anticipates that an estimated 3,600,000 cubic yards of dredged material associated with creation of the turning basin and berthing area will require placement at an off-site location. Based upon recommendations made by the COE for the channel deepening project, that portion of the channel located immediately adjacent to the Site is likely to contain sediments composed mostly of clay and unlikely to be suitable for beneficial reuse to decrease shoreline erosion along South Padre Island (COE 2014). Texas LNG has discussed with the BND the potential use of the existing upland confined Placement Area (“PA”) 5A, or PAs 4A and 4B located directly across the Brownsville Ship Channel from the proposed Project Site as shown in Figure 1.6-1. Placement Area 5A is about 4 miles west of the project site and has greater capacity than PAs 4A and 4B.

If any of the PAs are used, Texas LNG likely will raise the existing dikes which surround the PAs to offset the anticipated volume of dredge material to be placed at these locations.


£¤100

£¤48

£¤4

625Acres

5A737 Acres

4B254 Acres

4A533

Acres


0 5,000 10,000Feet


Federal & State Lands

Dredged Material Placement Areas pan ERM Group company

Figure 1.6-1Potential Dredged Material Placement Areas


1:120,000




1-21 May 2015

Construction to raise the PA containment dikes would be done within the footprints of the existing PAs. The PAs are owned by the BND.

1.7 Construction Schedule and Procedures

1.7.1 Construction Schedule

Texas LNG anticipates that the FERC authorization to site, construct, and operate the proposed facilities will be issued by mid-2017. Texas LNG plans to begin construction of Phase 1 of the Project in 2017, and begin production in 2020.

During the peak construction period of Phase 1 at the Project Site, approximately 1,000 on-site workers will be required. However, the number of workers present at different stages of construction will vary significantly. Initial mobilization will involve 50 to 100 workers. As site activity increases, the workforce will average approximately 600 workers for three years of the construction, increasing during installation of the liquefaction train components and decreasing as the facilities near completion and pre-commissioning, commissioning, and plant start-up.

Construction of Phase 2 at the Project Site would require a similar work force to that used for Phase 1 with the exception that site preparation and installation of the marine facilities, substation, gas gate station, refrigerant storage, flares, firewater storage and pumps, and utilities would not be required. Texas LNG anticipates that during the peak of construction of Phase 2, approximately 900 on-site workers will be required. Initial mobilization will involve 40 to 80 workers. As site activity increases, the workforce will average approximately 400 workers, increasing during installation of the liquefaction train components and decreasing as the facilities near completion and pre-commissioning, commissioning, and plant start-up.

Figures 1A-1 and 1A-2, found in Appendix 1A, depict the approximate number of construction personnel by month for both phases of the Project. The graphs use the assumption that construction of Phase 2 would commence after commissioning of Phase 1 has been completed resulting in two distinct peaks in the construction workforce. The timing of the construction of Phase 2 of the Project cannot be accurately forecasted at this time; Phase 2 will commence after the production capacity of Phase 2 is sold to an LNG offtake customer.

1.7.2 Construction Procedures

1.7.2.1 Environmental Compliance, Training, and Inspection

All facilities will be designed, installed, tested, operated, and maintained in accordance with applicable laws, regulations, and standards that are intended to prevent facility accidents and failures, ensure public safety, and protect the environment. With respect to the liquefaction, storage, and export infrastructure at the Project Site, these standards and regulations include the DOT’s Federal Safety Standards for Liquefied Natural Gas Facilities (49 CFR Part 193), the NFPA Standard for the Production, Storage and Handling of LNG (NFPA 59A), applicable sections of the U.S. Coast Guard’s regulations for Waterfront Facilities Handling LNG (33 CFR Part 127 and Executive Order 10173) and Texas Railroad Commission Chapter 14, Regulations for Liquefied Natural Gas.”

In lieu of adopting the FERC’s Upland Erosion Control, Revegetation, and Maintenance Plan (“UECRM Plan”) and FERC’s Wetland and Waterbody Construction and Mitigation Procedures (“WWCM Procedures”) Texas LNG plans to utilize a project-specific Construction Plan. The Construction Plan will detail measures to be implemented during construction by



1-22 May 2015

Texas LNG or its contractor to minimize environmental impacts. The Construction Plan will be provided in a subsequent filing of this report.

During construction, the potential exists for spills of hazardous materials, such as hydraulic fluid and diesel fuel for equipment and vehicles; in addition, stormwater runoff from the construction workspace could carry unconfined debris or materials. To address these concerns, Texas LNG will develop and adhere to a Spill Response Plan and Storm Water Pollution Prevention Plan (“SWPPP”), consistent with applicable regulations and permit requirements.

Texas LNG will review project-specific environmental conditions with prospective contractors during pre-bid meetings, will incorporate such conditions into construction bid documents and ultimately into construction contracts. Contractors will be obligated to comply with all environmental rules and regulations. As soon as Texas LNG becomes aware of any non-compliance during construction, it will direct the contractor to comply and may take other corrective actions as necessary, including issuance of stop-work orders.

For purposes of quality assurance and to support regulatory compliance, Texas LNG will be represented by a chief inspector. Craft inspectors and one or more environmental inspectors (“EI”) will assist the chief inspector. In addition, Texas LNG will use craft inspectors for inspection services at manufacturing and fabrication facilities handling process modules, equipment, and piping prior to delivery to the Project Site. All Texas LNG inspectors will have access to the compliance specifications and other relevant material contained in the construction contracts.

The EIs’ duties will be fully consistent with those outlined in paragraph III.B (Responsibilities of the Environmental Inspector) of the UECRM Plan and outlined in the Construction Plan. The primary role of the EIs is to ensure that the environmental conditions associated with permits and other authorizations are satisfied. The EIs will have authority to stop work or require other corrective action(s) to achieve environmental compliance. In addition to monitoring compliance, the EIs will assist with environmental training for Project personnel and report compliance status on a daily, weekly, and biweekly basis. The environmental training program will be designed to ensure that all individuals receive training tailored to their particular role before beginning on-site work, adequate training records are maintained, and refresher training is provided as needed.

1.7.2.2 Project Site

Site Preparation

The proposed Project Site will require significant site work, including clearing, grubbing, grading, soil stabilization, and filling to increase ground elevation, some of which must be performed ahead of foundation development and plant construction. The full scope of these activities will be dependent in part on the results of Texas LNG’s geotechnical study, which will evaluate geotechnical soil properties (e.g., bearing capacity, deformability, liquefaction potential, moisture content, compaction, and slope stability), not only for the existing soil at the Site, but also for any imported soil required for general and structural backfilling.

Most of the LNG facility components (e.g., storage tanks, liquefaction trains, etc.) would be located on the highest portion of the site which currently has elevations ranging between 2 and 25 feet above mean sea level (“amsl”). As part of site preparation that portion of the site in which the facility would be constructed would be modified by cut and fill activities to an elevation above 15 feet NAVD 88. Texas LNG anticipates that approximately 240,000 cubic yards of imported fill will be required to achieve this elevation and that the soil will require improvement



1-23 May 2015

and stabilization to provide a load-bearing surface suitable for construction. Commonly used stabilizers include Portland cement and hydrated lime. Soil consolidation may also be achieved through the use of other methods, such as the installation of wick drains and stone columns. Soil improvement requirements will be established after Texas LNG’s geotechnical investigations are completed. Aggregate materials (e.g., gravel, oyster shells, and/or crushed stone) and geotextile layers will be used to level and finish temporary workspace and operational areas, as necessary. Aggregate materials will be delivered to the Project Site by truck, or by barge or other ocean going vessel via the MOF.

The proposed source(s) of additional fill material have not been confirmed. Texas LNG is considering the use of commercially available aggregate materials, including gravel, oyster shell, and crushed stone sourced from local or regional commercial operations. This will be required for construction of the new access roads, preliminary site preparation, and development of the MOF.

Preparation of construction workspace across the Project Site will involve cutting and filling to rough grade and soil stabilization/improvement as referenced above, followed by erection of temporary fencing to isolate construction activities from peripheral areas. Temporary site roads and parking areas will also be stabilized and compacted for heavy load traffic. The temporary site roads will generally follow the anticipated layout of the permanent plant roads, and will be paved with asphalt, shell, or gravel depending on anticipated traffic loads. In addition to plant roads, any electrical, communications, and water systems needed during construction will be installed at this time.

During site preparation, topographic grading plans will be designed to ensure efficient and environmentally protective stormwater drainage. The site will be sloped to direct discharges towards perimeter outfalls through a system of ditches and, if necessary, holding basins and filtration devices during construction, allowing sufficient retention time to preclude high sediment loads from reaching receiving waters. Stormwater controls (including placement of gravel or other suitable material to provide a stable, well-drained surface) will be installed. Throughout construction, Texas LNG will follow the erosion and sedimentation control procedures described in its Construction Plan and SWPPP.

Plant Facilities

The Liquefaction Plant foundation construction will commence with installation of piles to provide a firm base for the structures supporting the liquefaction trains. Pile specifications will be based on guidance in the FERC’s most recent draft seismic guidelines (FERC, 2007) and section 7.2.2 of NFPA Standard 59A (2006). After the piles have been positioned, using pre-drilled holes and/or pile-driving, caps will be installed and the concrete pad poured. The piles will be delivered to the site by barge or other ocean going vessel, and/or truck.

The liquefaction systems will be interconnected with the Gas Gate Station and LNG storage tanks by buried and aboveground piping interconnects, the latter on steel-framed support racks.

Pipe spool fabrication will be undertaken mainly off site. Spools fabricated off site will be delivered by truck and barge. Pipe sections will be painted, coated, or insulated, as necessary. Coatings and insulation, if required, will be applied to welds after welds have been tested according to applicable codes.

Certain larger equipment units, such as pretreatment systems, liquefaction and refrigerant compressors, will be assembled as modules in prefabrication yards. This off-site



1-24 May 2015

modular approach allows equipment assembly in a more controlled environment than that encountered under the on-site “stick-built” approach, facilitating final hook-up and testing. Larger modular units will be transported to the MOF, off-loaded, and transported to their respective foundations. Other equipment will be shipped to the Project by truck or barge. All equipment will undergo quality assurance/quality control inspection and testing at its place of origin and upon installation at the Project Site.

Once foundations have been set, work on the liquefaction trains, piping interconnects, and associated utility systems can occur within the same general timeframe, but will be coordinated such that various inter-dependent systems (e.g., electrical and instrumentation) can be installed and tested according to an appropriately sequenced schedule. After the equipment and piping has been set in place, cable systems will be installed. Ultimately, road paving, final site grading, seeding, and cleanup will be completed. Temporary construction facilities will be left in place for Phase 2 construction. After Phase 2, these temporary construction facilities will be disassembled and removed on a progressive basis when they are no longer needed.

Pipe sections will be either hydrostatically or pneumatically tested (see Resource Report 2 for additional details) depending on the type and intended function of the pipe.

Berth/Dock/MOF

Excavation and dredging at the Project Site and within the Brownsville Ship Channel dredge prism will be required for construction of the LNG berthing area and associated turning basin. The LNG berthing area will be recessed within the existing shoreline of the Project Site, as illustrated on Figures 1.3-3 and 1.3-4. Initial estimates indicate that about 2,400,000 cubic yards of material will be excavated and dredged from within the Project Site to reach the required water depths. Texas LNG estimates that an additional 1,200,000 cubic yards of material will be required to be dredged from the Brownsville Ship Channel dredge prism to create the turning basin and connect the Project Site to the navigational channel, for a total of 3,600,000 cubic yards.

Texas LNG is currently evaluating various potential placement options for the excavated and dredged material including placement in nearby upland dredged material placement areas or beneficial use. Texas LNG has discussed with the BND the potential use of the existing upland confined PAs 4A, 4B, and 5A located nearby and south of the Brownsville Ship Channel from the proposed Project Site as shown in Figure 1.6-1.

Texas LNG will perform the necessary sediment analyses to comply with applicable regulations for dredged material placement. These include pre-dredge analyses in accordance with the requirements of the permitting and review authorities (COE, Galveston District and U.S. Environmental Protection Agency, Region VI) under section 103 of the Marine Protection, Research and Sanctuaries Act and other laws and regulations (see Table 1.9-1).

During construction, Texas LNG anticipates that a portion of materials, equipment, and modular plant components will be brought to the site by barge or other ocean-going vessel. This will require development of a separate MOF to allow deliveries during construction and maintenance.

Site Drainage

The Project Site will be graded such that stormwater flow from process areas will enter a peripheral system of shallowly sloped swales. Stormwater from areas that do not have a potential for contamination will be carried directly to outfalls. In areas that have a potential for



1-25 May 2015

oil contamination, stormwater will pass through surficial containment sump devices, which are designed to remove oil from the stormwater. Amine pumps will be isolated to prevent this source of stormwater contamination. Portions of the site where the topography remains unchanged will retain their natural drainage. A detailed stormwater conveyance plan will be designed at a later stage in project development.

The design and operation of all stormwater discharge and treatment facilities will be in accordance with applicable regulations and permits, including the U.S. Environmental Protection Agency’s National Pollutant Discharge Elimination System (“NPDES”) regulations under the Clean Water Act and Federal Emergency Management Agency regulations embodied in the local requirements of Cameron County.

1.7.3 Site Access and Traffic

Road access to the Project Site from Port of Brownsville from the west and Port Isabel from the east will be via State Highway 48. State Highway 48 generally runs parallel to the Brownsville Ship Channel and is bordered on the north by the Laguna Atascosa National Wildlife Refuge. Texas LNG will prepare a Traffic Management Plan to address worker and materials/equipment transportation to the Project Site. The plan will comply with state and local regulatory requirements and will contain specific routing information and delivery timelines. Prior to implementation, it will be provided to the Texas Department of Transportation, area law enforcement and emergency response authorities, and county and local municipal administrators for review and comment. The overall intent of the plan will be to minimize disruption to local traffic flow and communities and ensure that construction-related road use proceeds in a safe and efficient manner.

Texas LNG anticipates that, during construction, most modular units, major material supplies, and equipment will be delivered by barge or other ocean going vessel. Other deliveries of material and equipment during construction will be by road. Texas LNG is currently estimating the number of truck trips required and will provide additional information in a subsequent version of this resource report.

1.8 Operations, Maintenance, and Safety

All facilities will be operated and maintained in accordance with government safety standards and regulations that are intended to ensure adequate protection for the public and to prevent facility accidents and failures. With respect to the liquefaction, storage, and export facilities, these standards and regulations include the DOT Federal Safety Standards for Liquefied Natural Gas Facilities (49 CFR Part 193), the NFPA Standard for the Production, Storage and Handling of LNG (Standard 59A), and applicable sections of the U.S. Coast Guard’s regulations for Waterfront Facilities Handling LNG (33 CFR Part 127, Executive Order 10173), and Texas Railroad Commission Chapter 14, Regulations for Liquefied Natural Gas.

Operating procedures will be prepared for the Project after the final design is completed. Comprehensive training will be provided to ensure that all facility personnel are familiar with the fundamental science, safety procedures, operating procedures and maintenance procedures utilized at the Project Facilities. The training will be conducted by professional trainers with expertise in their particular area of responsibility. A written training curriculum will be developed that includes both classroom and field training exercises. The training program will include testing to demonstrate that the personnel are competent to perform their assigned duties. These procedures will address safe startup, shutdown, cool down, purging, upset response as well as routine operation and monitoring. A process training simulator will be developed to train



1-26 May 2015

operators. During emergency response training, coordination with and involvement of appropriate local emergency responders will be undertaken to ensure effective integration with local communication and emergency response systems.

Texas LNG estimates that the Project will require approximately 80 full-time personnel for operation of Phase 1 of the Project. Operation of Phase 2 of the Project would require an additional 40 full-time personnel. However, these are preliminary estimates and may change as operational plans are further developed.

Maintenance of the Project Facilities will be conducted in accordance with procedures and programs developed by Texas LNG. Full-time staff will conduct routine maintenance and minor overhauls, whereas major overhauls and non-routine maintenance will be handled by qualified contractors. Scheduled preventive and predictive routine maintenance also will include inspection and maintenance of safety equipment, environmental systems, and instrumentation.

The LNG Plant, LNG storage tank, marine berth deck level, main buildings and utilities will be constructed at an elevation above the 500-year floodplain so as to reasonably assure their structural and functional integrity. Primary internal access roads, but not all roads, will also be above the 500-year floodplain so as to insure access from outside the LNG Facility and movement of personnel and equipment about the Project Facilities for the control of fire and other emergencies.

The Project will contain many complementary layers of safety, hazard prevention, and mitigation systems and controls. These layers, as described below, include: (1) primary containment of the LNG; (2) secondary containment in the event of a leak; (3) control systems, operational integrity & protocols, operator knowledge, training & experience; (4) safeguard systems, separation distances; and (5) firefighting contingency planning and exercises, and emergency response.

The primary containment of LNG, i.e., the systems that are used to process, contain and transfer LNG, are written in codes, standards and regulations that have been perfected over decades of experience. Texas LNG will not utilize unproven technology within the facility and all equipment designs, processes, and material types have been used many times before in similar facilities.

A second layer of safety and hazard management is secondary containment. All equipment and piping that contains LNG has secondary containment. In the unlikely event of a spill, the leak will be contained in a series of curbed or bermed areas, trenches, and impoundment pits that are designed to contain any leaked LNG and prevent it from leaving the property.

A third layer of safety and hazard management uses control systems, operational integrity & protocols, operator knowledge, training & experience, to monitor processes and enforce a rigorous set of procedures that have proven to be successful over decades. The procedures will be taught and reinforced by continuous training so that all operating personnel know how to operate the facility during all situations and conditions. Process instruments will continuously monitor conditions such as pressure, flow, and temperature, which can give operators an early indication of a potentially hazardous condition.

Fire and gas detectors that can alert operators and send a signal to process computers within seconds of a leak or fire will be positioned throughout the facility. These hazard



1-27 May 2015

detectors are designed to sense a variety of conditions, including combustible gas, low temperatures, smoke, heat, and flame. Each of these systems will trigger visual and audible alarms at specific site locations and in the control room areas to facilitate effective and immediate response. One of the process computers receiving these signals controls the emergency shutdown system that will automatically close valves and stop the motors of pumps and compressors if a leak is detected.

Separation distance is employed by regulation and good engineering practice to limit the effects of a major leak, called a design spill, such that the vapor cannot catch fire at the property line. If the spill were to catch fire within the facility, the separation distance also limits the effect of thermal radiation at the property line.

In the unlikely event of a fire, fire control systems and equipment for the Project will consist of the following:

A looped, underground firewater distribution piping system serving hydrants, firewater monitors, hose reels, water spray, and sprinkler systems;

Fixed dry-chemical systems; Portable and wheeled fire extinguishers employing dry chemical and CO2, the

latter intended primarily for energized electrical equipment; and Fire protection in buildings, generally consisting of smoke detectors,

ultraviolet/infrared flame detectors, and portable fire extinguishers. Finally, all operations personnel will be trained in emergency response and will receive

regular training to reinforce response to all types of emergency conditions. This training will include, as appropriate, local emergency responders to ensure that, if ever required, the integrated command can function as an effective coordinated unit.

These systems also apply to the marine facilities. Safety of the LNG carrier while

docked and loading is a major design consideration for hazard detection and response. Safety measures include emergency “ship-to-shore” shutdown systems, spill containment, and fire protection.

The LNG industry, both marine and onshore, has an excellent safety record that is the result of a rigorous attention to detail and continuous improvement.

1.9 Future Expansion and Abandonment Plans

Beyond the currently proposed Phase 1 and Phase 2 of the Project, Texas LNG has not identified any future additions. Moreover, there are no current plans relating to abandonment or removal of any of the proposed facility.

1.10 Non-Jurisdictional Facilities

Texas LNG has identified all of the proposed facilities at the Project Site as jurisdictional and subject to FERC authorization. Non-jurisdictional facilities, which will be authorized and regulated by Texas state agencies, will include construction of an intrastate natural gas pipeline to provide natural gas supply to the Project and new utility service connections to a local electric power system.



1-28 May 2015

1.10.1 Intrastate Natural Gas Pipeline

The facility will receive natural gas via a non-jurisdictional intrastate natural gas pipeline to be constructed from the Agua Dulce natural gas hub approximately 150 miles north of Brownsville to the Brownsville market to provide natural gas to proposed LNG export facilities in the Port of Brownsville, industrial projects, power generation facilities, gas utility companies, and export markets in Mexico. The Agua Dulce area is a natural gas trading hub with multiple inter- and intrastate pipelines transiting the area. Interconnecting pipeline systems in the Agua Dulce area include Texas Eastern Pipeline, Tennessee Pipeline, Energy Transfer, Enterprise, South Cross, Natural Gas Pipeline Company, Transcontinental Gas Pipeline, Conoco, and Houston Pipeline.

Texas LNG does not plan to own or operate the proposed intrastate pipeline that will provide feed gas supply to the Texas LNG Project. Texas LNG has been in discussions with several intrastate pipeline companies that are developing pipelines to supply the Brownsville market and Mexico. The objective of the negotiations is a long-term firm pipeline transportation agreement for the full quantity of natural gas required to supply the proposed 4 MTA Project Facilities, which will be in-service on or before the date that Texas LNG requires natural gas for the commissioning of the facility. The proposed pipeline connection would be sized to deliver the gas necessary for servicing both Phase 1 and Phase 2 of the proposed project. Preliminary design suggests the pipeline connection to the Project Site would be 30 inches in diameter and deliver the gas at approximately 600 psig at the inlet of the gate station to be constructed onsite. Construction of the pipeline likely would require a construction right-of-way about 100 feet wide and additional temporary extra workspaces at features such as road and stream crossings.

1.10.2 Electric Transmission Line

Texas LNG has been in discussions with American Electric Power (“AEP”) regarding the installation of a new electric transmission line to the proposed Project Site. To provide power to the facility, AEP would be required to build a new approximately 10 mile long radial line to the Project Site from the existing Union Carbide Substation located near the Port of Brownsville. Preliminary design of the Project indicates that the transmission line must be capable of providing at least 120 megawatts (“mW”) of power or greater to serve each phase of the proposed Project. Texas LNG anticipates that the new transmission line would be placed on single pole structures within a 100 wide permanent right-of-way that would be constructed primarily adjacent to State Highway 48. Construction of the transmission line likely would require temporary extra workspaces at features such as road and waterway crossings. Siting of the power line would be regulated by the Public Utilities Commission of Texas.

1.11 Permits and Approvals

Texas LNG will obtain all necessary permits, clearances, and licenses for construction and operation of the Project.

On December 31, 2013, Texas LNG LLC filed an application with the Department of Energy/Office of Fossil Energy (“DOE/FE”) in FE Docket No. 13-160-LNG seeking authorization to export up to 2 MTA to Free Trade Agreement (“FTA”) and non-FTA nations over twenty-five (25) years. On June 11, 2014, Texas LNG LLC received approval for the FTA portion of its request; Texas LNG, LLC, DOE/FE Order No. 3443 (2014). Texas LNG’s application for DOE/FE authorization to export the same volume of LNG to non-FTA nations is pending. Texas LNG will file with DOE/FE at a future time to transfer the existing FTA authorization from Texas



1-29 May 2015

LNG LLC to Texas LNG Brownsville LLC and to modify the pending non-FTA application to account for the full 4 MTA of Phase 1 and 2.

Table 1.11-1 provides a list of required authorizations and identifies the applicable federal, state, or local agency or other authority in each case. Copies of agency correspondence and approvals received by Texas LNG prior to submittal of the formal application will be appended to the appropriate resource reports in the ER. Additional correspondence and approvals will be filed with the Commission upon receipt.

TABLE 1.11-1

Texas LNG Project Permits, Approvals, and Clearances

Agency Permit/Approval/

Regulatory Citation Anticipated Application/Filing date Federal Federal Energy Regulatory Commission (FERC)

Authorization to Construct and Operate Facilities under section 3(a) of the Natural Gas Act

November 2015

Department of Energy/Office of Fossil Fuels (DOE/FE)

Authorization to export LNG by vessel to Free Trade Agreement (FTA) and non-FTA nations

Receipt of Authorization to Export 2 MTA of LNG to FTA nations: June 11, 2014 Receipt of Authorizations to Export 2 MTA of LNG to non-FTA nations: Pending

U.S. Department of Homeland Security – U.S. Coast Guard (USCG)

Waterfront Facilities Handling Liquefied Natural Gas and Liquefied Hazardous Gas (33 CFR 127 ), which includes Letter of Intent (LOI) submission (33 CFR 127.007), Waterway Suitability Assessment (WSA) consultation, and Letter of Recommendation from the USCG (18 CFR 157.21)

Preliminary WSA – February 16, 2015 Follow-on WSA – October 2015

U.S. Environmental Protection Agency (EPA) - Region VI, Dallas, TX

Hydrostatic Test Water Discharge Permit NPDES Waste Water and Stormwater Discharge Permits

1st quarter 2016

U.S. Army Corps of Engineers (COE) – Galveston District

CWA Section 404 Permit for impacts on Waters of the U.S., including wetlands (33 USC § 1344) Rivers and Harbors Act Section 10 Permit for construction and operation of structures in and across federally navigable waterways (33 USC § 403) Section 408 – Alternation of Public Works Project Authorization

November 2015

U.S. Fish and Wildlife Service (FWS), Southwest Region (Region 2)

Endangered Species Act (ESA) Section 7 Consultation (16 USC Chapter 35) Migratory Bird Treaty Act Consultation (16 USC Chapter 7, Subchapter II) Fish and Wildlife Coordination Act Consultation (16 USC Chapter 5a, Subchapter I)

1st quarter of 2015



1-30 May 2015

TABLE 1.11-1

Texas LNG Project Permits, Approvals, and Clearances

Agency Permit/Approval/

Regulatory Citation Anticipated Application/Filing date U.S. Department of Commerce, National Oceanic and Atmospheric Administration, National Marine Fisheries Service (NMFS)

Marine Mammal Act Consultation (16 USC § 1382) (ESA) Section 7 Consultation (16 USC § 1856 et seq) Magnuson-Stevens Fishery Conservation and Management Act Consultation Essential Fish Habitat (EFH) Consultation (50 CFR Part 600) Fish and Wildlife Coordination Act Consultation (16 USC Chapter 5a, Subchapter I)

2nd quarter of 2015

U.S. Department of Transportation – Federal Aviation Administration

Notice of Proposed Construction Possibly Affecting Navigable Air Space under 14 CFR Part 77

1st quarter 2016

Pipeline and Hazardous Materials Safety Administration

49 CFR 193

State Texas Commission on Environmental Quality

30 Texas Administrative Code (TAC) Chapter 116 - Permit to Construct

30 TAC Chapter 122 – Operating Permit

November 2015

Texas Commission on Environmental Quality

Temporary Water Use Permit (for hydrostatic test water) Water Use Permit (marine water intake)

1st quarter 2016

Texas Railroad Commission Hydrostatic and Waste Water Discharge Permits Section 401 Water Quality Certification Coastal Management Plan Consistency Determination

Texas Railroad Commission Chapter 14, Regulations for Liquefied Natural Gas.

November 2015

Texas Department of Transportation

Road Opening/Access Permits 2nd quarter 2016

Texas Historic Commission – State Historic Preservation Office

Consultation under Section 106 of the National Historic Preservation Act

April 2015

Texas Parks and Wildlife Department

State-Listed Species Consultation 1st quarter 2015

1.12 Agency, Public, and Other Stakeholder Communications

Texas LNG has initiated a comprehensive public outreach and consultation plan with stakeholders to discuss the proposed Project and to identify issues of concern. As part of this plan, Texas LNG has undertaken and will continue written and verbal communication (including



1-31 May 2015

meetings) with the following groups: agencies (federal, state, and local); landowners; elected officials (federal, state, county, and local); tribes; community leaders; agricultural, business, and civic groups; and non-governmental organizations. An introductory letter announcing the Project was sent to stakeholders (including adjacent landowners) on April 21, 2015. Consultation to date has enabled Texas LNG to engage in an ongoing dialogue with stakeholders, providing Project information and a means for stakeholder input into Project plans. Texas LNG held public open house meetings on May 5 and 6, 2015, in Brownsville and Port Isabel, respectively.

In addition, Texas LNG is offering several other communication opportunities for stakeholders to learn more about the proposed Project and provide input. These include informational materials (e.g., pamphlets and fact sheets), a bilingual Project website (http://www.txlng.com/), and direct communication (i.e., e-mail [[email protected]] and a telephone number (1-832-849-4957).

In accordance with 18 CFR section 157.6(d)(2), Texas LNG will send formal written notification to all landowners within a 0.5 mile of the Project Site within three business days following the date the Commission issues a Notice of Application (see Appendix 1B for current landowner list – Filed as Privileged Information – Do not Release). Additionally, copies of Texas LNG Application will be provided to the main public libraries located in the Cities of Brownsville and Port Isabel.

1.13 References

Federal Energy Regulatory Commission. 2007. Draft Seismic Design Guidelines and Data Submittal Requirements for LNG Facilities. Issued January 23, 2007. Available online at www.ferc.gov/industries/gas/indus-act/lng/lng-seis-guide.pdf. Accessed November 2014.

Pillarella, Mark, Yu-Nan Liu, Joseph Petrowski, and Ronald Bower. 2007. The C3MR liquefaction cycle: versatility for a fast growing, ever changing LNG industry. Proceedings of the 15th International Conference and Exhibition on Liquefied Natural Gas. Available online at: http://www.cne.es/cgi-bin/BRSCGI.exe?CMD=VEROBJ&MLKOB=311667233838. Accessed March 2015.

Potential Gas Committee, Press Release: Potential Gas Committee Reports Increase in Magnitude of U.S. Natural Gas Resource Base. Issued April 8, 2015. Available online at http://potentialgas.org/press-release. Accessed April 29, 2015.

U.S. Army Corps of Engineers. 2014. Brazos Island Harbor, Texas Channel Improvement Project – Final Integrated Feasibility Report – Environmental Assessment. Issued July 2014.

U.S. Department of Labor, Bureau of labor Statistics. 2014. October 2014 Local Area Unemployment Statistics Map. Available online at: http://data.bls.gov/map/MapToolServlet?survey=la&map=state&seasonal=s. Accessed December 2014.

U.S. Energy Information Administration. 2014. Texas – State Profile and Energy Estimates. Issued November 20, 2014.



1-32 May 2015

U.S. Energy Information Administration. 2015. Annual Energy Outlook 2015. Available online at http://www.eia.gov/forecasts/aeo/. Accessed April 29, 2015.


TEXAS LNG PROJECT

Resource Report 1

APPENDIX 1A Additional Figures




Figure 1A-1Construction Workforce Graph

Phase 1

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\RR01\_TXL_LNG_Workforce_Graph_Ph1.mxd | REVISED: 05/14/2015 | SCALE: 1:2,440 DRAWN BY: THohn




Figure 1A-2Construction Workforce Graph

Phase 2

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\RR01\_TXL_LNG_Workforce_Graph_Ph2.mxd | REVISED: 05/14/2015 | SCALE: 1:2,631 DRAWN BY: THohn


TEXAS LNG PROJECT

Resource Report 1

APPENDIX 1B Landowner List

[Privileged Information – Do Not Release]


TEXAS LNG BROWNSVILLE LLC

TEXAS LNG PROJECT

Resource Report 10

Alternatives

Preliminary Draft

Docket No. PF15-14-000

Prepared by

May 2015


10-i May 2015


RESOURCE REPORT 10 – ALTERNATIVES

Federal Energy Regulatory Commission Environmental Checklist Minimum Filing Requirements: Report Section Reference Address the “no action” alternative. (§380.12 (l) (1)) Section 10.2 For large projects, address the effect of energy conservation or energy alternatives to

the project. (§380.12 (l) (1)) Section 10.3

Identify system alternatives considered during the identification of the project and provide the rationale for rejecting each alternative. (§380.12 (l) (1))

Section 10.4

Identify major and minor route alternatives considered to avoid impact on sensitive environmental areas (e.g., wetlands, parks, or residences) and provide sufficient comparative data to justify the selection of the proposed route. (§380.12 (l) (2)(ii))

Section 10.5

Identify alternative sites considered for the location of major new aboveground facilities and provide sufficient comparative data to justify the selection of the proposed site. (§380.12 (l) (2)(ii))

Section 10.5


10-ii May 2015


RESOURCE REPORT 10 – ALTERNATIVES

TABLE OF CONTENTS

10.0 RESOURCE REPORT 10 – ALTERNATIVES ............................................................. 10-1 10.1 Introduction ....................................................................................................... 10-1 10.2 No-Action Alternative ........................................................................................ 10-2 10.3 Energy Source Alternatives .............................................................................. 10-3 10.4 System Alternatives .......................................................................................... 10-4 10.5 Location, Site, and Facility Alternatives ............................................................ 10-6

10.5.1 Location and Site Alternatives .............................................................. 10-6 10.5.2 Preliminary Sites Considered ............................................................... 10-6 10.5.3 Port of Brownsville Site Selection ....................................................... 10-11

10.6 Proposed Site Layout Alternatives ................................................................. 10-15 10.7 Power Generation Alternatives ....................................................................... 10-15 10.8 Process Alternatives ....................................................................................... 10-17 10.9 Dredged Material Placement Alternatives ...................................................... 10-18 10.10 Conclusion ...................................................................................................... 10-20 10.11 References ..................................................................................................... 10-20

LIST OF TABLES

Table 10.4-1 Planned, Proposed, or Authorized Liquefaction Projects Along the Gulf Coast – Summary Profile of System Alternatives .......................... 10-5

Table 10.5.1-1 Selection Criteria for Project Site Alternatives .................................... 10-13

LIST OF FIGURES

Figure 10.5-1 Preliminary Alternative Site – Bean Tract – Calhoun Port Authority Figure 10.5-2 Preliminary Alternative Site – Port of Corpus Christi Figure 10.5-3 Preliminary Alternative Site – Port of Port Arthur Figure 10.5-4 Preliminary Alternative Site – Port of Brownsville Initial Site Figure 10.5-5 Port of Brownsville – Sites Considered during Tier 2 Alternatives Analysis Figure 10.6-1 Terminal Layout Alternative – Filed March 9, 2015 Figure 10.9-1 Potential Dredged Material Placement Areas


Texas LNG Project Resource Report 10 – Alternatives

10-iii May 2015

ACRONYMS AND ABBREVIATIONS

APCI Bcf/d BND

Air Products and Chemicals, Inc. billion cubic feet per day Brownsville Navigation District

COE DOE/FE FERC or the Commission FWS

U.S. Army Corps of Engineers U.S. Department of Energy, Office of Fossil Energy Federal Energy Regulatory Commission U.S. Fish and Wildlife Service

LNG m3

liquefied natural gas cubic meters

MCHE Bcf/d MOF MTA mW NWI PA Texas LNG

Main Cryogenic Heat Exchanger Billion standard cubic feet per day Materials Offloading Facility million metric tonnes per annum megawatt National Wetlands Inventory Placement Area Texas LNG Brownsville LLC


10-1 May 2015


10.0 RESOURCE REPORT 10 – ALTERNATIVES

10.1 Introduction

Resource Report 10 describes the alternatives evaluation process undertaken by Texas LNG Brownsville LLC (“Texas LNG”) to identify the “preferred” or “proposed” action for the Texas LNG Project (or “Project”). The report is in compliance with the Federal Energy Regulatory Commission’s (“FERC” or the “Commission”) application requirements set forth in Title 18 Code of Federal Regulations section 380.12 for projects seeking authorization under section 3(a) of the Natural Gas Act. The Project involves the proposed development of a liquefied natural gas (“LNG”) production, storage, and export facility at a site located on the Brownsville Ship Channel in Cameron County, Texas. Figures 1.3-1 and 1.3-2 in Resource Report 1 illustrate the Project’s regional location Figures 1.3-3 and 1.3-4 depict the facility layout.

As described in Resource Report 1, Texas LNG’s proposed terminal is composed of multiple LNG facility components at an approximately 625-acre site (“Project Site or Site”). The main liquefaction components, located at the Project Site, and their support facilities, including gas pretreatment units using the proven Air Products and Chemicals, Inc. (“APCI”) C3MR propane precooled mixed refrigerant technology, are collectively referred to as the “Liquefaction Plant.” The liquefaction system is designed to liquefy approximately 0.618 billion cubic feet per day (“Bcf/d”) over an operating year, which equates to 4.4 million metric tons per year (“MTA”) of LNG. While the facility (Phase 1 and 2) will have the Nameplate Capacity of 4.4 MTA, Texas LNG estimates that both phases of the project when constructed will produce 4.0 MTA of LNG for export.

In addition to the Liquefaction Plant described above, Texas LNG proposes to construct various other facilities at the Project Site to support the liquefaction and export operation including two single containment storage tanks with a capacity of 210,000 cubic meters (“m3”) of LNG each, one LNG carrier berthing dock, a materials offloading facility (“MOF”), and ancillary support components.

The proposed facility and site location represents the option with the least environmental impact, and that is the most technologically viable and economically advantageous for meeting the Project’s stated purpose and need, namely the export of domestically produced natural gas (as LNG) to promote trade and diversification of natural gas supplies on an international basis, with potential global environmental benefits (see Resource Report 1, Sections 1.1 and 1.2). In particular, the Project’s smaller size will allow the Project to utilize electric motors, instead of gas-powered turbines, thereby reducing the environmental impacts of the project, as discussed further in Section 10.5.2.

The Project alternatives analysis addresses options and comparative advantages or disadvantages in six areas of focus, as summarized below and discussed in greater detail in Sections 10.2 through 10.7.

Section 10.2 – No-Action Alternative. Under the no-action alternative, the proposed Project would not be developed; consequently, the capacity to convert



10-2 May 2015

approximately 0.618 Bcf/d of domestically produced natural gas to 4 MTA of LNG for storage and export would not be realized.

Section 10.3 – Energy Source Alternatives. Energy source alternatives to LNG include fossil fuels (coal, oil, and natural gas [in its gaseous form]), nuclear fuels, and renewable sources.

Section 10.4 – System Alternatives. System alternatives for Texas LNG’s liquefaction, storage, and export facilities include the development of similar facilities at existing or proposed LNG terminals. To be a viable system alternative, the alternative facilities would need to be capable of satisfying the same export capacity requirement, customer base, and market demand as the Texas LNG Project.

Section 10.5 – Location, Site, and Facility Alternatives. Location alternatives and selection criteria for the Terminal Site are discussed, along with layout design alternatives for the major plant components on the proposed site.

Section 10.6 – Process Alternatives. Natural gas liquefaction can be achieved using several recognized design technologies, each with its own particular advantages and disadvantages. Texas LNG’s selection of the APCI process is discussed in this section.

Section 10.7 – Dredged Material Placement Alternatives. Dredging necessary to create the proposed turning basin and berth for the LNG carrier and utility docks will produce a large volume of dredged material requiring placement in a manner consistent with applicable rules, regulations, and permit conditions. Texas LNG’s selection of dredged material placement location is discussed in this section.

10.2 No-Action Alternative

The FERC has three alternative courses of action in processing an application. It may deny the proposal, postpone action pending further study, or authorize the proposal with or without conditions.

Texas LNG holds the exclusive right to lease the approximately 625-acre Project Site located on the Brownsville Ship Channel from the Brownsville Navigation District (“BND”). If the FERC accepts the no-action alternative and denies authorization of the Project, certain short- and long-term environmental impacts associated with construction and operation would not occur.

For the Project Site, if it were to be developed, the most significant environmental impacts would include the permanent impact to tidal and emergent wetlands. However, as noted, the site is owned by the BND, which is interested in leasing this property for development. The site is well located for industrial development, with approximately 3,000 feet of channel frontage located less than 5 miles from the Gulf of Mexico. The property is located on lands owned by the BND intended for development of the Brownsville Ship Channel. The site is surrounded by undeveloped areas and more than 1.5 miles from the nearest residential areas of Port Isabel. We have no reason to believe the location will not be developed for a different industrial use if not used for the Texas LNG Project.



10-3 May 2015

The Project is being developed to procure domestic natural gas supplies for liquefaction and export to meet international market demand and customer requirements. As stated in Section 1.2 of Resource Report 1, the Project will provide several direct and indirect economic and environmental benefits on a local, regional, national, and global scale by:

stimulating economic activity on a local, state, regional, and national basis through increased tax revenues and the creation and/or retention of jobs;

promoting domestic natural gas production, both conventional and unconventional, and developing a production infrastructure that allows access to new markets for energy supplies;

strengthening economic trade with foreign nations; and

providing an environmentally friendly, clean-burning alternative fuel source.

If the no-action alternative is adopted, this wide array of economic and environmental benefits would not be realized. As such, Texas LNG does not consider adoption of the no-action alternative to be a viable alternative.

10.3 Energy Source Alternatives

Assuming LNG exported by Texas LNG either reduces natural gas supplies being flared or vented within the United States or displaces the equivalent use of other fossil fuels in recipient countries, a number of advantages can be realized as discussed below and as referenced in Texas LNG’s December 31, 2013, request to the U.S. Department of Energy’s Office of Fossil Energy (“DOE/FE”) for authorization to export LNG to Free Trade Agreement countries and Non-Free Trade Agreement countries.

Texas LNG expects that at least a portion of LNG which would be exported from the facility would displace the equivalent use of other fossil fuels in recipient countries. As the cleanest burning fossil fuel, natural gas offers several related environmental benefits compared to oil and coal. The combustion of natural gas causes less pollution than the combustion of other fossil fuels. Compared with the average air emissions from coal-fired electric generation, power plants that burn natural gas emit half as much carbon dioxide, less than a third of the nitrogen oxides, and one percent of the sulfur oxides (USEPA 2013). Combustion of natural gas produces about 25 to 30 percent less carbon dioxide than combustion of gasoline or diesel (USEIA 2014).

Not only is natural gas the cleanest burning fossil fuel, but new natural gas-fired plants are much less expensive to develop than renewable energy, coal, or nuclear projects. Further, natural gas-fired electric power plants have very fast ramp-up times and are widely viewed as the ideal complement to renewable energy to allow continuous power generation around renewables’ intermittent availability. Global demand for LNG is increasing as more nations seek alternate fuel sources for power generation beyond coal or oil, and move to regulate or tax greenhouse gas emissions. This demand requires the environmentally responsible development of safe and reliable liquefaction, storage, and export facilities in countries with sufficient supplies of domestically produced natural gas, such as the United States.

In liquid form, natural gas is convenient to store and transport by ship, occupying only 1/600th of the volume of the same quantity of gas in its gaseous state at atmospheric pressure.



10-4 May 2015

LNG is colorless, odorless, non-corrosive, and non-toxic. Although natural gas vapor is flammable, in liquid form it cannot explode or burn. The LNG industry has a proven safety record during more than 50 years of shipping LNG worldwide. More than 100,000 LNG carrier voyages have taken place without significant loss of cargo or safety or security problems, either in port or at sea.

Texas LNG anticipates that LNG exports from the Project will help displace other more environmentally problematic fuel sources than those that are either currently utilized or proposed in recipient countries. On this basis, promoting LNG as an alternative fuel source has a clear environmental advantage that would not be realized if the alternative fuel sources were developed for use or continued to be used.

10.4 System Alternatives

System alternatives are alternatives to the proposed action that would make use of other existing or proposed systems, with or without modifications, to meet the stated objectives of a proposed project. Adoption of a system alternative could preclude the need to construct all or part of a project, although some modifications or additions to another existing system may be required to increase its capacity, or another entirely new system may need to be constructed. Such modifications or additions would result in environmental impacts that could be less than, comparable to, or greater than those associated with a proposed project.

As discussed in Section 10.1, the Project is designed to produce 4 MTA of LNG for export after both proposed phases of the Project are complete. The liquefaction and export capacity necessary to meet this objective could be achieved, theoretically, through the utilization of existing or proposed LNG facilities elsewhere in the United States. Ultimately, the identification and evaluation of system alternatives serves to determine whether potential environmental impacts associated with construction and operation of the Project could be avoided or reduced by using another system.

Texas LNG identified proposed and planned LNG export projects in the vicinity of the proposed Project and the Gulf Coast region, including proposed expansions at existing LNG terminals. Collectively, 24 LNG export projects were reviewed for the purposes of this study. Table 10.4-1 identifies the LNG export projects that are planned (projects for which pre-filing review has been initiated or have been otherwise publicly announced), proposed (projects for which a formal FERC application has been filed), or authorized along the Gulf Coast. For each project, the table summarizes the proposed export capacity, FERC application status, and in-service target date. Feed gas for all the projects is derived from intrastate and interstate pipeline systems; therefore, natural gas can be supplied from any source location, but delivery is limited by the pipeline capacity in a given area.



10-5 May 2015

TABLE 10.4-1

Texas LNG Project Planned, Proposed, or Authorized Liquefaction Projects Along the Gulf Coast –

Summary Profile of System Alternatives a

Project Location Capacity

(Bcf/d) FERC Status

In-Service Target Date

Expansion Projects at Existing LNG Terminals Proposed Projects

Sabine Pass Liquefaction, LLC

Sabine Pass, LA 4.1 Authorization granted; Under construction

2015

Cameron LNG, LLC Cameron Parish, LA 3.5 Authorization granted; Under construction

2017-2018

Freeport LNG Development Freeport, TX 2.8 Authorization granted; Under construction

2017

Lake Charles Export LLC Lake Charles, LA 4.0 Application filed on 03-25-14 2018 Golden Pass Products, LLC Sabine Pass, TX 2.6 Application filed on 07-07-14 2018

Planned Projects Gulf LNG Liquefaction Company LLC

Pascagoula, MS 1.5 Pre-filing initiated on 05-21-14 Not Known

Stand-alone Projects at Greenfield Sites Proposed Projects

Corpus Christi Liquefaction, LLC

Corpus Christi Bay, TX 2.1 Authorization granted; Under construction

2017

Excelerate Liquefaction Solutions I, LLC

Calhoun County, TX 1.4 Application filed on 02-06-14 (being held in abeyance at applicant request until 09-01-15)

2017

Magnolia LNG LLC Lake Charles, LA 1.1 Application filed on 04-30-14 2018 Planned Projects

CE FLNG Plaquemines Parish, LA 1.1 Pre-filing initiated on 04-16-13 Not Known Louisiana LNG Energy, LLC

Plaquemines Parish, LA 0.3 Pre-filing initiated on 07-18-14 2018

Venture Global Calcasieu Pass, LLC

Cameron Parish, LA 1.7 Pre-filing initiated on 10-10-14 Not Known

Annova LNG Common Infrastructure, LLC

Brownsville, TX 0.9 Pre-filing initiated on 03-27-15 2019

Port Arthur LNG, LLC Port Arthur Texas 2.7 Pre-filing initiated on 03-31-15 2021 Rio Grande LNG, LLC Brownsville, TX 3.6 Pre-filing initiated on 04-13-15 2020 Gasfin Cameron Parish, LA 0.2 Pre-filing not initiated Not Known Waller LNG Services, LLC Cameron Parish, LA 0.2 Pre-filing not initiated Not Known Gulf Coast LNG Export LLC Brownsville, TX 2.8 Pre-filing not initiated 2018 Barca LNG Brownsville, TX 1.6 Pre-filing not initiated Not Known Eos LNG Brownsville, TX 1.6 Pre-filing not initiated Not Known SCT&E LNG Cameron, LA 1.6 Pre-filing not initiated Not Known G2 LNG LLC Cameron Parish, LA 1.8 Pre-filing not initiated 2019 Live Oak LNG Lake Charles, LA 0.6 Pre-filing not initiated 2019 Pelican Island LNG Galveston, TX Not Known Pre-filing not initiated Not Known

____________________ a Table includes both approved and pending LNG export applications received by the U.S. Department of Energy as well

as projects that have been publicly announced. Planned export facilities that would not be under the jurisdiction of Federal Energy Regulatory Commission were excluded from comparison.

The cost of an LNG export project is such that most, if not all, of the available capacity is

subscribed to customers before construction begins. Some of the Gulf Coast projects in table 10.4-1 are fully subscribed and, therefore, would not have the additional capacity to satisfy the requirements of Texas LNG’s customer base. For other LNG projects in the Gulf Coast region,



10-6 May 2015

the projects’ viability with respect to regulatory approvals, securing customers, and financing is highly uncertain. For those reasons, these projects cannot serve Texas LNG’s purpose as viable system alternatives.

10.5 Location, Site, and Facility Alternatives

10.5.1 Location and Site Alternatives

Texas LNG chose the Brownsville Ship Channel as the preferred location of the Project in part due to the number and size of potential suitable sites available for lease from the BND. Other ports were also considered by Texas LNG during preliminary screening including sites located in Calhoun Port, Port of Port Arthur, and Port of Corpus Christi in Texas and Lake Charles in Louisiana.

Texas LNG conducted a preliminary or Tier 1 assessment of potential locations appropriate for its LNG liquefaction and export facility based on the following screening criteria:

Option to Lease Land. Given the lengthy permitting process, Texas LNG required an option to lease land and was not seeking to purchase private land.

Available Land Located in Industrial Zone. Texas LNG preferred sites that would be zoned for industrial activities so as to minimize environmental impact and have a greater buffer with the residential areas.

Deepwater Channel. In order to accommodate LNG carriers, a draft of at least 40 feet was a requirement.

Waterfront Access. Water front access to accommodate berthing of LNG carriers (approximately 1,000 feet) was a requirement.

Proximity to Natural Gas Pipeline Network. The site must be located in proximity to sufficient natural gas supplies. Feed gas of at least 0.300 Billion standard cubic feet per day (“Bcf/d”) (for Phase 1) and an additional 0.300 Bcf/d for Phase 2 was required.

No Waterway Obstructions. Obstructions such as bridges could present a safety hazard and hinder navigation.

Sufficient Distance from Residential Areas. The site must not be located adjacent to residential communities to comply with federal safety standards.

Proximity to Electric Power. The Project favored electric motor drivers due to the lower local air emissions. The proposed facility requires potential power supply of 120 megawatts (“mW”) (for Phase 1) and an additional 120 mW for Phase 2.

10.5.2 Preliminary Sites Considered

Figures 10.5-1 through 10.5-4 identify four locations considered by Texas LNG during its preliminary siting process. These sites range in size from 21 acres to 53 acres. In Texas LNG’s


Bean Tract - Calhoun Port Authority53 Acres

£¤35


0 200 400Feet

Bean Tract - Calhoun Port Authority

pan ERM Group company

Figure 10.5-1Bean Tract - Calhoun Port Authority

Potential SitePoint Comfort, Texas

1:5,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Bean_Tract.mxd | REVISED: 05/12/2015 | SCALE: 1:5,000 DRAWN BY: THohn


Port of CorpusChristi

21 Acres


0 200 400Feet

Port of Corpus Christi Site


Figure 10.5-2Port of Corpus Christi

Potential SiteCorpus Christi, Texas

1:5,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Port_of_Corpus_Christi.mxd | REVISED: 05/12/2015 | SCALE: 1:5,000 DRAWN BY: THohn


Port ofPort Arthur

30 Acres


0 200 400Feet

Port of Port Arthur Site


Figure 10.5-3Port of Port Arthur

Potential SitePort Arthur, Texas

1:5,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\RR10\_TXL_LNG_Port_of_Arthur.mxd | REVISED: 05/14/2015 | SCALE: 1:5,000 DRAWN BY: THohn


Port ofBrownsville

51 Acres


0 200 400Feet

Port of Brownsville Initial Site


Figure 10.5-4Port of Brownsvillle

Potential SitePort of Brownsville, Texas

1:7,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\Resource Reports\2015\Figures\_TXL_LNG_Port_of_Brownsville_Initial_Site.mxd | REVISED: 05/12/2015 | SCALE: 1:7,000 DRAWN BY: THohn



10-11 May 2015

application to the DOE/FE filed on December 31, 2013, the preliminary Project design included an LNG liquefaction barge with integrated LNG storage within its hull which would have been fabricated offsite and then permanently grounded at the selected location. The barge would have been held in place by a retaining wall that would also provide support for an offloading jetty. This design required a much smaller footprint than the currently proposed project. Ultimately, Texas LNG decided not to pursue this design for the facility. The small size of these preliminary sites is not sufficient to accommodate the necessary facility layout proposed in this filing and satisfy the federal safety regulations. Therefore, Texas LNG no longer considers these sites as viable alternatives and omitted them from further review.

10.5.3 Port of Brownsville Site Selection

Texas LNG chose the Brownsville Ship Channel as the preferred location of the Terminal as a result of passing all the previously discussed screening selection criteria. The alternative sites considered during the preliminary or Tier 1 review were rejected because they did not comply with one or more of the selection criteria or did not have sufficient space for siting of the Project as currently proposed. Another reason for selecting the Port of Brownsville was in part due to the number and size of potential suitable sites available for lease from the BND.

After rejecting the five preliminary sites, TX LNG conducted a subsequent site selection

or Tier 2 siting assessment of four alternative sites, all located on the north side of the Brownsville Ship Channel prior to selection of the proposed location. Figure 10.5-5 identifies the four locations considered by Texas LNG during the Tier 2 site selection process. The criteria used in the evaluation were:

Site of sufficient size, approximately 300 acres (225 acres for terminal

components plus associated buffer areas and 75 acres for laydown areas) and contiguous usable acres to provide for facility components, construction laydown areas, and sufficient buffer to neighboring properties to allow use of single containment LNG storage tanks for both Phase 1 and Phase 2 of the Project in compliance with federal safety standards;

Proximity to sufficient waterfront or shoreline for waterway access, a minimum of 2,400 feet of shoreline is required for construction of a recessed berth with sufficient distance for vapor dispersion in the event of a spill and turning basin with a diameter of 1,400 feet (required for LNG carrier entry/exit of berthing area) while also minimizing construction costs and allow sufficient room for ingress and egress of LNG carriers;

Sufficient waterway width and depth to allow LNG carriers access to the site;

Minimal distance from the Gulf of Mexico to minimize transit time and prevent congestion on the shipping channel;

Naturally elevated area to minimize the volume of fill necessary to be imported to raise the elevation of the critical facilities above the 500-year storm surge; and

Minimal acreage of wetland impacts associated with development of the site.


£¤48

Site 3625 Acres

Site 1111.5Acres

Site 2500 Acres

Site 4205 Acres


0 2,000 4,000Feet

Sites Considered


Figure 10.5-5Sites Considered During Tier 2 Alternatives Analysis


1:40,000

FILE: M:\Clients\S-U\TXL\Texas LNG\_ArcGIS\2015\04\08_Five_Sites_Map_for_Ross_Hargrove\_TXL_LNG_2014_Five_Sites.mxd | REVISED: 05/12/2015 | SCALE: 1:40,000 DRAWN BY: THohn



10-13 May 2015

Figure 10.5-5 identifies the locations of each of the alternative sites evaluated by Texas LNG during the Tier 2 analysis. Table 10.5-1 provides a comparison of the key features considered by Texas LNG during site selection. A narrative description of each site’s advantages and disadvantages follows Table 10.5.1-1.

TABLE 10.5-1

Texas LNG Project Selection Criteria Summary for Project Site Alternatives

Selection Criteria Site

1 2 3 (Proposed) 4

Size 111.5 acres 500.0 acres 625.0 acres 205.0 acres

Distance from Gulf of Mexico 8.7 miles 5.8 miles 4.8 miles 9.6 miles

Channel Frontage (Approximate) 2,200 6,000 3,000 5,500

Average Elevation above sea level +2.1 feet +8.0 feet +13.2 feet +5.5 feet

Wetlands and Tidal Areas a 17.1 270.8 248.1 80.0

____________ a Wetland and tidal areas at Sites 1, 2, and 4 were estimated using National Wetland Inventory GIS data layers. Wetland

and tidal area estimate for Site 3 was completed using wetland delineation data completed at the site by Texas LNG.

Proposed Site – Site 3

The proposed Site is an approximately 625-acre site located about 4.8 miles from the Gulf of Mexico, the nearest of the four sites considered.

The Site offers several key advantages:

The Site is located close to the channel entrance with over 3,000 feet of water frontage on the Brownsville Ship Channel. This location will minimize LNG carrier transit time within the Brownsville Ship Channel.

Dredging estimates and associated impacts with excavation of the turning basin, berth, and site access were less than Sites 2 and 4, thus requiring the least amount of dredge material necessitating placement.

The site’s existing elevation is closest to the desired elevation of 15 feet above sea level, thus requiring the least amount of fill material of the four sites considered.

The site has sufficient shoreline frontage on the Brownsville Ship Channel to accommodate a recessed LNG turning basin with the desired diameter and berthing dock, in a location that would allow safe and efficient navigation for both visiting LNG carriers and existing marine traffic.

The site is of a suitable size, geometric shape, and topographic profile to optimize the layout design for plant infrastructure and buffer zones with respect to engineering feasibility, constructability, and safety and accommodate the buffer exclusion zones for single containment storage tanks.

Development of the site would impact the least amount of wetlands.



10-14 May 2015

Based on consideration of these advantages, relative to the other sites under review, the 625-acre site was selected as the proposed site for the Project facilities.

Site 1

Site 1 was the smallest of the sites considered at approximately 111.5 acres. The site has the fewest acres of National Wetland Inventory (“NWI”) mapped wetlands at about 17.1 acres and also had the lowest average elevation of about 2.1 feet above sea level. A portion of the site contains a mangrove that limits the use of this area. Development of the site for the Project would require use of nearly all of the site acreage to construct a 2 MTA facility equivalent to Phase 1 of the proposed Project. The size of the site would also not allow the use of a single containment storage tank due to the federal thermal radiation exclusion zone requirements. In addition, Site 1 is not large enough to accommodate Phase 2 of the proposed Project.

Because of Site 1’s elevation, a significant amount of fill would be required to bring the critical facilities above the level of the 500-year storm surge. Also due to the small size of the site and insufficient channel frontage, the berthing area would have to be shored up with sheet piling to provide a turning basin. Because of the insufficient room to accommodate Phase 2 of the Project or the anticipated size of LNG carriers expected, the site was not pursued by Texas LNG and eliminated for consideration early in the evaluation process.

Furthermore, potentially sensitive environmental areas were located along the boundaries of Site 1. Namely, there is a U.S. Fish and Wildlife (“FWS”) conservation easement for the ocelot which is listed as endangered under the Endangered Species Act. This corridor is located adjacent to the west side of the site boundary. This site borders on the ‘cat corridor’, a section of land set aside by the BND for potential ocelot and jaguarondi migration across the Brownsville Ship Channel.

Site 2

Site 2 is approximately 500 acres and located immediately adjacent to Texas LNG’s proposed Site 3. The site’s average elevation is about 8 feet above sea level which is about 5 feet lower than the proposed site. Based upon NWI mapping, Site 2 contains about 270.8 acres of wetlands or about 54 percent of the site. Of the 270.8 acres of wetlands, nearly 200 acres are classified as tidal mudflats.

Development of the site would accommodate both phases of the proposed Project and the desired turning basin and berthing area. However, the extensive wetlands would limit flexibility in the layout of the various components and provide insufficient area for laydown. Development of the site for the proposed Project likely would result in greater permanent wetland impacts when compared to the proposed site. The layout of the site combined with the fill required to raise the critical facilities above the 500-year storm surge, precluded this site from selection.

Site 4

Site 4 is approximately 205 acres and has an average elevation of 5.5 feet above sea level. Site 4 is located 9.6 miles from the Gulf of Mexico which is the greatest distance to the Gulf of the sites considered. About 80 acres of wetlands are present on the site or totaling about 39 percent of the site. Most of the wetlands present are classified as freshwater emergent wetlands located within the interior of the parcel. Development of the site likely would



10-15 May 2015

accommodate both phases of the proposed Project and the desired turning basin and berthing area, and dock. However, the extensive wetlands would limit flexibility in the layout of the various components and provide insufficient area for laydown. Full containment LNG storage tanks also may be required in order to meet federal safety siting criteria.

Development of the site for the proposed Project likely would result in greater permanent wetland impacts when compared to the proposed site. Also due to the size and shape of the site, the berthing area would have to be shored up with sheet piling to provide the required turning basin radius. Use of the site would require more fill material dredging/excavation to prepare the site when compared to the proposed site. Site 4 could be considered as an alternate choice for the Project location, but it has a large disadvantage in that the elevation of Site 4 is significantly lower than Site 3 and it would be difficult to site facility components to provide the necessary temporary workspace and laydown areas and meet federal safety siting criteria.

Furthermore, potentially sensitive environmental areas were located along the boundaries of Site 4. Namely, the FWS conservation easement for the ocelot and jaguarondi adjacent to the east side of the site boundary which has been set aside by the BND to facilitate potential ocelot and jaguarondi migration across the Brownsville Ship Channel.

10.6 Proposed Site Layout Alternatives

Since filing of its pre-filing status request, Texas LNG has been evaluating the layout of several facility components in order to avoid or minimize impacts on wetlands. Figure 10.6-1 represents the layout of the proposed facility filed with FERC as part of its pre-filing request package on March 9, 2015. Figure 1.3-3 in Resource Report 1 represents the layout of the facility as currently proposed. Since the filing of the original facility layout design, Texas LNG has made the following modifications resulting in an estimated 16 acre reduction of permanent wetland impacts.

Relocation of the MOF to the LNG carrier berth reduced the total size of the turning area and berth by about 14 acres. Relocation of the MOF and the smaller berthing area will prevent use of the MOF while an LNG carrier is berthed.

Repositioning of the Phase 1 train, flare, and access roads, etc. resulted in a decrease of 2 acres of permanent wetland impacts.

Based upon the site layout revisions of the various facility components made to date, Texas LNG believes the current facility layout represents the least amount of potential wetland impacts associated with use of proposed Site 3. As design of the facility progresses, Texas LNG will continue to look for opportunities to reduce wetland impacts and will update the Commission accordingly.

10.7 Power Generation Alternatives

Gas turbines and electric motors were considered as drivers for the refrigeration compressors. Electric motors were chosen because they could adequately provide the power required while significantly reducing onsite air emissions associated with the proposed facility.


Marine Berth

Barge

LNG Carrier

"UtilitySubstation

"Gas MeteringStation

"Administration Area

"


Phase 2Liquefaction

Train

Phase 1LNG Storage

Tank

Phase 2LNG Storage

Tank

Phase 1Liquefaction

Train

"

Access Roads

MainFlare

£¤ 48


0 0.1 0.2Miles

Proposed Terminal SiteSite Pipeline

Docking AreaAccess Roads

15-ft Elevated Facility FootprintWetlands

U.S. or State HighwaysZ


Figure 10.6-1Terminal Layout Alternative - Filed March 9, 2015





10-17 May 2015

10.8 Process Alternatives

Texas LNG investigated various liquefaction technologies available on the market for the Project, including the currently proposed liquefaction process. The criteria used in the evaluation were:

Economic – capital expenditure and anticipated expense during operation of the facility;

Technical – equipment count, availability of materials, and reference plant experience;

Operability/Maintainability – configuration complexity and anticipated cost of maintenance;

Maturity – proven years of technology operation; and

Construction and engineering schedule.

Texas LNG reviewed two liquefaction technologies available on the market today: the APCI C3-MR and Linde LIMUM® liquefaction processes. Texas LNG determined that the APCI C3-MR is best suited for the Project. The rationale for this selection is as follows:

APCI C3-MR

The APCI C3-MR liquefaction process has been used at LNG export facilities located worldwide for over 40 years. Liquefaction of natural gas using the APCI C3-MR process is achieved using separate propane refrigeration and a mixed refrigerant system. The four stage propane system provides chilling for the natural gas feed and the mixed refrigerant. The mixed refrigerant system provides low temperature refrigeration to produce LNG in the main cryogenic heat exchanger (“MCHE”). The requirement for a separate pre-cooling process leads to an increased number of equipment components as well as a slight increase in the overall space required for the equipment when compared to the Linde process. The APCI C3-MR process has been successfully used for liquefaction trains ranging from 1.3 to 7.8 MTA of LNG.

Although the APCI process is more complicated and takes longer to construct, it ultimately uses less electricity than the Linde process, which results in significant operational savings. This efficiency is gained by the technology’s ability to match the mixed refrigerant boiling curve to that of the feed gas condensation curve. The maturity of the technology and lower electricity requirements were primary factors in the selection of this liquefaction technology for the Project.

Linde LIMUM®

The Linde LIMUM® process has been in use for about 10 years. Linde’s process consists of a single mixed refrigerant cycle which is separated into two refrigerant streams of different molecular weights using 2-stage refrigerant cycle compression and partial condensation downstream of the compressor stages. The heavier hydrocarbon fraction is used for precooling of natural gas, the lighter mixed refrigerant is first pre-cooled and then separated into two fractions from which the heavy one is used for liquefaction and the light one for sub-cooling of the natural gas. As pre-cooling, sub-cooling, and liquefaction are completed in a



10-18 May 2015

single MCHE the process requires fewer components, takes up less space, and requires less time for construction than that required by the APCI process.

The Linde process is generally optimized for facilities producing less than 1 MTA of LNG per year. As such two trains using the Linde process would be required for each phase of the Project to match the output of one train per phase of the Project using the APCI process. Although construction cost and time necessary for installation is slightly less than the APCI process, use of the technology requires about 8 percent more electricity than when compared to the APCI process, which creates a significant expense over the life of the Project.

10.9 Dredged Material Placement Alternatives

Texas LNG is investigating various locations available near the Brownsville Ship Channel for the placement of dredge material including several designated Placement Areas (“PAs”) owned by the BND. Generally, the dredged material will result from dredging of the proposed turning basin and berthing area at the proposed Terminal Site. Texas LNG estimates dredged material as a result of construction of the Terminal will result in approximately 3,600,000 cubic yards of material requiring placement offsite. The criteria Texas LNG will use in its evaluation of dredge material placement alternatives are:

Proximity of existing PAs to the Terminal Site;

Capacity of existing PAs and cost of improvements necessary to offset disposal of the material; and

Texas LNG is considering the following locations for dredged material placement available near proposed Site 3:

PAs 4A and 4B owned by the BND

PA 5A owned by the BND - this is the preferred disposal site

Texas LNG has discussed with the BND the potential use of the existing upland confined PAs 4A and 4B that are located directly across the Brownsville Ship Channel from the proposed Project Site or use of PA 5A, which is about 4 miles west of the Project Site and has greater capacity as shown in Figure 10.9-1.

Use of the existing PAs would require improvements to their existing dikes to offset the capacity required for disposal of dredge materials produced by the Project. If PAs 4A and 4B, or PA 5A were chosen, Texas LNG would raise the dikes which surround the PAs to offset the anticipated volume of dredged material to be disposed of at these locations. Construction to raise the PA containment dikes would be done within the footprints of the existing PAs.

Based upon U.S. Army Corps of Engineers (“COE”) recommendations for the channel deepening project in the Final Integrated Feasibility Report – Environmental Assessment, the portion of the channel located immediately adjacent to Proposed Site is likely to contain sediments composed mostly of clay and unlikely to be suitable for beneficial use to decrease shoreline erosion along South Padre Island (COE 2014).


£¤100

£¤48

£¤4

625Acres

5A737 Acres

4B254 Acres

4A533

Acres


0 5,000 10,000Feet


Federal & State Lands

Dredged Material Placement Areas pan ERM Group company

Figure 10.9-1Dredge Spoil Disposal Location Alternatives


1:120,000




10-20 May 2015

Dredge Material PAs 4A and 4B

PAs 4A and 4B are located directly across the Brownsville Ship Channel from the proposed Project Site. Figure 10.9-1 identifies the boundaries of the placement areas. The dikes surrounding the PAs are currently 28 feet tall.

Portions of PAs 4A and 4B have been mapped by the FWS as Critical Habitat under the Endangered Species Act for the piping plover. Portions of these PAs may contain unvegetated sand flats that may be used by piping plovers for foraging or roosting. The sand and/or mudflats are the result of the periodic use of these areas for the placement of dredged material. Following placement of dredged material, the water is allowed to decant, allowing the sand or mudflats to reemerge and again provide potential habitat to the piping plover.

Dredge Material PA 5A

PA 5A is located about 4 miles west of proposed Site 3. The PA is also located adjacent to the Brownsville Ship Channel. The existing dike walls are approximately 15 feet. Use of the PA site as a placement area would require use of booster pumps to transport the dredged material to the Site for placement. Although PA 5A, may contain suitable habitat for the piping plover, the area has not been mapped as Critical Habitat by the FWS. Based upon the anticipated cost associated with raising the dikes at PA 4A and 4B, Texas LNG is currently pursuing PA 5A as its preferred dredged material placement location.

10.10 Conclusion

Upon consideration of the alternatives analyses discussed in this Resource Report 10, Texas LNG believes that the proposed Project and current facility layout represents the most environmentally sound, technologically feasible, and economically viable development option.

10.11 References

U.S. Army Corps of Engineers. 2014. Brazos Island Harbor, Texas Channel Improvement Project – Draft Integrated Feasibility Report – Environmental Assessment. Issued July 2014.

U.S. Energy Information Administration. 2014. How much carbon dioxide is produced when different fuels are burned? – FAQ. Issued June 4, 2014.

U.S. Environmental Protection Agency. 2013. Natural Gas, Clean Energy. Issued September 25, 2013.


Document Content(s)

Transmittal Letter.PDF................................................1-1

Texas LNG Draft Resource Report 1 Vol I of II Public.PDF.............2-42

Texas LNG Draft Resource Report 10.PDF................................43-66


K&L GATES LLP - Port Isabel-South Padre Press

Documents

Transcript of K&L GATES LLP - Port Isabel-South Padre Press