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PINS Reference: EN010062

Thursday 23 April 2015

Application by Tata Steel UK Limited for the

Port Talbot Steel Works (Power Generation Enhancement Order)

Associated British Ports (ABP) – reference 1003007

Written Summary of the Representations made at the Issue Specific hearing held on Wednesday 15 April 2015

- and -

Response to the ExA’s Second Round Questions

Deadline 6

1. These written submissions comprise both a summary of ABP’s oral representations made at the Issue Specific hearing held on Wednesday 15 April and ABP’s responses to the ExA’s Second Round questions. Second Round Question - Protective Provisions

2. The ExA, in his second round questions dated 26 March, has asked if:

“Associated British Ports can “provide a copy of their preferred Protective Provisions as appropriate for their interests adjacent to the development area in relation to water abstraction”

3. At the examination held on Wednesday 15 April, the ExA was informed that since the Issue

Specific hearing held on 25 February there had in fact been an exchange of draft Protective Provisions between the Applicant and ABP but that it had not, as yet, been possible for both sides to agree a final version.

4. ABP explained that whilst remaining fully in support of the Applicant’s power station proposal, it had only a limited ability actually to negotiate a protective provision with the Applicant in view of the overriding statutory obligations with which ABP has to comply.

5. As the ExA is aware, ABP is the owner and operator of the port of Port Talbot. As such, it is also the port statutory undertaker and in that capacity it has to fulfil and comply with a number of statutory obligations and duties.

6. For example, section 9 of the Transport Act 1981, provides that:

“It is the duty of Associated British Ports to provide port facilities at its harbours to such extent as it may think expedient”.

7. This statutory provision effectively means that if ABP determines that any improvement in its

port facilities is desirable in the context of its statutory port operations, then it must act to provide that facility.

8. In addition, section 33 of the Harbour, Docks and Piers Clauses Act 1847 places a specific obligation on statutory port operators such as ABP to maintain an “open port”, as follows:

“On payment of the rates.... payable ….the harbour, dock and pier shall be open to all persons for the shipping and unshipping of goods and the embarking and landing of passengers”

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9. As was explained at the hearing, historically this particular statutory provision was introduced over 150 years ago to prevent private port operators from excluding commercial “competitors” from their ports. The practical effect of section 33 today is that ABP has a statutory duty to maintain an “open port” for all shipping – both commercial customers and visitors. The only qualification to that statutory duty derives from the practical ability of any given port actually to accommodate the size of the visiting vessel.

10. In the case of the port of Port Talbot, the Dock is advertised as being able to accommodate vessels with a draft of up to 7.7 metres. With a required under keel clearance (UKC) of just under 1 metre, that means that ABP is under a statutory duty to ensure that there is always sufficient water in the Dock – or if not, the requisite amount of water can be sourced from the sea or from the feeder channel - to provide a satisfactory operational water depth at the cill of the inner lock, of 8.6 metres or such lower level as may be appropriate depending on the size of visiting vessels.

11. At the examination, some confusion may have arisen, however, as to ABP’s commercial needs as opposed to ABP’s statutory obligations. As indicated in ABP’s written summary of its oral submissions (dated 5 March) following the Issue Specific hearing held in February, for a vessel drawing only 6.7m (namely around 3,000t deadweight), the required depth and water level would clearly be commensurately less than for a larger vessel of say 10,000t deadweight.

12. That said, the ExA at the Issue Specific hearing of 15 April, will also have noted Mr Slorach’s comment to the effect that although the Dock currently accommodates some 120 – 150 ships per annum, in the light of ABP’s business strategy, as the port’s commercial business continues to expand, this figure is very likely to rise in the future to nearer 400 vessels per annum – effectively approaching in excess of one vessel a day.

13. Indeed, in this context, Mr Slorach also drew the ExA’s attention to the fact that it was ABP’s intention to bring Margam Wharf, located at the northern end of the Dock, back into commercial use. The practical effect of so doing is that the Port Talbot Dock will, in future have to be able to accommodate more of the larger class of vessels than may currently be the case. The Civil & Marine berth typically services vessels of about 6.7 metres draft. The vessels being served by Margam Wharf will be in the range of 8-10,000 tonnes deadweight and they, typically will have a draft of 7.7 metres, thereby requiring a minimum depth over the cill of the inner lock of 8.6 metres.

14. The Ex.A will appreciate, therefore, that whilst the size of vessels using the Port Talbot Dock inevitably vary, in view of ABP’s statutory obligation to maintain an “open port” – ABP must have complete control over the Dock’s operation so as to be able to maintain satisfactory operational water levels, potentially at 8.6 metres or above. Only in so doing can ABP satisfy its statutory obligation to be able to accommodate vessels with a draft of 7.7 metres.

15. In this context, the ExA should be aware that the “normal water level” within the Dock – if there can be an accepted “norm” – is actually around 8.8m on the inner lock cill. In practice, however, for most of the year the Dock will be at a level closer to 9.0m which actually leads to water overtopping the gates.

16. The information provided above is designed to assist the ExA in understanding ABP’s dilemma. Whilst it fully supports the Applicant’s development proposal, ABP is not prepared to accede to any arrangement whereby its ability to control water levels within its own Dock is circumscribed by a third party. Such a position would quite simply, on a commercial level alone, be totally unacceptable - and indeed this position is underlined by the existence of the long-standing legal agreements between ABP and the Applicant (and both their respective predecessors), in relation to water abstraction - to which reference is made below.

17. In addition, however, ABP cannot in any case accede to such an arrangement – even if it was prepared to do so – because to give the Applicant what to all practical intents and purposes would amount to a carte blanche to extract water from the Dock – would, in practical terms, be nothing less than a derogation of ABP’s statutory obligations.

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18. Indeed, to agree such an arrangement could leave ABP open to legal action by dissatisfied third parties for failure to comply with its very clear statutory duties.

19. In the light of the above, ABP has given considerable thought to the wording of a Protective Provision which would give the Applicant the comfort it seeks in terms of ensuring adequate water supply for its power station project whilst not at any time putting at risk ABP’s ability to maintain satisfactory operational water levels within the Dock, thereby enabling it to meet both its statutory and its commercial requirements.

20. To this end, ABP has had recourse to the extant legal agreements entered into by ABP and the Applicant and to which reference was made in its written submissions for Deadline 1 submitted on 15 January 2015.

21. The ExA will recall that in those earlier submissions, reference was made, at paragraph 8.2, to the abstraction agreements currently in existence between the Applicant and ABP. It is clear that those agreements provide not just a useful framework for any protective provision going forward but also establish a legal precedent based on the past negotiated and established position of both parties. As noted in the January representations, there is in existence:-

(i) A legal agreement permitting the Applicant to extract unlimited amounts of water from the Dock provided the same volume of water extracted from the Dock is returned to the Dock less an agreed amount which is effectively “consumed” within the Applicant’s steel production process. The terms of this agreement are reflected in paragraph 2(1) of the draft protective provision set out below. In addition –

(ii) There is a binding legal agreement with the Applicant which relates to the pumping station operated by the Applicant and which is constructed on ABP’s land. The agreement permits the Applicant to extract water from the River Afan feeder channel. That extraction rate is, however, limited – and indeed limited to a figure below that licensed and permitted by NRW - although in this context, as noted previously, NRW accept that the licensed abstraction levels may not meet ABP’s operational requirements for the Dock (reference para 2.15 of ABP’s written submission for Deadline 4, March 2015). The mere fact of the existence of the NRW licences, however, underlines the critical need for a protective provision in the light of ABP’s continuing statutory obligations.

22. As a consequence of the above considerations, therefore, and taking into account the Applicant’s expressed concerns, ABP has revised the protective provision previously placed before the Applicant and included in its Deadline 4 representations. This revised wording is set out in para. 25 below.

23. In brief, the ExA will see that:-

(i) Paragraph 2(1) of the draft provision reflects the position as currently exists between ABP and the Applicant in the light of the extant legal agreements;

(ii) Paragraph 2(2) merely records that ABP will not be acting unreasonably if it refuses to allow Tata Steel to abstract volumes of water over and above those permitted in paragraph 2(1) on the basis that the additional abstraction would be likely to have a detrimental effect on ABP’s ability to maintain a satisfactory operational level of water within the Dock in compliance with is statutory obligations;

(iii) Paragraph 5, however, provides an undertaking by ABP to maintain water levels within the Dock of “…8.6 metres or such level as is required to maintain a satisfactory operational level of water in the Dock being not less than 8 metres at the inner lock gate cill …”. This undertaking is given subject to the proviso that the Applicant pays ABP’s reasonable costs for maintaining those satisfactory operational water levels, although in this context, the ExA should note that this requirement simply reflects the terms of the existing legal agreements between ABP and the Applicant. It should also

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be borne in mind that the reductions in water levels faced by ABP within the Dock arise essentially as a result of the volumes of water abstracted by the Applicant for its steel production process both from the Dock and the River Afan feeder channel.

24. Proposed Protective Provision

1. In this Part of this Schedule:

(1) “AB Ports” means Associated British Ports in its capacity as the owner, operator and harbour authority for the Port of Port Talbot;

"the Dock" means the main inner dock at the Port of Port Talbot;

"the existing abstraction licence" means the abstraction licence issued under the Water Resources Act 1991 with the reference number 21/58/61/0024 - Nant Ffrwdwyllt;

"the primary source" means the River Afan (Dock feeder channel); and

"the secondary sources" means the Nant Ffrwdwyllt and the Dock.

(2) The provisions of this Part of this Schedule have effect for the protection of AB Ports

unless otherwise agreed in writing between the undertaker and AB Ports and are without prejudice to the terms of any agreements in place between the Undertaker and ABP at the date of this Order.

2. The Undertaker must not abstract water from the primary or the secondary sources

for the purpose of the authorised development at a rate which combined with abstraction of water from those sources for any other purpose exceeds the following levels:

(a) River Afan (Dock feeder channel) - 27.4 Megalitres per day; (b) the Dock - 54.8 Megalitres per day as a net consumption; (c) Nant Ffrwdwyllt: the maximum volume of water that is permitted to be extracted

as set out in the existing abstraction licence;

without the consent of AB Ports.

3. The consent of AB Ports is not to be unreasonably withheld having regard to the need to maintain a satisfactory operational level of water in the Dock but may be given subject to reasonable conditions for this purpose.

4. The Undertaker must, on a monthly basis from commencement of operation, provide to

AB Ports detailed records of the levels of water abstracted from the River Afan (Dock feeder channel) and/or the Dock for the purpose of the authorised development and the Port Talbot Steelworks identifying the time, point of abstraction and levels of water abstracted.

5. Subject to the Undertaker complying with paragraphs 2, 4 and 6 and to the effect of any

events which cannot reasonably be foreseen, AB Ports will use reasonable endeavours to ensure that the water level in the Dock is maintained at all times at a level of 8.6 metres or such level as is required to maintain a satisfactory operational level of water in the Dock being not less than 8 metres at the inner lock gate cill subject always to ABP and the Undertaker agreeing that a level in the Dock of less than 8 metres would be acceptable at any given time and for any agreed period.

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6. The Undertaker must pay AB Ports the costs reasonably incurred by AB Ports in:

(a) Pumping water into the Dock; (b) Maintaining, repairing and cleansing the Dock and taking such other actions as in the

opinion of AB Ports may be necessary to prevent the creation of a nuisance or danger; and

(c) Supplying, maintaining, repairing and renewing any plant or equipment used by AB Ports

so as to enable AB Ports to maintain the level of water in the Dock in accordance with paragraph 5 above.

Second Round Question - ABP water level requirements

25. The ExA has asked, at para. 2.5.3 of the Second Round Questions if ABP could:

“…provide graphical evidence to support their water level and extraction rate requirements contained within their written representation for Deadline 4. Such should include, where relevant, the influence of the Port Talbot Dock characteristic tidal cycle and its ability to replenish water levels within the Dock.”

26. The position is as follows, and in this context, the ExA’s attention is drawn to the three documents attached, namely –

a) Port Talbot Dock – Dry Weather Flow – Snapshot Calculations;

b) ABP South Wales - Port Talbot Schematic Diagram – Dry Flow Water Balance;

c) Port Talbot Datum for Tidal Predictions

27. For most of the year there is adequate water for all demands, including those additional demands (viz: an additional 13.5 mega litres or 13,500 cubic metres per day) for the Applicant’s proposed project. However all parties accept that during prolonged dry periods, there is insufficient water available from the River Afan to meet all demands, including sufficient provision for maintaining flows in the fish-pass at Greenpark Weir.

28. Tata Steel, via their consultants, carried out a computer modelling exercise, based on previous Halcrow work, to try to predict the effects of the enhanced demands needed for the Applicant’s project. The results from this were, however, difficult to understand and contained anomalies.

29. ABP, therefore, constructed the simple Dry Weather Flow Spreadsheet attached - to calculate, on a continuity basis, what impounding effort would be necessary in prolonged dry periods, to maintain a constant dock water level. This was carried out for low exceedance flows ranging from Q80 to Q95 – i.e. the flows that are exceeded for 80% to 95% of the time which are thus the lowest flows. The Spreadsheet takes into account all the contributions of flows available and all the known demands and losses and calculates the impounding flows needed to balance so that dock water levels remain constant. Whilst this is a simplification, it does provide a useful snapshot of what is required, and also considers how the dock water levels would drop if no impounding took place. The Spreadsheet has in fact previously been circulated to both NRW and the Applicant and both have approved and agreed the details included – some of the information helpfully being provided by NRW.

30. The accompanying Schematic Diagram illustrates the flows, demands and losses which are included in the Spreadsheet calculations.

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31. With regard to depth of water required in the approach channel and the ExA’s query as to the influence of the Port Talbot Dock characteristic tidal cycle and its ability to replenish water levels within the Dock – with reference to the attached tidal prediction chart, the following will be of assistance:

(a) Examination of the tide tables shows that for 75 - 80% of all tides ABP can accept a vessel of draft 7.7m as advertised, navigating up the channel and into the lock - this is quite a normal percentage for an impounded dock, and corresponds to a minimum tide level of 8.2m above Admiralty Chart Datum - which is equivalent to a water depth of 6.05m over the inner cill. The approach channel from open sea to the lock is maintained at a depth of 0.4m below Admiralty Chart Datum. However, to lift that vessel up to a level for transit over the inner cill and across the dock, a water depth over the inner cill of 8.6m is required (+5.50mAOD).

(b) Regarding tidal replenishment - a MHWS tide of +4.40m AOD (equivalent to 7.45m water depth over the inner cill) or 9.60m above Admiralty Chart Datum - as shown in our published information and available from Admiralty sources and Bidston Tidal Observatory) would not recharge the Dock water level even up to Tata's Safety Critical dock water level of 7.50m above the inner cill gauge (+4.45mAOD) without the help of freshwater inflow from the dock feeder or impounding and would clearly not reach the Tata Amber Warning level depth of 8.0m above inner cill level (+4.95mAOD).

(c) Tides above MHWS do occur of course and the HAT (Highest Astronomical Tide) level for Port Talbot is +5.70mAOD (equivalent to a water depth of 8.75m over the Inner cill, or 10.9m above Admiralty Chart Datum). Such tides do occur very occasionally, but a more typical level for higher spring tides at Port Talbot would be 10.5m to 10.7m above Admiralty Chart Datum (equivalent to a water depth over the Inner cill of 8.35m to 8.55m or a level of +5.30m to +5.50m AOD). However such a tidal recharge would soon be consumed by operational demands from ABP and Tata Steel without additional water from the River Afan or by impounding.

31. As can be seen from the above, therefore, it is certainly not possible to maintain a water depth of 8.6m above Inner cill (or a water level of +5.55m AOD) by tidal recharge alone for the vast majority of the time, even without consideration of the volume of water required to meet the various operational demands. Hence the importance of the dock feeder and the ability to impound to maintain operational dock water level, particularly during neap tides when the level for MHWN is only +2.1m AOD (5.15m over the Inner cill), which is way below the level at which tidal replenishment of the dock water would be possible.

Winckworth Sherwood on behalf of Associated British Ports 23 April 2015