[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
     SECURING LIQUEFIED NATURAL GAS TANKERS TO PROTECT THE HOMELAND 

=======================================================================

                              FULL HEARING

                                 of the

                     COMMITTEE ON HOMELAND SECURITY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 21, 2007

                               __________

                           Serial No. 110-19

                               __________

       Printed for the use of the Committee on Homeland Security
                                     
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                     COMMITTEE ON HOMELAND SECURITY

               BENNIE G. THOMPSON, Mississippi, Chairman

LORETTA SANCHEZ, California,         PETER T. KING, New York
EDWARD J. MARKEY, Massachusetts      LAMAR SMITH, Texas
NORMAN D. DICKS, Washington          CHRISTOPHER SHAYS, Connecticut
JANE HARMAN, California              MARK E. SOUDER, Indiana
PETER A. DeFAZIO, Oregon             TOM DAVIS, Virginia
NITA M. LOWEY, New York              DANIEL E. LUNGREN, California
ELEANOR HOLMES NORTON, District of   MIKE ROGERS, Alabama
Columbia                             BOBBY JINDAL, Louisiana
ZOE LOFGREN, California              DAVID G. REICHERT, Washington
SHEILA JACKSON LEE, Texas            MICHAEL T. McCAUL, Texas
DONNA M. CHRISTENSEN, U.S. Virgin    CHARLES W. DENT, Pennsylvania
Islands                              GINNY BROWN-WAITE, Florida
BOB ETHERIDGE, North Carolina        MARSHA BLACKBURN, Tennessee
JAMES R. LANGEVIN, Rhode Island      GUS M. BILIRAKIS, Florida
HENRY CUELLAR, Texas                 DAVID DAVIS, Tennessee
CHRISTOPHER P. CARNEY, Pennsylvania
YVETTE D. CLARKE, New York
AL GREEN, Texas
ED PERLMUTTER, Colorado
VACANCY

       Jessica Herrera-Flanigan, Staff Director & General Counsel

                        Todd Gee, Chief Counsel

                     Michael Twinchek, Chief Clerk

                Robert O'Connor, Minority Staff Director

                                  (II)































                            C O N T E N T S

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                                                                   Page

                               STATEMENTS

The Honorable Bennie G. Thompson, a Representative in Congress 
  From the State of Mississippi, and Chairman, Committee on 
  Homeland Security
  Oral Statement.................................................     1
  Prepared Sttement..............................................     2
The Honorable Peter T. King, a Representative in Congress From 
  the State of New York, and Ranking Member, Committee on 
  Homeland Security..............................................     2
The Honorable Gus M. Bilirakis, a Representative in Congress From 
  the State of Florida...........................................    42
The Honorable Christopher P. Carney, a Representative in Congress 
  From the State of Pennsylvania.................................    40
The Honorable Peter A. DeFazio, a Representative in Congress From 
  the State of Oregon............................................    43
The Honorable Al Green, a Representative in Congress From the 
  State of Texas.................................................    67
The Honorable James R. Langevin, a Representative in Congress 
  From the State of Rhode Island.................................    35
The Honorable Sheila Jackson Lee, a Representative in Congress 
  From the State of Texas........................................    46
The Honorable Christopher Shays, a Representative in Congress 
  From the State of Connecticut..................................    37

                               Witnesses
                                Panel I

Mr. H. Keith Lesnick, Director, Office of Deepwater Port 
  Licensing, Maritime Administration, Department of 
  Transportation:
  Oral Statement.................................................    15
  Prepared Statement.............................................    17
Mr. J. Mark Robinson, Director, Office of Energy Projects, 
  Federal Energy Regulatory Commission:
  Oral Statement.................................................    19
  Prepared Statement.............................................    21
Rear Admiral Brian M. Salerno, Director, Inspection and 
  Compliance, U.S. Coast Guard, Department of Homeland Security:
  Oral Statement.................................................     8
  Prepared Statement.............................................    10
Mr. Jim Wells, Director, Energy, NRC, Natural Resources and 
  Environment, Government Accountability Office (GAO):
  Oral Statement.................................................     3
  Prepared Statement.............................................     5

                                Panel II

Mr. Ron Davis, President, Marine Engineers' Beneficial 
  Association:
  Oral Statement.................................................    49
  Prepared Statement.............................................    51
Phani Raj, PhD, President, Technology & Management Systems, Inc.:
  Oral Statement.................................................    55
  Prepared Statement.............................................    57

                               Appendixes

Appendix A:  For the Record
  The Honorable Bob Etheridge,Prepared Statement.................    77
Appendix B:  Additional Questions and Responses
  Responses from Mr. Ron Davis...................................    79
  Responses submitted by Mr. Mark E. Gaffigan, Acting Director, 
    Natural Resources and Environment, Government Accounting 
    Office (GAO).................................................    84
  Responses from Phani Raj, PhD..................................    87
  Responses from Mr. J. Mark Robinson............................    97
  Responses from RADML Brian M. Salerno..........................    99


     SECURING LIQUEFIED NATURAL GAS TANKERS TO PROTECT THE HOMELAND

                              ----------                              


                       Wendesday, March 21, 2007

                     U.S. House of Representatives,
                            Committee on Homeland Security,
                                                    Washington, DC.
    The committee met, pursuant to call, at 11:21 a.m., in Room 
311, Cannon House Office Building, Hon. Bennie Thompson 
[chairman of the committee] presiding.
    Present: Representatives Thompson, DeFazio, Jackson Lee, 
Langevin, Carney, Green, King, Shays, Dent, Brown-Waite, 
Bilirakis, McCarthy, and McCaul.
    Chairman Thompson. [Presiding.] The Committee on Homeland 
Security will come to order.
    The committee is meeting today to receive testimony on 
``Securing LNG Tankers to Protect the Homeland.''
    Natural gas accounts for about one-fourth of all energy 
consumed in the United States. The Department of Energy 
predicts that the United States will have to increase imports 
by 600 percent in the next 25 years to fulfill demand.
    To meet this demand, energy companies have submitted 32 
applications to build new terminals for importing liquid 
natural gas in 10 states and five offshore areas. Today, there 
are only five import terminals.
    The dramatic increase in terminals will assist in meeting 
the demand, but it will also increase the number of potential 
terrorist targets. We must ensure that these new facilities and 
tankers are adequately secured.
    Many agencies within the administration have a role to play 
in this endeavor. I look forward to hearing from our government 
witnesses today of the steps each has taken to improve the 
security of LNG transportation.
    Additionally, the men and women who crew these tankers are 
the critical eyes and ears of the system. I applaud the 
Maritime Administrator's initiative in increasing the number of 
U.S. mariners on LNG tankers.
    I look forward to hearing more about how we can increase 
U.S. presence on these tankers.
    I am also interested in hearing from the Coast Guard about 
the impact of increased amount of LNG traffic and what it will 
have on it as an agency.
    Coast Guard assets are aging by the day. I am concerned 
about whether or not the Coast Guard has the assets to meet 
this growing mission.
    I recognize that Admiral Allen has set a course to fix the 
Coast Guard's Deepwater program, but I want to know if this 
course correction will occur before additional LNG facilities 
come online.
    Finally, I am interested in learning from the Government 
Accountability Office about its recommendations to fix the 
conflicting assessments of the specific consequences of an LNG 
spill.
    Mr. Wells's written testimony is correct. Access to 
accurate information will play a critical role in developing 
risk assessments for LNG placement decisions. The continued 
absence of this information is troubling and must be 
rectified.\1\
    The chair now recognizes the ranking member of the full 
committee, the gentleman from New York, Mr. King, for an 
opening statement.
    [The statement of Mr. Bennie G. Thompson follows:]

   Prepared Statement of the Honorable Bennie G. Thompson, Chairman, 
                     Committee on Homeland Security

    Natural gas accounts for about one-fourth of all energy consumed in 
the United States The Department of energy predicts that the United 
States will have to increase imports by 600% in the next 25 years to 
fulfill demands. To meet this demand, energy companies have submitted 
32 applications to build new terminals for importing liquid natural gas 
in 10 states and 5 offshore ares.
    Today, there are only 5 import terminals. The dramatic increase in 
terminals will assist in meeting the demand, but it will also increase 
the number of potential terrorist targets. We must ensure these new 
facilities and tankers are adequately secure.
    Many agencies within the Administration have a role to play in this 
endeavor. I look forward to hearing from our government witnesses today 
of the steps each has taken to improve the security of LNG 
transportation.
    Additionally, the men and women who crew these tankers are the 
crucial eyes and ears of the system. I applaud the Maritime 
Administrator's initiative in increasing the number of U.S. mariners on 
LNG tankers. I look forward to hearing more about how we can increase 
U.S. presence to these.
    Coast Guard assets are aging by the day, and I am concerned about 
whether or not the Coast Guard has the assets to meet this growing 
mission. I recognize that Admiral Allen has set a course to fix the 
Coast Guards's Deepwater Program, but I want to know if this course 
correction will occur before the additional LNG facilities come on 
line.
    Finally, I am very interested in learning from the Government 
Accountability Office about its recommendations to fix the conflicting 
assessments of the specific consequences of an LNG spill. Mr. Wells' 
written testimony is correct--access to accurate information will play 
a crucial role in developing risk assessments for LNG placement 
decisions. The continued absence of this information is troubling and 
must be rectified.

    Mr. King. Thank you, Mr. Chairman. Thank you for yielding 
me the time. Thank you for calling this hearing and also for 
the closed session which we just had, which was also extremely 
interesting and illuminating.
    I basically concur with everything you said in your opening 
statement.
    The fact is the United States does consume more energy per 
capita than any country in the world. We definitely will have 
to make greater use of LNG. We definitely need more LNG 
facilities in this country.
    At the same time, the issue arises whether or not we are 
able to secure those facilities, whether or not we have the 
resources to secure them. What is being done to make sure that 
there is security?
    Certainly, near my own district there is the proposed 
Broadwater facility, which of course is causing a considerable 
amount of controversy.
    So this is an issue which is going to be increasing many-
fold over the next 5 years, 10 years, 15 years, 20 years, and 
to me, there is no doubt that we need the LNG. We have to be 
increasing facilities.
    But at the same time, we have to ensure that our government 
is able to provide us with a level of security in the post-9/11 
world in which we live.
    So with that, I look forward to the testimony and yield 
back the balance of my time.
    Chairman Thompson. Thank you very much.
    Other members of the committee are reminded that, under 
committee rules, opening statements may be submitted for the 
record.
    I welcome our first panel of witnesses. Our first witness, 
Mr. Jim Wells, is director of energy, natural resources 
environment team of the GAO.
    Our second witness, Real Admiral Salerno, assumed his 
duties as director of inspections and compliance at the U.S. 
Coast Guard headquarters in May of 2006.
    Our third witness, Mr. Keith Lesnick, is the director of 
the Office of Deepwater Port Licensing at the Maritime 
Administration.
    And our fourth witness is Mr. Mark Robinson, who is with 
the Federal Energy Regulatory Commission and has been director 
of the Office of Energy Projects since 2001.
    Without objection, the witnesses' full statement will be 
inserted in the record.
    I now ask each witness to summarize his statement for 5 
minutes, beginning with Mr. Wells.

    STATEMENT OF JIM WELLS, DIRECTOR, ENERGY, NRC, NATURAL 
  RESOURCES AND ENVIRONMENT, GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Wells. Thank you, Mr. Chairman, members of the 
subcommittee.
    We at GAO are pleased to discuss the results of our 
released report on the public safety consequences of a 
terrorist attack on a tanker carrying LNG.
    As you know, there is a lot of consternation about how we 
meet our increasing energy needs for natural gas at the same 
time that we can ensure public safety and security.
    The supply of natural gas, as you referenced, in the future 
will be brought to us as LNG by tanker imports. Today we bring 
in our ports about two tanker ships every 3 days.
    Industry is asking to build new or expanded existing 
terminals in 10 states and offshore. Going forward, this type 
of tanker traffic will grow by over 400 percent.
    My testimony at this hearing summarizes the results of one 
of three GAO reports that this committee has asked for. A 
classified report on maritime security was discussed this 
morning in the closed briefing.
    Our second report we are talking about today is a 
summarization of existing research and the existing knowledge 
on the consequences of an LNG spill.
    Because some additional studies, research studies, are 
classified, we will be issuing a separate classified report 
with related findings at a later date.
    The GAO report focuses on the effects on water and not on 
land or at the shore facilities. GAO reviewed six unclassified 
studies conducted since 9/11.
    The GAO report summarizes their findings as they relate to 
the heat impact of an LNG fire, the possible potential hazards 
of a large LNG spill and the reported conclusions on explosion 
potentials.
    These studies were conducted for differing purposes, used 
multiple scenarios, numerous assumptions, and relied heavily on 
computer modeling, since no real LNG event or large-scale fire 
has occurred to date.
    While there is a general agreement on the type of effects 
of an LNG spill, the results are different enough to create 
conflicting assessments of specific consequences, creating 
uncertainty for regulators and the public.
    These results are not just academic. The Coast Guard, for 
example, uses them to make risk-informed decisions on how to 
adequately protect and assess the waterways used by these 
tankers.
    GAO went further and documented the opinions of 19 experts 
from industry, academia, government, consultants and experts 
with explosive and spills experience.
    These experts generally agreed on the public safety impacts 
of an LNG spill, but they did disagree on specific conclusions 
of some government studies and suggested future research 
priorities.
    They agreed on three main points. The most likely public 
safety impact of an LNG spill is the heat impact of a fire.
    Explosions are not likely to occur in the wake of an LNG 
spill unless the LNG vapors are in a confined area, and that 
some of the hazards, such as freeze burns and asphyxiation, do 
not pose a hazard to the public.
    However, not all experts were in agreement with the 
commonly used one to 1.25-mile proper heat zone hazard zone, 
with about half believing this number was about right, and 
others evenly split on whether the distance was too 
conservative or not conservative enough.
    Experts also did not agree with some of the government 
conclusions that only three of the five LNG tanks on a tanker 
would be involved in a cascading failure.
    Finally, the experts suggested priorities to help guide 
future research aimed at clarifying these uncertainties about 
heat impact distances, cascading failures including large-scale 
fire experiments, large-scale spill experiments on water, and 
the potential for cascading failures of multiple LNG tanks.
    Knowing that DOE has recently funded a 2-year study 
involving large-scale LNG fire experiments addressing some, but 
not all, of the research priorities that I have identified here 
today, the experts and GAO have recommended that DOE consider 
expanding the scope of its existing work.
    In closing, Mr. Chairman, it is important to know the 
public safety consequences of future LNG shipments. Access, as 
you said, to accurate information is critical for the Coast 
Guard, for FERC, for DHS as they make important decisions about 
where and when and how to expand LNG facilities.
    If the existing research underestimates, the public is 
exposed to inappropriate risk. If the research overestimates, 
we incur costly mitigation measures and we potentially lose the 
availability of a critical, valuable energy resource going 
forward.
    DOE needs to go further. They need to prioritize the scope 
of their future research. And they need to settle some of these 
uncertainties.
    I will stop here, Mr. Chairman. Thank you.
    [The statement of Mr. Wells follows:]

                    Preppared Statement of Jim Wells

    Mr. Chairman and Members of the Committee:
    I am pleased to be here to discuss the results of our recently 
released report on the public safety consequences of a terrorist attack 
on a tanker carrying liquefied natural gas (LNG).\1\ As you know, LNG 
is a supercooled liquid form of natural gas, which, if spilled, poses 
potential hazards, such as fire, asphyxiation, and explosions. U.S. 
imports of LNG, now about 3 percent of total U.S. natural gas supplies, 
are projected to be about 17 percent of U.S. supplies by 2030. To meet 
this increased demand, energy companies have submitted 32 applications 
to federal regulators to build new terminals for importing LNG in 10 
states and 5 offshore areas. Access to accurate information about the 
consequences of LNG spills is crucial for developing risk assessments 
for LNG siting decisions. Despite several recent modeling studies of 
the consequences of potential LNG spills, uncertainties remain about 
the risks such spills would pose to the public. One of these studies, 
conducted by Sandia National Laboratories (Sandia) in 2004, is used by 
the Coast Guard to assess the suitability of waterways for LNG tankers 
traveling to proposed LNG facilities. In this context, DOE has recently 
funded a new study that will conduct small--and large-scale LNG fire 
experiments to refine and validate existing models that calculate how 
heat from large LNG fires would affect the public.
---------------------------------------------------------------------------
    \1\ GAO, Maritime Security: Public Safety Consequences of a 
Terrorist Attack on a Tanker Carrying Liquefied Natural Gas Need 
Clarification, GAO-07-316 (Washington, D.C.: Feb. 22, 2007). This 
report was prepared at the request of this Committee, the House 
Committee on Energy and Commerce, and Representative Edward J. Markey.
---------------------------------------------------------------------------
    My testimony today summarizes the results of our report. 
Specifically, I will (1) describe the results of recent unclassified 
studies on the consequences of an LNG spill and (2) identify the areas 
of agreement and disagreement among experts concerning the consequences 
of a terrorist attack on an LNG tanker. To address these issues, we 
examined six unclassified studies of the consequences of LNG spills. We 
also convened a Web-based panel of 19 experts to identify areas of 
agreement and disagreement on LNG spill consequence issues. Because 
some additional studies are classified, we will be issuing a separate 
classified report with related findings at a later date.

Summary
    The six unclassified studies we reviewed all examined the heat 
impact of an LNG fire but produced varying results; some studies also 
examined other potential hazards of a large LNG spill and reached 
consistent conclusions on explosions. Specifically, the studies' 
conclusions about the distance at which 30 seconds of exposure to the 
heat could burn people--also termed the heat impact distance--ranged 
from less than 1/3 of a mile to about 1-1/4 miles. These variations 
occurred because, with no data on large spills from actual events, 
researchers had to make numerous modeling assumptions to scale up the 
existing experimental data for large LNG spills. These assumptions 
involved the size of the hole in the tanker, the number of tanks that 
fail, the volume of LNG spilled, key LNG fire properties, and 
environmental conditions, such as wind and waves. Three of the studies 
also examined other potential hazards of an LNG spill, including LNG 
vapor explosions, asphyxiation, and the sequential failure of multiple 
tanks on the LNG vessel (cascading failure). All three studies 
considered LNG vapor explosions unlikely unless the vapors were in a 
confined space. Only the Sandia study examined asphyxiation and 
concluded that asphyxiation did not pose a hazard to the general 
public. Finally, only the Sandia study examined the potential for 
cascading failure of LNG tanks and concluded that only three of the 
five tanks on a typical LNG vessel would be involved in such an event 
and that this number of tanks would increase the duration of the LNG 
fire.
    Our panel of 19 experts generally agreed on the public safety 
impact of an LNG spill, disagreed on specific conclusions of the Sandia 
study, and suggested future research priorities. Experts agreed on 
three main points: (1) the most likely public safety impact of an LNG 
spill is the heat impact of a fire; (2) explosions are not likely to 
occur in the wake of an LNG spill unless the LNG vapors are in confined 
spaces; and (3) some hazards, such as freeze burns and asphyxiation, do 
not pose a hazard to the public. However, the experts disagreed with a 
few conclusions reached by the Sandia study that the Coast Guard uses 
to assess the suitability of waterways for LNG tankers going to 
proposed LNG terminals. Specifically, all experts did not agree with 
the study's 1-mile estimate of heat impact distance resulting from an 
LNG fire: 7 of 15 thought Sandia's distance was ``about right,'' 8 were 
evenly split on whether the distance was ``too conservative'' or ``not 
conservative enough,'' and 4 did not answer this question. Experts also 
did not agree with the Sandia National Laboratories' conclusion that 
only three of the five LNG tanks on a tanker would be involved in a 
cascading failure. Finally, experts suggested priorities to guide 
future research aimed at clarifying uncertainties about heat impact 
distances and cascading failure, including large-scale fire 
experiments, large-scale LNG spill experiments on water, the potential 
for cascading failure of multiple LNG tanks, and improved modeling 
techniques. DOE's recently funded study involving large-scale LNG fire 
experiments addresses some, but not all, of the research priorities the 
expert panel identified.

Background
    As scientists and the public have noted, an LNG spill could pose 
potential hazards. When LNG is spilled from a tanker, it forms a pool 
of liquid on the water. As the liquid warms and changes into natural 
gas, it forms a visible, foglike vapor cloud close to the water. The 
cloud mixes with ambient air as it continues to warm up, and eventually 
the natural gas disperses into the atmosphere. Under certain 
atmospheric conditions, however, this cloud could drift into populated 
areas before completely dispersing. Because an LNG vapor cloud 
displaces the oxygen in the air, it could potentially asphyxiate people 
who come into contact with it. Furthermore, like all natural gas, LNG 
vapors can be flammable, depending on conditions. If the LNG vapor 
cloud ignites, the resulting fire will burn back through the vapor 
cloud toward the initial spill. It will continue to burn above the LNG 
that has pooled on the surface--this is known as a pool fire. Small-
scale experiments to date have shown that LNG fires burn hotter than 
oil fires of the same size. Both the cold temperatures of spilled LNG 
and the high temperatures of an LNG fire have the potential to 
significantly damage the tanker, causing a cascading failure. Such a 
failure could increase the severity of the incident. Finally, concerns 
have been raised about whether an explosion could result from an LNG 
spill.
    The Federal Energy Regulatory Commission is responsible for 
approving applications for onshore LNG terminal sitings, and the U.S. 
Coast Guard is responsible for approving applications for offshore 
sitings. In addition, the Coast Guard reviews an applicant's Waterway 
Suitability Assessment, reaches a preliminary conclusion on whether the 
waterway is suitable for LNG imports, and identifies appropriate 
strategies that reduce the risk posed by the movement of an LNG tanker.

Studies Identified Different Distances for the Heat Effects of an LNG 
Fire, but Agreed on Other LNG Hazards
    The six studies we examined identified various distances at which 
the heat effects of an LNG fire could be hazardous to people. The 
studies' results about the distance at which 30 seconds of exposure to 
the heat could burn people ranged from less than 1/3 of a mile (about 
500 meters) to about 1--1/4 miles (more than 2,000 meters). The 
studies' variations in heat effects occurred because (1) different 
assumptions were made in the studies? models about key parameters of 
LNG spills and (2) the studies were designed and conducted for 
different purposes. Since no large-scale data are available for LNG 
spills, researchers made numerous modeling assumptions to scale up the 
existing experimental data for large spills. Key assumptions made 
included hole size and cascading failure, waves and wind, the volume of 
LNG spilled, and the amount of heat radiated from the fire. For 
example, studies made assumptions for the size of the hole in the LNG 
tanker that varied from less than 1 square meter up to 20 square 
meters. Additionally, the studies were conducted for different 
purposes. Two studies were academic analyses of the differences between 
LNG and oil spills; three specifically addressed spills caused by 
terrorist attacks, which was a concern in the wake of the September 11 
attacks; and the final study developed appropriate methods for 
regulators to use to estimate heat hazards from LNG fires. Results of 
these studies can be found in our report being released today.
    Some studies also examined other potential hazards, such as 
explosions, asphyxiation, and cascading failure, and identified their 
potential impacts on public safety. Three studies examined the 
potential for LNG vapor explosions, and all agreed that it is unlikely 
that LNG vapors could explode if the vapors are in an unconfined space. 
Only one study examined the potential for asphyxiation following an LNG 
spill if the vapors displace the oxygen in the air. It concluded that 
fire hazards would be the greatest problem in most locations, but that 
asphyxiation could threaten the ship's crew, pilot boat crews, and 
emergency response personnel. Finally, only the Sandia study examined 
the potential for cascading failure of LNG tanks and concluded that 
only three of the five tanks would be involved in such an event and 
that this number of tanks would increase the duration of the LNG fire.

Experts Generally Agreed That the Most Likely Public Safety Impact of 
an LNG Spill Is the Heat Effect of a Fire, but That Further Study Is 
Needed to Clarify the Extent of This Effect
    The 19 experts on our panel generally agreed on the public safety 
impact of an LNG spill, disagreed with specific conclusions of the 
Sandia study, and suggested future research priorities.\2\ 
Specifically:
---------------------------------------------------------------------------
    \2\ We considered experts to be ``in agreement'' if more than 75 
percent of them indicated that they completely agreed or generally 
agreed with a given statement. Not all experts commented on every issue 
discussed.
---------------------------------------------------------------------------
     Experts agreed that the main hazard to the public from a 
pool fire is the heat from the fire, but emphasized that the exact 
hazard distance depends on site-specific weather conditions; 
composition of the LNG (relative percentages of methane, propane, and 
butane); and the size of the fire.
     Eighteen of 19 experts agreed that the ignition of a vapor 
cloud over a populated area could burn people and property in the 
immediate vicinity of the fire. Three experts emphasized in their 
comments that the vapor cloud is unlikely to penetrate very far into a 
populated area before igniting.
     With regard to explosions, experts distinguished between 
explosions in confined spaces and in unconfined spaces. For confined 
spaces, such as under a dock or between the hulls of a ship, they 
agreed that it is possible, under controlled experimental conditions, 
to induce explosions of LNG vapors; however, a detonation--the more 
serious type of vapor cloud explosion--of confined LNG vapors is 
unlikely following an LNG spill caused by a terrorist attack. For 
unconfined spaces, experts were split on whether it is possible to 
induce such explosions under controlled experimental conditions; 
however, even experts who thought such explosions were possible agreed 
that vapor cloud explosions in unconfined spaces are unlikely to occur 
following an LNG spill caused by a terrorist attack.
    Our panel of 19 experts disagreed with a few of the Sandia study's 
conclusions and agreed with the study authors' perspective on risk-
based approaches to dealing with the hazards of potential LNG spills. 
For example:
     Seven of 15 experts thought Sandia's heat hazard distance 
was ``about right,'' and the remaining 8 experts were evenly split as 
to whether the distance was ``too conservative'' (i.e., larger than 
needed to protect the public) or ``not conservative enough'' (i.e., too 
small to protect the public). Officials at Sandia National Laboratories 
and our panel of experts cautioned that the hazard distances presented 
cannot be applied to all sites because of the importance of site-
specific factors. Additionally, two experts explained that there is no 
``bright line'' for hazards--that is, 1,599 meters is not necessarily 
``dangerous,'' and 1,601 meters is not necessarily ``safe.''
     Nine of 15 experts agreed with Sandia's conclusion that 
only three of the five LNG tanks on a tanker would be involved in 
cascading failure. Five experts noted that the Sandia study did not 
explain how it concluded that only three tanks would be involved in 
cascading failure.
     Finally, experts agreed with Sandia's conclusion that 
consequence studies should be used to support comprehensive, risk-based 
management and planning approaches for identifying, preventing, and 
mitigating hazards from potential LNG spills.
    The experts also suggested priorities for future research--some of 
which are not fully addressed in DOE's ongoing LNG research--to clarify 
uncertainties about heat impact distances and cascading failure. These 
priorities include large-scale fire experiments, large-scale LNG spill 
experiments on water, the potential for cascading failure of multiple 
LNG tanks, and improved modeling techniques. As part of DOE's ongoing 
research, Sandia plans to conduct large-scale LNG pool fire tests, 
beginning with a pool size of 35 meters--the same size as the largest 
test conducted to date. Sandia will validate the existing 35-meter data 
and then conduct similar tests for pool sizes up to 100 meters. Of the 
top 10 LNG research priorities the experts identified, only 3 have been 
funded in the DOE study, and the second highest ranked priority, 
cascading failure, was not funded. One expert noted that although the 
consequences of cascading failure could be serious, because the extreme 
cold of spilled LNG and the high heat of an LNG fire could damage the 
tanker, there are virtually no data looking at how a tanker would be 
affected by these temperatures.

Conclusions
    It is likely that the United States will increasingly depend on LNG 
to meet its demand for natural gas. Consequently, understanding and 
resolving the uncertainties surrounding LNG spills is critical, 
especially in deciding where to locate LNG facilities. While there is 
general agreement on the types of effects of an LNG spill, the study 
results have created what appears to be conflicting assessments of the 
specific heat consequences of such a spill.
    These assessments create uncertainty for regulators and the public. 
Additional research to resolve some key areas of uncertainty could 
benefit federal agencies responsible for making informed decisions when 
approving LNG terminals and protecting existing terminals and tankers, 
as well as providing reliable information to citizens concerned about 
public safety.
    To provide the most comprehensive and accurate information for 
assessing the public safety risks posed by tankers transiting to 
proposed LNG facilities, we recommended that the Secretary of Energy 
ensure that DOE incorporates the key issues the expert panel 
identified, particularly the potential for cascading failure, into its 
current LNG study.
    DOE concurred with our recommendation.
    Mr. Chairman, this concludes my prepared statement. I would be 
happy to respond to any questions that you or Members of the Committee 
may have.

    Chairman Thompson. Thank you very much, and we will 
probably get back into that during the questions.
    I now recognize Rear Admiral Salerno to summarize his 
statement for 5 minutes.

     STATEMENT OF REAR ADMIRAL BRIAN M. SALERNO, DIRECTOR, 
  INSPECTION AND COMPLIANCE, U.S. COAST GUARD, DEPARTMENT OF 
                       HOMELAND SECURITY

    Admiral Salerno. Good morning, Mr. Chairman and 
distinguished members of the committee. I am Rear Admiral Brian 
Salerno, director of inspections and compliance at Coast Guard 
headquarters.
    It is my pleasure to appear before you today to discuss the 
Coast Guard's role in providing for the safety and security of 
liquefied natural gas vessels and facilities and the recently 
completed General Accountability Office reports on petroleum 
and LNG tanker security.
    In coordination with other federal agencies and state and 
local stakeholders, the Coast Guard plays a major role in 
ensuring all facets of marine transportation of LNG are 
conducted safety and securely and that the risks associated 
with the operation of LNG vessels, shoreside terminals, and 
offshore deepwater ports are managed responsibly.
    LNG vessels have an impressive safety record over the last 
45 years. Since the inception of LNG shipping in 1959, there 
have been over 40,000 LNG shipments around the world but very 
few serious accidents, and those accidents which have occurred 
have not resulted in a breach of cargo tanks.
    LNG vessels and other vessels transporting liquefied 
hazardous gases in bulk are built and inspected to the highest 
engineering and safety standards as established in the 
International Code for the Construction and Equipment of Ships 
Carrying Liquefied Gases in Bulk, known more simply as the IGC 
Code.
    Today there are over 200 LNG foreign-flag vessels operating 
worldwide. They are crewed by some of the most highly trained 
officers and merchant seamen afloat.
    In response to the terrorist attacks of 2001, the Maritime 
Transportation Security Act of 2002 was enacted. It required a 
robust maritime security regime for both vessels and 
facilities.
    These security requirements closely parallel the 
International Ship and Port Facility Security Code, or ISPS. 
Under ISPS, vessels in international service, including LNG 
vessels, must have an international ship security certificate.
    To achieve the international ship security certificate by 
its flag state, the vessel must develop and implement a threat-
scalable security plan that, among other things, establishes 
measures for access control, cargo handling and delivery of 
ship stores, surveillance and monitoring, security 
communications, as well as security incident procedures and 
training and drill requirements.
    Additionally, like all deep draft vessels calling in the 
U.S., LNG vessel operators must provide the Coast Guard with a 
96-hour advance notice of arrival and include information on 
the vessel's last ports of call, crew identities and cargo 
information.
    That information is vetted to detect any concerns or 
anomalies. The Coast Guard conducts pre-entry security 
boardings of LNG vessels during which Coast Guard personnel 
conduct security sweeps of the vessel and ensure it is under 
control of proper authorities during its intended transit.
    In order to protect the LNG tanker and other vessels 
carrying especially hazardous cargoes from external attack, 
these vessels are escorted by armed Coast Guard and other law 
enforcement vessels through key port areas.
    By acting as a deterrent against a potential attack against 
the vessel, these escorts reduce the risk to nearby population 
centers from the consequences of an attack.
    Coast Guard efforts are often augmented by other government 
agencies and the facility operators' private security forces, 
which also conduct activities such as waterway patrols and 
surveillance.
    The combined efforts of federal, state, local and private 
assets contribute to the overall local LNG port risk mitigation 
plan.
    The Federal Energy Regulatory Commission, FERC, has the 
siting authority for shoreside LNG terminals. However, the 
Coast Guard is a cooperating agency in the preparation of 
FERC's environmental impact statement associated with the 
siting of the facility.
    Additionally, the local Coast Guard captain of the port 
must assess and make a determination regarding the suitability 
of the waterway for the proposed vessel transits, ensuring that 
full consideration is given to the safety and security of the 
port, the facility and vessels transporting LNG.
    The process involves the local area Maritime Committee and 
the Harbor Safety Committee and includes identification of the 
mitigating measures to responsibly manage the safety and 
security risks identified during the suitability assessment.
    The assessment also includes an analysis of the optimal mix 
of federal, state and local resources in addition to private 
resources needed to implement any necessary risk mitigation 
measures.
    The Coast Guard continues to analyze resource allocation 
and resource needs in light of the potential growth of the LNG 
industry in the U.S.
    This new work may be accommodated through reallocation of 
existing resources, expanding the use of other government 
agency and private security forces to conduct security 
operations, or requesting new resources. All of these options 
are under consideration.
    It is important to note that there are other hazardous 
cargoes that the Coast Guard regulates to ensure safety and 
security. Moreover, there are 11 other missions for which the 
Coast Guard is responsible to execute.
    Our prevention and protection strategies are aimed at 
ensuring the highest risk situations receive the highest level 
of protection. This is an ongoing process.
    As you are aware, the GAO recently concluded two reports. 
One examined current security practices for energy commodity 
tankers, including LNG, and the Coast Guard had extensive 
interaction with GAO in the drafting of this report and has 
formally concurred with all of GAO's recommendations.
    The second report is a comprehensive review of the existing 
LNG consequence studies. As DOE was the principal federal 
agency interacting with GAO, the Coast Guard had minimal input 
into this study.
    However, we do agree that additional studies are needed to 
further examine potential consequences of an LNG spill and 
fire, particularly in the areas identified by the expert panel.
    Thank you for the opportunity to discuss the Coast Guard's 
role in LNG. I will be happy to answer any questions.
    [The statement of Admiral Salerno follows:]

               Prepared Statement of RADML Brian Salerno

Introduction
    Good morning Mr. Chairman and distinguished members of the 
Committee. I am Rear Admiral Brian Salerno, the Director of the 
Inspection and Compliance Directorate at U.S. Coast Guard Headquarters. 
It is my pleasure to appear before you today to discuss the Coast 
Guard's role in providing for the safety and security of Liquefied 
Natural Gas (LNG) vessels and facilities, and how the Coast Guard is 
cooperating with other Federal Agencies on this important national 
issue.
    As the Federal Government's lead agency for Maritime Homeland 
Security, the Coast Guard plays a major role in ensuring all facets of 
marine transportation of LNG, including LNG vessels, shoreside 
terminals and LNG deepwater ports, are operated safely and securely, 
and that the risks associated with the marine transportation of LNG are 
managed responsibly. Today, I will briefly review the applicable laws 
and regulations that provide our authority and the requirements for the 
safe and secure operation of the vessels, shoreside terminals and 
deepwater ports. I will also describe how the Coast Guard is working 
with the other Federal entities here today, as fellow stakeholders in 
LNG safety and security.

LNG Vessel Safety
    The Coast Guard has long recognized the unique safety and security 
challenges posed by transporting millions of gallons of LNG or 
``cryogenic methane.'' LNG vessels have had an enviable safety record 
over the last 45 years. Since international commercial LNG shipping 
began in 1959, tankers have carried over 40,000 LNG shipments and while 
there have been some serious accidents at sea or in port, there has 
never been a breach of a ship's cargo tanks. Insurance records and 
industry sources show that there were approximately 30 LNG tanker 
safety incidents (e.g. leaks, groundings or collisions) through 2002. 
Of these incidents, 12 involved small LNG spills which caused some 
freezing damage but did not ignite. Two incidents caused small vapor 
vent fires which were quickly extinguished.
    Today, there are over 200 LNG vessels operating worldwide and 
another 100 or so under construction. While there are no longer any US 
flag LNG vessels, all LNG vessels calling in the U.S. must comply with 
certain domestic regulations in addition to international requirements. 
Our domestic regulations for LNG vessels were developed in the 1970s 
under the authority of the various vessel inspection statutes now 
codified in Title 46 United States Code. Relevant laws providing the 
genesis for LNG vessel regulation include the Tank Vessel Act (46 
U.S.C. 391a) and the Ports and Waterways Safety Act of 1972, as amended 
by the Port and Tanker Safety Act of 1978 (33 U.S.C. 1221, et. seq). 
Regulations located in Title 46, Code of Federal Regulations (CFR) Part 
154, ``Safety Standards for Self-Propelled Vessels Carrying Bulk 
Liquefied Gasses,'' specify requirements for the vessel's design, 
construction, equipment and operation. Our domestic regulations closely 
parallel the applicable international requirements, but are more 
stringent in the following areas: The requirements for enhanced grades 
of steel for crack arresting purposes in certain areas of the hull, 
specification of higher allowable stress factors for certain 
independent type tanks and prohibiting the use of cargo venting as a 
means of cargo temperature or pressure control.
    All LNG vessels in international service must comply with the major 
maritime treaties agreed to by the International Maritime Organization 
(IMO), such as the International Convention for the Safety of Life at 
Sea, popularly known as the ``SOLAS Convention'' and the International 
Convention for the Prevention of Pollution from Ships, popularly known 
as the ``MARPOL Convention.'' An addition, LNG vessels must comply with 
the International Code for the Construction and Equipment of Ships 
Carrying Liquefied Gases in Bulk, known as the ``IGC Code.''
    Before being allowed to trade in the United States, operators of 
foreign flag LNG carriers must submit detailed vessel plans and other 
information to the Coast Guard's Marine Safety Center (MSC) to 
establish that the vessels have been constructed to the higher 
standards required by our domestic regulations. Upon the MSC's 
satisfactory plan review and on-site verification by Coast Guard marine 
inspectors, the vessel is issued a Certificate of Compliance. This 
indicates that it has been found in compliance with applicable design, 
construction and outfitting requirements.
    The Certificate of Compliance is valid for a two-year period, 
subject to an annual examination by Coast Guard marine inspectors, who 
verify that the vessel remains in compliance with all applicable 
requirements. As required by 46 U.S.C. 3714, this annual examination is 
required of all tank vessels, including LNG carriers.

LNG Vessel Security
    In addition to undergoing a much more rigorous and frequent 
examination of key operating and safety systems, LNG vessels are 
subject to additional measures of security when compared to crude oil 
tankers, as an example. Many of the special safety and security 
precautions the Coast Guard has long established for LNG vessels 
derived from our analysis of ``conventional'' navigation safety risks 
such as groundings, collisions, propulsion or steering system failures. 
These precautions pre-dated the September 11, 2001 tragedy, and include 
such measures as special vessel traffic control measures that are 
implemented when an LNG vessel is transiting the port or its 
approaches, safety zones around the vessel to prevent other vessels 
from approaching nearby, escorts by Coast Guard patrol craft and, as 
local conditions warrant, coordination with other Federal, state and 
local transportation, law enforcement and/or emergency management 
agencies to reduce the risks to, or minimize the interference from 
other port area infrastructure or activities. These activities are 
conducted under the authority of existing port safety and security 
statutes, such as the Magnuson Act (50 U.S.C. 191 et. seq.) and the 
Ports and Waterways Safety Act, as amended.
    Since September 11, 2001, additional security measures have been 
implemented, including the requirement that all vessels calling in the 
U.S. must provide the Coast Guard with a 96-hour advance notice of 
arrival (increased from 24 hours advance notice pre-9/11). This notice 
includes information on the vessel's last ports of call, crew 
identities and cargo information. In addition, the Coast Guard now 
regularly boards LNG vessels at-sea, where Coast Guard personnel 
conduct special ``security sweeps'' of the vessel and ensure it is 
under the control of proper authorities during its port transit. In 
order to protect the vessel from external attack, LNG vessels are 
escorted through key port areas. These armed escorts afford protection 
to the nearby population centers by reducing the probability of a 
successful attack against an LNG vessel. These actions are in addition 
to the safety and security oriented boardings previously described.
    Of course, one of the most important post-9/11 maritime security 
improvements has been the passage of the Maritime Transportation 
Security Act of 2002 (MTSA). Under the authority of MTSA, the Coast 
Guard developed a comprehensive new body of security measures 
applicable to vessels, marine facilities and maritime personnel. Our 
domestic maritime security regime is closely aligned with the 
International Ship and Port Facility Security (ISPS) Code. The ISPS 
Code, a mandatory requirement of the SOLAS Convention, was adopted at 
the IMO in December 2002 and came into effect on July 1st 2004. Under 
the ISPS Code, vessels in international service, including LNG vessels, 
must have an International Ship Security Certificate (ISSC). To be 
issued an ISSC by its flag state, the vessel must develop and implement 
a threat-scalable security plan that, among other things, establishes 
access control measures, security measures for cargo handling and 
delivery of ships stores, surveillance and monitoring, security 
communications, security incident procedures, and training and drill 
requirements. The plan must also identify a Ship Security Officer who 
is responsible for ensuring compliance with the ship's security plan. 
The Coast Guard rigorously enforces this international requirement by 
evaluating security compliance as part of our ongoing port state 
control program.

Shoreside LNG Terminal Safety and Security
    Presently there are six shoreside LNG terminals in the U.S. and 
U.S. Territories: the export facility in Kenai, AK; and, import 
terminals in Everett, MA; Cove Point, MD; Elba Island, GA; Lake 
Charles, LA; and Penuelas, PR. Under Title 33, CFR Part 127, the Coast 
Guard has responsibility for the facility's waterside ``marine transfer 
area'' and the Department of Transportation's Pipeline and Hazardous 
Materials Safety Administration has responsibility for shoreside 
portion of the facility. The safety requirements regulated by the Coast 
Guard in the marine transfer area include electrical power systems, 
lighting, communications, transfer hoses and piping systems, gas 
detection systems and alarms, firefighting equipment, and operational 
matters such as approval of the terminal's Operations and Emergency 
Manuals and personnel training.
    The recently promulgated ``Maritime Security Regulations for 
Facilities,'' found in Title 33 CFR Part 105, were developed under the 
authority of MTSA. These regulations require the LNG terminal operator 
to conduct a facility security assessment and develop a threat-scalable 
security plan that addresses the risks identified in the assessment. 
Much like the requirements prescribed for vessels, the facility 
security plan establishes access control measures, security measures 
for cargo handling and delivery of supplies, surveillance and 
monitoring, security communications, security incident procedures and 
training and drill requirements. The plan must also identify a Facility 
Security Officer who is responsible for ensuring compliance with the 
facility security plan. The six existing U.S. LNG terminals were 
required to submit their security plans to the Coast Guard for review 
and approval in 2003 and full implementation of the plans was required 
by July 1, 2004. These reviews have been completed, and the terminals' 
compliance with the plans has been verified by local Coast Guard port 
security personnel through on-site examinations. In contrast to our 
safety responsibility, whereby our authority is limited to the ``marine 
transfer area,'' our authority regarding the security plan can, 
depending upon the particular layout of the terminal, encompass the 
entire facility.

Shoreside LNG Terminal Siting
    The issue of constructing new shoreside LNG terminals has been 
controversial, due in large part to public concerns over both perceived 
and actual risks to the safety and security of LNG vessel operations. 
Under the Natural Gas Act, the Federal Energy Regulatory Commission 
(FERC) has permitting authority, including safety review of facility 
siting, for LNG terminals onshore and within state waters. The Coast 
Guard is not involved in any aspect of determining or approving the 
shoreside facility's location.
    However, the Coast Guard plays an important role in the siting 
process once it has begun. Along with an application to the FERC, an 
owner or operator who intends to build a new shoreside LNG facility, or 
who plans new construction on an existing facility, must submit a 
``Letter of Intent'' to the Coast Guard Captain of the Port (COTP) in 
whose zone the facility is located (in accordance with by 33 CFR 
127.007). This letter must provide information on: the physical 
location of the facility; a description of the facility; the 
characteristics of the vessels intended to visit the facility and the 
frequency of visits; and, charts that show waterway channels and 
identify commercial, industrial, environmentally sensitive and 
residential areas in and adjacent to the waterway to be used by vessels 
enroute to the facility, within 15.5 miles of the facility.
    The COTP reviews the information provided by the applicant and 
makes a determination on the suitability of the waterway for LNG 
vessels. Factors considered include: density and characteristics of 
marine traffic in the waterway; locks, bridges or other man made 
obstructions in the waterway; the hydrologic features of the waterway, 
e.g., water depth, channel width, currents and tides, natural hazards 
such as reefs and sand bars; and underwater pipelines and cables. If 
the waterway is found suitable and after the Coast Guard meets all of 
its National Environmental Policy Act (NEPA) requirements, the COTP 
will issue a Letter of Recommendation (per 33 CFR 127.009).
    Both the Coast Guard and the FERC recognize that the ``Letter of 
Recommendation'' process, which dates from 1988, does not, in its 
current form, adequately take into account the security concerns of our 
post 9/11 environment. Also, the existing regulations are focused 
primarily on conventional navigation safety risk management issues such 
as traffic density, hydrologic characteristics of the waterway, etc. 
They do not focus on port security risk management issues, and in 
particular, they do not directly require an analysis of the 
consequences of an LNG spill on the waterway proposed for vessel 
transits.
    To address this problem, on February 10, 2004, the Coast Guard 
entered into an Inter-Agency Agreement (IAA) with FERC and RSPA to work 
in a coordinated manner to address issues regarding safety and security 
at shoreside LNG facilities, including terminal facilities and tanker 
operations, to work together, avoid duplication of effort, and to 
maximize the exchange of relevant information related to the safety and 
security aspects of LNG facilities and the related maritime concerns.
    Soon after the completion of the IAA, work began on a more detailed 
guidance document for use by the involved agencies. On 14 Jun 05, the 
Navigation and Vessel Inspection Circular (NVIC) 05-05, Guidelines on 
Assessing the Suitability of a Waterway for LNG Marine Traffic, was 
published to provide guidance on how to conduct and validate a Waterway 
Suitability Assessment so that full consideration is given to the 
safety and security of the port, the facility, and vessels transporting 
the LNG. Simply put, it established a uniform national process for 
conducting port-specific risk and waterway suitability assessments.
    Under the NVIC 05-05 guidelines, since the Coast Guard is also a 
cooperating agency for the preparation of the FERC's Environmental 
Impact Statement, this guidance assists the Coast Guard in obtaining 
all information needed to assess the proposed LNG marine operations and 
fulfill its commitment to FERC to provide input to their Environmental 
Impact Statement (EIS). Once completed, the Coast Guard can adopt 
FERC's EIS to meet its NEPA obligations associated with the subsequent 
issuance of the COTP Letter of Recommendation.
    The Waterway Suitability Assessment (WSA) process put forth in the 
NVIC uses a risk management approach to developing mitigation measures 
for the hazards introduced to the affected waterway due to the nature 
of LNG. The NVIC requires the applicant to conduct a risk analysis of 
the waterway and propose mitigating measures. In addition, the 
applicant is required to do an analysis of the resources necessary to 
perform the proposed mitigation measures. This WSA process usually 
begins very early in the process, typically during the FERC's pre-
filing period.
    In addition to an evaluation of conventional navigation safety 
risks, a critical part of the WSA is an analysis of an LNG spill on the 
waterway and the thermal effects from a resulting pool fire. The 
analysis includes the application of the hazard distances and zones of 
concern established by the spill consequence models described in the 
2004 Sandia National Labs Report.
    Once the WSA is completed by the applicant, it is submitted to the 
Coast Guard and reviewed and validated by key stakeholders at the port, 
such as the Area Maritime Security Committee and the Harbor Safety 
Committee, and other local port stakeholders. In previous cases, there 
have even been public meetings and workshops during the development and 
validation of the WSA and the public is encouraged to provide comments.
    When the Coast Guard's WSA validation process is complete, the COTP 
makes a preliminary determination regarding the suitability of the 
waterway, whether the waterway can accommodate the proposed traffic and 
whether there is sufficient capability within the port community to 
responsibly manage the safety and security risks of the project. This 
preliminary determination is communicated to the FERC in a Waterway 
Suitability Report (WSR).
    The WSR report conveys the assessment and analysis conducted by the 
applicant during the WSA process and it usually includes risk 
mitigation measures that the COTP determines is necessary for the 
vessel to safely and securely transit to the proposed facility. Once 
FERC receives the WSR, the report is incorporated into the EIS. FERC 
addresses the environmental impacts of the proposed vessel transits on 
the waterway, the environmental impacts of the proposed risk mitigation 
measures and the public safety and environmental impacts of a LNG spill 
and fire on the waterway.
    Once the FERC's EIS is published, it is subsequently reviewed by 
the Coast Guard's environmental specialists. If it is acceptable and 
meets all of the Coast Guard's NEPA requirements, the Coast Guard 
issues a Record of Decision that adopts the EIS for our Letter of 
Recommendation process.
    Upon completion of the Record of Decision, the COTP issues a 
``Letter of Recommendation'' to the owner or operator of the proposed 
facility, and to the state and local government agencies having 
jurisdiction, as to the suitability of the waterway for the proposal 
(33 CFR 127.009).
    The Coast Guard is also working on the regulatory changes in 33 CFR 
Part 127 necessary to bring the existing ``Letter of Intent'' and 
``Letter of Recommendation'' regulations up to date, specifically by 
requiring the waterways management information to be submitted to the 
COTP at the time of FERC ``pre-filing'' or conventional application, 
and adding specific requirements for a port security assessment, in 
addition to the waterways management information, to be presented to 
the COTP for evaluation.
    LNG Deepwater Ports: Authority and Agency Relationships
    The Coast Guard's authority to regulate Deepwater Ports (DWPs) 
derives from the Deepwater Port Act of 1974 (DWPA). The regulations 
pertaining to the licensing, design, equipment and operation of DWPs 
are found in Title 33 CFR Subchapter NN (Parts 148, 149 and 150). 
Originally pertaining only to oil, MTSA amended the DWPA to include 
natural gas. This Act allows for the licensing of DWPs in the Exclusive 
Economic Zone, outside of state waters, along all maritime coasts of 
the United States. The Secretary of the Department of Homeland Security 
(DHS) and the Secretary of DOT delegated the processing of DWP 
applications to the Coast Guard and the Maritime Administration 
(MARAD), respectively. MARAD is the license issuing authority and works 
in concert with the Coast Guard in developing the Environmental Impact 
Statement, while the Coast Guard has primary jurisdiction over design, 
equipment and operations and security requirements.The DWPA established 
a specific time frame of 330 days from the date of publication of a 
Federal Register notice of a ``complete'' application to the date of 
approval or denial of a DWP license. Among other requirements, an 
applicant for a DWP license must demonstrate consistency with the 
Coastal Zone Management Plan of the adjacent coastal States.
    The Coast Guard and MARAD, in cooperation with other Federal 
agencies, must comply with the requirements of the National 
Environmental Policy Act in processing DWP applications within the 
timeframes prescribed in the Deepwater Port Act. To date the Coast 
Guard has received a total of 15 DWP applications, including four that 
have already been licensed: Louisiana Offshore Oil Platform, Chevron-
Texaco's Port Pelican project, Excelerate Energy's Gulf Gateway 
project, and Shell's Gulf Landing. Recently, the Maritime Administrator 
has issued Records of Decisions for three others: Freeport
    McMoRan's Main Pass Energy Hub, Suez's Neptune project and 
Excelerate Energy's Northeast Gateway. The latter two are off the coast 
of Massachusetts and the others are all offshore of Louisiana. Only the 
Gulf Gateway has been built so far. Three have been withdrawn and six 
others are in various stages of processing. We are anticipating between 
two and four additional applications within the next several months.
    To expedite the application review process, and more efficiently 
coordinate the activities of the numerous stakeholder agencies, the 
Coast Guard entered into a Memorandum of Understanding (MOU), involving 
more than a dozen agencies, including FERC, NOAA, the Army Corps of 
Engineers and the Environmental Protection Agency.The MOU obliges the 
participating agencies to work with each other and with other entities 
as appropriate, to ensure that timely decisions are made and that the 
responsibilities of each agency are me these responsibilities include: 
assessing their particular role in the environmental review of DWP 
licenses; meeting with prospective applicants and other agency 
representatives to identify areas of potential concern and to assess 
the need for and availability of agency resources to address issues 
related to the proposed project.

LNG Deepwater Ports Safety and Security
    While conventional crude oil DWPs have been in operation around the 
world for many years, LNG DWPs are an emerging concept. Currently, 
there is only one in operation, off the coast of Texas. There are a 
variety of different designs under development that borrow from designs 
and technology that have been time-tested in the offshore energy and 
the LNG industries. Proposals include ship-shaped hull designs similar 
to existing Floating Production, Storage and Offloading (FPSO) units, 
platform based storage and regasification units, gravity based 
structures, and innovative docking structures that attach directly to 
the LNG carrier to serve as both a mooring and offloading system. 
Because this is a new concept, the Coast Guard's regulations apply a 
``design basis approach, rather than mandate a series of prescriptive 
requirements. Under a ``design basis'' approach, each concept is 
evaluated on its own technical merits, using relevant engineering 
standards and concepts that have been approved by recognized vessel 
classification societies and other competent industrial and technical 
bodies. In addition, the Coast Guard's DWP regulations require that all 
LNG DWPs develop and implement a security plan that, at a minimum, will 
addresses the key security plan elements provided in Title 33 CFR Part 
106, ``Maritime Security: Outer Continental Shelf Facilities.'' A risk 
and consequence analysis is completed as part of the risk mitigation 
strategy and security measures are developed between the applicant and 
the Coast Guard local Captain of the Port.
    Thank you for giving me this opportunity to discuss the Coast 
Guard's role in LNG safety and security and our relationships with 
other stakeholder agencies. I will be happy to answer any questions you 
may have.

    Chairman Thompson. Thank you, Admiral.
    The next witness is Mr. Lesnick, to summarize his statement 
for 5 minutes.

 STATEMENT OF H. KEITH LESNICK, DIRECTOR, OFFICE OF DEEPWATER 
    PORT  LICENSING, MARITIME ADMINISTRATION, DEPARTMENT OF 
                         TRANSPORTATION

    Mr. Lesnick. Good morning, Mr. Chairman and members of the 
committee.
    I am pleased to have the opportunity to testify before you 
today to discuss the dramatic growth in U.S. liquefied natural 
gas imports, the deepwater port licensing program, and plans to 
increase the employment of U.S. mariners within this highly 
specialized and vital energy sector.
    While worldwide natural gas is in plentiful supply, the 
United States holds less than 4 percent of world reserves. And 
by the year 2025 our LNG imports are projected to increase 
eightfold.
    And today, the United States finds itself competing in a 
global market for our energy resources. Advances in vessel 
size, technologies, and the rapid expansion of the worldwide 
LNG fleet have made importing energy more efficient, cost-
effective and available to emerging worldwide markets.
    The Maritime Administration, by delegation from the 
secretary of transportation, is the lead federal agency for 
licensing offshore LNG and oil terminals.
    In processing deepwater port license applications, the 
Maritime Administration works in concert with the U.S. Coast 
Guard and numerous federal, state and local agencies.
    At the conclusion of the applicant's review process, the 
Maritime Administration issues a record decision approving or 
denying a deepwater port license.
    To date, 15 LNG deepwater port applications have been filed 
and six projects have been approved. When ultimately 
constructed and operating, they will all represent over one-
fourth of the nation's total gas capacity.
    The deepwater port mandates the expedited licensing of 
deepwater oil and LNG terminals seaward of U.S. territorial 
waters.
    And while this program has made significant progress, 
numerous logistical hurdles remain to the timely construction 
of offshore LNG-receiving facilities that will be required to 
meet our growing energy needs.
    For example, local opposition to the construction of LNG 
terminals is growing, compounding the already difficult task of 
locating suitable gas-receiving sites.
    We are working to overcome these obstacles and meet 
congressional directives that clearly mandate the increased 
U.S. involvement in the safe and efficient transportation of 
LNG to our nation's shores.
    In 2006 Congress amended the Deepwater Port Act and 
directed the secretary of transportation to develop and 
implement a program to promote the transportation of LNG to the 
United States on U.S.-flag vessels and give top priority to 
applications that use U.S.-flag vessels in their operations.
    The act also requires that applicants provide the nation of 
registry for and the citizenship of officers and crews serving 
on vessels transporting LNG to U.S. deepwater ports.
    In response to these legislative directives, the Maritime 
Administration developed a voluntary deepwater port manning 
program to promote the utilization of U.S. seafarers and 
accommodate the forecasted international LNG manning shortfall.
    We are already seeing results. Last December, the Maritime 
Administration announced an innovative public-private U.S. 
crewing partnership with Suez Energy, the first official 
partnership of this kind within the international LNG industry.
    Since that time, three additional companies have 
voluntarily joined this initiative. These agreements represent 
sound public policy, increased safety, security, improved 
transportation efficiencies, and provide vital training and 
employment opportunities for U.S. mariners in the LNG industry.
    By the year 2010 the global LNG carrier fleet is expected 
to grow by over 200 vessels. This expanded fleet will require 
as many as 10,000 additional seafarers and offer tremendous 
employment opportunities for U.S. mariners.
    However, if we do not act quickly, the magnitude of this 
shortage may negatively impact the LNG industry's excellent 
safety record.
    To alleviate this growing worldwide manpower shortage, we 
have engaged the nation's maritime industry in an effort to 
ensure a reliable supply of U.S. citizen mariners for LNG 
service.
    We are working with the U.S. Merchant Marine Academy, state 
maritime academies and other training facilities to develop and 
expand innovative LNG educational programs.
    Our specific goal is to provide immediate training and 
employment for U.S. citizens in the LNG tanker fleet.
    The licensing of deepwater ports also contributes to the 
Department of Transportation's strategic goal of improved 
mobility and reduced congestion by limiting the number of mega-
LNG tankers entering our nation's port facilities.
    Clearly, the construction of deepwater port terminals 
enhances transportation safety and security by isolating 
terminals away from congested land-based port facilities.
    And finally, the maritime administrator is required to 
consider the national interest in the issuance of a deepwater 
port license.
    My agency considers the safe, secure and efficient 
transportation of an environmentally friendly source of energy 
vital to the nation's interest.
    We are proud of the deepwater port licensing program and 
our efforts to encourage the employment of qualified U.S. 
citizens. And I will be happy to respond to any questions that 
you might have.
    [The statement of Mr. Lesnick follows:]

                 Prepared Statement of H. Keith Lesnick

    Good Morning, Mr. Chairman and Members of the Committee. I am 
pleased to have the opportunity to testify before you today and to 
discuss the dramatic growth in U.S. Liquefied Natural Gas (LNG) 
imports, the deepwater licensing program, and the Department of 
Transportation and the Maritime Administration's plans to increase the 
employment of U.S. mariners within this highly specialized and vital 
energy sector.
    While worldwide natural gas is in plentiful supply, the United 
States holds less than 4 percent of world reserves. During 2006, about 
84 percent of all natural gas consumed in the United States was 
domestically produced. By the year 2025, as demand increases, domestic 
production is only expected to account for 79 percent of consumption. 
To accommodate this shortfall, LNG imports are projected to increase 
eight-fold to 4.4 trillion cubic feet per year.
    Importing LNG will serve to relieve the Nation's growing energy 
needs by diversifying energy sources. Deepwater ports are necessary to 
enhance the Nation's ability to import LNG from world wide sources. The 
Energy Information Administration's recently released Annual Energy 
Outlook 2007 states U.S. energy consumption projected for the year 2025 
will be about 23 percent higher than it was in 2006.
    As a consequence, the United States finds itself in a situation 
unlike any we have experienced before. There is strong international 
competition from China, Japan, and Korea for energy resources. Advances 
in vessel size to transport oil and LNG, the number of LNG carriers, 
and advances in LNG transfer technology have made importing energy ever 
more efficient and cost effective.
    Numerous logistical hurdles remain, however. Local opposition to 
the construction of LNG terminals is growing, compounding the already 
difficult task of locating suitable gas receiving sites. At present, 
the continental United States has 5 operational LNG import terminals--1 
is a deepwater port located 116 miles off the coast of Louisiana. The 
combined capacity of the five terminals is equal to six percent of the 
Nation's gas consumption. Clearly, the Nation's growing need for 
imported natural gas necessitates greater investment in the 
infrastructure required to accommodate energy needs. As such, the 
Maritime Administration's Deepwater Port licensing program is designed 
to facilitate the licensing, construction, and operation of deepwater 
oil and LNG terminals located seaward of U.S. territorial waters.
    In 2002, the Deepwater Port Act was amended to expand the Secretary 
of Transportation's existing authority to include authority to issue 
licenses for offshore natural gas terminals. (The permitting of LNG 
facilities onshore and in state waters remain under the jurisdiction of 
the Federal Energy Regulatory Commission.) The Maritime Administration, 
by delegation from the Secretary of Transportation, is the lead federal 
agency for licensing offshore LNG and oil terminals. The Secretary of 
Transportation delegated authority over ``pipeline maters'' to the 
Pipeline and Hazardous Materials Safety Administration. In processing 
of Deepwater Port license applications, the Maritime Administration 
works in concert with the U.S. Coast Guard, numerous federal agencies, 
and state and local governments. At the conclusion of the application's 
environmental review process, the Maritime Administration makes a final 
license approval determination through the issuance of a Record of 
Decision. The Record of Decision incorporates the reasons behind the 
Maritime Administration's decision to issue or deny a license. The 
Record of Decision also enumerates the various conditions of licensure 
that govern the operation of the deepwater port facility.
    To date, 15 LNG Deepwater Port applications have been filed and 4 
licenses have been issued. If all applications under consideration by 
the Maritime Administration were constructed and operating at full 
capacity, they would represent over a quarter of the Nation's total gas 
capacity.
    Congress amended the Deepwater Port Act through the Coast Guard and 
Maritime Transportation Act of 2006, to direct the Secretary of 
Transportation to develop and implement a program to promote the 
transportation of LNG to the United States on U.S.-flag vessels. The 
Act further directed the Secretary to give top priority to applications 
that use U.S.-flag vessels in their operations. The Act also requires 
that applicants provide the nation of registry for, and the citizenship 
of officers and crew members serving on vessels transporting LNG to 
U.S. deepwater ports. The Maritime Administration interprets this 
requirement to include those international LNG tankers providing gas to 
the deepwater facilities licensed by the Agency.
    Therefore, in responding to these legislative directives, the 
Maritime Administration is in the process of developing a voluntary 
deepwater port manning program to encourage employing highly trained 
and skilled U.S. mariners to meet the current and forecasted demand for 
professional mariners in the international LNG shipping industry.
    We are already seeing results from our efforts. Last December, the 
Maritime Administration announced an innovative public-private 
partnership with SUEZ Energy--the first official partnership of its 
kind within the international LNG industry. Under this agreement, SUEZ 
will provide training and employment opportunities for U.S. citizen 
officers, cadets, and unlicensed mariners aboard their tanker fleet and 
at both of their planned deepwater port terminals off the coasts of 
Boston and Florida. Additionally, Excelerate Energy has entered into a 
similar agreement for the Northeast Gateway deepwater port facility in 
Massachusetts Bay and for its existing facility in the Gulf of Mexico. 
In January 2007, a Louisiana-based applicant, Freeport-McMoRan Energy, 
also committed to work with the Maritime Administration to develop 
programs to train and employ U.S. mariners on LNG vessels servicing 
their Main Pass Energy Hub facility being planned off the coast of 
Louisiana.
    These agreements represent sound public policy--increased safety, 
security, and improved transportation efficiencies--and they open up 
vital training and employment opportunities for U.S. mariners in the 
LNG industry. The Maritime Administration intends to continue to reach 
similar voluntary agreements with our pending and future deepwater port 
applicants and all energy companies serving the Nation's international 
maritime markets.
    It is estimated that as many as 3,700 to 5,000 additional mariners 
may be needed by next year. The magnitude of this manpower shortage 
will only serve to negatively impact this industry's excellent safety 
record. Over the last 5 years the global LNG carrier fleet grew by 73 
percent, from 128 to 222 vessels. And, an additional 133 LNG vessels 
are scheduled for delivery to service the global LNG trades by 2010. 
This expanded fleet will require as many as 10,000 additional 
seafarers, of whom almost 3,000 will be licensed officers--and, offers 
tremendous employment opportunities for both licensed and unlicensed 
U.S. mariners. This dramatic increase also comes at a time when we are 
already experiencing a greater demand for seafarers in general due to a 
dramatic increase in international trade.
    The worldwide LNG tanker fleet currently lacks a single U.S.-flag 
vessel. As a direct result, few U.S. mariners have the opportunity to 
gain vital hands-on experience in this growing industry. Clearly, the 
lack of U.S.-flag LNG tankers translates into a lack of job 
opportunities for U.S. citizens. It is the Maritime Administration's 
goal to help correct this situation and provide U.S. mariners 
opportunities in an industry vital to our energy and security needs.
    The Maritime Administration strives to ensure a reliable supply of 
U.S. citizen mariners to serve on LNG vessels calling at U.S. energy 
receiving facilities. The Agency is working with the U.S. Merchant 
Marine Academy, state maritime academies, and other training facilities 
to develop and expand innovative educational programs. Specifically, 
the goal is to provide immediate employment for entry level mariners, 
both licensed and unlicensed, into the LNG industry upon graduation and 
courses for the retraining and/or recertifying of current mariners who 
are sailing on vessels other than LNG--permitting them to transition 
into LNG service.
    Ultimately, employing highly trained and skilled licensed U.S. 
mariners will help alleviate the growing worldwide shortage of 
professional mariners confronting the international LNG shipping 
industry. It will also serve to help maintain the industry's excellent 
safety record by maintaining the LNG officer pool. U.S. mariners are 
highly skilled in the operation of steam plants used on the majority of 
LNG vessels and are experts in operating other marine main propulsion 
systems, such as diesel, diesel electric, and gas turbines. In 
addition, America's maritime officers unions continue to train their 
members to the highest industry standards in LNG technologies.
    It is also important to note that from an economic and competitive 
perspective, the growing worldwide shortage of trained and qualified 
LNG ships' officers has created an opportunity for U.S. officers to 
work aboard foreign-flag LNG vessels. International vessel operators 
are dramatically increasing the wages and benefits offered to foreign 
officers to keep or attract their services, thus narrowing the gap 
between the wages and benefits paid to Americans and those paid to 
their foreign counterparts.
    The licensing of deepwater ports also contributes to the Department 
of Transportation's strategic goal of improved mobility and reduced 
congestion by limiting the number of mega LNG tankers entering our 
Nation's port facilities. The construction of deepwater port terminals 
enhances transportation safety by isolating terminals away from 
congested population areas.
    The Maritime Administrator is required to consider the national 
interests in the issuance of a deepwater port license. The Maritime 
Administration considers the safe, secure, and efficient importation of 
an environmentally friendly source of energy vital to the Nation's 
economic growth.
    We are proud of the Deepwater Ports Licensing Program and our 
efforts to encourage employing qualified U.S. citizens to work aboard 
the vessels serving the energy sector.
    I want to thank the Members of the Committee and Chairman Thompson 
in holding this hearing today and I am happy to respond to any 
questions that you may have.

    Chairman Thompson. Thank you for your testimony.
    I now recognize Mr. Robinson to summarize his testimony for 
5 minutes.

   STATEMENT OF J. MARK ROBINSON, DIRECTOR, OFFICE OF ENERGY 
         PROJECTS, FEDERAL ENERGY REGULATORY COMMISSION

    Mr. Robinson. Thank you, Mr. Chairman. My name is Mark 
Robinson. I am director of the Office of Energy Projects.
    Our office is responsible for approximately 2,500 non-
federal dams, their safety and security, their licensing and 
their administration; the siting of natural gas pipelines; the 
siting of electric transmission lines; and, more significantly 
for this group, the authorization and the ongoing safety and 
security of LNG terminals in the U.S.
    My testimony is going to go into three areas, the siting of 
those terminals, which includes the review of the tankers 
associated with those tankers; the tanker safety record, which 
the admiral has already mentioned today; along with the GAO 
report and our general agreement with that, with some 
clarification.
    When it comes to siting LNG terminals, safety and security 
are integral to every aspect of that in our review.
    We have a very well-choreographed review of LNG terminal 
safety and security that we do with the Department of 
Transportation and the Coast Guard.
    It starts before the authorization occurs at the commission 
with a pre-filing process that the Congress has dictated that 
we ensure occurs with every LNG terminal siting activity that 
we do.
    The pre-filing process involves all the federal agencies, 
state agencies and local citizens that exist around the 
terminal. Everything is above the board. Everything is on top 
of the table. There are no secrets involved. And that does 
include how the facilities are going to be maintained and safe.
    This is performed along with our environmental impact 
statement as we prepare that, with public meetings and public 
discussion. Some of your areas--we have actually had meetings 
in your areas on LNG facilities that are proposed.
    If the commission does, in fact, authorize one of these LNG 
terminals, then we go into the pre-construction phase of our 
review process.
    We look at detailed design drawings that include exactly 
where safety equipment would be, safety monitors would be in 
place. More than 100 safety monitors are typically imposed at 
any LNG terminal.
    Those are all reviewed, ensured that they are properly 
sized and spaced. And no construction is allowed until that 
review and authorization has occurred.
    One other thing that does happen in the pre-construction 
phase is that there is the development of an emergency response 
plan.
    That emergency response plan identifies who would do what 
if there was, in fact, some action that occurred either at the 
terminal or at the docks, who is responsible for the boats, who 
pays for them.
    There is a cost-sharing plan developed with the local 
entities on who does pay for things such as extra police 
patrols or maritime patrols. This is done with the Coast Guard 
and worked out prior to any construction being allowed.
    If construction does initiate, then we do inspections about 
every 8 weeks or so to make sure the project is constructed 
with all the safety equipment that we have required through 
about a 3-year construction period.
    If that occurs to our specification, we will then do the 
third authorization on the LNG terminal, which is to allow it 
to, in fact, operate.
    We have had experiences in each of those areas where we 
have not granted that authorization either at the authorization 
phase at the commission, or at the construction phase, or at 
the operation phase.
    Ultimately, the commission has vested in our office the 
right to take whatever action is necessary to protect life, 
health and property. And we take that very seriously, and we do 
take those actions.
    On tanker safety, I think the only thing I would like to 
mention, since the admiral pretty much covered that in terms of 
its excellent record, is that the commission does ensure that 
they understand what measures would be taken to allow a tanker 
to safety come in, in a fashion that would protect the public.
    If they don't have confidence in that, that goes into the 
siting decision and whether or not the commission would, in 
fact, authorize a plant.
    To date, working very closely with the Coast Guard, we have 
managed to review and be satisfied that for those plants that 
we have authorized, tankers can, in fact, come into the 
terminal and do that safely.
    Finally, I would like to briefly discuss the GAO report. I 
am very pleased that much of the GAO findings are consistent 
with the findings that we have made repeatedly in our EISs; 
namely, that it is very unlikely that there would ever be any 
type of an explosion associated with unconfined LNG vapor--in 
fact, we would probably term that somewhere resting between 
improbable and impossible, and I would be more than happy to 
discuss that--that there would be no risk to the public in 
terms of asphyxiation or freeze burns, and that the most likely 
consequence of an LNG event would be a pool fire.
    As far as the distance that the radiant heat effect of a 
pool fire would extend to, GAO cited that as a disagreement 
among the experts.
    I would like to note that 11 out of the 15 experts either 
agreed with our estimates or thought we were too conservative, 
meaning that our estimate of the extent of the consequence zone 
is overly stated.
    I tend to agree with the latter, because when I--we did the 
ABSG study, which is one the studies reviewed. When I gave 
directions to the staff on how to conduct that study, I asked 
them to make sure wherever there was uncertainty to take the 
most conservative position that we could take. And we have done 
that.
    The research that GAO indicated should occur we agree with. 
We think that that will result in a shrinkage of the 
consequence zones.
    Ultimately, we have a policy of--we are constantly raising 
the floor on LNG safety and security, and we will continue to 
do that. We think it can be and is a safe and secure fuel 
source for America.
    Thank you very much.
    [The statement of Mr. Robinson follows:]

                 Prepared Statement of J. Mark Robinson

    My name is J. Mark Robinson and I'm Director of the Office of 
Energy Projects (OEP) at the Federal Energy Regulatory Commission (FERC 
or Commission). I am here as a staff witness and do not speak on behalf 
of any Commissioner. Our office is responsible for non-federal 
hydroelectric licensing, administration, and safety; siting of electric 
transmission lines; certification of interstate natural gas pipelines 
and storage facilities; and, more significantly for today's session, 
authorization and oversight over the construction, operation, and 
safety of on-shore and near-shore Liquefied Natural Gas (LNG) 
terminals. We also share security responsibilities for these facilities 
with the U.S. Coast Guard (Coast Guard), which has primary 
responsibility under the Maritime Transportation Security Act of 2002.
    I want to thank you for this opportunity to speak today and to 
specifically address how we ensure the safety and security of LNG 
import facilities and the related LNG shipping. Overall, the safety 
record of the industry is commendable. LNG terminals in the United 
States have never had an LNG safety-related incident that harmed the 
public or the environment. Similarly, no shipping incidents have 
occurred worldwide that resulted in a significant loss of cargo during 
the almost 50 years of LNG transport. I will first describe the 
measures we use to provide for safe and secure LNG import terminal 
siting, construction and operation. Next, I will briefly address the 
measures taken to ensure the continuing safe history of LNG shipping. 
And finally, I will comment on the GAO report.

Safety, Security and Siting of LNG Import Terminals
    Be assured that consideration of public safety is our highest 
priority when fulfilling our Congressional mandate under the Natural 
Gas Act to regulate facilities for the importation of natural gas. The 
Commission has been proactive in addressing safety concerns and 
rigorously applies high safety standards to these projects. When 
projects meet our safety standards and are found to be in the public 
interest, the Commission will approve them. If a proposed project falls 
short of these standards, the Commission will reject it, as was done 
with the proposed Keyspan LNG Terminal Project in Providence, Rhode 
Island.
    The excellent safety record of the LNG import facilities in the 
U.S. extends over the past 35 years. The siting and oversight of LNG 
facilities is governed by a comprehensive scheme of federal regulation 
that guarantees that the FERC and other federal agencies work together 
to ensure public safety. The FERC's LNG project review process works to 
address all siting and operational issues with the full participation 
of the federal and state agencies, and the public, and, only after that 
comprehensive review, attempts to ensure the timely development of 
necessary energy infrastructure. Once in operation, FERC oversight and 
inspection is an on-going process for the life of the facility.
    Every aspect of our engineering and siting review, and our 
coordination with the Coast Guard and the U.S. Department of 
Transportation (DOT), is geared toward assuring that a facility will 
operate safely and securely. This review may be broken into three 
distinct phases: pre-authorization review; pre-construction review; and 
pre-operation review.

    Pre-Authorization Review--During the pre-authorization phase, 
Commission staff addresses the safety and security of an LNG import 
terminal by reviewing facility designs and ensuring that the proposal 
includes a number of design and operational features. FERC regulations 
require that from the early stages of project development, potential 
applicants meet with FERC staff to describe the proposal and solicit 
guidance on required design features. At this point, we make sure that 
DOT and the Coast Guard are aware of new projects or proposed 
expansions. These meetings provide the opportunity for FERC staff to 
offer suggestions related to the environmental, engineering and safety 
features of the proposal and review conceptual designs. These 
activities occur over at least a six month time span during the 
mandatory pre-filing period required by the Energy Policy Act of 2005 
and are detailed in the FERC's regulations under Title 18 of the Code 
of Federal Regulations (CFR) Sec. 157.21.
    Based on this input from FERC staff, the project sponsors continue 
to develop the front-end-engineering-design (FEED) to be filed as part 
of the formal application for the proposed LNG facility. The design 
information, which must be contained in the formal application, is 
extensive and is specified by 18 CFR Sec. 380.12 (m) and (o). In order 
to ensure that the filings are complete, FERC publicly issued ``Draft 
Guidance For Filing Resource Reports 11 ( Reliability and Safety) & 13 
(Engineering and Design) For LNG Facility Applications'' in December 
2005. This document clarified the level of detail required for the 
engineering submittal so FERC staff can adequately assess the safety, 
operability, and reliability of the proposed design. Areas for specific 
guidance and clarification include:
         the level of detail, including a requirement for a 
        hazard design review, necessary for the FEED submitted to the 
        FERC;
         LNG spill containment sizing and design criteria for 
        impoundments, sumps, sub-dikes, troughs or trenches;
         design spills to be used in the calculation of thermal 
        and flammable vapor exclusion zones; and
         use of the Coast Guard's Navigation and Vessel 
        Inspection Circular 05-05 and the waterway suitability 
        assessment process.
    The level of detail required to be submitted in the proposed design 
will require the project sponsor to perform substantial front-end 
engineering of the complete facility. The design information is 
required to be site-specific and developed to the extent that further 
detailed design will not result in changes to the siting 
considerations, basis of design, operating conditions, major equipment 
selections, equipment design conditions, or safety system designs 
considered by the FERC during the review process. The required 
information must include all features necessary for commissioning, 
start-up, operation and maintenance of the facility, including details 
of the utility, safety, fire protection and security systems. Novel 
designs require additional detail for proof of concept.
    A complete FEED submittal will include up-to-date piping and 
instrumentation diagrams (P&IDs). Information on these drawings allows 
FERC staff to begin assessing the feasibility of the proposed design. 
Adequate P&IDs will include:
         equipment duty, capacity and design conditions;
         piping class specifications;
         vent, drain, cooldown and recycle piping;
         isolation flanges, blinds and insulating flanges;
         control valves and operator types (indicating valve 
        fail position);
         control loops including software connections;
         alarm and shutdown set points;
         shutdown interlocks;
         relief valve set points; and
         relief valve inlet and outlet piping size.
    Once an application is formally made to the Commission, FERC staff 
performs a detailed review of the information supporting the proposed 
LNG facility design. Since the enactment of the Energy Policy Act of 
2005, no later than 30 days after the application filing, the agency 
designated by the Governor of the state where the terminal is proposed 
may file an advisory report on state and local safety considerations. 
Before issuing an order authorizing an applicant to site, construct, 
expand, or operate an LNG terminal, the Commission shall review and 
respond specifically to the issues raised.
    During the analysis of the application, FERC staff compiles 
pertinent technical information to assess the design of the LNG 
facility. Although operability and reliability of the proposed design 
are considered, our primary focus is on the safety features that must 
be built into the system. This review is performed prior to any 
Commission approval and evaluates the safety of:
         the LNG transfer systems;
         storage tanks and process vessels;
         pumps and vaporizers;
         pressure relief, vent and disposal systems;
         instrumentation and controls;
         spill containment systems;
         hazard detection and control systems; and
         emergency shutdown systems.
    Each LNG import terminal must have an extensive array of hazard 
detection devices to provide an early warning for the presence of 
combustible gases, fires, or spills of LNG and activate emergency shut-
down systems. Using the submitted design, FERC staff assesses the 
conceptual hazard detection system, which typically consists of 
combustible-gas detectors, fire detectors, heat detectors, smoke or 
combustion product detectors, and low temperature detectors. Typically, 
each facility will have over 100 of these types of detectors.
    Use of these active systems to automatically shutdown equipment, 
and other passive safety protections, such as impoundments, are 
reviewed to ensure that appropriate safety provisions are incorporated 
in the plant design. A detailed layout of the passive spill containment 
system showing the location of impoundments, sumps, sub-dikes, 
channels, and water removal systems is evaluated to allow FERC staff to 
assess the feasibility of the location, design configuration, 
dimensions, capacity and materials of construction for this system. In 
accordance with Title 49 of the Code of Federal Regulations, 
Sec. 193.2181, these spill containment systems must accommodate 110 
percent of an LNG tank's maximum liquid capacity.
    Active hazard control systems consisting of strategically placed 
dry chemical extinguishers; carbon dioxide or nitrogen snuffing 
equipment; high expansion foam systems; and fire-water systems 
throughout the terminal are evaluated in accordance with Federal 
regulations and good engineering practices. A detailed layout of the 
fire water system showing the location of fire water pumps, piping, 
hydrants, hose reels, and auxiliary or appurtenant service facilities 
is reviewed for adequacy.
    In addition, each storage or process area containing LNG must be 
surrounded by an impoundment structure to contain and limit potential 
spills associated with that equipment. Based on the size and location 
of these impoundments, the project sponsor must establish exclusion 
zones around the facility so that the effects from potential LNG pool 
fires and flammable vapors from an unignited LNG spill do not pose a 
hazard to the public. In accordance with Title 49 CFR Sec. 193.2057 and 
193.2059, and in conjunction with the National Fire Protection 
Association 59A LNG Standards, thermal radiation and vapor dispersion 
exclusion zones are calculated by FERC staff based on spill scenarios 
and heat flux levels. The operator must be able to legally control land 
uses within any portion of these zones extending beyond the terminal 
site to prevent damaging effects of an LNG pool fire or a flammable 
vapor mixture from impacting public safety.
    Further, during the pre-authorization phase and beyond the 
cryogenic design review, each application for an LNG facility is 
subject to a detailed review by the FERC staff of numerous other 
studies and reports that the applicants are required to complete. These 
include:
         seismic analyses;
         fire protection evaluations;
         threat and vulnerability assessments; and
         Operation and Maintenance manuals.
    The information used for the pre-authorization review is gathered 
from the application, data requests, and a Cryogenic Design Technical 
Conference held with the applicant's design team. This meeting allows 
FERC staff and company engineers to discuss specific engineering-
related issues. Representatives from the Coast Guard and DOT, as well 
as state and local fire marshals, are invited to attend. Although the 
Coast Guard is generally in attendance to address facility issues, the 
issues specifically related to LNG vessel transit are dealt with during 
the Coast Guard's separate waterway suitability assessment (WSA) 
process.
    The staff's conclusions and recommendations on the proposed design, 
including all safety measures, are presented in the Safety section of 
the publicly-released FERC environmental assessment or environmental 
impact statement (EIS). Ultimately, these recommendations have appeared 
as conditions in Commission Order approving the project. In addition to 
design considerations, the Order may also contain other LNG-specific 
standard conditions that pertain to the safe operation and security of 
the facility. If the Commission decides that a project would be safe, 
is in the public interest, and authorizes it, continued review would 
occur during the pre-construction phase.

    Pre-Construction Review--If a project sponsor receives a Commission 
Order and decides to pursue the project, it will engage the services of 
an Engineering, Procurement, and Construction (EPC) firm to commence 
detailed engineering of the facility. This process results in a ``final 
design'' that usually contains further development or minor refinements 
to the approved FEED on file with the FERC. For these modifications, 
the FERC Order requires the project sponsor to request approval for the 
change, justify it relative to site-specific conditions, explain how 
that modification provides an equal or greater level of protection than 
the original measure; and receive approval from the Director of OEP 
before implementing that modification. For more significant changes, 
the project sponsor would be required to file an amendment or a new 
application, initiating another extensive review at the Commission.
    The final design will typically include hundreds of pages of 
detailed engineering drawings and specifications for every area and 
piece of equipment in the facility including the marine platform, 
transfer lines, tanks, sumps, pumps, compressors, vaporizers, and 
blowers. Only after FERC staff has reviewed the final design for a 
particular facility component to ensure it complies with all the safety 
conditions of the Order and that it conforms to the approved design on 
file, will authorization to construct that component be granted. We 
review large scale issues such as the facility's final plot plan and 
location of equipment, tanks, and impoundments to verify that all 
exclusion zones remain in compliance with siting regulations. These 
final review checks will also confirm that the number, location, type, 
and size of hazard detection and hazard control equipment match or 
improve upon the approved design and that redundancy, fault detection, 
and fault alarm monitoring exist in all potentially hazardous areas and 
enclosures.
    Prior to entering the detailed design phase, project sponsors 
perform a hazard and operability study of the initial design. This 
study is intended to identify potential process deviations that could 
occur during operation and lead to personnel injury or equipment 
damage. The analysis proceeds by systematically identifying possible 
causes for operational deviations and the consequences of these 
deviations at numerous locations in the regasification process. Areas 
of concern typically include equipment failures, human failure, 
external events, siting issues, previous incidents, and safeguard or 
control failures. These causes and consequences are in turn used to 
evaluate the inherent safeguards in the design and to identify suitable 
design modifications as required. Examples of the additional safeguards 
that are required are: detection systems, prevention systems, 
procedural safeguards, active and passive safety equipment, emergency 
response procedures, and secondary containment.
    During the pre-construction phase, FERC staff will review this 
study as well as review all piping and instrumentation diagrams, 
including every valve and thermocouple, to make sure that the overall 
safety of the final design provides an equal or greater level of 
protection as the original design approved by the FERC.
    Furthermore, the design of some facility components such as the 
foundation of the LNG tanks will be reviewed by geotechnical experts 
who determine if the foundation structure is capable of safely 
supporting the load of a full LNG tank, even during seismic events.
    In accordance with the Energy Policy Act of 2005, Commission Orders 
authorizing an LNG import terminal require the project sponsor to 
develop an Emergency Response Plan (ERP) in consultation with the U.S. 
Coast Guard and state and local agencies. Prior to any construction at 
the facility, this plan, which must also include cost-sharing 
provisions for safety and security, must be approved by the Commission. 
The ERP must include written procedures for responding to: emergencies 
within the LNG terminal; emergencies that could affect the public 
adjacent to an LNG terminal; and emergencies that could affect the 
public along the LNG vessel transit route. The ERP must be prepared in 
consultation with the Coast Guard and state and local agencies, and it 
must be approved by the Commission prior to any final approval to begin 
construction at the terminal site.
    Commission engineering staff reviews each ERP to ensure that the 
appropriate state and local agencies have been involved in preparing 
the plan, that the local Coast Guard Marine Safety Office has been 
consulted and concurs, and that the following topics are completely 
addressed:
         Structure of the incident management organization of 
        the LNG terminal; and name, title, organization, and phone 
        number of all required agency contacts;
         Procedures for responding to emergencies within the 
        LNG Terminal--identification of the types and locations of 
        specific emergency incidents that may reasonably be expected to 
        occur at the LNG terminal due to operating malfunctions, 
        structural collapse, personnel error, forces of nature and 
        activities adjacent to the terminal;
         Procedures for emergency evacuation adjacent to the 
        LNG Terminal and along LNG vessel transit route; detailed 
        procedures for recognizing an uncontrollable emergency and 
        taking action to minimize harm to terminal personnel and the 
        public; procedures for the prompt notification of appropriate 
        officials and emergency response agencies based on the level 
        and severity of potential incidents; and the sequence of such 
        notifications;
         Plans for initial and continuing training of plant 
        operators and local responders; and provisions for annual 
        emergency response drills by terminal emergency personnel, 
        first responders, and appropriate federal, state and local 
        officials and emergency response agencies; and
         Documentation that the required consultation with the 
        Coast Guard and state and local agencies has been completed 
        through correspondence with consulting agencies, and minutes or 
        notes of coordination meetings.
    In addition, both the Energy Policy Act of 2005 and Commission 
Orders authorizing LNG terminals require that the ERP include a Cost-
Sharing Plan identifying the mechanisms for funding all project-
specific security costs and safety/emergency management costs that 
would be imposed on state and local agencies. The cost-sharing plan 
must specify what the LNG terminal operator will provide to cover the 
cost of the state and local resources required to manage the security 
of the LNG terminal and LNG vessel, and the state and local resources 
required for safety and emergency management, including:
         Direct reimbursement for any per-transit security and/
        or emergency management costs (for example, overtime for police 
        or fire department personnel);
         Capital costs associated with security/emergency 
        management equipment and personnel base (for example, patrol 
        boats, fire fighting equipment); and
         Annual costs for providing specialized training for 
        local fire departments, mutual aid departments, and emergency 
        response personnel; and for conducting exercises.
         The cost-sharing plan must include the LNG terminal 
        operator's letter of commitment with agency acknowledgement for 
        each state and local agency designated to receive resources.
    FERC and other federal agencies work with state and local entities, 
as well as the general public, to ensure that all public interest 
considerations are carefully studied and weighed before a facility is 
permitted and allowed to begin construction and operate, and that 
public safety and the environment are given high priority. No 
construction may commence until the Director of OEP finds that all 
safety requirements have been met.

    Pre-Operation Review--Once construction of the project has been 
authorized to begin, Commission staff inspects each site at least once 
every eight weeks to ensure that project construction is consistent 
with the designs approved during the pre-authorization and pre-
construction review phases.
    During these inspections, Commission staff physically examines the 
entire site to verify the ongoing construction activities in each area. 
Staff confirms that the locations of individual process equipment under 
construction are in accordance with the approved site design, ensuring 
that the safe distances required between property lines, equipment, and 
facilities are being maintained. Staff verifies that all site activity 
and equipment under construction comply with the conditions of the 
Order that are applicable for that phase of the project. Commission 
engineers also meet with the owner's project design engineers to 
discuss any modifications or design refinements that may result from 
the detailed design phase of development - for example, adjustments 
considered necessary as a result of equipment vendor specifications or 
other insights realized during construction.
    In addition, staff reviews both the owner's and the EPC firm's 
quality assurance plans to verify that rigorous and stringent quality 
control inspections are being conducted by both parties during all 
phases of the construction process. Inspections must apply to equipment 
and components being fabricated at manufacturing sites, material and 
equipment received at the construction site, specific assembly or 
fabrication methods employed during construction, and also the 
continuous verification of the precision and quality of all structural 
work carried out during the construction process.
    Staff reviews all of the non-conformance reports generated by the 
project's quality control inspectors and how these incidents have been 
satisfactorily resolved. These deviations from the intended quality of 
work are evaluated by FERC staff to ensure that the final quality of 
the work will meet or exceed design requirements. Problems of 
significant magnitude are required to be reported to the Commission 
within 24 hours.
    During the later stages of the typical three-year construction 
period, FERC staff monitors the EPC contractors' efforts to commission 
(i.e., test and start-up) the various process systems and equipment 
throughout the terminal in preparation for the commencement of 
commercial operations. Commission staff is actively involved in the 
commissioning phase to verify that the final, constructed facility 
complies with the design authorized by the Commission Order, and that 
the project sponsor has complied with all conditions. This review 
includes verification that all of the cryogenic design recommendations 
in the Order applicable to the facility's pre-construction and 
construction phases have been fulfilled. Multiple on-site inspections 
are performed to confirm the construction and location of all plant 
equipment, process systems, and safety systems, including:
         Verifying LNG spill containment structures for 
        completion of walls, piping, correct slope, size, materials 
        used, sump pumps, and instrumentation for cold detection 
        shutoff, and confirmation that proper materials have been used 
        to complete containment;
         Checking critical instrumentation against the P&IDs 
        with the actual piping, valves, and controls; and the 
        instrument readouts, controls, and alarm/shutdown functions in 
        the plant control room;
         Confirming that all required hazard detection devices 
        (combustible gas, fire, smoke, low temperature) have been 
        installed, including an examination of the cause and effect 
        diagrams and instrument locations for appropriate redundancy 
        and ``alarm'' and ``shutdown'' conditions. The physical 
        inspection also evaluates detector location and orientation for 
        blind spots that may require additional hazard detection 
        devices;
         Confirming that all dry chemical, carbon dioxide, or 
        other fire extinguishing units/bottles have been installed. The 
        devices are checked to confirm proper weight and areas have 
        been covered;
         Confirming that all critical pressure relief valves 
        have been installed, have proper discharge orientation, and 
        vent collection systems are operable;* Confirming that the 
        entire firewater system is in place, including monitors, 
        hydrants, pumps, screens, deluge and water supply, and has been 
        tested for operation;
         Checking each LNG storage tank's equipment including 
        elevation bench marks, rotational devices, liquid level gauges, 
        pressure and vacuum relief valves, and discretionary relief 
        valves for proper installation and confirming that all 
        permanent covers have been installed. After cool-down, the fill 
        lines and tank penetrations are inspected for presence of 
        excessive low temperature conditions;
         Checking critical, required alarms and shutdowns, 
        including set points (e.g., tank foundation temperatures, send-
        out temperature shutdown set points) within the plant's Control 
        Room and satellite control centers;
         Confirming that all temporary construction structures 
        have been removed and the facility complies with National 
        Electrical Code Division requirements; and
         Confirming that the plant's Emergency Shutdown System 
        has been tested and is fully operational, including that all 
        required systems have been tied into it.
    Prior to operation, each LNG tank is hydrostatically tested to 
gauge the tank's ability to handle expected loads. During the 
hydrostatic test, the FERC Order will require the project sponsor to 
include a reliable measurement system to monitor any deflections in the 
tank foundation or structure during the hydraulic test. At a minimum, 
this system must include as many monitoring points as is necessary so 
that sag, warping, tilt, and settlements can be monitored. Tolerances 
for sag, tilt, and shell warping must meet or exceed the limits 
specified by the tank manufacturer. In this manner, the strength of the 
tank is thoroughly examined under loads similar to what will be 
experienced in actual operation. The final design review will ensure 
that adequate plans for such testing are in place for all facility 
components.
    As part of the pre-commission inspection, FERC staff also reviews 
the Start-up Manual, Safety Plan Manual, and Operations and Maintenance 
Manuals applicable to the installation. This review includes verifying 
that the terminal staff has received the necessary training to operate 
the plant or new systems, if an existing plant is being expanded. We 
confirm that the plant has employed the required staffing with a level 
and function appropriate for the facility.
    FERC staff confirms that all plant security systems are in place 
(personnel, cameras, and other equipment), and that the Facility 
Security Plan is current. This review also includes confirming that all 
spare equipment that was authorized is on site and properly installed.
    FERC staff also checks the entire facility site to ensure that all 
recommended environmental mitigation measures including erosion and 
sediment controls are in place, are being properly maintained, and that 
the company is making prudent steps to ensure that the site is properly 
stabilized for the operational life of the facility (e.g., installation 
of shore line stabilization mats and rip rap).
    Prior to operation, FERC staff also reviews the facility security 
to ensure compliance with the authorized design. Principal concerns are 
compliance with the DOT regulations, as well as sufficient levels of 
security provided by surveillance cameras; intrusion detection systems; 
security fencing; and on-site access control plans.
    Only after all of the above-identified inspections and reviews have 
been successfully completed would FERC staff recommend that the 
terminal is ready for operations. The Director of OEP must issue a 
letter to the company that authorizes commencement of service from the 
facility.
    Prior to operation, the terminal must also satisfy other federal 
agency requirements. For example, the facility must have a Facility 
Security Plan approved by the Coast Guard and a Vessel Transit 
Management Plan prepared by the Coast Guard and port stakeholders.
    FERC oversight continues after an LNG import terminal project 
commences commercial operations. In fact, the Office of Energy Projects 
was reorganized to specifically create a Branch that is dedicated to 
ensuring that all FERC requirements, including safety and security 
measures, are complied with throughout the life of the project. Each 
LNG facility under FERC jurisdiction is required to file semi-annual 
reports to summarize plant operations, maintenance activity and 
abnormal events for the previous six months. LNG facilities are also 
required to report significant, non-scheduled events, including safety-
related incidents (e.g., LNG or natural gas vapor releases, fires, 
explosions, mechanical failures, unusual over-pressurization, major 
injuries) and security-related incidents (e.g., attempts to enter site, 
suspicious activities near the plant site or around the marine 
terminal), as soon as possible but no later than within 24 hours. In 
addition, FERC staff conducts annual on-site inspections and technical 
reviews of each import terminal throughout its entire operational life. 
The inspection reviews the integrity of all plant equipment, operation 
and maintenance activities, safety and security systems, any unusual 
operational incidents, and non-routine maintenance activities during 
the previous year. Ultimately, the Director of the Office of Energy 
Projects has the authority to take whatever measures are necessary to 
protect life, health, property or the environment.
    We are proud of our track record working with DOT, the Coast Guard, 
states agencies, and with all interested stakeholders on these 
projects, and we are committed to continuing LNG's outstanding 
operational performance.

    The Safe History of LNG Shipping
    In addition to ensuring safe and secure terminal sites, FERC 
coordinates closely with the Coast Guard to ensure the safety and 
security of the LNG vessel transit to the import facility. Under our 
pre-filing regulations, applicants are required to prepare a WSA, which 
is reviewed by the Coast Guard and members of the local Area Maritime 
Security Committee. The Coast Guard convenes a working group consisting 
of members of the local Area Maritime Security Committee, federal 
agencies, state and local law enforcement, state and local 
firefighters, maritime and security professionals, and key port 
stakeholders throughout the port area.
    Under Coast Guard supervision, this group, through a series of 
focused meetings, brings together its viewpoints to form a consensus on 
appropriate measures and mitigation needed to manage responsibly the 
safety and security risks posed by LNG marine traffic. At these 
meetings, FERC staff serves as the LNG technical advisor to the working 
group, provides insight from our participation in other waterways, and 
assists in identifying credible hazard scenarios. The group's detailed 
recommendations from the meetings are presented to the Coast Guard to 
assist in the Captain of the Port's review of the applicant's WSA. 
Based on its review, the Captain of the Port will make a preliminary 
determination on the suitability of the waterway. This determination 
will be presented to the FERC in the Coast Guard's Waterway Suitability 
Report.
    The Waterway Suitability Report, filed with the Commission, 
preliminarily determines whether the waterway is suitable for LNG 
vessel transits, from both a safety and security perspective, and 
identifies additional resources that may be required. The results of 
this analysis are incorporated into the draft EIS and released for 
public comment. The 45-day comment period usually includes a public 
meeting near the proposed facility and along the pipeline route. In 
this manner, after public comment has been received and the final EIS 
is published, the Commission has a complete record on the suitability 
of the waterway and potential resource requirements prior to deciding 
whether to approve a particular LNG import terminal.
    Since the beginning of commercial operations in 1959, LNG carriers 
have made over 46,000 voyages worldwide without a significant release 
of cargo or a major accident involving an LNG carrier. In no instance 
has an LNG cargo tank been breached either by an accidental or 
intentional event.
    Any LNG carriers used to import LNG to the United States must be 
constructed and operated in accordance with the International Maritime 
Organization's (IMO) Code for the Construction and Equipment of Ships 
Carrying Liquefied Gases in Bulk, the International Convention for the 
Safety of Life at Sea, as well as 46 CFR Part 154, which contain the 
United States safety standards for vessels carrying bulk liquefied 
natural gas. Foreign flag LNG carriers are required to possess a valid 
IMO Certificate of Fitness and a Coast Guard Certificate of Compliance.
    LNG carriers are well-built, robust vessels employing double-hull 
construction, with the inner and outer hulls separated by about 10 
feet. The LNG cargo tanks are further separated from the inner hull by 
a layer of insulation approximately one-foot thick. As required by the 
IMO conventions and design standards, hold spaces and insulation areas 
on an LNG carrier are equipped with gas detection and low temperature 
alarms. These devices monitor for leaks of LNG into the insulation 
between primary and secondary LNG cargo tank barriers. In addition, 
hazard detection systems are also provided to monitor the hull 
structure adjacent to the cargo tank, compressor rooms, motor rooms, 
cargo control rooms, enclosed spaces in the cargo area, specific 
ventilation hoods and gas ducts, and air locks.
    Even in the few instances worldwide where there have been 
incidents, the integrity of LNG vessel construction and safety systems 
has been demonstrated. One of the more significant incidents involved 
the El Paso Paul Kayser which grounded on a rock in the Strait of 
Gibraltar during a loaded voyage from Algeria to the United States in 
June 1979. Extensive bottom damage to the outer hull and the ballast 
tanks resulted; however, the cargo tanks were not damaged, and no cargo 
was released.
    There have been a few other instances where LNG ships have 
grounded. In 1980, the LNG Taurus grounded near the entrance to Taboata 
Harbor, Japan. The grounding resulted in extensive bottom damage, but 
the cargo tanks were not affected and no cargo was released. The ship 
was refloated and the cargo was unloaded. In 2004, the Tenaga Lima was 
grounded on rocks, due to a strong current while proceeding to open sea 
East of Mopko, South Korea. The ship's shell plating was torn open and 
fractured over an approximate area of 20--by 80-feet. Internal breaches 
allowed water to enter the insulation space between the primary and 
secondary membranes. However, the ship was refloated, repaired, and 
returned to service. Although damage was incurred when these LNG ships 
were grounded, their cargo tanks were never penetrated and no LNG was 
released.
    In another incident, the Norman Lady was struck by the nuclear 
submarine USS Oklahoma City while the submarine was rising to periscope 
depth near the Strait of Gibraltar in November 2002. The LNG carrier 
sustained only minor damage to the outer layer of its double hull but 
no damage to its cargo tanks.
    More recently, the Khannur had a cargo tank overfill into the 
ship's vapor handling system during unloading at Everett, 
Massachusetts, in 2001. Approximately 100 gallons of LNG were vented 
onto the protective decking over the cargo tank dome resulting in 
several cracks. After inspection by the Coast Guard, the Khannur was 
allowed to discharge its cargo. In 2002, the Mostaefa Ben Boulaid had 
LNG spill onto its deck during loading operations in Algeria. The 
spill, which was believed to be caused by overflow, caused brittle 
fracturing of the carbon steelwork. The ship was required to discharge 
its cargo and proceed to dock for repairs. Although all these incidents 
resulted in an LNG release, there were no injuries in any of these 
incidents.
    The most recent incident occurred in 2006 when the Golar Freeze 
moved away from its docking berth during unloading in Savannah, 
Georgia. The powered emergency release couplings on the unloading arms 
activated as designed, and transfer operations were shut down, 
preventing release of significant amounts of LNG or any structural or 
environmental damage. After inspection and onsite clearance by FERC 
staff and the Coast Guard, the arms were reactivated and transfer 
operations resumed without incident.
    The low number of LNG tanker incidents can be attributed to the 
careful handling of the tankers, as well as safety and security 
procedures used in the ports. The transit of an LNG vessel through a 
waterway is strictly controlled by the Coast Guard to prevent 
accidental or intentional incidents that could damage the vessel or 
endanger the public. Entry into a port typically involves Coast Guard 
requirements such as:
         96 hours advance notification of arrival and the 
        vessel crew manifest;
         Coast Guard boarding of the LNG Vessel for an 
        inspection of the ship safety system;
         Moving safety/security zones around the LNG vessel;
         Armed and unarmed escorts;
         Tug escort to assist with turning and mooring 
        operations;
         Safety and security zones around the terminal dock 
        while the vessel is berthed;
         Accompaniment by a state-licensed pilot; and
         Inspection of the dock safety systems before 
        commencing cargo transfer.
    With these operational measures, the transit of LNG carriers has 
been demonstrated to be safe along the waterway from the berthing area 
to the territorial sea.

    GAO Report [No GAO-07-316]: ``Public Safety Consequences of a 
Terrorist Attack on a Tanker Carrying Liquefied Natural Gas Need 
Clarification.''
    I am encouraged that the GAO report reached many of the same 
conclusions on LNG hazards which we have published in each FERC 
environmental impact statement. The findings of the GAO expert panel 
concur with FERC staff's assessment of the potential public safety 
consequences of a terrorist attack on an LNG tanker regarding:
         unconfined vapor cloud explosions;
         freeze burns;
         asphyxiation; and
         rapid phase transitions (RPTs).
    These phenomena do not pose a significant hazard to the on-shore 
public during a large-scale LNG spill. Natural gas vapors (primarily 
methane) can detonate if contained within a confined space, such as a 
building or structure, and ignited. However, unconfined methane-air 
mixtures have been ignited but not detonated in experiments. Although 
the addition of heavier hydrocarbons influences the tendency of an 
unconfined vapor cloud to detonate, the possibility for detonation of a 
large unconfined vapor cloud is unrealistic due to precise timing, 
necessary mixing, and required amount of initiating explosives.
    Similarly, the public is not at risk from freeze burns or 
asphyxiation. Clouds from an LNG spill would be continuously mixing 
with the warmer air surrounding the spill site. Dispersion modeling 
estimates that the majority of the cloud would be within 25 degrees 
Fahrenheit of the surrounding atmospheric temperature, with colder 
temperatures closest to the spill source and away from the public. In 
addition, the majority of the cloud would be below concentrations which 
could result in oxygen deprivation effects, including asphyxiation, 
with the highest methane concentrations closest to the spill source.
    The report also focused on potential impacts from RPTs. Our 
project-specific EISs include a discussion of this issue. While RPTs 
can occur during a spill on water, impacts would be limited to the area 
within the pool and would be unlikely to affect the public. The 
overpressure events observed during experimentation have been 
relatively small, estimated to be equivalent to several pounds of TNT. 
Although such an event is not expected to cause significant damage to 
an LNG vessel, it could increase the rate of LNG pool spreading and the 
LNG vaporization rate for a spill on water.
    FERC staff also concur with the GAO report on the potential for a 
boiling liquid expanding vapor explosion (BLEVE). While it may be 
theoretically possible, the low storage pressure, use of insulation, 
and installation of relief valves on both onshore LNG storage tanks and 
LNG carriers render the possibility of a BLEVE unlikely for LNG as it 
is normally transported and stored.
    The report further states that the most likely public safety impact 
from an LNG spill would be from heat associated with a pool fire. FERC 
staff has also analyzed this issue in the course of project specific 
reviews and has reached that same conclusion. In its 2004 report, 
Sandia considered scenarios likely to breach an LNG cargo tank. Events 
ranged from accidental collisions, groundings, rammings, sabotage, 
hijackings, attacks with small missiles and rockets, and attacks with 
bulk explosives. These types of events which could potentially lead to 
a large LNG spill would likely be accompanied by a number of ignition 
sources. Surrounding impacts would be from an LNG pool fire, and 
subsequent radiant heat hazards, rather than the formation of a large 
unconfined vapor cloud. Each of our EISs describes those potential 
impacts on the local waterway.
    As stated in the 2004 Sandia report, the most significant impacts 
to public safety and property exist within approximately 500 meters 
(1,640 feet) of a spill due to thermal hazards from a fire, with lower 
public health and safety impacts beyond 1,600 meters (approximately 1 
mile). We believe the Sandia report and FERC's site-specific analysis 
are a reasonable and conservative basis to examine potential impacts 
from an LNG tanker fire.
    The GAO study reports four experts thought the Sandia distance 
calculations were ``too conservative''; four thought ``not conservative 
enough''; seven thought ``about right.'' Although the report 
characterizes this as disagreement, the majority of the panel (11 of 
15) responded that the calculations were either accurate or overly 
conservative.
    Although FERC staff generally agrees with the material presented in 
the GAO report, further explanation of some information is necessary. 
For instance, the report mentions that an LNG vapor cloud is visible, 
but natural gas vapors are colorless. The fog-like appearance usually 
associated with an LNG vapor cloud results from condensation of water 
vapor in the air due to the lower temperatures of the cloud. However, 
appearance of this visible water vapor does not necessarily reflect the 
flammable portion of the cloud. In addition, the report states that LNG 
fires burn hotter when the maximum flame temperature of methane is 
nearly the same as other fuels. Radiant heat from a large-scale LNG 
pool fire is assumed to be greater than other common hydrocarbon fuels 
based on the results of small-scale fire measurements. However, it has 
not been proven that this effect would scale up to larger fires. Oxygen 
deprivation and smoke generation in a larger fire may lead to lower 
surface emissive power.
    In each EIS, FERC staff includes site-specific modeling done with 
the methodology developed for FERC by ABS Consulting. In areas of 
uncertainty due to the lack of large-scale field data, the FERC model 
uses conservative assumptions (i.e., resulting in longer hazard 
distances). These conservative assumptions concern: calculation of the 
pool spread; determination of the pool fire flame height; and use of a 
higher surface emissive power. Our results have been in agreement with 
the Sandia guidance zones of concern, and support the conservative 
nature of the calculations.
    Cascading failure of the LNG storage tanks, addressed by Sandia in 
its previous examination of currently operating LNG carriers, was 
another topic of disagreement among the experts. Sandia stated that the 
events would not likely involve more than two or three cargo tanks. As 
stated in the 2004 Sandia report, the nominal hole size of an 
intentional breaching scenario would be no more than 5--to 7-m2, which 
is the appropriate range we use in the FERC staff EIS for calculating 
potential hazards from spills. For a breach of a 7 m2 in a single tank, 
the fire duration would be approximately 10 minutes. Whereas smaller 
hole sizes could result in fires lasting over 1 hour. While the 
expected fire duration from cascading tank failure would increase, the 
overall fire hazard was not expected by Sandia to increase by more than 
20 to 30 percent. GAO recommended that further study of this issue 
could be undertaken by Sandia. We concur that further study on 
cascading mechanisms may clarify if the subsequent failure of the 
fourth and fifth cargo tanks would occur over time with the most 
probable consequence of further extending the duration of the fire.
    Related to cascading failure mechanisms are the effects such an 
event may have on a pool fire (i.e., whether it would increase the 
duration of the event, increase the size of the pool fire, or lower the 
radiant heat due to increased smoke generation). Current knowledge of 
the physical properties associated with an LNG spill are based on 
small-scale (<35 meter diameter pool) tests. How the data collected 
from small-scale pool fires can be extrapolated to the potentially 
large-scale cargo releases is a subject of much debate among the 
modeling community. Quantifying the physical properties of large-scale 
LNG spill should be a priority. This will allow analysts to refine the 
consequence models and generate more consistent results. Sandia 
currently has this effort underway with the Advanced LNG Pool Fire 
Testing Program.
    Initial experimental results are expected in a few months, and the 
large-scale experiments are planned to be complete by August 2008. The 
initial results of these experiments will determine better correlations 
for the flame height and mass fire behavior which could be expected 
during larger fires. The large-scale tests will result in better data 
on vapor production rates, smoke generation, and surface emissive 
power. In a separate effort, Sandia is also applying its threat 
analysis and spill probability methodology to LNG tankers larger than 
those previously studied. The research is designed to provide an 
estimation of the sizes of breaches, including hole size, spill volume, 
and number of tanks breached, for membrane-designed ship classes 
ranging from 216,000 m\3\ to 267,000 m\3\. These are representative of 
LNG ships that are currently being designed, constructed and proposed 
for use at LNG facilities in the United States. Presently, each Order 
issued by the Commission requires the applicant to prove that staff's 
modeling of hazards for those large tankers is accurate. They must do 
this and get approval from the Director of OEP prior to accepting the 
larger size ships.
    We will use this new data to enhance our modeling capabilities for 
determining possible consequence areas resulting from a successful 
intentional attack on an LNG tanker. FERC staff has always committed to 
modify our analyses, when appropriate, as new data and improved 
modeling technologies are developed.
    I believe that this research is beneficial and necessary and will 
provide more exact information and technical details. Removing the 
uncertainty inherent in modeling phenomena will result in more accurate 
models. However, in current areas of uncertainty, we have made 
conservative assumptions. FERC staff believes the refined models will 
likely show smaller consequence areas. FERC, and along with it, the 
Coast Guard and DOT have a competent understanding of the risks and how 
to mitigate them effectively to ensure public safety.
    In conclusion, LNG is a commodity which has been and will continue 
to be transported safely in the United States. The U.S. Coast Guard, 
the U.S. DOT and FERC are committed to ensuring that safety. As a 
matter of policy, the Commission is committed to continually raising 
the bar on energy infrastructure safety. As new safety measures, 
improved monitoring equipment, and enhanced safety and security 
protocols are developed, the Commission will ensure that LNG remains a 
safe and secure fuel source for the country.

    Chairman Thompson. Thank you very much, Mr. Robinson. I 
thank you and all the witnesses for your testimony.
    I will remind each member that he or she will have 5 
minutes to question the panel.
    I will now recognize myself for the first 5 minutes.
    Mr. Lesnick, it is my understanding that the maritime 
administrator is working with individual companies to increase 
the number of U.S. mariners on LNG tankers.
    How many companies have agreed to increase their number of 
U.S. mariners at this point?
    Mr. Lesnick. At this point in time, I think it is four, 
Congressman.
    Chairman Thompson. Four out of----
    Mr. Lesnick. Four out of perhaps any number that--there are 
numerous companies that deliver LNG to the United States.
    Chairman Thompson. For the record, share with the members 
of the committee just what the maritime administrator is 
proposing for each LNG tanker that comes on our shores.
    Mr. Lesnick. Well, essentially, when we began the program, 
it is just dealing with the offshore facilities, Mr. Chairman.
    But what we have done is we have asked each applicant to 
agree voluntarily to provide a certain level of U.S. licensed 
and unlicensed crew on every vessel that is delivering gas to 
one of the deepwater port facilities.
    What happened with Suez Energy is that when they entered 
into that agreement with us, they also entered into an 
agreement to provide the same level of U.S. crews on all of the 
tankers coming to all of their facilities into the United 
States.
    We are working now with British Gas and with Shell. We 
don't specifically have offshore facilities with the same type 
of agreement.
    Chairman Thompson. Okay. Well, I guess my point is what is 
the percentage the administrator----
    Mr. Lesnick. Twenty-five percent of the licensed and 10 
percent of the unlicensed mariners aboard the vessel, every 
vessel coming in.
    Chairman Thompson. Okay. Is there any effort to increase 
that percentage?
    Mr. Lesnick. There will be efforts to do that once we meet 
that particular quota.
    Chairman Thompson. So you are saying only four companies 
have agreed so far.
    Mr. Lesnick. So far, but there are more--there are at least 
three additional ones that are interested in doing such. We are 
in conversations with them.
    Chairman Thompson. Well, now, are the ones who are not--who 
have not agreed--are they allowed to come and utilize the 
facilities?
    Mr. Lesnick. At present, we only have one operating 
deepwater port, sir. When they are all--yes, they will be 
allowed to use the facilities.
    Chairman Thompson. They will be.
    Mr. Lesnick. Yes.
    Chairman Thompson. Does the administrator have any plans to 
deny the use because they won't hire American to a certain 
percentage on the ships?
    Mr. Lesnick. Under the Deepwater Port Act, we wouldn't have 
the authority to do that, sir.
    Chairman Thompson. So basically you are saying the 
administrator is just using his influence to get the 
percentages?
    Mr. Lesnick. What we do is we give priority processing to 
people who agree to this manning agreement. And we are also 
working with applicants to actually re-flag vessels, LNG 
tankers, to the U.S. flag.
    Through that priority, they get moved to the front of the 
queue in terms of the license application process, and that has 
enticed them, along with all of the security and political 
pressures attached to that. It has enticed other companies to 
agree to do the same thing.
    They understand that there is a shortfall and that there is 
going to be a worldwide shortfall, and they need Americans on 
board all of those vessels. They are seeking U.S. crews.
    Chairman Thompson. Well, personally, I think it is a good 
idea to hire Americans, you know, and would have no problem 
making that part of the requirements. And I guess we will look 
at that at some point.
    Admiral is there a reason why the TWIC identification card 
at this point is only applied to U.S. mariners and not 
everybody who is coming in?
    Admiral Salerno. Yes, sir. The provisions of MTSA, which 
required the credential, the transportation worker 
identification credential for mariners, applies to U.S. 
mariners. It does not extend to foreign mariners.
    So there is no requirement or mandate in law to require 
that for foreign mariners.
    Chairman Thompson. So in other words, we vet the Americans 
who come but everybody else on the ship--we don't vet them.
    Admiral Salerno. Sir, there is other dimensions to this. 
For other people on--everybody that is arriving in the U.S. is 
vetted through a security protocol.
    Not everybody will have a TWIC, but they will be vetted 
through the 96-hour advance notice protocol.
    Chairman Thompson. I understand that, but if TWIC is for 
people who are somehow handling hazardous cargo, why--I mean, 
do you see a value in vetting everybody under TWIC who is on 
that ship?
    Admiral Salerno. Sir, the TWIC is intended for people who 
have unescorted access to facilities and to secure areas of a 
vessel.
    If a foreign mariner were to come ashore into a facility 
and to be granted access into a secure area, he would have to 
be escorted. So he would not need a TWIC to be escorted, but 
that can be covered within the facility security plan.
    Also, as I mentioned, each ship under the international 
code is required to have its own security plan, which we 
verify, that is in place and that there is a ship security 
officer on board the ship that makes sure that the plan is 
followed.
    So there are security provisions that apply to the ship and 
to the mariners on that ship.
    Chairman Thompson. I guess my point, though, is if that is 
in place, why give Americans the extra level of vetting that 
you don't give other individuals?
    Admiral Salerno. Sir, the expectation is that with a TWIC, 
a U.S. mariner would be able to have unescorted access through 
a facility and to areas of a vessel operating within our 
waters.
    It is to have additional freedoms, if you will, by virtue 
of having that TWIC that would not be granted to a foreign 
mariner through a U.S. facility.
    Chairman Thompson. Thank you.
    I yield to the ranking member.
    Mr. King. Thank you, Mr. Chairman.
    Admiral Salerno, would you describe what the rules of 
engagement are regarding the use of deadly force to protect an 
LNG shipment? And has deadly force ever been used or a weapon 
ever been discharged?
    Admiral Salerno. To answer your last question first, sir, 
deadly force has not been used. It is authorized in conformity 
to Coast Guard instructions, commandant policy.
    Generally speaking, we only use as much force as is 
necessary to compel compliance. If we can use nonlethal means, 
that is what we will do if we can protect the ship.
    Only if there is an imminent danger of loss of life either 
to our own crews or to another person would deadly force be 
used. But our crews are trained in judgmental shooting and 
proper procedures for the use of that force.
    Mr. King. Mr. Robinson, can you tell me how many new LNG 
projects are being considered by FERC?
    Mr. Robinson. We have nine under review right now.
    Mr. King. And maybe you mentioned this in your testimony, 
but approximately how long does that process take? I mean, is 
there any standard? Is there any guideline you use?
    Mr. Robinson. If everything goes well, the pre-filing 
process--which, again, is legally mandated--we like to see that 
accomplished in 8 months to 10 months, something in that time 
frame.
    The application, once it is on file--we authorize the 
facility within 11 months, but we don't have a standard where 
we have to meet that.
    We also have projects that we have been looking at--as an 
example, the port of Long Beach in California--for about 3 
years now. We won't go to the commission for authorization 
until we have a complete record, to include the record on 
safety and security for each facility.
    Mr. King. Have you had any companies withdraw their 
application?
    Mr. Robinson. We have had companies approach us and talk to 
us about an LNG facility and then withdraw from that proposal. 
Once somebody has reached pre-filing, they have usually spent a 
considerable amount of money at that point, and they pursue 
their application.
    We have had no one withdraw once they got into a formal 
application with the commission.
    Mr. King. Once the process is started, are there 
modifications undertaken? I mean, is that standard, or, I mean, 
can it be adjusted as it goes along, or is it--
    Mr. Robinson. It is adjusted from day one as it goes along. 
And just as an example, almost every authorization the 
commission issues has--not almost. Every authorization the 
commission issues has a list of requirements and modifications 
to what is proposed.
    Typically that runs 70 or 80 very specific requirements 
that are imposed upon a terminal operator.
    Mr. King. Do you get much resistance or they pretty much do 
what they are told? I mean, you know, are you definitely 
holding the upper hand? I guess what I am talking about--you 
know, when you are dealing with the industry--
    Mr. Robinson. I have had the opportunity to hold tankers 
offshore because I wasn't satisfied that a particular valve was 
installed correctly.
    I have stopped work on projects and held complete work 
forces off for a week while we reviewed soldier beam 
installation for tanker design.
    No, we have no problem protecting life, health and property 
and we have the authority to do it.
    Mr. King. How would you compare the compliance record or 
the cooperation, let's say, between LNG and the oil industry?
    Mr. Robinson. Well, I don't have that much experience in 
the oil industry, but as far as the cooperation with the LNG 
industry, we have never met any resistance.
    And along with that, the Congress was good enough to give 
us the authority through the Energy Policy Act of 2005 to fine 
our companies $1 million a day if they don't comply with our 
requirements.
    Mr. King. So long as I have you here today, is there 
anything you can tell me about Broadwater?
    Mr. Robinson. Currently the status of that offshore 
facility--and we do the authorization for offshore facilities 
in state waters such as Broadwater.
    We have issued a draft environmental impact statement. That 
included the water suitability report that was prepared by the 
Coast Guard. I personally was involved in about five public 
meetings on Long Island and Connecticut post-draft EIS.
    We are now reviewing the thousands of comments that we have 
received on that project and will treat each and every one of 
them--respond to them. That will take us some time. We don't 
have a time frame right now for the final EIS and commission 
order.
    Mr. King. Thank you, Mr. Robinson.
    I yield back, Mr. Chairman.
    Chairman Thompson. Thank you very much.
    We now recognize the gentleman from Rhode Island, Mr. 
Langevin.
    Mr. Langevin. Thank you, Mr. Chairman.
    Gentlemen, I want to thank you for your testimony here 
today.
    I have been following and been involved with the LNG issue 
for quite some time now. We have an LNG facility in my home 
state, my district, in downtown Providence which is located 
right in the heart of a very densely populated area.
    There was a proposed expansion of that facility not too 
long ago which was denied for a variety of reasons, I think 
less because of safety and security reasons as it was dealing 
with the actual infrastructure, things that needed to be 
changed in order to accommodate the facility. It is an older 
facility and such.
    I didn't agree necessarily that safety concerns were taken 
into account in the way they should be, but--and there is also 
the Weaver Cove facility that is near my district, and we are 
by--the tanker ships would need to go by areas in my district 
if that facility were to be expanded.
    But let me turn to a couple questions I have. As we 
continue to increase our reliance on natural gas, I certainly 
understand that we will need to establish new and also enlarge 
existing LNG import facilities throughout the country.
    However, I believe that we must carefully coordinate these 
efforts with our expected demand. So to this end, it is crucial 
that proposed facilities be examined using a regional approach 
rather than on a case-by-case basis.
    And let me give you an example. Again, in my home state of 
Rhode Island, there was a proposal to expand an LNG facility in 
Providence, and there was also this proposal to build a 
facility at Weaver's Cove in Fall River, Massachusetts--that is 
less than 20 miles away--that FERC was considering at the same 
time.
    Now, each of these proposals was considered on its own 
merit independent of the other proposed facilities within the 
region.
    Though FERC, again, ultimately denied the Providence 
proposal, I understand that other LNG facilities are under 
consideration in the New England area, raising the prospect of 
numerous tanker shipments along populated coastlines with no 
greater coordination among the proposals.
    So my question, to start with Mr. Robinson, would you 
please explain to us why FERC has not yet adopted a regional 
approach? And do you think that we should only consider each 
proposal independently? Or do you think that regional aspects 
should be taken into consideration as well?
    And if I could also on this same point, Mr. Wells, in light 
of the findings of your recent report, what would you say about 
adopting a regional approach for building new LNG facilities?
    And I would like to give the entire panel the chance to 
answer this question as well, going back to Mr. Wells.
    And again, should we adopt a more regional-based approach 
to determining where new LNG facilities should be located to 
promote a more comprehensive approach to security?
    And I will start with Mr. Robinson.
    Mr. Robinson. Thank you. We do look at regional issues when 
we site an LNG facility.
    As an example, for the KeySpan project, the one that we did 
turn down for safety reasons--it was very specifically for 
those reasons that we did reject that application--I think we 
looked at something on the order of 14 other sites that were in 
three other states in that area to see if there were any other 
facilities that might have superior characteristics, and 
concluded that in that instance there certainly were, because 
we denied that application.
    As to regional planning in general, ultimately--and I have 
been siting energy infrastructure for almost 30 years now. When 
it comes to siting a piece of energy infrastructure, be it a 
dam, an LNG facility, a pipeline or transmission line, it 
always comes down to those local concerns and the local issues 
that people have who would be near that facility.
    Those are what have to be treated, and that is what the 
commission takes very seriously.
    A regional planning effort in that context--I think it 
would be difficult for a group to ultimately conclude that this 
is the best site, when they are approaching it from a regional 
perspective, because they don't know the details of that 
specific site.
    Ultimately, you have to do a site-specific analysis and 
assessment to see if, in fact, that is correct. That is why the 
commission takes the approach that it does. We understand that 
all facilities will not be constructed. The market ultimately 
will dictate what gets built and what doesn't.
    But what the commission does is make sure that they believe 
that they have the information necessary to determine if it is 
in the public interest to allow a site to be constructed at 
that particular point.
    Mr. Langevin. Mr. Wells, could you comment?
    Mr. Wells. Clearly, GAO over the years has had experience 
in assessing the success or failure of various regulatory 
approaches and permitting approaches.
    You can pick and choose the issues where we have had 
piecemeal approvals that have involved local issues and have 
not been as desirable in the actual approval process.
    We have had successes in regional approaches, particularly 
in electricity. Whether you agree or disagree with deregulation 
in the electricity market, regional approaches have achieved 
successes.
    You would think as we move forward into the future that we 
would be able to bring some lessons learned in terms of what 
works and what doesn't work and maybe have a combined approach.
    But typically, in the Federal Regulatory Agency, we see a 
tendency to stick with what you have always done.
    Mr. Langevin. Do either of the other two gentlemen care to 
comment?
    Admiral Salerno. Sir, from the Coast Guard perspective, we 
evaluate each of the applications presented to us on a case-by-
case basis, not from a standpoint of deciding which is the best 
site.
    We look at the applicant's package and we make the 
assessments for navigational safety, the security concerns and 
so forth.
    As was mentioned, there is approximately 40 applications 
submitted. Probably only a dozen or so will actually be built. 
So the determination as to the best regional location would 
probably come after our assessment.
    Mr. Lesnick. We are a market-driven--deciding is market 
driven. However, the Deepwater Port Act itself is unique in the 
fact that the governor of the adjacent coastal state has the 
right to approve or deny the application, and also approve it 
with conditions.
    And that usually provides safeguards for the local state 
and the region in terms of exactly where a siting is going to 
occur.
    Mr. Langevin. I see my time has expired. I have got some 
other questions for the record I will submit with regard to 
safety and what weight safety issues go into making a 
determination about where to site or if a site should be 
approved. But again, my time has expired.
    I thank the chairman, and I yield back.
    Chairman Thompson. Thank you very much.
    I now yield to the gentleman from Connecticut, Mr. Shays.
    Mr. Shays. Thank you, Mr. Chairman. Thank you for holding 
this hearing.
    And, gentlemen, thank you for your service to our country. 
I have been one who believes that while we don't feel that we 
are safer today, we are. We just had a very false sense of 
security in the past.
    But saying we are safer doesn't mean we are safe. And I 
know that you all are working every day to have that happen.
    I would just like to encourage you publicly to make sure 
that you are blunt as can be when you are in the public forum 
about the risk, because--and I will just quickly make this 
analogy.
    We all knew we had problems at Walter Reed Hospital. There 
were reports about it. But frankly, when I had hearings about 
it, and others, the press wasn't there, and nobody paid any 
attention.
    And then when there was a graphic picture of mold on a 
wall, the lightning struck. And then all of a sudden the press 
is saying where were we. And a lot of us were trying to address 
that issue.
    I want to know if the concern about LNG plants is 
overblown. I look at these--and there are different types of 
tankers, correct? I see some that have the ball, and I see some 
that look straight.
    Somehow the ones with the spheres look more frightening, 
and are they the older model? A nodding of heads won't get the 
answer here.
    Admiral Salerno. Sir, there are different designs, but 
essentially they are all meant to meet the same performance 
criteria.
    Mr. Shays. And by performance, security as well?
    Admiral Salerno. Actually, the design of the ship, the 
containment of the cargo, the double-hulled design, all of--
regardless of the design, they are all meant to perform----
    Mr. Shays. Now, everyone who is a politician has opposed 
the location of an LNG plant everywhere around the world--in 
the United States, excuse me, practically. I don't want to 
over--but certainly, we have on Long Island Sound.
    And I take that position--I take that position because I 
want us to deal with the energy problem in total, and then I am 
open to looking at a lot of things like offshore drilling. I am 
willing to look at nuclear. I am willing to look at everything.
    But I want to see us deal with being more efficient with 
what we have before we start robbing the bank--not robbing the 
bank--before we start using our savings account. My view is 
let's spend the money better and then let's decide.
    And I feel a little guilty, frankly, as someone who lives 
in Connecticut, New England, where I feel like we are at the 
end of the pipeline, and we are constantly saying no to more 
energy supply and so on.
    So I am being honest with you about where I am coming from. 
When I am told that the LNG plant in Long Island would endanger 
someone within a mile radius, I then think well, here in 
Providence or in Boston, and I say, ``My God, that is the 
target.'' I mean, we are wondering, that is the target.
    I want you to tell me how dangerous are these facilities--
these ships, excuse me, and the facilities where they connect, 
but basically the ship. The flame is hot. I am told it is 
extremely hot, very efficient.
    And while you wouldn't get an explosion, you would get a 
huge flame, a fire. I am told the bigger--there is projection 
that the larger the fuel that the less likely of a more intense 
fire because it would conflict, that it would--you might have 
more smoke than fire.
    Tell me what your studies tell you and what your experience 
tells you.
    Mr. Wells. I will start by saying your description of the 
conclusions reached by the few somewhat small number of studies 
confirm what you just said in regards to what the computer 
modeling tells them may exist, which falls into the gap that we 
have addressed in asking the Department of Energy to address.
    Much of these conclusions and results are speculated based 
on assumptions and modeling techniques, and we are asking the 
Department of Energy to do the type of research to actually do 
a better job of assessing the consequences of a large fire, 
bigger spill volumes, larger holes in hulls, to, in fact, 
determine if that conclusion is valid.
    Mr. Shays. I am more interested in--and I am just going to 
ask for a comment, but I am more interested in, say, a 
shoulder-fired missile, a portable air defense missile, you 
know, manual--I am more interested in that type of terrorist 
activity.
    But let me go down the line here, if you have something to 
add.
    Admiral Salerno. Sir, in light of the threats that were 
identified in the report, certainly, a standoff weapon is one 
of the concerns that we would have.
    But I think as the report pointed out--and I think we could 
say this in a non-SSI environment--the likelihood that--
    Mr. Shays. No, I am going to ask you to--I will make the 
judgment here. If there is a terrorist attack using a manual--
you know, handheld rocket, what is our determination?
    Admiral Salerno. The determination would be the 
consequence--the damage to the vessel would be less than a 
suicide attack.
    Mr. Shays. Okay. Oh, I am sorry, suicide would be a ship 
coming up with more explosives?
    Admiral Salerno. Similar to a----
    Mr. Shays. Well, then let me add--I mean, a terrorist 
attack as opposed to something that happened because they ran 
aground or something.
    Admiral Salerno. No, that is the way I meant it, sir.
    Mr. Shays. I am sorry.
    Admiral Salerno. Comparable to the attack on the USS Cole.
    Mr. Shays. I got you. Fair enough.
    Yes, sir?
    Mr. Lesnick. In terms of the damage done, that would be for 
someone else to assess, other than--but one of the reasons we 
remotely site these facilities is that is one of the reasons 
these sites are put offshore, so far offshore.
    Mr. Robinson. Your question was is it overblown. It depends 
on where your information comes from. Certainly, if you read 
the popular press, it is completely overblown.
    If you read the analyses that go into each of the projects, 
the very lengthy analyses that go in, I think you will get a 
clear picture of what the potential risks are.
    As an example, the recent press on the GAO report--one of 
the headlines I saw was ``LNG Explosion Burns People One Mile 
Away.'' The GAO report was very clear that explosions were 
unlikely. Again, I phrased it somewhere between improbable and 
impossible.
    So even though in the popular media you will see explosions 
all the time, that is just not the case.
    Burns One Mile Away--what they are talking about there are 
second-degree burns at a mile distance, if you hold your 
exposed skin up for 20 seconds to 30 seconds and don't move it. 
If you have clothes on, you are protected.
    So the way it comes across in the media is everybody will 
be burned up to a mile out, when actually we are talking about 
just move away within 20 seconds to 30 seconds and you won't 
have a burn.
    I think there is a difference between where you pick up 
your information and how it is portrayed.
    Mr. Shays. Thank you.
    Let me just make a summary comment, if I could, Mr. 
Chairman.
    If you tell the American people the truth, they will have 
you do the right thing.
    The problem we have in this whole dialogue is in some cases 
they have a fear that may not be warranted, and in other cases, 
based on reports that you have stated to us under closed 
meeting, they have a lack of knowledge of things that they 
should fear.
    Our struggle needs to be to tell the American people the 
truth and then they are going to push us to do the right thing.
    Thank you, Mr. Chairman.
    Chairman Thompson. Thank you very much.
    We now yield to the gentleman from Pennsylvania, Mr. 
Carney.
    Mr. Carney. Thank you, Mr. Chairman.
    And, gentlemen, thank you for coming in today. We 
appreciate it. I have just a couple of questions.
    First, for Mr. Wells, and this is a quick one. You 
mentioned in your opening statement that there is a classified 
report that is almost ready, available soon?
    Mr. Wells. Available soon to people that have the national 
security clearance. That is correct.
    Mr. Carney. So like guys like us on the committee--
    Mr. Wells. Can, in fact, hear the results and answer 
Congressman Shays's most recent question.
    Mr. Carney. Very good. Do we have a time frame, kind of a 
date certain on that?
    Mr. Wells. I don't have a date certain. It is with the 
intelligence agency now for classification, so it is pretty 
much finished. We are just getting the clearances.
    Mr. Carney. Very good. Okay.
    Chairman Thompson. Well, I guess, let me take it a little 
bit--as soon as it is ready, will you notify the committee so 
we can schedule a time for the briefing?
    Mr. Wells. Absolutely, Mr. Chairman.
    Chairman Thompson. Thank you.
    Mr. Carney. The unfortunate reality is that the committee 
has been promised reports that now, in some cases, are a couple 
of years past due. I am not saying that is your case, Mr. 
Wells.
    Mr. Wells. Thank you.
    Mr. Carney. We are especially sensitive right now on this 
sort of thing. Certainly, I am.
    This is a general statement for--or question, rather, for 
you all. We have learned that there are up to 32 applications 
for new LNG facilities. I don't know if they are all going to 
come to life. Probably not.
    But do we have the resources available to protect many more 
facilities?
    Admiral?
    Admiral Salerno. We are very mindful of the fact that there 
will be a number of new facilities coming online, and certainly 
the question of resources is something that is before us.
    We are looking at that very, very closely. In recent years, 
we have, in fact, looked at the overall requirements for our 
presence in ports, not only for LNG but for dangerous cargoes 
generally, and in the past have had requests submitted 
successfully for additional resources.
    Mr. Shays. Would the gentleman yield? Would you mind, 
just----
    Mr. Carney. Yes, Mr. Shays, I yield.
    Mr. Shays. Isn't the honest answer ``no''?
    Admiral Salerno. Sir, we are assessing the risks on that.
    Mr. Shays. Isn't the honest answer ``no'' based on what we 
heard previous? Isn't that the honest answer? I will just leave 
it hanging.
    I don't want to take your time.
    Admiral Salerno. Honestly, sir, it is on the table.
    Mr. Shays. I think that is a punt, and I don't think it is 
an honest answer. I am sorry.
    And I thank the colleague. I am sorry to interrupt.
    And I hope the chairman gives him more time.
    Mr. Carney. Thank you, Mr. Shays.
    Mr. Lesnick, what do you think? From your perspective, do 
we have the resources available at the Coast Guard?
    Mr. Lesnick. From my interaction with the Coast Guard----
    Mr. Carney. Right.
    Mr. Lesnick. --in terms of the applications that we have on 
the table right now, yes.
    Mr. Carney. Okay.
    Mr. Lesnick. But I know how hard they work through this 
whole process.
    Mr. Carney. Mr. Robinson?
    Mr. Robinson. Yes. I would like to bring in one other 
aspect here that goes directly to this, and I mentioned it 
earlier. Once a project is authorized--you have 30 to 40 
applications--however many are out there.
    But once a project is actually authorized, before they can 
start construction they have to develop an emergency response 
plan which identifies the resources, and who is going to pay 
for them, and where they are going to come from to ensure the 
safety and security of that facility.
    That is done with the Coast Guard. There is about a 3-year 
period post-construction authorization to build the plant out. 
During that period, resources are acquired. The Coast Guard, 
our licensee, the locals, paid for as directed by this plan.
    At the point that a tanker would come in, if the safety 
facilities are not in place, we wouldn't allow the plant to 
start operating, and I am sure the Coast Guard wouldn't allow a 
tanker to come in if they didn't have the facilities to ensure 
its safety as it came in.
    So it is not like there is just an authorization and 
everything is there. You wouldn't want those facilities there 
before it is authorized. You have to bring them on as you 
approach actual operation. And we have a plan in place to make 
sure that happens.
    Admiral Salerno. If I could just add to that, that is very 
much in our thinking and in our method of operation that we 
look at other partner agencies within the port, because there 
are concurrent responsibilities and jurisdictions, as well as 
to the private sector, because they have a role in providing 
security resources as well.
    And it is that composite mix that really goes into our 
assessment of whether it is suitable for a vessel to operate in 
a port area.
    Mr. Carney. Well, I appreciate that. I guess I do go back 
to Mr. Shays's point. It sounds like the answer is no.
    Does the Coast Guard--or are the LNG facilities or the 
applications--is that what drives Coast Guard growth?
    Admiral Salerno. As part of the review process, what the 
captain of the port will do is assess the security needs, and 
figure out what are the resources required and can he meet 
those requirements with his own resources and with other agency 
resources.
    That is absolutely essential in the assessment. And 
overall, within the Coast Guard, if we cannot meet those 
requirements, obviously that may drive the need for more 
resources.
    However, we also have to look at our ability to shift 
resources internally before we get to the point where we decide 
that we do, in fact, need more resources.
    Mr. Carney. Okay.
    Thank you, Mr. Chairman.
    Chairman Thompson. Thank you very much.
    Very rarely do I find a committee offering to help and help 
is denied. I just want to put that on the record. Clear, if the 
15 applications that we had on file were approved, 3 years out, 
based on what I heard, we would have 15 more LNG facilities 
that obviously would have to meet the requirements.
    I would hope that in meeting the requirements we would not 
delay ships coming in because we don't have help to do the 
inspections.
    And I think if somebody--and maybe, Admiral, what I would 
like for you to do for the committee is looking at the 15 
applications, will you provide us what assets, being personnel 
as well as boats, that would be needed to support those 15 
applications that we presently have on file?
    We will now go to Mr. Bilirakis of Florida for 5 minutes.
    Mr. Bilirakis. Thank you, Mr. Chairman.
    All ships carrying LNG that come into the U.S. ports must 
have additional safety measures you have described. This is for 
the admiral.
    My understanding is that when these ships leave their 
initial port of call they are unaware of their final 
destination, which is determined by market demand.
    At what point does the Coast Guard confirm that these ships 
meet U.S. safety standards? And if they do not, are they turned 
away?
    Admiral Salerno. Sir, the 96-hour advance notice of arrival 
gives us that ability to make sure that the ships meet all of 
the required safety, environmental and security standards.
    That applies to every ship coming to the U.S. Now, in 
reality, there is relatively few ports that supply LNG to the 
United States. The primary one by ship is Trinidad and Tobago. 
Algeria is a second.
    We frequently or routinely see the same ships over and over 
again, so they become very much a known quantity. We have 
frequent interaction with them. We inspect these ships on a 
regular basis.
    In many cases, we send Coast Guard inspectors to ride the 
ships from the loading port to the port of destination in the 
United States. That gives us a great deal of familiarity with 
the operations on the ships, the nature of the crews.
    Additionally, the crew members on many of these ships are a 
different caliber than we see on many other merchant ships. 
They tend to be long-term employees of the companies that 
employ them. They are very highly trained.
    The companies invest a lot of time in training in these 
people. They tend to keep them for a long time, because of the 
sophistication of the ships. So our confidence level not only 
in the maintenance of the ships but in the crewing of the ships 
is very high.
    Mr. Bilirakis. Thank you.
    In 2005 the Coast Guard received 14 new boats to meet the 
port and waterway security mission. Four went to LNG vessels.
    Were there any resources requested in fiscal year 2006, 
2007 or in your proposed 2008 budget to meet the expected 
growth in the LNG industry?
    Admiral Salerno. You are correct on the fiscal year 2006 
request. And for 2007 and 2008 there was not a request, and we 
are evaluating future needs based on the anticipated growth in 
LNG and other dangerous cargoes.
    Mr. Bilirakis. Thank you, Mr. Chairman.
    Chairman Thompson. Thank you very much.
    We now recognize Mr. DeFazio for 5 minutes.
    Mr. DeFazio. Thank you, Mr. Chairman.
    To Mr. Lesnick, we have had a discussion of the resources 
that are available to the Coast Guard. What about the resources 
available to your agency? Do you have adequate staffing and 
expertise to process this crush of applications and do all of 
the work necessary?
    Mr. Lesnick. At the moment, Congressman, we don't have a 
line item in our budget for this program. We take it out of the 
pie.
    We have attempted to try to keep a certain portion of the 
fees for this so that we could use it to support the staff. So 
it can become difficult at times in this sense, but we have 
been able to, you know, keep up with the load so far.
    Mr. DeFazio. Okay. So the answer is ``no.''
    I know it is hard. You know, you have--you know, OMB is 
listening, you know. I mean, we had one honest head of--you 
know, the Army Corps of Engineers secretary for a short period 
of time, a former member of Congress.
    And when he came before the Transportation Committee and 
Infrastructure Committee and admitted his budget was 
inadequate, totally inadequate, to meet the critical needs, he 
was fired.
    I hope you gentlemen don't feel that kind of pressure 
operating in an environment that has to do with national 
security from this administration.
    And so, you know, I would say that, you know, Mr. Shays's 
line of questioning and others--and to the admiral, and knowing 
the Coast Guard, the Coast Guard does not have a budget that is 
optimal to perform this task and provide maritime security.
    I am not going to put them on the spot, but I am going to 
make that as an assertion. And I have been on and off the Coast 
Guard Committee for more than 20 years. And now we hear that 
MARAD doesn't have the resources it needs, and that causes me 
concern.
    Mr. Lesnick, you said something else that puzzled me, 
something about governors of adjoining states having veto 
authority over siting. What was that?
    Mr. Lesnick. Under the Deepwater Port Act, Congressman, the 
governor of the adjacent coastal state has the ability to 
approve or deny or approve the application with conditions any 
deepwater port application.
    And in doing so, normally, they set conditions into the 
license that protect the state's interests in the operation of 
the port.
    Mr. DeFazio. Okay.
    Well, then I would turn to Mr. Robinson from FERC. Now, if 
California proposed putting an LNG facility offshore, my 
governor could veto it in Oregon. But an LNG company can 
propose to put an LNG facility in Oregon, and my governor has 
no say, is that correct?
    As I understand the changes mandated by the Energy Act, it 
is up to FERC whether or not that facility can be sited. My 
governor does not have veto power. Is that correct?
    Mr. Robinson. Does not have veto power similar to the 
Deepwater Port Act. However, the state does have authority 
under the Coastal Zone Management Act to withhold that permit. 
If it is withheld, no site can be constructed.
    Mr. DeFazio. Withhold it under what conditions?
    Mr. Robinson. Under inconsistencies with the state's plan 
for preserving the coast.
    Mr. DeFazio. And does the state have to make a legal case 
or can they make an assertion? What is the level of proof?
    Mr. Robinson. They have to follow the state's procedures 
for issuing or denying a coastal zone permit, whatever those 
state's procedures may be.
    Mr. DeFazio. Okay. And if a state makes that finding, then 
FERC cannot----
    Mr. Robinson. FERC cannot issue an authorization for the 
facility.
    Mr. DeFazio. Okay. All right. Let me ask another question. 
Is it ideal to build an LNG facility very remote from the 
projected point of demand?
    I mean, is it a good idea to locate something in another 
state and then build a land line for, say, 800 miles or 1,000 
miles to the preferred market for that LNG? I mean, do you 
think that is optimal? Or maybe we should locate the LNG 
facility closer to the end point.
    Mr. Robinson. I think a combination of both. We have 
existing infrastructure which allows the transport of natural 
gas from distant sources. I mean, we grew up with the gulf 
production.
    Mr. DeFazio. Right, but this is to build an entirely new 
pipeline.
    Mr. Robinson. But to build a new pipeline from there--I 
think that would probably be cost-prohibitive. If you can 
locate an LNG facility in a load center, it clearly has 
economic and reliability aspects to it that are very positive.
    Mr. DeFazio. And what about the FERC approval process for a 
very lengthy new pipeline crossing thousands of privately owned 
parcels of land?
    Mr. Robinson. We do that. I mean, we are currently in the 
midst of looking at whether or not to authorize the Rockies 
West and Rockies East pipeline, which is a combined 1,500 
miles, bringing new gas out of the Rockies to the load centers 
in the East.
    Mr. DeFazio. Right. But of course, we don't have much 
option. If the gas comes out of the mountains, you have got to 
go there to get it.
    Mr. Robinson. That is correct.
    Mr. DeFazio. But with LNG, you could take it to a different 
place.
    Mr. Robinson. That is why there is such interest in 
bringing LNG terminals into the load centers.
    Mr. DeFazio. Okay. Because in my case, California doesn't 
want an LNG facility, so they want to locate it halfway up my 
state, and then build a pipeline that extends for about 800 
miles or 1,000 miles down to California to serve the California 
market.
    And you are saying that would be cost-prohibitive in your 
estimation.
    Mr. Robinson. No, it depends on what they will pay for the 
gas. And California pays a good deal for the gas, because they 
are at the end of the pipe.
    Mr. DeFazio. Right. Okay.
    If we could just--if the chair would indulge us for a 
moment, I just want to return to--again, having served on the 
Coast Guard and Maritime subcommittee for many years, and as 
raking member for a while.
    It is mentioned in the deepwater application--or Mr. 
Lesnick mentioned about the preference for U.S.-flag vessels. 
We will hear about that later.
    But it says provide the nation of registry for and the 
citizenship of officers and crew members serving on vessels 
transporting LNG to deepwater ports.
    What does the nation of registry for mean, Admiral? Does 
that mean we know who actually owns that ship?
    Admiral Salerno. Sir, the nation of registry just simply 
indicates where the vessel is registered, what flag it flies.
    Mr. DeFazio. And it has nothing to do with where the ship 
is from or who owns it.
    Admiral Salerno. It is not an indication of ownership.
    Mr. DeFazio. Okay. Now, are we able to pierce the veil now? 
I understood that supposedly we were creating more transparency 
for ownership post-9/11, because in the pre-9/11 world Osama 
bin Laden could own a fleet of freighters that are registered 
at Malta.
    And I have been to Malta and asked the registrar there if 
he would please reveal the ownership of vessels to me, and he 
said, ``Absolutely not. We keep that secret.'' Has that 
changed?
    Admiral Salerno. We do track ownership, managing owners, of 
each vessel. Often, as I am sure you are aware, the owners are 
owned by other entities.
    Mr. DeFazio. Right.
    Admiral Salerno. And that does become somewhat difficult to 
pierce the veil, as you say, but I think we have gotten 
somewhat better in the past few years. But certainly----
    Mr. DeFazio. But wouldn't it be desirable to just have an 
outright requirement that the U.S. would sponsor at the IMO 
that would say we want to know who the ultimate owner of each 
and every ship that is going to call on the United States is?
    Wouldn't that be a good thing to know? I mean, I am really 
not comfortable with the idea Osama might own a fleet out 
there.
    Admiral Salerno. Sir, I could probably get back to you on 
the record----
    Mr. DeFazio. Okay.
    Admiral Salerno. --for the extent of our knowledge on that, 
on how we pierce that veil.
    Mr. DeFazio. Right. Okay. And then I won't belabor it again 
since I brought it up in the other session, but it is not--and 
that is the not really knowing who the crews are outside of 
those on these LNGs, and we will get into that another time.
    Thank you, Mr. Chairman, for being so tolerant.
    Chairman Thompson. Thank you very much.
    We will now yield to the gentlelady from Texas, Ms. Jackson 
Lee, for 5 minutes.
    Ms. Jackson Lee. Mr. Chairman, thank you so very much.
    Thank the witnesses. And bells have begun to ring, so let 
me be as focused as I can, coming from one of the largest ports 
in the world, the port of Houston.
    This is a vital, vital concern to me. And whenever I am in 
front of the Coast Guard or they are in front of me, I take it 
upon myself to again thank them for work that is usually unsung 
and sometimes not noted, the vitality of your work.
    And let me applaud you for what I think will be part of the 
annals of history of the heroic work in Hurricane Katrina. And 
I know you continue to do that every day.
    To Mr. Wells, let me just--I noticed that part of your 
research had to do with acknowledging that in the LNG tankers 
it might be more susceptible to fire as opposed to explosion, 
if I am hearing or reading correctly.
    And if not, just clarify that, because we are here dealing 
with terrorism and homeland security. What is the danger of an 
LNG as it relates to a terrorist attack, a tanker?
    You had your study--were you able to assess that?
    Mr. Wells. The available research that has been conducted--
we were focused on LNG threats to public safety. It is clearly 
the fire potential, and there was consensus among the experts 
it is extremely unlikely and very difficult to effect an 
explosion in an unconfined space.
    Clearly, the research indicates there are other energy 
commodity vessels, like LPG, that have even greater explosive 
capability than LNG.
    Ms. Jackson Lee. Well, Mr. Chairman, just on that note, I 
hope that we will take it to the next step of exploring 
additional research, because I think this is a vital question. 
And let me move quickly.
    Mr. Wells, do you have an assessment as to whether the 
Coast Guard--GAO has an assessment--needs or has enough 
resources as relates to this issue with the LNG tankers?
    Mr. Wells. Fortunately, as an audit agency and oversight 
agency reporting to the Congress, we are not involved in the 
resource allocation decisions by the Congress.
    But clearly, GAO has work that is in reporting form that 
will talk about the Coast Guard's achievement of their current 
mission or not achieving getting everything done with their 
existing resources.
    And couple that with the increasing demands, it is 
certainly going to be challenging for them to figure out a way 
to get the necessary resources to meet the needs.
    Ms. Jackson Lee. Thank you very much. That answers it. They 
have needs and they have responsibilities, and they may not 
have matching resources.
    Admiral Salerno, let me just ask the pointed question. 
Again, I think it is important. We are here to help. Do you 
have enough resources, as was just indicated, to meet the 
mission and responsibilities that you have?
    Admiral Salerno. Let me answer that in a couple ways. We 
are assessing that. We are doing a number of things. And as was 
just indicated, the overall port security mission is broader 
than just LNG.
    Ms. Jackson Lee. Well, Admiral, because the time is going, 
can you indicate that you don't think you have enough resources 
but you are assessing it?
    Admiral Salerno. We are assessing. We are looking at risk 
across the board, through all dangerous cargoes.
    Ms. Jackson Lee. And you may not have enough, but you want 
to assess it before you tell us.
    Admiral Salerno. We want to fully characterize the risk and 
then take a look at where we have our resources placed to see 
if they can be reallocated. And then if we are short, then 
obviously we would look at----
    Ms. Jackson Lee. That is a good soldier, Admiral, and I 
really do respect you. I don't think you are going to find that 
you have enough resources.
    But let me ask you whether or not you know the countries 
that we receive LNG from. And also, are these countries 
compliant with the International Ship and Port Facilities 
Security Code? Do you know the countries?
    Admiral Salerno. Yes, ma'am.
    Ms. Jackson Lee. Are they compliant?
    Admiral Salerno. Yes, they are.
    Ms. Jackson Lee. All of them, Nigeria, Algeria?
    Admiral Salerno. We have visited--the primary is Trinidad 
and Tobago and Algeria, and we have sent Coast Guard teams to 
those countries and assessed that.
    Ms. Jackson Lee. Would you provide this committee with a 
report on that? I am not sure whether we have that. I would 
appreciate it. I am only moving because I need to move--I would 
like a report on that, sir. And you have added Trinidad, so 
that is good.
    Are you concerned about the frequency and the nationality 
of stowaways that have been confirmed on international vessels, 
particularly from international ports? And have they been 
vetted by the U.S. Coast Guard?
    Admiral Salerno. We are concerned about stowaways. We have 
procedures in place to deal with them. Part of our port visits 
overseas--and we visit about--on tap to visit about 150 
different countries--is to look at the security systems in 
place.
    Ms. Jackson Lee. You are on tap. Have you visited those 
countries or are you in the process of visiting?
    Admiral Salerno. In the process. We visited about over 70 
countries so far. And part of our assessment is the security 
measures at the facility.
    Ms. Jackson Lee. And have you vetted the stowaways? Have 
you been able to--once they get off, or----
    Admiral Salerno. When stowaways are detected--and 
typically, they are reported by the ship's crews at sea, so we 
know in advance of----
    Ms. Jackson Lee. And are you there to receive them?
    Admiral Salerno. There is a Coast Guard and Customs and 
Border Protection response.
    Ms. Jackson Lee. I would that you would need more money 
just to go to 150 countries. This is my last question.
    According to your testimony, the Maritime Administration is 
working to develop and expand LNG training programs so as to 
provide immediate employment for entry-level mariners, both 
licensed and unlicensed.
    Can you provide us with information about this training?
    Mr. Lesnick. Yes. We are working with the state academies, 
one of which would be in your state----
    Ms. Jackson Lee. Absolutely.
    Mr. Lesnick. --and the federal maritime academy and the 
union training schools to get a curriculum together to stand 
up----
    Ms. Jackson Lee. What is your time frame for that?
    Mr. Lesnick. It is almost immediate. They were already 
ready to go. These new manning agreements that we have been 
signing----
    Ms. Jackson Lee. Will we have some of those in the school 
that is in my area?
    Mr. Lesnick. Yes, Congresswoman.
    Ms. Jackson Lee. And do you have the resources to add for 
this training?
    Mr. Lesnick. The state schools could use additional 
resources to provide that.
    Ms. Jackson Lee. Mr. Chairman, I think there is a lot of 
work that we could do in helping the Coast Guard.
    And I do think there is a question of resources, and I 
would like to join you in your leadership in helping with the 
training and helping with some of the ports that are going to 
need additional resources for the Coast Guard.
    With that, I yield back. I thank you.
    Chairman Thompson. Thank you, Madam Jackson Lee. I look 
forward to working with you, too. There is no question about 
the need for additional resources.
    Let me thank the panel for your testimony here before the 
committee.
    Let me say, before our second panel, we have about six 
votes to take before we can come back. So we are probably 
looking at about an hour from now. Do you want to say 2 
o'clock?
    Okay, about 2 o'clock we will reconvene for panel two. The 
committee is recessed.
    [Recess.]
    Chairman Thompson. We have talked with Ranking Member King, 
who has indicated it would be all right to start until he 
comes.
    We would like to reconvene this hearing and welcome our 
second panel. I welcome the panelists, Mr. Ron Davis and Dr. 
Phani Raj, to the audience.
    Mr. Davis has served as MEBA's district and national 
president since early 2002. He began his seagoing career in the 
Navy, which included time in Vietnam. He also sailed on MEBA 
contracted ships from 1978 to 1991, when he was elected to 
union office.
    Dr. Raj--I hope I am pronouncing it--all right, thank you 
very much--has over 30 years of experience working in the LNG 
field. He has authored over 80 technical reports and 50 papers 
in this highly complex area. He was also one of the experts GAO 
consulted during the audit that we heard about from the 
previous panel.
    Without objection, full statements will be inserted into 
the record. I now ask each witness to summarize his statement 
for 5 minutes, beginning with Mr. Davis.

STATEMENT OF RON DAVIS, PRESIDENT, MARINE ENGINEERS' BENEFICIAL 
                          ASSOCIATION

    Mr. Davis. Thank you, Chairman Thompson. The safe and 
secure transportation of liquefied natural gas to the United 
States is of critical importance, and we all appreciate your 
holding this hearing.
    For 137 years, MEBA has represented Coast Guard-licensed 
deck and engineering officers serving in the commercial and 
government fleets. Despite our presence in nearly every aspect 
of the maritime industry, there are practically no Americans 
employed on LNG ships today.
    The worldwide demand for LNG is increasing at such a 
tremendous rate that it is very difficult for the maritime 
industry to keep up. It took over 40 years for the LNG fleet to 
reach 200 vessels. It is now expected that the fleet will hit 
300 vessels by 2010, just 3 years away.
    With this rate of expansion, there is an increased demand 
for qualified mariners. Right now, the international fleet is 
facing a severe shortage of qualified crews.
    The various ship operators have even resorted to poaching 
officers from each other, paying over $20,000 a month for 
qualified officers.
    As the size of the fleet expands, the qualified mariner 
pool shrinks. There is a significant chance that the standard 
of education will suffer and mariners with substandard training 
will begin taking these jobs.
    That puts our nation at risk. If this shortage is not 
addressed, it will only be a matter of when, not if, a major 
safety incident takes place.
    Security is the major concern as well. As you know, a 
number of studies discuss terrorist attacks on LNG tankers. 
MEBA believes that the greatest threat to an LNG tanker would 
come from a knowledgeable crew member deliberately sabotaging 
the vessel.
    Therefore, we must ensure the proper vetting for LNG crews. 
Because there is no uniform, completely trustworthy system for 
vetting foreign mariners, this is next to impossible under the 
current system.
    Background checks of the level of thoroughness conducted on 
Americans by the Coast Guard and TSA are only performed on 
Americans and not foreign crews.
    While the Coast Guard does require crew lists from vessels 
entering U.S. ports, they have no real way to be sure that 
those foreign crews on board are who they say they are.
    U.S. merchant mariners receive their credentials to work 
from the Coast Guard. Foreign mariners do not. U.S. mariners 
undergo extensive background checks through the FBI. Foreign 
mariners do not.
    U.S. mariners are vetted through the National Driver Record 
Database. Foreign seafarers are not. U.S. mariners will be 
subject to terrorism background checks through TSA. Foreign 
seafarers are not.
    Finally, U.S. merchant mariners are U.S. citizens or 
persons lawfully admitted for permanent residency. The mariners 
crewing these ships are not.
    My solution to this problem is a simple one. Use U.S. crews 
on LNG vessels calling on U.S. ports. Americans are available, 
well-trained, economical and thoroughly vetted.
    Putting Americans on board these ships will go a long way 
to ensuring the safety and security of these vessels both at 
home and abroad.
    The United States is the leading producer of mariners. All 
of the state and federal training academies and union training 
schools have added or updated their LNG courses.
    The Calhoun MEBA Engineering School, for instance, recently 
installed a state-of-the-art vessel and LNG simulator. Right 
now, MEBA has a pool of qualified and experience senior LNG 
mariners who are ready, willing and able to sail LNG ships.
    And as I have already stated, we undergo the most rigorous 
background checks in the maritime world. Despite all of this, 
it has been extremely difficult for Americans to break back 
into the LNG trade.
    Foreign prejudice against American mariners is rampant. 
Congress has recognized this and has taken steps to assist us.
    Thanks in part to these efforts, several operators have 
agreed to expand their LNG crews to include U.S. citizens, 
including Suez LNG, Freeport McMoRan and Excelerate Energy, 
which I must commend.
    I am pleased to announce that MEBA has recently signed a 
memorandum of understanding with Excelerate Energy that will 
allow our members to sail on their international fleet of LNG 
tankers.
    This is a major step forward for the U.S. merchant marine 
and we look forward to a continued long-term relationship with 
Excelerate. We hope the other operators soon follow suit.
    We have made progress, but we can't afford to rest here. 
The responsible operators I have mentioned are only a portion 
of the LNG industry. Congress must continue to press for 
Americans on board LNG vessels, and MEBA offers any assistance 
you may need in this endeavor.
    The American merchant marine is known as the fourth arm of 
defense. Why not use us? Why not put us on LNG ships?
    Thank you.
    [The statement of Mr. Davis follows:]

                    Prepared Statement of Ron Davis

    Thank you Chairman Thompson and Ranking Member King, and thank you 
to the rest of the Committee for inviting me to speak before you today. 
I would specifically like to thank you for allowing us the opportunity 
to discuss the unique issues we face in safely and securely 
transporting Liquefied Natural Gas to the United States.
    My name is Ron Davis, and I am the President of the Marine 
Engineers? Beneficial Association. The MEBA is the nation's oldest 
maritime labor union, representing deck and engineering officers 
licensed by the United States Coast Guard. Our mariners serve in a 
variety of capacities in the commercial, government owned and operated, 
and domestic fleets, as well as in shore side employment.
    The MEBA was proud to take a leading role in the development of the 
transportation of LNG by ocean tank vessel in the 1970s. Our members 
crewed U.S. flag LNG vessels until 2001. Today, however, not a single 
LNG tanker flies the American flag, and none of these vessels are 
crewed by Americans. We feel that this represents a serious threat to 
America, and we have been working to restore American mariners aboard 
this important segment of the maritime community.

        Need for Shipboard Import of LNG to the United States
    According to the Federal Energy Regulatory Commission, U.S. natural 
gas demand is expected to increase by 40% by 2025 to 30.7 trillion 
cubic feet (TCF).i However, domestic supply, which has not 
equaled demand for many years, will only increase by 14.5%. Without 
intervention, our natural gas supply will not keep pace with industry 
and the public's demand. Mr. Jeff Wright, Chief of the Energy 
Infrastructure Group, Office of Energy Project, Federal Energy 
Regulatory Commission cites the following reasons for this situation:
         Decline in the United States' underground domestic gas 
        reserves;ii
         Canada's problems with flattening gas production 
        in the Western Canadian Sedimentary Basin (WSCB) and its need 
        to fulfill its own demands;iii and
         Continuation of Mexico's growing economy with Mexico 
        keeping an increasing share of its natural gas to meet its 
        future demands.iv
    This means the United States cannot rely solely on natural 
gas produced in North America. Therefore, LNG will need to be imported 
to the United States on oceangoing LNG tankships.
    Thorough Vetting of U.S. Merchant Mariners Provides Unmatched 
Shipboard and Deepwater Port Security
    All LNG entering the U.S. is carried on foreign flag ships operated 
by either non-U.S. citizen mariners, or aliens who are not lawfully 
admitted to the United States for permanent residence. Unlike foreign 
seamen:
         U.S. Merchant Mariners receive their credentials to 
        work from the U.S. Coast Guard;
         U.S. Merchant Mariners undergo extensive background 
        checks performed by the Federal Bureau of Investigation;
         U.S. Merchant Mariners are background checked through 
        a National Driver (vehicle) Record database;
         U.S. Merchant Mariners will also be subject to 
        jurisdiction of the Transportation Safety Administration (TSA) 
        where they will be vetted through a terrorist watch database in 
        order to receive a Transportation Worker Identification Card 
        (TWIC).
         U.S. Merchant Mariners are citizens of the United 
        States or aliens lawfully admitted for permanent residence.
    American mariners undergo a stringent and thorough vetting and 
credentialing process. Our Coast Guard-issued license is considered 
accurate (with regard to identity of the holder) and valid with respect 
to the qualifications and ability of the individual mariner. Moreover, 
the document is relatively tamper-proof. Each mariner goes through an 
extensive background check by several federal agencies including the 
Coast Guard, Federal Bureau of Investigation and now with the TWIC 
coming into effect, the Transportation Security Administration.
    While foreign mariners may be required to comply with their 
government's regulations as well as international standards, the 
validity of some of the credentials is suspect. A few years ago, 
International Transport Workers Federation President, David Cockroft, 
purchased an authentic Panamanian first officers certificate and sea 
book despite no practical maritime experience. The Seafarers' 
International Research Centre at the University of Wales investigated 
the issue of fraudulent qualifications. Its preliminary findings 
revealed 12, 653 cases of forgery in 2001.
    Federal and state government, local municipalities and the 
communities surrounding LNG import terminals can be assured, that with 
American mariners, the LNG vessels are manned by professional seafarers 
who have the integrity and the training necessary for the safe 
transport of LNG.

    Congress Recognizes Need for U.S. Mariners
    Congress has recognized the security that U.S. mariners bring to 
LNG vessels and has taken steps to promote enhanced security. Last 
year's Coast Guard Authorization bill included language that gave 
priority application processing to companies seeking LNG terminal 
licenses if they commit to using American crews, and it also directed 
the Maritime Administration to find ways to promote the use of 
Americans in this sector.
    Problems in Growth of Demand for LNG and with Incoming Generation 
of LNG Officers
    On June 20, 2006, Reuters reported that a growing global demand for 
liquefied natural gas and tight supply of specialized tankers and crew 
create a risk of dangerous lapses in standards of security. See, Darwin 
(Reuters), LNG Demand Growth Risks Fall in Shipping Standards, June 20, 
2006.
    Setting aside the security issue of foreign mariners, the United 
States must take into consideration the risks involved with poorly 
trained, insufficiently qualified and questionably vetted mariners who 
may deliver LNG to its shores. For instance, Yea Byeon-Deok, professor 
and LNG initiative coordinator of the International Association of 
Maritime Universities, recently stated at a conference in Australia: 
``Nobody knows what would happen if a significant accident occurred on 
a large LNG carrier. All we can say is that a 100,000 ton tanker has 
four times the energy potential of the atomic bomb used to hit 
Hiroshima. . . Many sub-standard vessels have begun to appear as demand 
for LNG increases, while there is a chronic shortage of experienced 
crew.''
    New orders for construction of LNG vessels imply a need for 3,575 
officers over the next three years, Professor Yea said, of which 60% 
would need to be at senior or experienced level. Yea warned that 
``recruitment and training were falling dangerously short of 
requirements to staff complicated vessels which could make dramatic 
targets for potential terror attacks.'' Reuters, June 20, 2006. Mr. Yea 
pointed out that the growth in ``flag of convenience'' ships which fly 
alternative flags to the country of ownership, allow the owners to 
avoid taxes, quality control and labor regulations which evidences 
deteriorating standards.
    The younger generation of sea-going deck and engineering officers 
is withdrawing from the industry prematurely. These junior officers are 
showing less and less interest in continuing to go to sea and they are 
typically leaving for shore-side positions prior to taking on senior 
level seagoing positions. This has made it difficult for ship owners 
and operators to ensure a sustained supply of senior officers. There is 
as of yet no effective means to counter this tendency. This data is 
based on a report in the U.S. Coast Guard Journal of Safety at Sea, 
Proceedings regarding the international (non-U.S. Merchant Mariner) 
pool of shipboard officers.
    The U.S. Merchant Marine was not considered in the aforementioned 
report. Indeed, had the U.S. Merchant Marine been considered, the 
resulting report would have shown that there is a vibrant and growing 
U.S. Merchant Mariner pool resulting in part by investments made in the 
passenger, freighter and tanker vessel maritime sectors. Moreover, it 
makes sense to staff LNG vessels delivering cargo to the United States 
with U.S. merchant mariners. U.S. merchant mariners are true patriots 
and care about their country--they would not be ``for hire'' foreign 
personnel with little or no connection to America other than a job that 
provides a paycheck. U.S. Coast Guard licensed officers and crew 
provide answers and solutions to many of the safety and security 
concerns surrounding the importation of LNG.
        Wide Scale Officer Shortage is Resulting in Foreign Ship 
        Operators ``Poaching'' LNG Officers; Poor Training; Steep 
        Decline in Safety and Security; and Violations of International 
        Law
    As reported in numerous articles and studies conducted by leading 
international maritime trade publications including Tradewinds and 
Fairplay, LNG owners and operators are lashing out at each other with 
allegations of ``poaching'', conducting insufficient training in 
violation of ISM Code as well as failing to properly check past 
employment references.
    The sudden and sustained surge in global demand for liquefied 
natural gas and the worldwide shortage of mariners with LNG and steam 
experience is leading to predictable results. Ship managers seem 
willing to do whatever they can to get their ships fully crewed in the 
face of a growing wide-scale officer shortage. ``The industry had 
previously grown slowly, so companies were able to train manpower and 
expand operations at a comfortable rate of two to three ships every two 
years,'' Keith Bainbridge, director of LNG Shipping Solutions, told 
Fairplay magazine in 2005 ``But where an industry experiences 40--50% 
growth within a couple of years, it will split at the seems,'' he 
predicts.v
    This manpower crisis is made even worse by new ship managers 
entering the LNG trade. A Fairplay article titled, Poaching War for 
Crew Erupts, cited the ``voracious appetite for scarce manning 
resources, both at sea and onshore. This has created severe competition 
among LNG owners.''vi
    The Society of International Gas Tanker and Terminal 
Operators LTD (SIGTTO) has recognized the acute shortage and the 
reaction by some. ``A short-term answer for an LNG vessel operator is 
to ``poach'' crew from another such operator but, clearly, the long-
term answer is training, training, and further training. SIGTTO 
members, as much as anyone, wish for the quite unique safety record of 
LNG shipping to be preserved. The influx of new personnel into the 
industry is of concern, especially if there is a temptation by a 
minority of operators to ``cut corners'' and put officers into 
positions of responsibility on a LNG carrier before they have been 
properly trained.''vii
    In an article titled Officer Crunch Sparks Safety Alarm, 
Anglo Eastern Ship Management's training director Pradeep Chawla states 
that ``intense pressure to promote more maritime officers is resulting 
in inexperienced officers making more mistakes and more dangerous 
situations on board. The training director noted that, ``shortages have 
made it harder to retain officers because manning agents use higher 
wages to lure away experienced seafarers, especially in LNG/LPG and 
other specialized trades.'' xiii Moreover, not all companies 
train officers, with many resorting to poaching.
    The crewing crunch is giving rise to new and dangerous theories of 
crewing to meet the sustained demand. ``Some operators are 
contemplating an airline-style approach, training their crew units to 
ever-higher standards and frequently rotating them among vessels. That 
would fly in the face of an industry that had, until last year, been 
characterized by its conservatism on crewing and had viewed rapid crew 
rotation as a threat to safety.'' The article mentions that with the 
shortage, there is an ``increasing incidence of crews of strangers 
being cobbled together with precious little time to develop mutual 
trust and overcome their natural fear of blame.''
    In an article titled Near Calamities in Cargo Operations, Fairplay 
details two case studies, on international vessel crewing practices, to 
illustrate the dangers of new crew members who are unfamiliar with the 
vessel or on-board procedures. ``In both incidents, one of the factors 
that contributed to the near calamities was the fact that one or more 
of the crewmembers involved were new to the ship and unfamiliar with 
all aspects of the vessel.'' ``The importance of learning the 
idiosyncrasies of a particular vessel cannot be overstressed, and even 
when crew are transferred to sister ships they should not assume that 
every feature of the ships will be the same.'' As noted above, short 
cuts in manning and ``inventive'' solutions to crew shortages can prove 
to be a recipe for disaster.ix
    The consequences of crewing instability and poaching can also 
lead to serious deterioration of the relationship between mariner and 
management. ``There has to be a management team in which officers can 
pick up the phone and discuss problems openly, rather than hiding them 
until it is too late'' says Simon Pressly, GM of Dorchester Marine, an 
LNG vessel operator in a Fairplay article. The author continues with 
the observation that, ``Unfortunately, with poaching so rampant, the 
dangerous lack of crew continuity is likely to continue until operators 
start making the requisite investments in manpower training.'' x
    Tradewinds states that the LNG-crewing shortage is giving 
rise to some serious shortcomings that are a direct threat to the 
industry's safety record and are in violation of the International 
Safety Management (ISM) Code. Some operators and ship managers are 
employing senior-level ship's officers that were terminated from 
employment by competing companies due to poor performance and substance 
abuse.xi
    On another front, big international shipping companies and 
ship management firms are feeling the LNG crewing pinch. Some operators 
are enticing LNG shipboard officers to switch companies by offering 
wages at 30%--40% higher than what has been paid in the past--and 
officers are switching companies and leaving their former employer in 
crisis. Some companies are offering over $18,000 a month (in wages 
only, not including benefits) to attract qualified LNG 
officers.xii
    All decision makers and stakeholders involved with the 
importation of LNG to the United States must take notice of what is 
going on in the international market. With growing natural gas demands 
and some 50-plus applications on the books for LNG import terminals, 
the American people need to be assured that the most highly trained and 
experienced personnel are transporting security sensitive LNG to the 
United States. There is no room for error when it comes to liquefied 
natural gas. Like no other time in history, the economics are in place 
whereby the U.S. Merchant Marine can economically and safely deliver 
LNG cargo; provide a stable pool of mariners for the long term; provide 
the highest amount of training; and comply with all U.S. and 
international laws.
    International Consequence: Insurance Underwriters Deeply Concerned 
with Inexperienced Crews Aboard LNG Vessels
    A recent article titled LNG Ships Facing Premium Boost details the 
nervousness of the insurance industry as the LNG fleet suffers through 
poorly managed growing pains. ``Underwriters appear to be changing 
their view of LNG vessels, which have traditionally been regarded as 
particularly well managed, despite being costly and potentially 
hazardous.'' Now, higher insurance premiums are the prospect for LNG 
vessel owners as a result of ``a big deterioration in the claims record 
of the world gas fleet.'' Marsh, the largest insurance brokering group 
issued a report concerning claims of more than $400 million run up by 
the LNG fleet.xiii
    Higher insurance premiums are in prospect for owners of LNG 
carriers after a spate of claims including operational incidents have 
left insurance underwriters facing big losses according to 
Marsh.xiv Marsh reports that risk profile is increasing due 
to a shortage of crew with LNG experience.xv
    With 200 LNG vessels in service and over 100 on order, Marsh 
identifies a number of factors associated with the rapid growth as 
adding to the risk profile of the gas-ship fleet including shortage of 
crews with LNG-carrier experience and new owners entering the market 
with the intention of trading vessels on the spot market rather than 
traditional long term charters.xvi
    The shortage of mariners in the international fleet is dire. 
It is abundantly clear, therefore, that the U.S. Merchant Marine must 
enter the market.
        International Reaction: Responsible Shipping Ministries React 
        to Manning Shortcuts and Abuse; Use of National Flag Vessels 
        Promoted By Major Importers
    Some of the world's largest importers of LNG, Japan and Korea, are 
an increasingly powerful consumer of LNG, have made registry of LNG 
ships a matter of national maritime policy. ``Japan transported about 
43% of its total LNG import of 59.1 million tons in 2003 on Japanese 
owned and controlled ships. Similarly, Korea transported about 61% of 
its LNG imports of 19.3 million tons in the same year on Korean 
controlled ships. In the combined import of Japan and Korea, third-
party owned ships constituted only 8.3 percent,'' says a shipping 
industry representative.xvii It is notable that Japanese and 
Korean controlled vessels are in respectable registries and do not cut 
corners on crewing in order to compete on the world market.
    India's Shipping Ministry has attempted to rejuvenate its merchant 
marine by requiring Indian manning and Indian registry for LNG vessels 
importing to the Indian coastline. However, another branch of the 
Indian government, the Indian Ministries of Commerce and Petroleum & 
Natural Gas, has prevailed in the internal battle, handing India a set 
back in its efforts to build a domestic flagged LNG fleet.

    Conclusion
    With 97% of all cargo imported to United States being carried on 
vessels that are not registered under the American-Flag and not crewed 
by U.S. citizens, one would think that the safe and secure 
transportation of security sensitive cargo would be a serious concern. 
More to the point, at this time 100% of all Liquefied Natural Gas that 
enters the United States is carried on ships staffed by non-U.S. 
citizen mariners. The MEBA strongly believes that the use of American 
mariners is a critical component to the safe and secure importation of 
LNG to the United States.
    With this in mind, some responsible corporate citizens in the LNG 
sector have recently agreed to expand their crewing practices to 
include U.S. citizen crews on LNG tankers. These companies, Suez LNG/
Neptune, Excelerate/Northeast Gateway and Freeport-McMoRan, must be 
commended. We must also praise Maritime Administrator Sean Connaughton 
and the Maritime Administration for their efforts to promote American 
mariners on LNG tankers. Without their help, the progress made with 
these companies would have been much more difficult.
    We look forward to working with Congress and the Administration 
moving forward to further protect our communities and maritime 
infrastructure.
------------------------
i Annual Energy Outlook 2005, Energy Information 
Administration, U.S. Department of Energy, February 2005, Table 13.
ii Mr. Wright cites the Annual Energy Outlook 2005, Energy 
Information Administration, U.S. Department of Energy, Table 13, which 
reaches the conclusion that production from conventional underground 
gas deposits is projected to decline between now and 2025. This decline 
is somewhat offset by increased gas production from non-conventional 
domestic gas sources (most notably coal-bed methane), increased 
production from deep water sources (greater than 200 meters) in the 
Gulf of Mexico, and commencement of deliveries of Alaska gas to the 
lower 48 states. The Alaskan volumes are problematic according to Mr. 
Wright, because there has been no application to construct necessary 
infrastructure to transport the gas, and the timeline from application 
to first delivery is approximately 10 years.
iii The National Energy Board of Canada states, the Western 
Canadian Sedimentary Basin (WSCB) accounts for more than 90% of the gas 
production in Canada and for about 23% of North American natural gas 
production annually. In the last few years, gas production from the 
WSCB appears to have flattened after many years of growth, leading to 
increased uncertainty about the ability of industry to increase or even 
maintain current production levels from the basin over the longer term. 
See, Canada's Conventional Natural Gas Resources: A Status Report, 
National Energy Board, April 2004, pp. 9--10.
iv Exports of gas to Mexico have increased greatly in the 
last few years. These exports do not constitute a large out-flow of gas 
at present. However, the Mexican economy is growing and if it continues 
to grow, its demand for natural gas will increase and require the 
United States to import an increasing amount of gas to meet, not only 
domestic needs, but also the needs of Mexico. In other words, what 
Mexico imports and shares today by way of natural gas, Mexico may not 
be able share later. Jeff Wright, Chief, Energy Infrastructure Policy 
Group, Office of Energy Project, Federal Energy Regulatory Commission, 
Fall 2005.
v Poaching War for Crews Erupts, Fairplay International 
Shipping Weekly, February 24, 2005.
vi Id.
vii SIGTTO News, September 2005, p.5.
viii Poaching War for Crews Erupts, Fairplay International 
Shipping Weekly, February 24, 2005.
ix Near Calamities in Cargo Operations, Fairplay 
International Shipping Weekly, December 1, 2005.
x Poaching War for Crews Erupts, Fairplay International 
Shipping Weekly, February 24, 2005.
xi LNG Crewing Shock, Tradewinds, February 25, 2005
xii Philippines Dangles $18,000 Carrot, Tradewinds, January 
9, 2006; See also, LNG Wage Anger, Tradewinds, November 4, 2005; 
Officer on $320,000 a year, claims Sigtto, Tradewinds, November 4, 
2005.
xiii Tradewinds, Insurers Get LNG Jitters, LNG Ships Facing 
Premiums Boost, March 17, 2006
xiv Id.
xv Id.
xvi Id.
xvii Foreign Flag Vessels May Bring Down LNG Import Costs, 
The Hindu Business Line, December 13, 2005.

    Chairman Thompson. Thank you very much, Mr. Davis.
    Dr. Raj, please summarize your statement for 5 minutes, 
please.

STATEMENT OF PHANI RAJ, PhD PRESIDENT, TECHNOLOGY & MANAGEMENT 
                         SYSTEMS, INC.

    Mr. Raj. Thank you, Mr. Chairman. Mr. Chairman, members of 
the committee, it is a privilege and high honor for me to be 
invited to testify before this committee.
    I come before you to share some of my knowledge on issues 
concerning liquefied natural gas, or LNG, and the public's 
concern on its hazards.
    My research, both experimental and modeling of the behavior 
of hazardous materials, including LNG, have been funded by U.S. 
government agencies.
    The LNG industry, to whom I have provided and continue to 
provide consulting services, has recently funded some LNG fire 
research jointly with the United States Department of 
Transportation.
    The testimony I am presenting today is based on my 
professional and scientific experience and was entirely 
prepared by me.
    However, I wish to acknowledge for the record that my 
professional time and expenses for preparation and appearance 
before this committee is being underwritten by the Center for 
Liquefied Natural Gas, CLNG, which is a coalition of entities 
active in the LNG industry.
    Mr. Chairman, in regard to LNG issues, I wish to make the 
following six observations. One, the LNG industry is one of the 
safest industries, very enviable record of safety for over 40 
years.
    Worldwide, there have been over 40,000 shipments of LNG to 
ports that have high marine traffic, and many of which are also 
near populated areas.
    In the U.S., millions of gallons of LNG have been 
transported, imported, handled, gasified, and have provided 
energy to the public, all with the industry's exemplary record 
of safety.
    In the 40 years that this activity of supplying the vital 
energy needs of the country has been going on, not a single 
person of the public has been injured or suffered a fatality by 
any LNG incident.
    Also, the total number of worker casualties in the LNG 
industry in the entire world over the last 40 years of 
operation can perhaps be counted on one's fingers.
    Number two, LNG, propane, gasoline, jet fuel and other 
hydrocarbon fuels, are all members of the hydrocarbon fuel 
family. The combustion properties of LNG and other hydrocarbons 
have more in common than in their differences.
    A large LNG fire will be very similar in radiant heat 
emission characteristics to a large fire of propane, gasoline, 
jet fuel, et cetera, all of them forming very smoky fires.
    Currently used LNG hazard assessment models have layer upon 
layer of conservative calculations, making the predicted 
distances to hazard substantially more than what it would 
likely be in reality.
    This is due to lack of information on how large spills, and 
especially large fires, behave. All we have now are data from 
small tests.
    Our confidence in extrapolating these large spill phenomena 
is low, and this leads to variations in predictions by 
different researchers.
    Larger LNG pool fire tests that are being planned will 
provide the necessary framework for the development of 
realistic fire models.
    Number four, other research that are equally important as 
pool fire tests and modeling should be undertaken to determine 
the type and magnitude of other hazards which may, under 
certain circumstances, become the more important hazard 
scenarios rather than the pool fire.
    These include, for example, water-LNG interaction, water 
intrusion into LNG tanks, and considerations of a fireball type 
of burning. The overall combined hazard may be, however, 
smaller than predicted if only the pool fire is considered.
    Focusing only on the consequences of a perceived worst case 
rather than the overall risk from an activity will result in 
poorly utilized and improperly allocated resources, not to 
speak of the economic penalties that may result.
    Risk analysis as a tool is being increasingly utilized in 
the U.S. for decision making, but only in bits and pieces. The 
single important reason for the lack of universal adoption of 
risk-based decision making is the lack of standards for the 
levels of risk that are acceptable to society.
    Mr. Chairman, in summary, the LNG industry operates very 
safely. Further research and its results will lead not only to 
enhancing our knowledge for better evaluations of safety but 
also help to educate the public on the real issues.
    Mr. Chairman and members of the committee, I thank you for 
this opportunity to testify before your committee. I will be 
happy to answer any questions.
    [The statement of Mr. Raj follows:]

                  Prepared Statement of Phani Raj, PhD

    Mr. Chairman, Mr. King, Members of the Committee, it is a privilege 
and high honor for me to be invited to testify and share my knowledge 
on liquefied natural gas (LNG) safety related to accidental or 
intentional breach of cargo tanks in a LNG vessel.

Introduction
    I come before you as a researcher in the field of LNG safety with 
over 30 years of experience in conducting experiments, analyzing the 
test results and developing mathematical models for the behavior of LNG 
upon its release into the environment and the hazards it may pose. My 
research projects related to LNG have been funded primarily by US 
Federal agencies (US Coast Guard and US Department of Transportation) 
and to a lesser extent by the LNG industry. I was one of the members of 
the research team (and the principal author of the technical report) 
that conducted the field experiments in mid 1970s to understand the 
different behavior phenomena associated with the release of LNG on 
water, including that of the pool fire on water and its radiant heat 
emission characteristics. This series of tests, which to this day 
remains as the only comprehensive set of experiments on water, was 
funded by the United States Coast Guard, and conducted in the US Navy 
testing facility in China Lake, CA. Many of the mathematical models 
used today are in one way or other based on the findings from this 
series of tests, though the test sizes were of a modest scale compared 
to sizes of postulated spills to which the models are being applied 
now. My recent research, sponsored jointly by the Pipeline & Hazardous 
Materials Safety Administration (PHMSA) of the US Department of 
Transportation and Distrigas of Massachusetts, LLC (DOMAC), has been to 
evaluate the data from the largest LNG fire experiment to date and 
model the characteristics of very large LNG pool fires and their 
radiant heat effects. This research and the model developed are based 
on the data from larger size LNG fire tests conducted in France in 
1987. The model and the findings, which have been published in a peer 
reviewed technical journal, indicate that large LNG fires behave quite 
differently than the smaller scale fires (used in China Lake tests) 
and, in fact, radiate less heat per unit fire area. Other research that 
I am currently involved in includes the determination of the tolerance 
(without injury) of human beings to LNG fire radiant heat exposure, and 
the degree of protection provided by ordinary civilian clothing and 
other intervening objects to the public from the effects of radiant 
heat from a large LNG fire.
    In my capacity as a scientist and researcher in the field of LNG 
behavior modeling, I have (i) provided consulting support to the 
Government agencies, the LNG industry, Standards setting bodies, (ii) 
testified before administrative and regulatory proceedings, (iii) 
presented many scientific research findings before peer groups, 
responded to the safety questions from the public in public hearings, 
(iv) trained firemen and first responders on the properties and 
behavior of LNG, and (v) authored a number of technical publications in 
reputable journals. I also serve on the LNG Standards Committee of the 
National Fire Protection Association (NFPA), which has developed a 
consensus standard on LNG facility design, LNG handling and storage, 
and personnel training requirements. Parts of this standard, especially 
on LNG fire hazard assessment and protection, have been incorporated in 
federal regulations.
    I review below some of the important questions that have been 
raised in scientific forums and public debate on LNG behavior and 
safety and provide my views on the subject. My testimony below will:
        (i) Comment on the exemplary safety record of the LNG industry 
        both in the US and worldwide
        (ii) Highlight some of the LNG properties that have an impact 
        on potential hazards and compared them with properties of other 
        common fuels,
        (iii) Discuss the knowledge related to what is known and 
        unknown in mathematical modeling to predict adverse public 
        impact distances from LNG releases,
        (iv) Identify immediate and near term research needs to fill 
        the gaps in our knowledge, and,
        (v) Argue that results based on risk analyses and not those 
        based on the consideration of a single scenario (however large 
        the hazard) should form the basis of policy decision-making 
        related to LNG activities. This discussion includes, briefly, 
        the current LNG regulatory requirements in the U.S. and 
        potential for improvements in assessment techniques that may 
        lead to a more balanced and efficient use of resources.

    Safety Record of the LNG Industry
    LNG industry has operated safely both in the US and worldwide for 
over six decades. There is no technical or operational reason why this 
exemplary record will not continue. New technologies, application of 
results of careful research, and continued personnel training are 
expected to contribute to the enhancement of the safety record.
    In the U.S., LNG has been used in peak shaving operations 
(liquefying pipeline natural gas during periods of low demand, storing 
the liquid, and re-gasifying it to meet peak demand, generally during 
winter months) for over 60 years. Trans-continental shipments of LNG in 
ocean-going tankers started in 1959. The worldwide demand for LNG has 
grown significantly since the 1960s and today over 150 LNG ships safely 
deliver the liquid to ports in many countries (including the US, Japan, 
France, et al) in some of the busiest and most congested ports of the 
world near population centers. The safety record of the LNG industry is 
enviable and unmatched by any other comparable industry--not a single 
injury or fatality to a member of the public for over 50 years and 
extremely low rates of injury even among the workers in the industry. 
Over 45,000 tanker shipments have occurred world wide to date, without 
any significant LNG spills (other than very minor leaks through pipe 
gaskets, overfilling of tanks, and spills during make and break of the 
unloading arms).
    The industry is highly regulated in the US and has to meet very 
strict mechanical design, personnel training and low public impact 
standards. The ships are built to international standards, are of 
double hull design (and have been from the very beginning of the 
industry). The US Coast Guard inspects every LNG vessel that visits a 
US port before it enters the port. This inspection includes a check of 
safety emergency systems, interview with personnel, review of ship's 
records and a security assessment. In addition, the US Coast Guard 
(specifically, USCG Sector Boston) has mandated certain exclusion zones 
in the fore, aft and sides of an LNG ship in transit to minimize 
collision risks with other vessel traffic in the port. The shore-based 
operations and facilities of LNG terminals come under the purview of 
the US DOT regulations and are inspected annually for safety. In 
addition, the design of storage tanks and other systems in the facility 
have to conform to the industry consensus standard, namely, the 
National Fire Protection Association's ``Standard for the production, 
Storage, and Handling of Liquefied Natural Gas, (NFPA 59A).'' The DOT 
regulations also stipulate the training requirements for industry 
personnel. Last but not the least, every one of the LNG terminal 
facilities in the US has to prepare and follow a security plan to 
thwart any potential sabotage or terrorist acts. This level of scrutiny 
and regulatory oversight, in addition to the industry's self interest 
to operate extremely safely, has been the principal cause of the safety 
success story. As mentioned earlier, no other energy industry has such 
an outstanding safety record. However, the price for an exemplary 
safety record is eternal vigilance, personnel training and 
implementation of advanced technologies.
    LNG properties that have an impact on potential hazards and 
comparison with properties of other common fuels
    LNG burning properties are not very different compared to similar 
properties of other commonly used hydrocarbon fuels. Large LNG fires 
will be very similar in radiant heat emission characteristics to large 
fires of propane, gasoline, jet fuel, etc.
    LNG is natural gas cooled at atmospheric pressure to a low 
temperature of --260 F. It consists, mainly, of methane and few 
percent by volume of ethane and propane and traces of other 
hydrocarbons and nitrogen. Methane is a member of the saturated 
hydrocarbon group of chemicals, which includes ethane, propane, butane, 
pentane, octane (the principal constituent of gasoline). Each molecule 
of a hydrocarbon fuel consists of carbon and hydrogen atoms combined in 
specific proportions. The combustion properties of all hydrocarbon 
fuels are very similar. For example, the heat produced when a pound of 
any one of these saturated hydrocarbons is burned in air \1\ is the 
about the same, namely 20,000 Btu (within  5%). Also, the pounds of 
air required to burn completely one pound of any of these fuels are 
also about the same, namely, 15.5 ( 3%), except for methane, which 
requires a larger quantity of air. The consequence of the similarity in 
combustion properties is that the fires all of these fuels should have, 
within  100 oF, the same temperature, methane fires being the least 
hot. This observation has been demonstrated by carefully conducted 
laboratory experiments with different fuels.
---------------------------------------------------------------------------
    \1\ In sufficient quantity of air which contains the chemically 
required amount of oxygen to react with the hydrocarbon for complete 
combustion (called the ``stoichiometric'' amount).
---------------------------------------------------------------------------
    The implication of the above observation is that methane (LNG) 
fires are no different in temperature than other fuels that the 
industrial society uses. All fires emit heat in the form of radiant 
heat (``infrared radiation'') and the amount of energy emitted is 
dependent on the fire temperature. The question, therefore, is why 
methane (or LNG) fires are considered to be more ``hazardous'' or 
``hot?'' This has to do with one additional phenomenon that occurs in 
burning, namely, production of soot particles (unburned carbon) in a 
fire. The higher the number of carbon atoms in the fuel molecule (as in 
gasoline or diesel fuel) the greater is the production of soot 
particles during the process of burning. That is, a methane fire will, 
all other conditions being the same, produce a smaller amount of soot 
in a given size fire than in a fire burning a heavier oil. The soot 
particles produced tend to form a mantle or shroud around the fire. The 
larger the density of the soot particles in the mantle, the higher is 
the absorption of the radiant heat emitted from inside the fire and the 
lower is the magnitude of the heat emitted to the surroundings. The 
soot layer acts as a ``heat blocker'' much the same way as a smoked 
glass does to visible light. In the case of smaller fires, this 
blocking of heat emission is smaller because of the lower soot amount 
produced. The fire from the burning of methane -which has a single 
carbon atom in the fuel molecule and which produces the least amount of 
soot- will therefore appear ``brighter'' or ``hotter'' to an observer 
outside the fire. However, as the methane fire size increases a lot 
more soot is produced, forming a black shroud around the fire, like 
fires of ``heavier'' hydrocarbons.. This reduces the overall radiative 
heat emission to the outside. Therefore, when the fire sizes become 
large (such as hundreds of feet in diameter), the distinction between 
fires of different hydrocarbon fuels tends to diminish and they all 
look about the same (with small differences in the amount of radiant 
heat emitted to the outside). That is, LNG is clean burning in 
relatively small size fires but as its size becomes large it burns 
``dirty.'' Exhibit 1 shows a 13 m diameter LNG fire on water observed 
in the tests conducted at China Lake. The smoky aspects of a large LNG 
fire is seen in Exhibit 2, which shows the 35 m diameter LNG fire in 
the tests conducted in 1987 at Montoir, France. The latter fire is the 
largest LNG fire tested to date.
    4. Immediate and near term research needs to fill the gaps in our 
knowledge
    4A. What is known and unknown in mathematical modeling to predict 
adverse public impact distances from LNG releases
    The models that are being currently used in LNG hazard assessment 
have layer upon layer of conservative calculations, making predicted 
distance to hazard substantially more than what it may be in reality. 
New sets of larger LNG pool fire tests and other equally important 
research will provide the necessary framework for the development of 
realistic models with which to assess the hazards from potential LNG 
release scenarios from ships.
    To a large extent the fire hazard assessment models used currently 
are based on the data and findings from tests such as China Lake 
experiments. These test sizes were of a modest scale compared to sizes 
of postulated spills to which the models are being applied now. There 
is considerable uncertainly in the scale-up and applicability to larger 
LNG releases.
    The extent of the potential hazard zone surrounding a LNG release 
depends upon a number of factors including the quantity and rate of LNG 
release, the location of release (onto water or land), the 
environmental conditions and mitigating circumstances and the type of 
behavior of interest (dispersion and subsequent ignition of a vapor 
cloud, a pool fire, or other type of behavior of concern). Our 
knowledge of and confidence in modeling some types of LNG behavior, 
even in the case of very large spills, are good and in other cases they 
are very limited or lacking. The gaps in our knowledge of applicability 
to larger LNG releases make it difficult to model the entire sequence 
of events as a system and estimate the magnitude of the final 
consequence.
    There are four distinct steps in modeling the consequences of 
release of any hazardous material, including LNG. These steps include, 
(i) the quantitative description of the details of the source and the 
modification that the released material may undergo in the immediate 
vicinity of release location due to its interaction with air or water. 
(ii) the description of behavior of the released material in the 
environment (burning as a pool fire, dispersion of vapor in the 
atmosphere and later burning as a vapor fire, rapid phase transition-
RPT, etc) and quantification of the hazardous effects caused by the 
behavior, (iii) the enhancement or reduction of the hazardous effects 
due to interaction with the atmosphere and, finally, (iv) calculation 
of the effects on people or structures using the appropriate 
susceptibility criteria for such hazards (or alternatively, calculating 
the distance from the release where the hazards are below acceptable 
levels).
    In the case of scenarios of potential LNG release from tankers, 
there are significant uncertainties and unknowns in the first step 
itself, namely source modeling. This has a significant impact on the 
overall hazard prediction. The calculation of the rate of discharge of 
LNG from a specified size hole on the side of a ship's tank is 
relatively straight forward, when such a hole is above the water line. 
Other phenomena may also occur, which substantially reduce the overall 
flow rate. One such is the creation of a vacuum condition in the tank 
leading to intermittent discharge (``glug-glug'' type of flow as from 
an inverted bottle). Our knowledge to calculate the LNG outflow and the 
water inflow rate in the case the hole is either at or below the water 
line should be supplemented. The physics of mixing of LNG outflow with 
the water inflow, and mixing of water entering the tank with the LNG 
inventory in the tank (causing rapid evaporation and exacerbating the 
tank pressure condition), are some of the potential phenomena that have 
not been studied carefully. The calculations of how fast LNG comes out 
and in what form (liquid, vapor, liquid drops) are extremely difficult 
and full of uncertainties. Currently, there are no experiments to guide 
us to model the flow when the hole is at or below water line. 
Performing a chain of calculations using only a single scenario of 
release cannot be the last word on the extent of the public hazard, 
however conservative the assumptions may be. A whole spectrum of events 
and their consequences needs to be considered.
    The GAO report has identified cascading tank failures due to heat 
or the contact of cryogenic liquid and carbon steel as another issue. 
The conditions under which these cascading tank failures may occur and 
resultant effects on the hazards are not clearly understood. Therefore, 
there are considerable uncertainties in describing the rate and 
quantity of LNG released and the form in which it may be released 
depending upon the locations and sizes of holes in the two hulls of the 
ship.
    The vapor formed by the release of LNG (into or on water) is most 
likely to be ignited, close to the ship, from hot metals or electrical 
sparks (static or cut cables). In all current generation models it is 
assumed that all released LNG will form an expanding-vaporizing pool on 
the water surface sustaining a pool fire. Modeling the spread of the 
pool given the volume of the liquid LNG in the pool (or the rate of 
volume entering the pool) is reasonably well established. However, what 
is not known precisely is how much of the LNG flowing out of the tank 
actually pools on the surface. A large jet of LNG pouring out from an 
elevated hole plunging into water can penetrate the water column to a 
significant depth, fragment by both mechanical and thermal interaction 
with water, form small droplets of LNG most of which will vaporize \2\ 
by the time they rise to the surface leaving only a fraction of the 
release to form a floating liquid pool. There are two main consequences 
of this. One is that the large vapor volume released could burn as a 
fireball near the ship. (A fireball puts out significantly higher heat 
(per unit area) but for a considerably shorter duration than a pool 
fire). The second possible outcome is that the vapor produced within 
the water column together with the vapor produced by the spreading LNG 
pool on water burns in a pool fire. The diameter of this pool fire 
would be far less than if all released liquid pooled on the water 
surface. Both of these phenomena have direct effect on the calculated 
hazard distance. No experiments have been conducted to understand the 
effects of LNG jet plunging into the water and the consequent fireball, 
pool fire or other types of burning.\3\
---------------------------------------------------------------------------
    \2\ My own recent analysis of the phenomenon of a LNG jet plunging 
into deep water indicates that depending upon the LNG plunging velocity 
into the water surface 50% or higher fraction of the released liquid 
could vaporize in the immediate vicinity of the release leaving only a 
smaller volume of liquid to spread on the water surface.
    \3\ I, however, noticed in the China Lake tests that the higher the 
spill rate (in gpm) of LNG the higher was the burning rate, the taller 
was the fire and the quicker it went out.
---------------------------------------------------------------------------
    A fire poses hazards due to the emitted radiant heat. Radiant heat 
is the heat felt by a person (or an object) outside the fire and at 
some distance from the fire so that the heat is not due to direct 
contact with the hot gases in the fire. This is the ``heat'' that one 
experiences when facing a fire in a home fireplace. The radiant heat 
emission from a fire is generally quantified by a parameter called the 
``emissive power,'' which is the average amount of heat energy 
``leaving'' a unit nominal surface area of the fire and is expressed in 
units of kW/m\2\ or Btu/hr ft\2\. The higher the emissive power the 
brighter a fire will appear and the farther one needs to be from the 
fire to be safe. The emissive power of LNG fires has been measured in 
relatively small-scale field tests. Most of these small fires burn 
bright (as seen in Exhibit 1). It is known that emissive power value is 
fire size dependent. A large body of current generation models used for 
LNG fire hazard distance evaluations assume that irrespective of the 
fire size the emissive power remains essentially the same (and high), 
leading to the prediction of uncomfortably large hazard distances from 
large spills of LNG.
    As argued earlier (and shown in Exhibit 2), large LNG fires become 
smoky, very similar to other fuel fires. All smoky fires have a region 
close to the bottom where the smoke mantle has not formed and where the 
hot ``bright'' parts of the fire are visible from which can emanate 
high radiant heat fluxes. The height of this region decreases as the 
size of the fire increases. The black (cold) smoke mantle enveloping 
the fire absorbs the radiant heat emission from the inner regions of 
the fire resulting in substantially less radiant heat energy being 
released to the areas outside the fire. In the case of large LNG pool 
fire on water the burning regions close to the water could be hot but 
the overall emissive power will be less than that from a smaller size 
fire. In addition, the hot region close to the water will result in 
inducing high vaporization of water, locally. The water vapor thus 
formed just around the base of the fire may contribute to absorbing the 
radiant heat emission in addition to, being sucked into the fire and 
affecting the combustion chemistry to make the fire cooler and less 
radiative. None of these phenomena have been studied quantitatively in 
any controlled, large-scale experiments. We do not know how smoky very 
large LNG fires will be and what the height of the lower ``bright'' 
burning zone would be or what the mean emissive power will be. A 
theoretical model developed using the principles of combustion physics 
and validated against the best available data from the 35 m LNG fire 
experiments (the largest fire to date) seems to indicate that the mean 
emissive power of large LNG fires from ship spills may be only about a 
1/3 as radiative as smaller fires. If this is true, the hazard 
distances predicted from current models will have to be reduced by 
almost a factor of 2. Certainly, more research and large pool fire 
experiments on water are needed to get definitive data. I concur with 
the GAO recommendation on the need for this research.
    Some people analyzing LNG hazards from ship releases are concerned 
with cascading failures of tanks due to external fires or interactions 
of the cryogenic LNG with metal structure of the ship. In fact, the GAO 
report recommends that research be conducted on this potential failure 
phenomenon. I agree with this recommendation, in principle, provided 
the types of research performed are realistic representations of the 
conditions following LNG release from a single tank. The heat from a 
pool fire may not result in further tank failures. The potential for 
cryogenic liquid-carbon steel interaction will depend upon a number of 
variables including the extent to which water is present, the location 
of contact between the hull plate and the liquid, whether such a 
contact will result in the immediate fracture of a part of the plate 
and the draining of the cryogenic liquid reducing the possibility of 
further contact, the engineered naval architectural designs that 
maintain the integrity of the ship structure even when a part of the 
structure fails, etc.
    It is my opinion that heat from even a LNG pool fire impinging on 
the outer hull plate of the ship will be insufficient to cause further 
tank failures. This opinion is based on the following reasons; (i) 
there are at lest two historical records of incidents involving ships 
carrying refrigerated liquefied fuels which were exposed to intense and 
very long duration (hours) hydrocarbon fires impinging on the hulls and 
deck plates, yet suffered no failures of the cryogenic liquid tanks, 
(ii) the ships were of smaller size than current day LNG vessels; 
because of shorter dimensions, the smaller vessels are relatively more 
vulnerable to heat transfer from the fire to the tanks (and yet the 
tanks did not fail), (iii) the calculated lifetime of a LNG pool fire 
is of the order of minutes within which the total heat transfer to a 
massive ship structure would not affect the hull integrity (especially 
since the outer hull is also cooled by sea water), and (iv) the LNG and 
hydrocarbon fires have the same temperature as discussed earlier. The 
cases I cite are the incidents with ``Yuyo Maru # 10'' and the ``Gaz 
Fountain.''
    In November 1974 the Yuyo Maru No10, a 47,300 m\3\ tank capacity 
ship carrying refrigerated LPG in insulated tanks with ballast tanks 
filled with naptha (a fuel very similar to gasoline) was underway in 
Tokyo harbor. It was hit broadside by 15,500dwt steel products carrying 
ship ``Pacific Ares,'' The collision resulted in one of the wing tanks 
of Yuyo Maru being punctured and releasing naptha on to both the water 
and the deck of the colliding ship.\4\ The naptha pool ignited 
immediately and the resulting fire caused damage to both the LPG 
carrier and the colliding vessel. The naptha fire on the sea engulfed 
the ships for more than 4 hours. The LPG vapors were released through 
the normal relief valves and no boiling liquid expanding vapor 
explosion (BLEVE) occurred nor did a leak of liquid propane occur nor 
any tank failure.
---------------------------------------------------------------------------
    \4\ William de Barry Thomas, Spectacle Blurs Issues, Hazardous 
Cargo Bulletin, p 23, October 1984.
---------------------------------------------------------------------------
    The other incident refers to Gaz Fountain. This ship, designed to 
carry both LNG and LPG, was hit in the Persian Gulf during the Iran/
Iraq war in October 1984 by three air-to-surface Maverick missiles, 
which caused extensive damage on the deck of the ship.\5\ The ship at 
that time was carrying LPG. Intense and long lasting fire resulted on 
the deck. Propane vapors burned through a gash in the tank roof as a 
large vent fire. No tank failure or release of refrigerated liquid 
propane resulted nor did any of the tanks undergo a BLEVE type of 
failure.
---------------------------------------------------------------------------
    \5\ J.A. Carter, Salvage of Cargo from war damaged Gaz Fountain, 
paper presented at the 1985 Gastech Conference, Nice, France, 1985.
---------------------------------------------------------------------------
    Other researchers have postulated the failure of LNG ship tanks due 
to fire heat exposure leading to a LNG tank explosion (due to BLEVE). 
As indicated above, no such explosions have occurred in tanks of ships 
carrying refrigerated liquefied petroleum gas (LPG) even after being 
subjected to intense fires on the outside. For a BLEVE to occur the 
liquid in a tank must be heated to temperatures well beyond its normal 
boiling temperature (and therefore higher pressure in the tank) and the 
tank has to be suddenly depressurized by, say, the sudden rupture of 
the tank wall. The rapid depressurization results in the production of 
large volumes of vapor, which may ignite and form a large fireball and 
the pressure waves created may hurl pieces of the tank to some 
distance. The higher the pressure in the tank at rupture the worse will 
be the effect of a BLEVE including the throw of the pieces of the tank 
to distances up to 10 mile. BLEVE incidents have occurred in 
pressurized (LPG) rail tank cars or relatively small LPG storage tanks 
in which the pressure is normally about 105 psig and the tank will 
withstand pressures up to 375 psig before rupturing. Large tanks have 
not exhibited the BLEVE type of explosive rupture;The smaller the tank 
and the higher the pressure it can withstand the greater is the 
likelihood for the occurrence of a BLEVE.
    One can conclude that a BLEVE is extremely unlikely in a LNG ship 
tank when one considers the conditions necessary for such an event to 
occur. First, the volume of liquid in each tank of a LNG carrier is 
large (25, 000 m3). To heat such a massive amount of liquid to any 
temperature significantly higher than its normal boiling temperature 
requires significant amount of heat to be input. The calculated 
lifetime of a LNG pool fire (caused by the rupture of another tank) 
generally ranges from a few minutes to, at best, 15 minutes. Over this 
burning time it is difficult to transfer significant quantity of heat 
to the LNG in the tanks. Second, the LNG tanks are well insulated and 
separated from the outer hull by a large (at least 2 m wide) inter-hull 
ballast space, which impedes heat transfer from the fire to the tank 
wall. Third, the tanks are provided with relief valves, which will 
ensure that no significant rise in the pressure occurs. Further more, 
because of the size of the LNG tank the roof of the tank will not be 
able to withstand any significant increase in pressure () before being 
damaged. Last but not the least, actual experience with large ships 
carrying refrigerated fuels (LPG and butane) in tanks similar to those 
in LNG carriers indicates that even though they were subject to fires 
lasting several hours no BLEVE resulted. Therefore, in my opinion, the 
consideration of BLEVE as a potential public hazard phenomenon in the 
scenario of an accidental or intentional release from a LNG ship is 
addressing a non-problem.

    4B. Areas that require additional research and why
    Other research that may be as important as pool fire tests and 
modeling needs to be performed to determine the type and magnitude of 
other hazards, which may, under certain circumstances, become the 
dominant hazard scenario(s) rather than a pool fire. These include 
water-LNG interaction, water intrusion into LNG tanks and 
considerations of a fireball type of burning.
    There are two most likely scenarios resulting from a large release 
from a LNG ship. These are (i) the formation of a LNG pool fire on 
water (initially expanding but reaching later a steady size) and, (ii) 
the potential formation of a large fireball type burning due to the 
immediate ignition of the large volume of vapor produced rapidly and 
locally from the LNG jet-water interaction. Whether such interaction 
could lead to localized and flameless rapid phase transition 
explosions, (RPT), should be investigated. A RPT together with LNG jet 
penetration into the water column together with the occurrence of a RPT 
can result in a very large volume of vapor bring thrown high up in the 
air leading to the formation of a fireball if ignited. The recent GAO 
report has recommended the investigation of the radiant heat emission 
and smoke production characteristics of large LNG pool fires on water. 
I am in agreement with GAO on this recommendation. However, the results 
of a pool fire test series alone will not provide all of the knowledge 
required to perform a credible public safety assessment. Therefore, I 
recommend the conduct of the following types of experiments followed by 
modeling to properly estimate the potential hazard areas from different 
types of similar magnitude phenomena. (These recommendations are 
complementary to those of the GAO).
        1. Large LNG pool fire of sizes up to 100 m in diameter on 
        (deep) water? the objective of these tests should be to 
        understand the variation of the fire dynamics, smoke production 
        characteristics and radiant heat emission change from bottom to 
        top of LNG fires as the fire size increases.
        2. Plunging LNG jet interaction with water (of significant 
        depth) to understand the phenomenon of depth of penetration, 
        jet fragmentation, rate of vaporization and fraction of liquid 
        spilled that will eventually pool on the water surface. This is 
        an equally important phenomenon to consider since in some 
        situations most of the spilled LNG may evaporate in the water 
        column and the pool formed may be so small as to not pose 
        significant pool fire hazard compared to, perhaps, other 
        phenomena like a fireball type of burning.
        3. Ignition tests with a plunging LNG jet into water to see if 
        a fireball results (and if so the conditions under which it 
        happens) or whether a fire similar to a pool fire but with 
        substantially large fire plume results due to very high gas 
        release rates in the ``pool.''
        4. Viewing a LNG Pool fire (or even a large natural gas fire) 
        from a distance of several hundreds of meters up to 2 km on a 
        very large expanse of water and measuring the absorption of the 
        radiant heat in the atmosphere. Current calculations of LNG 
        heat absorption by the intervening atmosphere are based on the 
        assumption that the fire radiates like an ideal black body. 
        However, LNG fires are known to be band emitters of radiation 
        in exactly the right frequency where the water vapor (and to 
        some extent the carbon dioxide) in the atmosphere absorbs. Such 
        a definitive test conducted on water will provide a basis for 
        taking into consideration the beneficial (and mitigative) 
        aspects of the atmosphere. Unfortunately, some of the models 
        used in calculating hazard distances either incorrectly model 
        the atmospheric absorption or do not consider it at all. Such 
        omission is not excusable when the predicted hazard distances 
        are in hundreds of meters (up to 2 km).
        5. The interaction of the LNG outflow and the water inflow 
        (simultaneously) to understand what may happen if the 
        postulated hole location in the ship's tank is at or below the 
        water line. The flow situation and the effects of large 
        quantity of water intrusion into a tank filled with LNG are 
        complex and need to be studied. Such a phenomenon may need to 
        be considered in hazard calculations.
    5. Results from risk assessments rather than from a single 
postulated scenario should be the basis of policy decision making.
    Risk analysis as a tool is being increasingly utilized in the US 
for decision-making, but only in bits and pieces. The single important 
reason for the lack of universal adoption of risk-based decision making 
is the lack of standards for the levels of risk that are acceptable to 
society.
    It is my opinion that policy decisions should be made after 
evaluating all possible scenarios of releases, their likelihood of 
occurrence, the levels of consequences associated with each scenario 
and considering the effects of either natural mitigation processes or 
man made technological or procedural systems. Absent such an approach, 
the focus will always be on the largest, most incredible types of 
releases, whether they have ever a chance of occurrence or not. 
Preparing for and managing resources required to respond to emergencies 
involving events that occur with very low probabilities is a 
misapplication of resources.
    It is very commendable that the report by Sandia \6\ recognizes 
that risk analysis must be the basis of overall assessment rather than 
the consequences of a single worst-case event. In fact, this report has 
provided a template on how one should perform a risk assessment; 
unfortunately, since the process has not been quantified with a 
specific example, the public seems to be focusing on the results from 
the theoretical assessment of the consequences only. Many other federal 
agencies have long recognized the usefulness of risk-based approach. 
However, it has been slow in ``permeating'' to the LNG industry 
regulations. The US Coast Guard requires the performance of Waterway 
Suitability Assessment, for LNG ship passage to a port, based on a risk 
consideration approach. The US DOT has in its Pipeline Integrity 
Management regulations the requirements for performing risk based 
assessments. The NFPA LNG Committee is considering providing, as an 
alternative Standard for compliance, a risk based standard.\7\ The 
European regulators have successfully used the risk-based approach to 
permitting LNG and other petrochemical facility siting for over a 
decade.
---------------------------------------------------------------------------
    \6\ Hightower M., L. Gritzo, A. Luketa-Hanlin, J. Covan, S. 
Tieszen, G. Wellman, M. Irwin, M. Kaneshige, B. Melof, C. Morrow, and 
D. Ragland, Guidance on Risk Analysis and Safety Implications of a 
Large Liquefied Natural Gas (LNG) Spill Over Water, Sandia National 
Laboratory Rep.# SAND2004-6258, U.S. Department of Energy, Washington, 
DC, Dec 2004.
    \7\ The full membership of this NFPA 59A Committee is considering 
this recommendation and verbiage provided by its sub-committee. If 
approved, this alternative standard would be incorporated into the 2009 
edition of the NFPA 59A Standards.
---------------------------------------------------------------------------
    One of the important recommendations I would offer this august body 
is to consider setting up acceptability standards for levels of risk 
that are suitable for siting industrial activities and for continuing 
such operations. Risk cannot be considered in a vacuum; it has to be 
based on comparative scales. There is substantial body of literature on 
this topic.

Conclusions
        1. LNG industry has operated safely both in the US and 
        worldwide for over six decades. There is no technical or 
        operational reason why this exemplary record will not continue. 
        New technologies, application of results of careful research, 
        and continued personnel training are expected to contribute to 
        the enhancement of the safety record.
        2. LNG burning properties are not very different compared to 
        similar properties of other commonly used hydrocarbon fuels. 
        Large LNG fires will be very similar in radiant heat emission 
        characteristics to large fires of propane, gasoline, jet fuel, 
        etc.
        3. The models that are being currently used in LNG hazard 
        assessment have layer upon layer of conservative calculations, 
        making predicted distance to hazard substantially more than 
        what it would likely be in reality. New sets of larger LNG pool 
        fire tests will provide the necessary framework for the 
        development of realistic models with which to assess the fire 
        hazards from potential LNG release scenarios from ships.
        4. Other research that may be as important as pool fire tests 
        and modeling needs to be performed to determine the type and 
        magnitude of other hazards, which may, under certain 
        circumstances, become the dominant hazard scenario(s) rather 
        than a pool fire. These include water-LNG interaction, water 
        intrusion into LNG tanks and considerations of a fireball type 
        of burning.
        5. Focusing only on consequences of perceived worst cases 
        rather than on the overall risk from an activity will result in 
        poorly utilized and improperly allocated resources, not to 
        speak of the economic penalties that may result.
        6. Risk analysis as a tool is being increasingly utilized in 
        the US for decision-making, but only in bits and pieces. The 
        single important reason for the lack of universal adoption of 
        risk-based decision making is the lack of standards for the 
        levels of risk that are acceptable to society.
    Mr. Chairman and Members of the Committee, I thank you for the 
opportunity to testify before your Committee.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    .epsChairman Thompson. Thank you very much.
    I thank both of you gentlemen for offering your testimony, 
and I remind each member that he or she will have 5 minutes to 
question the panel.
    I now recognize myself for the first 5 minutes.
    Mr. Davis, there were some questions earlier about the 
maritime administrator's initiative to increase the number of 
U.S. mariners on LNG tankers. Just for the record, do you 
support that?
    Mr. Davis. Absolutely. I think that the maritime 
administrator is doing a fantastic job. I think he recognizes 
that this is an important part of homeland security.
    And I think that he believes, as I do, that what better 
people to be watching out for the United States than U.S. 
citizens.
    Chairman Thompson. If this committee recommended to 
Congress that the administrator's initiative becomes law, 
requiring LNG tankers to have a certain minimal percentage of 
U.S. mariners, could we over time be able to provide those 
qualified persons to work on those LNG facility ships?
    Mr. Davis. Yes, Chairman Thompson. As it currently stands--
we had a fleet of vessels, LNG vessels, operating for over 20 
years with the American flag on it, which MEBA was on board and 
were the officers on board, and the Seafarers International 
Union was the crew on board.
    And those ships were taken and put a foreign flag on them 
for economic purposes, and we eventually lost all of our jobs 
on them.
    We still have a pool of mariners that essentially could 
walk on board the ships today--they would need a little bit of 
recency training and to get familiarized with any new vessels 
that are out there.
    But in a very short period of time--and I am talking weeks, 
not months--we could essentially start crewing up vessels. So 
my answer to that is yes, as well as the absolutely wonderful 
schools that we have around the country.
    We have the federal maritime school at Kings Point. We have 
the state schools at various states around the country, as well 
as the union schools, including my own in eastern Maryland.
    Chairman Thompson. Thank you very much.
    Dr. Raj, the GAO report highlights the fact that experts 
still disagree on the consequences of an LNG spill. Why do you 
think that disagreement exists? And kind of share that with the 
committee, if you would.
    Mr. Raj. Certainly, Mr. Chairman. The disagreement arises 
simply because of lack of knowledge. We have so far done tests 
on water, especially back in the 1970s, in which I was involved 
myself, spills on water where the size of the fire was about 50 
feet maximum diameter.
    But we are postulating scenarios based on ship spills that 
will go something like 1,000 feet in diameter, so there is a 
tremendous scale-up of the information from a 50-feet size 
experiment to a 1,000-feet diameter fire.
    We have recently come across, for example, information when 
the size of the fire is doubled from 50 feet to 100 feet it 
behaves completely differently. It completely becomes smoky 
fire and seems very much--looks very much like a gasoline fire.
    What has happened is people who know of those have used 
those models, whereas the people who do not know about this 
have used the older models, thinking that the fire is very 
bright. So we come up with substantially different estimates of 
the hazard.
    So I think it is a matter of lack of knowledge of really 
the behavior of LNG as we increase the size. And we are 
applying some very limited information that we have at the 
moment.
    Chairman Thompson. Has any of your research looked at 
potential economic consequences of spills? Or you just limited 
the research to just what would happen in the spill area?
    Mr. Raj. I have personally not undertaken any economic 
assessments. My field of research has been limited to 
understand the science part of it. But I am sure there are 
people who can understand the economic impacts if any such 
accidents do occur.
    Chairman Thompson. Well, and I think one of the things we 
want to consider is obviously the danger, but you know, 
terrorists would just as well like to keep a port out of 
business for a week or two, and that would be an absolute 
significant incident also associated with a spill or that 
particular incident.
    So I think part of our challenge is how do we look at all 
the consequences associated with the handling of LNG. Clearly, 
we want to know the hazards initially, but we also want to look 
at economic conditions that relate to it also. But I thank you 
for that.
    The other point that I want to talk to you, Mr. Davis, 
about is you have heard testimony that over time we will be 
bringing more LNG facilities online. And that will also require 
more and more people working in the facilities.
    So just like if the administrator's philosophy of more 
people on board ships become American, if we somehow can codify 
that, what happens if we bring 10 new facilities online and we 
will need additional ships for that?
    Do you see a problem with getting the necessary American 
citizens to work at those facilities also?
    Mr. Davis. Well, first, I think that the simple answer is 
no. If there are jobs for Americans, we will train them. We 
will fill the jobs when we have competent people to do that.
    But what I would like to say is in regards to land-based 
facilities that right now, there is no oversight on the vessel 
crewing issue for any ships to come into a land-based facility. 
MARAD has no say in that.
    It is interesting that MARAD has some input into the 
permitting process with the ships going to an offshore 
location, to a buoy set up offshore, but as far as the land-
based, for example, you can have a terminal right in the middle 
of a city, for example, which is certainly exposure to a lot of 
people.
    Now, the Coast Guard has 96 hours to essentially make sure 
that Joe Smith or whoever the name is that is given to them--
that they are supposedly cleared through their database.
    But basically, what they are not able to do is they are not 
able to--what MARAD is not able to do is have any say 
whatsoever in the crewing on board the ships that come into a 
land-based facility as it stands right now under the law.
    Chairman Thompson. Thank you, because that distinction was 
not made in testimony from the other panel. And I think that is 
absolutely beneficial.
    I will yield now to the gentleman from Houston, Texas, 
which, as you know, has a significant port operation going on 
there.
    Mr. Green?
    Mr. Green. Thank you, Mr. Chairman. And I want to thank you 
for hosting this important meeting.
    I thank the witnesses for taking the time to be with us 
today. And I have been gratified and edified by what you have 
said.
    So let me start by asking first, for my edification, how 
does the process work of having our mariners actually get to 
the ships? I am concerned about the logistics in that. What 
happens such that we can place our people on their ships? I am 
new to this. I am a neophyte on the committee.
    Mr. Davis. Well, as far as--you are talking on current 
ships, foreign-flag ships right now, American ships? I am not 
quite sure--
    Mr. Green. Well, you indicated that you thought that our 
mariners would be better suited because of their training to be 
on these vessels. So how do we get them there logistically 
speaking, if you don't mind?
    Mr. Davis. Well, logistically, a company--if a company's 
ship right now comes into the United States, we can--wherever 
it comes in and docks, we can just go ahead and put our people 
on there. Or if they are out at anchorage, we could send them 
out by boat.
    Or it is not uncommon at all for Americans to fly overseas 
and board a vessel overseas, and that is where they join the 
vessel.
    Now, what is going on in this industry is that there is a 
tremendous amount of new construction that is taking place. 
Many, many ships, well over 100 ships, which is a tremendous 
amount of ships, are being manufactured in other parts of the 
world.
    The best way to familiarize people with these ships and to 
become trained on these ships is to actually participate--
toward the end of the shipyard period as the ship nears 
completion, to actually go to that shipyard and participate at 
that point in time in the operations, because all the systems 
on board the ship are then tested and all before the ship is 
put into commission.
    That is the best way. But I mean--logistically, for new 
ships, the very best way. Older ships, all you have to do is 
fly people over to--fly Americans that are trained in LNG, 
which we do have--fly them overseas and put them on ships and 
they will take the ship to the United States and back to load 
again, discharge, and back and forth.
    And third case scenario is the ship is already here in the 
United States at an LNG facility or at an anchorage or a dock--
is we make the proper arrangements essentially to take people 
down to the ship either by boat or take them down in the car.
    Mr. Green. And is this process something that is employed 
in other places in the world, or would we be the first to 
initiate it?
    Mr. Davis. No, as far as putting people on board vessels--
Mr. Green, you are from Houston.
    Mr. Green. Yes.
    Mr. Davis. And I am very familiar with the Houston Ship 
Channel down there, and this is just standard procedure that we 
would do with any of the ships that--we are not on any of the 
international ships--international flag ships that come into 
Houston.
    But the American flag ships that come into Houston--this is 
all our standard procedure of what we do there.
    And if an American flag ship that was overseas in a port 
overseas--say it was in South America getting some oil, and 
they essentially came up a crew member short because an 
American on there got sick, we would fly a crew member down 
from Houston, put him onboard the ship in South America, and 
then he would bring the ship up to Houston, to the refinery in 
Houston.
    Mr. Green. If we imposed this type of requirement, could 
other ports, seeing this, conclude that because we now have 
ships coming to our port from the United States perhaps we 
would want to have some of our people on their ships?
    Mr. Davis. That is certainly possible, but right now, the 
United States--97 percent of all the shipping that comes into 
and out of the United States is carried on flags other than 
United States flag ships.
    So out of every 100 ships that comes into the United 
States, three of them are manned by Americans with a United 
States flag. The other 97 are foreign-flagged from some other 
country.
    Many of them are what we call flags of convenience, which 
are essentially flags that are licensed to a state that may not 
even have a port in it, but it has essentially big monetary tax 
breaks for a shipping company.
    Mr. Green. Dr. Raj, are you commenting at all, or are you 
in disagreement with what Mr. Davis is saying? Or are you just 
here to help us to understand the consequences of having the 
LNG handled inappropriately such that we have an explosion of 
some type?
    Mr. Raj. I am not competent, Mr. Green, to respond or--you 
know, I have not studied the problem. I am not an expert in 
this, and I don't have the background.
    So my expertise is really to understand what happens when 
LNG gets released.
    Mr. Green. All right. Are you familiar with the Houston 
Ship Channel?
    Mr. Raj. No, I have not been to the Houston Ship Channel. I 
am aware of it and heard many things about it.
    Mr. Green. Well, let's just take this hypothetical. In a 
ship channel, which is usually fairly narrow, if we have an 
explosion, how long--what is the duration, generally speaking--
the chairman got into this with you--for cleanup such that that 
ship channel will be traversable again from the point of the 
explosion, assuming that it is one that will incapacitate the 
vessel?
    Mr. Raj. I do want to mention that I agree with the GAO in 
their report that explosion from an LNG ship is a perhaps 
extremely unlikely scenario. LNG as a liquid does not explode.
    And LNG spills--if there is a fire, the fire is fairly 
short-lived and everything that gets released will be burned 
away or just literally go up in smoke. So there would be 
nothing left in the water as a cleanup of the material that got 
spilled.
    There may be other debris from the ship itself, or so on, 
and my expectation--and, you know, I don't have background in 
that area, but I will just expect that the port will be 
operational within hours, if not a day or two, because there is 
no cleanup kind of things that is required which would shut the 
port down.
    Mr. Green. Thank you, Mr. Chairman. I yield back.
    Chairman Thompson. Thank you.
    Just taking off from Mr. Green's comment, has your 
research, Doctor, taken in any potential acts of terrorism 
associated with an LNG tanker?
    Mr. Raj. No, sir. I have not specifically looked at 
terrorism. My expertise starts when there is a release, however 
the release is caused.
    Chairman Thompson. So if, say, as we had to happen in 
Yemen, where terrorists ran into the side of a ship with a lot 
of explosives, do you have any research or do you know of any 
research as to what the results of those kinds of terrorist 
acts potentially could be up on an LNG ship?
    Mr. Raj. I can only speculate, because--engineering 
judgment and science-based speculation, for two reasons. One is 
I can formulate what will happen to LNG when it gets released 
from tat kind of a situation where there is an explosive 
breakage of the hulls of the ships.
    But I also want to refer you to the information I have 
provided in my testimony on two actual incidents that happened 
in years past with large ships which were not hit by a 
terrorist but nevertheless they were subject to very high heat 
from flames.
    This happened in Tokyo Harbor where a ship carrying 
material called LPG, which is liquefied petroleum gas or 
liquefied propane, which is pretty similar to LNG, was involved 
in a t-bone collision accident with another ship, and there was 
no explosion or anything.
    In fact, what was released was a material similar to 
gasoline which was held in the side tanks of the ship, and the 
ships--both ships were cooked in the fire caused by the 
gasoline, the naphtha, released for 4 hours, and there were no 
explosions of any kind, other than burning. And the Japanese, 
in fact, had to tow that ship after 3 days and sink it with a 
lot of effort.
    The other incident that I am aware of is the one that--a 
ship that was hit by a maverick missile, surface-to-air 
missile--air-to-surface missiles in the Iran-Iraq war. And even 
there, when the missiles penetrated the hull of the ship, the 
deck of the ship, there were really no explosions or anything.
    So that is about all the knowledge we have at this time. We 
do not have experiments to really simulate exactly the 
situation that you have asked.
    Chairman Thompson. Well, do you think it would be 
worthwhile for us to have the experiments and the modeling that 
could probably give us some answers to some of these questions?
    Mr. Raj. Some of them, yes, indeed. I think it would be 
very worthwhile, and I have alluded to them in my testimony.
    Chairman Thompson. Thank you. Because part of it is the 
safety of LNG as it is, but the other is whether or not we can 
secure that LNG from a potential terrorist attack. And if we 
can, how do we do it? And heaven forbid, if we don't, what are 
the consequences?
    And how do we marshal the resources to respond to it in a 
manner that is coordinated and part of the strategic plan that 
we found out we don't have at the agency right now? And I will 
assume we will have it shortly. But we just keep our fingers 
crossed until we do.
    But that is part of the dilemma, and I can appreciate the 
testimony. I was not real happy with the Coast Guard and DHS's 
testimony that more assets and equipment is at this point not 
needed.
    I can't for the life of me see how, with the potential for 
these many facilities coming online--for us not to have need 
for more men and equipment.
    I know the Coast Guard is good, but I don't think you can 
be two places at one time. And that is kind of my thought. And 
Ranking Member King and others have kind of indicated similar 
opinions. And so we will be looking at that.
    I now yield to the gentlelady from Texas.
    Ms. Jackson Lee. Thank you, Mr. Chairman.
    And let me thank the witnesses on the second panel. This 
has been an important dialogue.
    One of the comments that I make and will continue to make 
in these hearings is that we have been lucky since 9/11. We 
have certainly made substantial improvements. We have awakened.
    But I can assure you, as the dust settles on any potential 
tragic incident, if they look to the lawmaking body, certainly 
this committee will be in the eyesight of those who will ask 
the question why.
    So we may be not finger pointing, but we may be looking 
under the hems of garments, and behind cracked doors, and 
turning on lights, and people will scratch their head and say, 
``We have been doing it this way for a long time. Why?''
    And I think it is simply because before the Yemen boat 
incident, if you will, who would have ever thought? A little, 
small boat--sounds like a fantasy story--goes up to a big, huge 
ship and 19 or so sailors are dead.
    So, Mr. Davis, let me ask you to speculate, because 
frankly, some would say, ``Well, he hasn't looked at the recent 
accounting pluses and minuses of the Coast Guard.''
    But just because you represent those who are a part of this 
marine industry, and I imagine you have encountered the Coast 
Guard and looked at the vastness of the area in which they 
operate--because your, if you will, members are probably 
engaged in a lot of what the Coast Guard is involved in.
    If you had to just look, would you think that there are 
enough resources in the Coast Guard--and I am going to ask you 
some other questions about--I think you made a point in your 
testimony that there should be more of your membership on 
ships.
    But just tell me, if you had to speculate, would you--could 
you feel comfortable in analyzing whether there is seemingly 
the Coast Guard--or the Coast Guard seemingly is doing all the 
work they need to do and could stand more resources? Mr. Davis?
    Mr. Davis. I am happy to answer that question. Thank you 
for asking it. I have, I guess, two ways that I would like to 
answer the question.
    The first kind of dovetails into a little bit of the 
previous question that the chairman had asked, and that is 
essentially the--I just feel it is my obligation at this point 
in time to state to this committee that in regards to terrorism 
with a ship, whether it be an LNG ship or any other type of 
ship, the most vulnerable place that you have on the ship is 
the crew.
    It is the crew that controls the ship. One or two engineers 
down in the engine room can take control of the ship, can 
control the steering of the ship, can control the speed of the 
ship, can have the ship going 20 knots up the Houston, ship 
channel or into New York Harbor or places in confined areas.
    They can ram the ship into bridges, Golden Gate Bridge. You 
name it--Verrazano Bridge, down in Houston. Anywhere they want, 
they can point this thing.
    Terrorists are not going to start some small fire that 
these tests and such have taken on. Terrorists are going to 
look for the most damage they can possibly do.
    They are going to direct--if they are going to use a ship 
for a weapon, it is going to be directed to do the absolute 
worst amount of damage, which will be stationary objects as 
well as perhaps other ships.
    And probably none of these studies have done a study of an 
LNG ship being deliberately smashed into another ship of highly 
flammable explosive types of materials.
    The barges that are down in the--coming up the Houston Ship 
Channel--unbelievable, some of the things that are in those 
barges.
    So to answer your--I just felt I needed to tell homeland 
security about this. It is the people on board the ship who 
ultimately control that ship. That is number one, and that is 
why--
    Ms. Jackson Lee. Could you hold your point for 1 second? So 
that means, in addition to the point you have made, to accept 
Mr. Raj's limitations by being encouraged that more research 
needs to be done in a vast area, because obviously terrorists 
are not going to pinpoint to us what they might do.
    Mr. Davis. Absolutely. There is no doubt about it. And you 
can't look at it as an isolated ship. You have to look at all 
the surrounding possible targets around there, how this could 
be done in such a matter.
    I mean, we do have nuclear power plants that are on rivers 
and bays and such. So there are certainly many possibilities, 
yes.
    Ms. Jackson Lee. It is my understanding that your 
organization and Excelerate Energy have entered into a 
memorandum of understanding. Can you provide us with 
information about the MOU?
    Mr. Davis. Yes. We have entered into an agreement between 
MEBA and Excelerate Energy that we will supply American 
officers for the Excelerate vessels.
    They made a commitment--Excelerate made a commitment to the 
maritime administrator, I believe, for 25 percent of the crews 
basically to be American, and that they intend to crew these 
ships up with American officers. That is deck officers and 
engineering officers.
    And we will integrate--right now, apparently, the ships 
have Belgian officers on board them, and we will integrate in 
there and take our experienced people that have LNG experience 
and integrate them onto these ships and get their recency and 
get their familiarization with this particular--each ship has 
its own idiosyncracies--and become familiar with that, and work 
together with the Belgian officers.
    And as Excelerate's fleet expands, perhaps at some point in 
time it may be all Americans on one ship and all Belgium on 
another, or something like that. I don't know.
    The final details of that I don't really know, because we 
are still in an exploratory process, because this is new for 
both Excelerate and for MEBA. But I would like to commend them. 
This is a major step forward, and we are very pleased that they 
have done this.
    Ms. Jackson Lee. You have got a little piece of paper next 
to you. Do you need to check on that?
    Or, Mr. Chairman, would you indulge me to finish my 
question? I am sorry.
    Do you need to----
    Mr. Davis. Well, just that Excelerate has made a commitment 
for their ships worldwide and not just for their ships that 
come into the U.S.
    Ms. Jackson Lee. Well, let me just say that being one that 
appreciates internationalism and working with our foreign 
allies, I am sensitive that we work worldwide.
    But I like what you have just indicated, and we might want 
to look at, as long as it is not proprietary, this MOU, because 
I think you are asking for more of our officers to be on 
foreign ships, to have a more integrated system, if you will, 
which can also play into this whole idea of security.
    And I don't know why we would be afraid of that. We have to 
do it in a way that speaks to our internationalism. But I think 
it would be a valuable approach to take. This MOU seems to be 
an advanced idea.
    In my last hearing, I asked about more training for your 
officers or for officers and I need your voice on that.
    I think it is important that we get on the same page, that 
we give more training as it relates to security, terrorism, 
prevention thereof to our officers and have the resources to do 
so.
    Would that be helpful to the individuals you represent?
    Mr. Davis. Yes. We have our own school, but most of our 
people have come from one of the state schools or the federal 
maritime academy, including Texas A&M.
    Ms. Jackson Lee. I am glad you said that, in Texas, and 
near Houston.
    Mr. Davis. In fact, I have been speaking with Texas A&M 
recently about some joint projects, joint training projects, 
between MEBA and them. We haven't come to any agreement or 
finalized anything, but we are discussing it.
    The maritime administrator has also been proactive with 
this. He asked all the CEOs of all the schools, federal, state, 
and the presidents of the labor unions that have training 
schools to please come to MARAD and sit down with him and 
discuss how we can train Americans for this specialized LNG 
training.
    And we did meet, and we have an ongoing committee meeting, 
and we are all working together and cooperating together to 
fill the possibility of jobs that we see coming down the road 
of putting Americans on these ships. So, yes.
    Ms. Jackson Lee. I appreciate it.
    Mr. Raj, let me bring my questioning to a close by posing 
two combined questions to you. And I heard you discuss 
research, and you made the very, I think, forward-thinking 
point that additional research is required.
    And I think it is, because you have talked about safety, 
but as I said to you, the question why will be asked, and I 
would say God forbid, were we to see a terrorist act.
    And so can you tell us why research has not been done and 
what approach we can--well, I think there should be sort of a 
firm approach to homeland security that this needs to be done 
and the appropriate researchers need to be engaged.
    But while you are answering that question, though you have 
noted the exemplary record that the LNG tankers have had, some 
60 years or so, couldn't you envision, as I have just heard Mr. 
Davis give us a wake-up call with some scenarios that he has 
offered, that it is vulnerable to terrorism, and that we should 
be mindful and watchful, and research would be warranted so 
that we can be prepared?
    Mr. Raj. Congresswoman, yes, I think you really hit the 
point. Research is needed to understand really what happens, 
and how it happens is an equally important part, as the 
chairman pointed out. And those are the areas that really need 
attention.
    One of the questions you asked is why was not research done 
all these years. I think the answer to that--research was done 
in the mid 1970s when LNG was considered to be one of the 
energy resources for this country, and for a variety of reasons 
the industry did not take off. In fact, a couple of them almost 
went bankrupt.
    And the revival of the industry is fairly recent in a 
sense, in the last 10 years or so. And with that, there is a 
lot more traffic in the world, a lot more traffic in the United 
States. And certainly, of course, 9/11 has added a new 
perspective and concern.
    I do want to mention one other thing. In my testimony, I 
have gone into great length to compare some of the other 
hydrocarbons that we deal with every day--gasolines, propane 
and so on.
    In my opinion, LNG is no different from them in the 
properties and, you know, hazardous properties. So we do not 
only have to be concerned with LNG--you know, our assessments, 
but also with the other materials which have similar 
properties.
    Ms. Jackson Lee. And you would think that we should not 
ignore the fact that a terrorist act could happen, but we need 
to generate the research, not only LNG but some of the other of 
the gases--propane, et cetera--that would be as susceptible to 
some act.
    Mr. Raj. Absolutely, because, you know, the price for 
freedom, as we all know, is eternal vigilance, and vigilance in 
this case includes understanding what would happen and prevent 
it from happening, and if it happens be responsive in emergency 
response.
    Ms. Jackson Lee. Mr. Chairman, profound eternal vigilance, 
I think, is a good not for me to yield back.
    But I just want to offer on the record--and it may sound 
redundant, but let me just offer it in any event. Before 9/11, 
none of us could imagine individuals learning to take off in 
planes and not have any training to land.
    And our first response for any of us who were looking awake 
or looking at the T.V. or seeing the reruns and hearing the 
initial responses as we listened to the tapes coming back was 
that it was an accident, that there must be a plane crash. 
Isn't it a little plane going into the towers initially?
    We had no understanding of that. And then my recollection 
is that we had a tragedy with an Egyptian pilot, if I recall, 
that has never been explained, I think, that flew one of the 
planes in New York and either wanted to commit suicide or--
whatever, but it was a human act.
    So things that we have never heard of have happened, and we 
need to get the vulnerability assessment studies, more 
research, more training.
    And, Mr. Davis, I think you have gotten hold of a good 
idea, and I would hope that if your document is not 
proprietary, I would like to have an opportunity to review it 
and begin to look at it as a model.
    Mr. Chairman, I yield back. Thank you for this hearing.
    Chairman Thompson. Thank you very much, Ms. Jackson Lee.
    I want to thank the witnesses both for their expert 
testimony as well as their response to the question. We are 
just beginning the process of looking into this area. We will 
have more hearings on this.
    So I hope you won't feel that we will be imposing on you 
from time to time to come back and share your information with 
us.
    It is the new kid on the block. It is coming. We have to be 
able to respond to whatever the challenge is, both if it is 
manpower, if it is safety. As you know, permitting of these 
facilities is question one, and it is always around safety. But 
now we have to add security to it.
    And the notion is whether or not from a government 
standpoint we can inspect them in real time, or are we going to 
have LNG tankers lined up, because we only have so many people 
around to do inspections.
    So those are some of the questions that this committee will 
have to grapple with.
    I want to compliment our MARAD administrator for being 
forthright in trying to negotiate putting American citizens on 
these particular ships. Hopefully we can move a little faster 
now that we know we can, over time, train the people to manage 
the facilities. So we will look forward to it.
    Again, let me thank the witnesses for their testimony.
    Hearing no further business, the committee stands 
adjourned.
    [Whereupon, at 3:54 p.m., the committee was adjourned.]


                               APPENDIX A

                             For the Record

Prepared Statement of the Honorable Bob Etheridge, a Representative in 
               Congress From the State of North Carolina

    I want to thank Chairman Thompson for convening this important and 
timely hearing. As energy prices have skyrocketed, alternative sources 
of energy and means of transportation for that energy. Liquid natural 
gas (LNG) will increasingly be used to diversify America's energy use, 
as shown by the recent upswing in applications for LNG facilities. As 
this gas will be transported under pressure in tankers traveling close 
to our shoreline, it is important that we ensure the public's safety as 
we increase the use of this fuel. This hearing is part of the Committee 
on Homeland security's vital work to make sure that the technologies 
and procedures in place are protecting the public.
    Last week's Government Accountability Office (GAO) report on the 
possible effects of a terrorist attack on a LNG tanker is a useful 
first step in identifying the threat and putting procedures in place to 
counter that threat. I look forward to hearing the testimony from the 
GAO experts today. I also will listen with interest to the officials 
from the Maritime Administration (MARAD) and Federal Energy Regulatory 
Commission (FERC) who are charged with licensing safe and secure LNG 
facilities. I want to be certain that the procedures in place take the 
possibility of a terrorist attack into account and require planning and 
security against that threat. I am pleased to see that the Director of 
Inspection and Compliance of the U.S. Coast Guard is here to give 
testimony as well, as the role of the Coast Guard in siting and 
approving LNG facilities includes emergency response planning and 
operational command in the event of an accidental or intention 
disaster.
    Again, I thank Mr. Thompson for his leadership, and our witnesses 
for their time in coming to speak with the Committee on this important 
issue. I look forward to the testimony and discussion as we work 
together to keep America Safe.


                               Appendix B

                              ----------                              


                   Additional Questions and Responses

  Questions From Honorable Bennie G. Thompson, Chairman, Committee on 
                           Homeland Security

                        Responses From Ron Davis

    Question 1: Do you support the Maritime Administrator's initiative 
to increase the number of U.S. mariners on LNG tankers? What else 
should be done?
    MEBA fully supports Administrator Connaughton's initiative to 
increase the number of American mariners on LNG tankers. His efforts 
have been a major factor in persuading LNG vessel operators to begin 
using United States merchant mariners on their vessels.
    We believe that the primary reason he has been successful is 
because plays a role in the permitting process of all deepwater LNG 
ports. However, does not play a role in the permitting process for land 
based terminals, which is overseen by the Federal Energy Regulatory 
Commission and the Coast Guard, neither of whom have a statutory duty 
to promote the U.S. maritime industry, as MARAD does.
    We believe that should play a role in the permitting process for 
on-shore (land based) terminals similar to the one they play with 
deepwater terminals.
    We also believe that the federal government should look into the 
feasibility of legislating a minimum crewing standard for LNG Tankers, 
including a requirement that 50% of the Officers be U.S. Merchant 
Mariners within a five-year period.

    Question 2.: How will the increase of mariners improve the security 
of the LNG tankers?
    Thanks to the in-depth vetting process that currently exists for US 
mariners, having them present on LNG tankers will help lower the threat 
of deliberate sabotage of the vessel by a knowledgeable member of the 
crew. This kind of an intentional incident is, in our opinion, the 
greatest threat to LNG tankers, and the most likely scenario that would 
result in loss of life or property. We can be sure that US mariners are 
who they say they are, and that they are adequately trained and loyal. 
This is not something we can be certain of with foreign crews.
    In addition, with U.S. Mariners the LNG vessels they will have a 
stake in the security of the vessel while it is overseas loading LNG. 
All shipboard LNG is delivered from foreign countries and sometimes 
from politically unstable nations. U.S. Mariners care about their 
country and will have a vested interest in keeping a keen ``watch'' on 
the gangway, mooring lines and other areas that stowaways or terrorists 
could attempt to board.
    The actual security vetting that U.S. Mariners undergo is 
extensive:
         U.S. Merchant Mariners receive their credentials to 
        work from the U.S. Coast Guard;
         U.S. Merchant Mariners undergo extensive background 
        checks performed by the Federal Bureau of Investigation;
         U.S. Merchant Mariners are background checked through 
        a National Driver (vehicle) Record database;
         U.S. Merchant Mariners will also be subject to 
        jurisdiction of the Transportation Safety Administration (TSA) 
        where they will be vetted through a terrorist watch database in 
        order to receive a Transportation Worker Identification Card 
        (TWIC).
         U.S. Merchant Mariners are citizens of the United 
        States or aliens lawfully admitted for permanent residence.
    As I wrote in my written testimony, foreign seafarers are not held 
to these standards.

    Question 3.: It is my understanding that the MEBA Calhoon 
Engineering School already has LNG training available for U.S. 
mariners. Please provide us with information about this training.
    The Marine Engineers' Beneficial Association operates a world 
renowned training facility, the Calhoon MEBA Engineering School (CMES), 
in Maryland. The school is fully accredited and certified by the U.S. 
Coast Guard and Det Norske Veritas (DNV), one of the world's leading 
classification societies.
    The MEBA training facility trains both deck and engineering 
officers and has recently installed a edge Bridge Simulation System 
designed and built by USA. The simulator is one of the newest and most 
sophisticated systems of its type in the world.
    The interactive program allows students to simultaneously control 
simulated ships utilizing any of 56 different types of vessels in over 
20 different ports. In addition to the ten ships that can be controlled 
within one scenario, instructors can further intensify the simulation 
by implanting multiple controlled ships into the scenario. Unlike many 
existing bridge simulators, each station, operating a different type of 
vessel (including LNG vessels), can interact with every other station 
simultaneously. The LNG cargo simulation program allows students to 
dock, load and discharge LNG vessels.
    Moreover, the computerized system even encompasses the terminal-
side operations of an LNG facility. It accommodates upgrades to adapt 
to ever-evolving Coast Guard and International Maritime Organization 
training and testing requirements.
    The Calhoon MEBA Training School prides itself in developing and 
offering courses before the need becomes apparent in the U.S. maritime 
industry. Relevant courses meeting today's LNG training needs include 
Liquefied Gases (LNG). This course has been part of the MEBA training 
core since 1975. It provides U.S. Coast Guard Licensed Deck and Engine 
Officers with the knowledge to safely and efficiently transport LNG. 
This LNG course is a USCG prerequisite for employment aboard LNG 
carriers. The class includes comprehensive lecture, lab work, and 
computer training as well as LNG science, engineering systems, cargo 
systems, stability, and safety. This course complies with the IMO Code 
for the LNG Vessels.
    Our school provides comprehensive lecture and computer-based cargo 
handling simulator training, including LNG science, engineering 
systems, cargo systems, interfaces, rules and regulations, and safety.
    I have provided a copy of a presentation that fully outlines our 
LNG instruction at CMES along with this testimony.

    Question 4.: How are U.S. mariners regulated versus foreign 
mariners?
    Under international law, each flag state is permitted to regulate 
mariners sailing on vessels documented under their flag. Generally 
speaking, many states claim to adhere to the minimum standards set by 
the lnternational Maritime Organization. Their regulations are reviewed 
and supposedly enforced by their own equivalent of the Coast Guard. 
However, because of the large number of ``flags of convenience'', which 
offer little or no oversight or regulation, there is a large 
discrepancy between how mariners are regulated in the United States and 
how they are regulated elsewhere.
    While foreign mariners may be required to comply with their 
government's regulations as well as international standards, the 
validity of some of the credentials is suspect. A few years ago, 
lnternational Transport Workers Federation President David Cockroft 
purchased an authentic Panamanian first officers certificate and sea 
book despite no practical maritime experience. The Seafarers' 
lnternational Research Centre at the University of Wales investigated 
the issue of fraudulent qualifications and in its preliminary findings 
revealed 12,653 cases of forgery in 2001.
    Federal and state government, local municipalities and the 
communities surrounding LNG import terminals can rest assured that with 
American mariners the LNG vessels are manned by professional seafarers 
who have the integrity and the training necessary for the safe 
transport of LNG.

    Question 5.: Is there a worldwide shortage of LNG mariners? If so, 
what can be done to close this gap?
    Yes. According to a variety of sources, as I mentioned in my 
written testimony, there is a worldwide shortage of LNG mariners. And 
with over one hundred vessels expected to enter the trade in the next 
few years, it will only get worse.
    We believe that an easy way to close the gap is to use the 
available pool of mariners in the United States. At the same time, we 
must do our best to entice young men and women to join the ranks of the 
maritime industry by going to sea. This means increased attention to 
our federal and state maritime academies and promotion of the industry.
    There are numerous articles cited in my written testimony regarding 
the international crewing crisis as it relates to LNG. To illustrate 
some of the concerns and the frequency with which the subject of the 
worldwide shortage is reported, the international trade journal Daily 
News published an article on April 4, 2007 that states:
    SINGAPORE--04 April--Rapid growth of LNG shipping has forced vessel 
operators to cream off senior officers from other ship types, causing a 
serious shortage of trained and quality crew, warned Anglo Eastern Ship 
Management quality and training director Chawla today. Speaking after a 
presentation at the Sea Asia conference in Singapore, Chawla said 
monthly wages for masters of LNG ships now stand at $18,000--20,000, 
with some even being offered $22,000. ``There is no fresh pool of 
officers to man LNG vessels. The entire LNG crew today have been 
recruited from other ships (mainly LPG vessels) and re-trained,'' he 
told Fairplay. Anglo Eastern manages four LNG vessels and is set to 
take on more. However, Chawla noted that the manager has an average 
crew retention rate of 10 years. The vicious circle of shortage has 
seen rapid promotions with the result that many senior on-board 
personnel have no hands-on experience, he said. Training methods have 
to change to adapt to this worrying position, Chawla observed.''
    In the end, shipping companies by nature traditionally wait until 
the very last minute to make appropriate changes to their crewing 
modules. This should not and cannot be the practice for LNG 
importation.

    Question 6.: According to Mr. Lesnick's written testimony, an 
additional 133 LNG vessels are scheduled for delivery to service the 
global LNG trades by 2010. This expanded fleet will require as many as 
10,000 additional seafarers. Where will the companies find this 
additional personal if there is already a shortage? What impact will 
this shortage have on security?
    This is a good question. The answer is unclear at this time. The 
likeliest scenario is that the companies will put increased pressure on 
their crewing agents, who will in turn begin to accept poorly trained 
or unqualified seafarers to crew the ships. This represents a 
significant threat to both safety and security. As the high standards 
that have always existed in the LNG sector begin to slip because of the 
shortage, the likelihood of an accident or intentional incident 
increases.
    This scenario is unacceptable, especially considering that there 
are qualified Americans available for employment, and the United States 
is a leading producer of entry-level mariners. The international 
maritime community's deeply engrained prejudice and preconceived 
notions about US merchant mariners remains a major impediment to 
getting our mariners these jobs.

    Question 7.: Do you support the Maritime Administrator's initiative 
to increase the number of U.S. mariners on LNG? If so, what else should 
be done?

    Question 8.: It is my understanding that MEBA and Excelerate Energy 
have entered into a Memorandum of Understanding. Please provide us with 
information about this MOU.
    On Tuesday, March 14, 2007, MEBA President Ron Davis signed a 
Memorandum of Understanding (MOU) with Excelerate Energy for the 
utilization of M.E.B.A. deck and engineering officers their liquefied 
natural gas (LNG) carriers. The MOU, which recognizes MEBA as the 
exclusive supplier of U.S. officers, involves Excelerate opening its 
vessels and terminals worldwide to our members in order to achieve 
recency qualifications to serve as officers in the LNG trade. In 
addition, once qualified, MEBA officers will begin to mix into the 
fleet as shipboard deck and engineering officers.
    Excelerate has two partners related to its LNG shipping. One is the 
Belgium based NV that operates the LNG tankers and the other is the 
Norway based Skaugen Petro Trans that operates LNG Terminals. MEBA will 
be providing officers for both shipboard and terminal side operations.
    There are still details that are being worked out. For instance, we 
are currently working with appropriate government agencies and 
embassies for the purpose of licensing acceptance for U.S. Coast 
licenses and qualifications international flag LNG vessels. In 
addition, we are working with Excelerate's partner NV on taxes, benefit 
structure, and qualification documentation.
    On May 8, 2007, Excelerate, and Skaugen will be visiting our 
training facility in Maryland. We expect that MEBA members will be on 
Excelerate's vessels operating worldwide before the end of the year.
    The following is an article from the April issue of Lloyd's List, 
one of the leading maritime industry trade publications regarding the 
deal:
    Excelerate Energy's ``landmark'' US crewing agreement will apply to 
all the company's vessels, the innovative US liquefied natural gas 
shipping operator has confirmed, writes Tony Gray. Last month, 
Excelerate reached an agreement with the Marine Engineers' Beneficial 
Association union under which it would employ US citizens as deck and 
engineering officers. Excelerate vice president Jonathan Cook said the 
intention was ``to integrate US mariners on all our ships''. The 
company's fleet comprises three regasification vessels and one 
newbuilding. Mr. Cook said Excelerate planned to integrate US mariners 
into the crews of the vessels, and not undertake a complete 
replacement. Existing crews comprise European officers and Filipino 
ratings.
    Mr. Cook said the decision was not taken because Excelerate 
considered US seafarers to be superior, ``We believe there will be a 
shortage of mariners, especially officers, and think that the US is an 
excellent source for qualified mariners.'' He explained that the US had 
``excellent training facilities'' from maritime academies to union 
training schools. ``We believe the competency of the existing crews is 
excellent and have been very impressed with their capabilities and Mr. 
Cook said. ``We expect that all of our crew will perform to the highest 
standards regardless of nationality.'' Mr. Cook said Excelerate's 
partner, Belgian gas shipping specialist was ``very supportive'' and 
``happy to be working together with us on this There were no plans at 
this time to change the flag--Belgium--under which the vessels sailed. 
Cook said it would be ``premature'' to comment on the cost of employing 
US officers compared with existing arrangements as ``details are being 
discussed and worked out.''

 Questions from the Honorable Peter T. King, Ranking Member, Committee 
                          on Homeland Security

    Question 9.: As you know, the Maritime Administration has begun 
providing priority licensing to platforms that promise to provide 
training opportunities for U.S. merchant mariners. How long does it 
take for a merchant mariner to become truly proficient in LNG systems? 
What does the qualification process involve?
    To be considered truly proficient in LNG systems we must specify at 
what level the officer will be working. A junior officer may be deemed 
to have met the standards of training after completing a combination of 
classroom and practical training. This may only take months to achieve. 
However, it could take as long as 1--2 years of experience working with 
expert senior officers to demonstrate the expertise to be considered 
truly proficient. Additionally, to build a senior officer through USCG 
License upgrades, specific specialized training and practical 
experience it would require approximately 7--10 years time.

    Question 10.: Where are merchant mariners trained on LNG systems? 
Are there currently any training facilities in the United States?
    At this time, all six of the state maritime academies and the 
federal maritime academy at King's Point all provide basic LNG training 
courses for their students. In addition, union training schools such as 
the Calhoon School have extensive training programs for LNG. MEBA has 
been teaching and training LNG technologies since the mid-1970's.

    Question 11.: You mention in your written testimony that younger 
junior officers are leaving the industry prematurely. We see this in 
government from time to time, including within the Department of 
Homeland Security. Why are these talented young seafarers leaving? Is 
it a generational phenomenon? How can we keep this talent?
    My testimony addressed the issues international fleet (foreign 
flag) junior officers leaving the industry before they reach senior 
level officer status thereby exacerbating the crisis. I placed this in 
the testimony to show that if the United States does not address the 
international crewing pinch now, then we are leaving ourselves open for 
a disaster later. All of my testimony and citations to reports and 
articles were based on what is going on in the international fleet. The 
international community did not take into consideration that the United 
States has a vibrant and growing pool of U.S. mariners ready, willing 
and able to sail in the LNG trade. Basically, until recently, the 
international maritime community forgot that the United States still 
has a merchant marine.

    Question 12.: If we required all LNG vessels calling on U.S. ports 
to be crewed by U.S. merchant mariners, what happens if a ship, not 
originally destined for the United States, wants to come to the U.S. 
because of market demands on LNG? Should we turn them away?
    It is quite common in the maritime industry to replace or add crew 
members while the vessel is between final destinations. Generally, the 
company would fly the replacement crew to a port somewhere along the 
route the vessel is taking before it reaches its final destination, and 
exchanges the crews as necessary.
    Right now, many of the vessels operating in the LNG trades are 
plying established routes, so the likelihood of their being diverted is 
low. For those ships operating on the ``spot'' market, they generally 
expect scenarios like this and plan for them appropriately. There would 
be no need to turn away a vessel, because there would be multiple 
opportunities to get qualified US crews in a reasonable amount of time.

    Question 13.: Can you perhaps give us some insight into the vetting 
process of some of the current LNG crews? I understand it varies from 
country to country. The actual security vetting that U.S. Mariners 
undergo is extensive:

         U.S. Merchant Mariners receive their credentials to 
        work from the U.S. Coast Guard;
         U.S. Merchant Mariners undergo extensive background 
        checks performed by the Federal Bureau of Investigation;
         U.S. Merchant Mariners are background checked through 
        a National Driver (vehicle) Record database;
         U.S. Merchant Mariners will also be subject to 
        jurisdiction of the Transportation Safety Administration (TSA) 
        where they will be vetted through a terrorist watch database in 
        order to receive a Transportation Worker Identification Card 
        (TWIC).
         U.S. Merchant Mariners are citizens of the United 
        States or aliens lawfully admitted for permanent residence.
    Under international law, each flag state is permitted to regulate 
mariners sailing on vessels documented under their flag. Generally 
speaking, many states claim to adhere to the minimum standards set by 
the International Maritime Organization. Their regulations are reviewed 
and supposedly enforced by their own equivalent of the Coast Guard. 
However, because of the large number of ``flags of convenience'', which 
offer little or no oversight or regulation, there is a large 
discrepancy between how mariners are regulated in the United States and 
how they are regulated elsewhere.
    While foreign mariners may be required to comply with their 
government's regulations as well as international standards, the 
validity of some of the credentials is suspect. A few years ago, 
International Transport Workers Federation President David Cockroft 
purchased an authentic Panamanian first officers certificate and sea 
book despite no practical maritime experience. The Seafarers' 
International Research Centre at the University of Wales investigated 
the issue of fraudulent qualifications and in its preliminary findings 
revealed 12,653 cases of forgery in 2001.

    Question 14.: The Coast Guard and the rest of the intelligence 
community continue to tell us that the biggest threat to vessels is 
that of a small boat attack--a Cole or a scenario. You argue that it is 
the insider threat. What are your sources?
    The United States Department of Energy commissioned a study which 
determined that one of the most likely threats associated with the 
carriage of LNG is an international (deliberate) act of terrorism by a 
crewmember working aboard and LNG tanker. See the report conducted by 
Sandia National Laboratories titled, ``Guidance on Risk Analysis and 
Safety Implications of an LNG Spill Over Water.'' The report was issued 
to the public in January of 2005 and can be found at:
    http://www.fossil.energy.gov/programs/oilgas/storage/lng/
sandia_lng_1204.pdf
    The Sandia report utilized available intelligence and historical 
data to establish a range of potential, intentional tank breaches that 
could be considered possible and credible. This included an evaluation 
of insider and hijacking attacks on ships and also external attacks, as 
well. The Sandia report is clear that the most devastating scenarios 
involving an LNG tanker are those occurring as a result of an 
intentional incident.
    As a Licensed Chief Engineer for Steam, Diesel and Gas Turbine 
vessels, I know how a ship operates and the ease with which a 
knowledgeable crew member can take control of a vessel from remote 
locations Especially in today's world of automation and computer 
controls, which have reduced the crew needed to safely operate a 
vessel, it is relatively easy for a member of the crew, intent on 
causing a disaster and with no regard for his own personal safety, to 
cause an intentional incident like the one I described in my oral 
testimony.

    Question 15.: The GAO, Coast Guard, and FERC have all testified 
this morning as to the excellent safety record of LNG vessels. Does 
MEBA have reason to question this assessment?
    Not at all. In fact, the MEBA was instrumental in the establishment 
of this safety record in the earliest days of the LNG trade. We 
recognize that the LNG sector of the maritime industry has the best 
safety record. Our desire is to ensure that this remains the case.
    With the increased number of vessels and the widely acknowledged 
crewing shortages, we believe that this excellent safety record is in 
jeopardy. This is why we feel it critical that we persuade the 
international maritime community to look to the United States as part 
of the solution to this ongoing problem. If we don't take steps now to 
address this looming problem, we make the possibility of a major 
accident or incident more likely, and that is a risk we cannot afford 
to take.
    The point being is that transportation of LNG worldwide is a 
rapidly expanding marine service. This growth has never happened so 
quickly before, or in a segment of the maritime industry that is 
technically so different from other segments. The shipboard 
transportation of LNG has a great safety record. This is due in large 
part because of the 40 years it took for the international LNG fleet to 
reach 200 vessels. It may only take 5 more years for the LNG fleet to 
increase by 100 or more LNG tankers. Thus proper vetting and training 
are critical factors for consideration. The United States will most 
likely be importing LNG at a very increased rate over the next several 
years and we need to be prepared.

Questions from the Honorable Bennie G. Thompson, Chairman, Committee on 
                           Homeland Security

                Responses submitted by Mark E. Graffigan

    Question 1: According to your testimony, uncertainties still exist 
concerning the risks LNG spill would pose to the public. Why do these 
uncertainties still exist?
    Response: A large LNG spill from a poses a number of potential 
hazards, the most likely of which is a large fire, which could 
potentially bum the public. Scientists measure the heat from such a 
fire by calculating the distance at which 30 seconds of exposure to the 
heat could cause second-degree burns (termed the heat hazard distance). 
The uncertainty surrounding this distance is evidenced by the range of 
estimates identified by the empirical studies conducted to date: from 
about 500 meters (less than mile) to more than 2,000 meters (about 1-
114 miles). Since there have been no large-scale LNG spills or large 
spill studies have relied on models to determine the heat hazard 
distance. Researchers had to make numerous modeling assumptions 
including key fire properties, the size of the hole in the tanker, the 
number of tanks that fail (cascading failure), the volume of LNG 
spilled, and environmental conditions, such as wind and waves. Without 
data on large-scale LNG spills, different studies used different 
parameters for each of these assumptions, which resulted in different 
heat hazard distances.

    Question 2: In your testimony you state that additional research to 
resolve some key areas of uncertainty could benefit federal agencies 
responsible for informed decisions when approving LNG terminals and 
protecting existing terminals. Please provide us with information on 
this much needed additional research.
    GAO Response: Additional research resolve some key areas of 
uncertainty (particularly involving dangers from fire) could benefit 
federal agencies responsible informed decisions when approving LNG 
terminals and protecting existing and tankers, as well as providing 
reliable information to citizens concerned about public safety. Our 
panel of experts identified several areas of research needed. The 
highest-ranked research needs are listed in table 1 below:

       Table 1: Expert Panel's Ranking of Need for Research on LNG
 
 
 
             Rank  Research area     Description         Funded in DOE's
                                                          study
------------------------------------------------------------------------
                1  Large fire        A large fire may
                    phenomena         behave
                                      differently than
                                      a small fire by
                                      breaking into
                                      several small,
                                      short flames,
                                      rather than
                                      remaining as a
                                      single, large
                                      fire. This
                                      behavior could
                                      reduce heat
                                      hazard distances
                                      by a factor of
                                      two or three.
                                      Research could
                                      this effect.
------------------------------------------------------------------------
                2  Cascading         Cascading failure
                    failure           is the sequential
                                      failure of
                                      multiple LNG
                                      storage tanks on
                                      an LNG tanker
                                      potentially due
                                      to cold, spilled
                                      LNG or the heat
                                      from an LNG fire.
                                      Research could
                                      determine the
                                      likelihood of
                                      cascading failure
                                      after an LNG
                                      spill.
------------------------------------------------------------------------
                3  Large-scale       Self-explanatory
                    spill testing
                    on water
------------------------------------------------------------------------
                4  Large-scale fire  Self-explanatory
                    testing
------------------------------------------------------------------------
                5  Comprehensive     Comprehensive
                    modeling:         modeling would
                    interaction of    model all phases
                    physical          of an LNG spill
                    processes         together, rather
                                      than creating
                                      separate models
                                      for each process
                                      (vapor
                                      dispersion,
                                      ignition of the
                                      vapors, etc.)
------------------------------------------------------------------------
                6  Risk              An assessment of
                    tolerability      the level of risk
                    assessments       the public would
                                      tolerate
                                      (potentially
                                      community
                                      specific)
------------------------------------------------------------------------
                7  Vulnerability of  An assessment of
                    containment       how vulnerable
                    systems (hole     LNG tankers are
                    size)             to attack
------------------------------------------------------------------------
                8  Mitigation        Research into
                    techniques        techniques that
                                      could be used to
                                      mitigate the
                                      consequences of
                                      an LNG spill
------------------------------------------------------------------------
                9  Effect of sea     Self-explanatory
                    water coming in
                    as LNG flows
                    out
------------------------------------------------------------------------
               10  Impact of wind,   Research to
                    weather, and      determine how
                    waves             wind, weather,
                                      and waves would
                                      impact existing
                                      models of LNG
                                      spills and fires
------------------------------------------------------------------------
     Source: GAO.
 

    Although DOE has recently funded a study that will address LNG 
fires, study will address 3 of the top 10 issues--and not second-
highest ranked issue-that our panel of experts identified as 
potentially affecting public safety. To provide the most comprehensive 
and accurate for assessing the public safety risks posed by tankers 
transiting to proposed LNG facilities, we recommended that DOE 
incorporate the key issues identified by the expert panel into its 
current LNG study. In particular, we recommended that DOE examine the 
potential for cascading failure of LNG tanks in order to understand the 
damage to the hull that could be caused by exposure to extreme cold or 
heat. DOE agreed with our and recommendation.

    Question 3: You have recommended that the Department of Energy 
incorporate the key issues identified by the panel into their upcoming 
report. What else should be done?
    GAO Response: We believe that a study which addresses the key 
issues identified by our panel of experts will significantly improve 
the understanding of the consequences of an LNG spill. DOE should 
ensure that the results of this research are available to and used by 
decision makers.

    Question 4: Do you think that the Coast Guard, the Maritime 
Administration, and the Federal Energy Regulatory Commission have the 
personnel and assets needed to oversee the additional 32 LNG 
facilities?
    GAO Response: As part of our work on the consequences of LNG 
spills, we did not analyze the personnel or assets of these three 
agencies.

    Question 5: As part of the audit, you convened a Web-based panel of 
19 experts. How did you select these experts?
    GAO Response: We identified the 19 experts from a list of 51 who 
had expertise in one or more key aspects of LNG spill consequence 
analysis. In compiling this initial list, we sought to achieve balance 
in terms of area of expertise. In addition, we included at least one 
author of each of the six major LNG studies we reviewed, that is, 
studies by National Laboratories; Consulting; Quest Consultants Inc.; 
Pitblado, et al.; James Fay (Massachusetts Institute of Technology); 
and William (National Oceanic and Atmospheric Administration). In 
researching each candidate, we gathered and reviewed resumes, 
publication and major related publications from the experts identified 
on the initial list.
    Specifically we sought: (1) broad experience in all facets of LNG 
spill consequence modeling (LNG spill from hole, LNG dispersion, 
vaporization and pool formation, vapor cloud modeling, fire modeling, 
and explosion modeling); (2) experience in conducting physical LNG 
experiments; and (3) specific experience with areas of particular 
importance, such as LNG explosion research.

    Question 6 Do you think that the Coast Guard, the Maritime 
Administration, and the Federal Energy Regulatory Commission have the 
personnel and assets needed to oversee the requested 32 LNG facilities?
    GAO Response: As part our work on the consequences of LNG spills we 
did not analyze the personnel or assets of these three agencies.

    Question 7: According to your testimony, these experts did not 
agree on several key issues. It has been over 5 years since 9/11, why 
is there still disagreement amongst the experts concerning the security 
on LNG tankers?
    GAO Response: Our expert panel members primarily included 
scientists and engineers who were experts in the areas of LNG 
experiments, modeling LNG dispersion, LNG vaporization, fire modeling, 
and explosion modeling. These experts do not have specific expertise in 
the area of security.
    The key areas of disagreement on the consequences of LNG spills 
primarily involved heat hazard and cascading failure conclusions of the 
Sandia study. Specifically, 7 of 15 experts thought Sandia's heat 
hazard distance was ``about right,'' and the remaining 8 experts were 
evenly split as to whether the distance was ``too conservative'' (i.e., 
too small to protect the pulic). Experts who disagreed with the 
distance in the Sandia study generally disagreed with some of the 
assumptions Sandia used in its models.
    Only 9 of 15 experts agreed with Sandia's conclusion that only 
three of the five LNG tanks on a tanker would be involved in cascading 
failure. Many of the experts who disagreed with Sandia's conclusion on 
cascading failure noted that the Sandia study did not explain how it 
reached this conclusion.

 Questions from the Honorable Peter T. King, Ranking Member, Committee 
                          on Homeland Security

    Question 1: Why is it important to study large pool fires? Why is 
the current data insufficient? How has the Department of Energy 
received your recommendations? Will you be following up with them 
following their 2008 tests?
    GAO Response: No LNG spills resulting from a cargo tank rupture 
have occurred. In the 1970s and 1980s, experiments to determine the 
consequences of a spill examined small LNG spill of up to 35 meters in 
diameter. Following the terrorist attacks of September 11, 2001, 
however, many experts recognized that an attack on an LNG tanker could 
result in a large spill-a volume of LNG up to 100 times greater than 
studied in past experiments, with uncertain effects.
    Since then, a number of studies have reevaluated safety hazards of 
LNG tankers in light of a potential terrorist threat. Because a major 
LNG spill has never occurred, studies examining LNG hazards rely on 
computer models to predict the effects of spills, often focusing on the 
properties of LNG vapor fires. Small-and large-scale LNG fire 
experiments are needed to refine and validate existing models to 
accurately calculate the heat hazards of large LNG fires. Our panel of 
experts recommended new LNG tests for fires between 15 meters and 1,000 
meters with a median recommended size of 100 meters. Some experts also 
raised the issue of whether large LNG fires will stop behaving like one 
single flame but instead break up into several smaller, shorter flames 
and whether large fires will produce sufficient smoke to partially 
shield the heat from the LNG fire.
    DOE agreed with our and recommendation. GAO will follow up on the 
implementation of this recommendation.

    Question 2: The GAO report refers to the possibility of a LNG 
explosion as ``unlikely.'' Would the GAO consider such an explosion 
more or less "likely" than gasoline?
    GAO Response: Our panel of experts agreed that (1) the most likely 
public safety impact of an LNG spill is the heat impact of a fire and 
(2) explosions are not likely to occur in the wake of an LNG spill, 
unless the LNG vapors are in confined spaces. For confined spaces, the 
experts agreed that it is possible, under controlled experimental 
conditions, to induce an explosion of LNG vapors; however, they agreed 
that a detonation--the more severe type of explosion--of confined LNG 
vapors is unlikely following an LNG spill caused by a terrorist attack. 
For unconfined spaces, such as a spill from a ship onto water, our 
experts were split on whether it is theoretically possible to induce 
such explosions; however, even experts who thought such explosions were 
possible agreed that explosions in unconfined spaces are unlikely to 
occur following an LNG spill caused by a terrorist attack.
    We did not specifically ask our panel of experts about whether an 
LNG explosion is more or less ``likely'' than gasoline, or any other 
commodity, explosion. However, we did ask our panel of experts to rate 
the risk to public safety posed by an attack on tankers carrying 
various energy commodities. The results of their ratings are included 
in Table 2 below.

                      Table 2: Expert Panel Comparison of Risk Posed by Energy Commodities
 Experts were asked ``In your opinion, what is the risk to public safety posed by an attack on tankers carrying
  each of the following energy commodities?'' The numbers in the table are a count of how many experts selected
                       each possible response (i.e. ``little to none,'' ``little,'' etc.)
 
                   Liquefied  natural                                           Heating     Jet      Liquefied
      Answer               gas           Crude oil     Diesel      Gasoline       oil       fuel   petroleum gas
 
Little to None                     1             2   1           0            1           1        0
----------------------------------------------------------------------------------------------------------------
Little                             3            10   11          5            11          6        1
----------------------------------------------------------------------------------------------------------------
Medium                             6             3   3           8            3           6        4
----------------------------------------------------------------------------------------------------------------
Large                              3             0   0           2            0           2        5
----------------------------------------------------------------------------------------------------------------
Very Large                         2             0   0           0            0           0        5
----------------------------------------------------------------------------------------------------------------
Did not answer                     4             4   4           4            4           4        4
 this question
----------------------------------------------------------------------------------------------------------------
 

    Ten of 15 experts identified a large to very large risk associated 
with an attack on a liquefied petroleum gas tanker; whereas, only 5 of 
15 rated LNG as a large to very large risk. In comparison, only 2 of 15 
experts rated gasoline as a large to very large risk.

Questions from the Honorable Bennie G. Thompson, Chairman, Committee on 
  Homeland Security and the Honorable Peter T. King, Ranking Member, 
                     Committee on Homeland Security

                    Responses from Phani K. Raj,PhD

    Question 1: In your written testimony, you state additional 
research is required. Why hasn't this research already been completed?
    Response: In any industry research is an ongoing activity simply 
because the nature, type of questions and underlying reasons for 
additional investigations change continually.
    In the case of the LNG industry, there was considerable research 
and assessments conducted in the US in 1970s and in early 1980s because 
the industry was just beginning to grow. The research, while initially 
focused on understanding LNG hazards, quickly was refocused on 
prevention of accidents and mitigation. With this change in the 
emphasis, small-scale test results were deemed acceptable, especially 
since large releases were discounted as being engineered out or of such 
a low probability of occurrence as not to pose a risk to society. The 
US Coast Guard promulgated regulations to control vessel traffic in 
harbors and required safe separation distances between a LNG ship and 
other vessels. This virtually eliminated the possibility of accidents 
in LNG shipping in and around harbors. The promulgation of the 
consensus industry standard, NFPA in 1969 and the federal regulations 
in 49 CFR, part 193 in late 1970s and for designing and operating LNG 
facilities together with the safe de facto operation of LNG facilities 
and shipping (world-wide) provided an assurance of public safety. The 
same was true for LNG industry in Europe with the promulgation of the 
EN1473 regulations. Some additional experimental research was continued 
in England (on heavy gas dispersion) and in France (on pool fire). 
However, by the time of late 1980s and for the rest of the 1990 decade 
no funds were invested by either government agencies or the industry in 
conducting substantive research because of the reduced importance of 
LNG in the energy economy of the world. In fact, many of the data from 
late 1980s tests went un-reviewed and unpublished because of lack of 
research funding.
    Since 9/11/2001 a new dimension of concern from LNG storage and 
transportation has been added to the public safety debate. Terrorism 
caused releases and their effects have opened up new concerns both in 
how much and how large a LNG spill may occur and on the consequences 
such releases pose to the public. Such concerns are expressed for 
releases from LNG ships in or near harbor entrances, more than for 
land-based terminals (thanks to successful terrorist attacks on ships 
like USS Cole and the crude oil tanker SS Limburg). Because of the 
possible scenarios of release caused by intentional acts, new potential 
hazards have been identified for LNG releases, which may or may not be 
larger than the hazards previously examined. These hazards, therefore, 
need to be investigated both mathematically and experimentally. That 
is, new research is therefore essential. In addition, the underlying 
premise of large holes being created by intentional attacks on LNG 
ships needs to be reviewed by a knowledgeable and cleared independent 
peer review panel to ensure that all aspects of the issue have been 
investigated and that the assumptions on which the hazard distance 
estimates have been developed are credible.
    As indicated earlier, some of the data from tests conducted in late 
1980s were not analyzed fully to understand the extent of hazards posed 
by large LNG (pool) fires. Only recently has it been realized that 
large LNG fires do not pose as large a threat as envisioned from the 
data of small fire tests of the 1970s. It is now known that large LNG 
fires burn with evolution of significant quantity of black smoke 
forming a shroud outside and around the burning inner core of the fire. 
The smoke layer prevents the heat from radiating out of the fire. 
However, the quantification of the extent of smoke production, the 
height of the burning zone, the variation of the heat emission from the 
various parts of the fire with height) are not all known with the 
degree of precision needed for proper estimation of the hazard area 
surrounding large LNG pool fires. Therefore, additional research in the 
form of conducting large LNG pool fires is needed.
    In addition, the release scenario associated with a terrorist 
attack (involving the formation of large gaping holes on the two hulls 
and the tank of a LNG ship) leads to certain phenomena that have not 
been understood or researched before. These include (i) the potential 
leak of LNG into the hold space and the possible detrimental effect of 
the interaction of the cryogenic liquid with the ship's structural 
members leading to metal cracking and multiple tank failures, (ii) the 
rapid and very large rate of release of LNG onto the water surface, its 
plunging into the water column, its high evaporation locally and rising 
to the water surface of both a large volume of vapor and liquid. The 
un-evaporated liquid would then spread as a pool on the water surface, 
(iii) the effect of wind and waves affecting the motion and evaporation 
of the pool with and without sustaining a fire on top, (iv) the 
transient nature of the pool spread and the characteristics of the fire 
on top of it, etc. These phenomena also need be assessed by conducting 
experiments of the appropriate size.
    In summary, while a considerable amount of LNG related research 
activities occurred in 1970s and the postulated circumstances and 
causes of potential releases in the 2000s are different and 
consequently their effects could be different. Hence, additional 
research is necessary.

    Question 2: The GAO report highlights the fact experts still 
disagree on the consequences of a LNG spill. What is the root of this 
disagreement? Will consensus reached on this important issue?
    Response: As discussed in response to question 1, there are a 
number of phenomena related to a LNG release that are incompletely 
understood and need additional research to provide information with 
which to make scientifically valid extrapolations to real situations.
    The sizes of postulated LNG releases, either on land from storage 
tanks or on water from LNG ships, from accidents or deliberate 
terrorist actions are substantially larger (by factors of 20 to 30) 
than any controlled tests performed to date. For example the largest 
test performed to understand the behavior of LNG pool fires on water 
are of about \1\ 5 m in diameter, whereas the postulated sizes of LNG 
pool fires occumng from spills from ships (due to intentional acts) can 
range from 300 m to 450 m in diameter. Therefore, in order to the 
consequences of large spills, considerable extrapolation of the results 
from small scale tests need to be made. This is where the disagreements 
amongst the scientists occur, because, the mathematical models used by 
different groups describe the largsscale phenomena differently. Some 
include additional physical phenomena that have been observed in other 
fuels, some do not; one group makes very conservative assumptions 
(essentially to overcome scientific ignorance), while another group 
assumes it knows how to extrapolate from smaller scale test data to 
larger scale. That is, scientific extrapolation involves significant 
issues of interpretation of existing data, assumptions regarding 
changes in the behavior characteristics (for example, the 
characteristics of large LNG fires) and consideration or lack thereof 
of certain other phenomena of interest (atmospheric absorption of 
radiant heat, effect of obstructions, clothing in reducing heat 
effects).
    In addition to the extrapolation of the effects of known phenomena 
with LNG behavior there are other causes for disagreements. The 
calculation of potential hazard (areas) from the release of LNG 
requires the consideration of three important elements, namely, (i) the 
description of the source; that is, the location, size and other 
characteristics of the hole, the rate of release of LNG given the hole 
characteristics, the interaction of LNG release with its immediate 
environment (water, land, etc), the sizes of pool or vapor cloud 
formed, (ii) description of the behavioral mode pf the LNG; that is, 
immediate ignition or not, burning as a pool fire, fire ball or 
unignited vapor cloud dispersion, probabilities of ignition of the 
dispersing vapor cloud with distance from the source, the type of 
burning of the vapor cloud, passive burning vs. energetic burning with 
the formation of a blast wave, etc, characteristics of the fires 
produced in terms of size, duration of existence, radiant energy 
output, etc, and (iii) description of the effects of fires or other 
hazards; including the radiant energy absorption in the atmosphere, its 
attenuation by intervening structures, clothing on persons; effects of 
radiant heat flux on a person, ability of a person to take corrective 
action and finally, the effects of any active mitigation activities 
instituted by the emergency responders. As can be seen, there are so 
many dimensions to evaluating the potential hazards. Therefore, 
depending upon what behavioral aspects are included in an analysis, how 
correct the description of the individual phenomenon is, and the 
correctness of extrapolation of small-scale test data (for those 
phenomena for which data exist), researchers can come up with different 
set of predicted areas of hazard.
    Therefore, it can be surmised that the root causes of disagreement 
among experts are (a) the nature of the problem itself and the extent 
to which the details of various phenomena are considered in any 
analysis, (b) validity of scenarios and the underlying assumptions, 
which lead to prediction of large scale releases, and (c) the 
variability in the science of extrapolation of small test data to 
larger scale phenomena, especially when some of the behavioral aspects 
of nature that occur in the large scale do not show-up in the small 
scale tests. For example, a technical peer panel of experts with proper 
technical and classified credentials will need to validate the result 
that very large holes are created by intentional attacks and not by 
ship-to-ship collisions event though the latter involves substantial 
energies. The magnitude of the source represented by the hole size 
forms the very basis of all other hazard assessment results. As to the 
question of whether consensus will ever be reached among the experts on 
this important issue, I will have to say that while convergence of 
approaches to evaluating the hazards for a given set of specified 
scenarios may be achieved in the future (especially with additional 
experiments on several scenarios for which we have, at present, limited 
or not data at all), I would not say that consensus on all issues will 
ever be possible. This is just the nature of scientific debate. In 
addition, the external circumstances may change, dictated by unforeseen 
circumstances (as indeed happened between the 1980s and 2000s by the 
interjection of terrorism as a force to contend with), technological 
improvements that may negate some of the ``scenarios'' currently being 
considered by some experts and not by others, and changes in regulatory 
requirements. Therefore, it would be difficult to expect a 100 
consensus among all experts on all issues in this field, or any other 
field for that matter.

    Question 3: In your written testimony you state that the LNG 
industry has operated safely both in U.S and worldwide for over six 
decades and that there is no technical operational reason this record 
will not continue. There is one reason why this record could be broken 
and that is terrorism. Do you believe that terrorists will be 
unsuccessful in targeting LNG ships? If so, why?
    Response 3: I want to address two aspects in my answer to the above 
question. The first is the presumption that LNG ships are attractive 
targets to terrorists. The second is whether LNG ships can be 
successfully targeted. I do not believe that on either of the above two 
criteria, LNG ships form attractive and successful targets.
    It is my considered opinion, based entirely on commonsense judgment 
and scientific training, that an LNG ship does not form an attractive 
target to terrorists. If one studies the modus operandi of terrorism, 
it is clear that it is always based on the need to make a big 
``splash'' either by affecting (injuring or killing) the largest number 
of people or attacking a target that represents a national ``symbol'' 
of some sort. The train and subway bombings in London, Madrid and 
Mumbai and the hotel bombings in Bali all represent the former type 
whereas US World Trade Center bombings in 1993 and the attack on 
represent both types of targets. A LNG ship or an installation is 
neither national symbol nor will a large LNG release from a ship cause 
mass casualties in nearby populations. The principal effect of concern 
in the case of LNG release is the radiant heat effects of the fire, 
whose effects can be, relatively easily, defeated or minimized by 
sheltering, hiding behind buildings or initiating other mitigation 
measures. That unfortunately, is not the case for a number of other 
soft targets where people gather in large numbers (sports arenas, big 
office buildings, mass transit, etc) or from chemical facilities that 
store or produce chemicals that once released can affect a large number 
of people.
    LNG is a fuel very much like other hydrocarbon fuels that are used 
in the US in much larger quantities and transported in more numerous 
ships. The fire effects of all fuels are about the same, especially 
when one considers the characteristics of very large pool fires. We 
have to assume, with reasonable amount of certainty, that terrorists do 
considerable research (as was evident from the 9/11 tragedy) on the 
science required, technical outcome, and the or symbolism of the target 
before selecting a target. It is reasonable to assume that only a 
target, which promises to be vulnerable and successful in the attack 
will be selected; that is, a terrorist wants the best for the (the 
unfortunate pun is intended here). Having said that, it is evident that 
there are other less well protected energy and chemical targets that 
may be more susceptible and closer to population centers than a LNG 
ship. On a sheer opportunity, availability and comparative effects 
basis, it is my opinion that LNG ships do not form a target that would 
be high on the list of ``attractive'' targets for terrorists. In fact, 
my above conclusion is similar to the conclusion in a relatively recent 
report by the GAO.\1\ To quote the GAO,
---------------------------------------------------------------------------
    \1\ GAO Homeland Security, Voluntary Initiatives are Underway at 
Chemical Facilities, but the Extent of Security Preparedness is 
Unknown. U.S. General Accounting Office, GAO-03-439, March, 2003.
---------------------------------------------------------------------------
    Flammable chemicals fewer people because the distance the substance 
travels tends to be shorter, and
    . . . chemical facilities present an attractive target for 
terrorists intent on causing massive damage because facilities house 
toxic chemicals that could become airborne and drift to surrounding 
areas Alternatively, terrorists could steal chemicals, which could be 
used to create a weapon capable of causing harm.
    The recent book \2\ by Stephen Flynn has also pointed out how many 
vulnerable, high damage ratio targets of interest there are in the US, 
which if attacked can result in significant harm to the public, both 
physically and economically. It is therefore, my considered opinion 
that an LNG ship neither provides the opportunity nor forms an 
attractive target, either from the perspective of causing mass 
casualties or disrupting the nation's economic activity.\3\
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    \2\ Stephen Flynn, ``The Edge of Disaster,'' Random House 
Publishers, New York, 2007.
    \3\ If a LNG ship is attacked and all its cargo is burned, a 
substantial loss will result to the owner of the ship and the cargo 
owner. But that will hardly disrupt the nation's long-term economic 
welfare. Short disruptions in port and natural gas supplies could 
occur, however.
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    The second part of the question is whether terrorists will be 
unsuccessful in targeting LNG ships. Sandia report \4\ indicates that, 
``Risks from intentional events, such as terrorist acts, can be 
significantly reduced with appropriate security, planning, prevention, 
and mitigation.'' Of course, what it does not say is that there are 
currently appropriate security, prevention, and mitigation regulations 
in place.'' The security planning, prevention and mitigation, are 
required to be implemented under the US Coast Guard regulations.\5\
---------------------------------------------------------------------------
    \4\ Hightower M., L. Gritzo, A. Luketa-Hanlin, J. Covan, S. 
tieszen, G. Wellman, M. Irwin, M. Kaneshige, B. Melof, C. Morrow, and 
D. Ragland, ``Guidance on Risk Analysis and Safety Implications of a 
Large Liquefied Natural Gas (LNG) Spill Over Water,'' Sandia National 
Laboratory Rep.# SAND2004-6258 U.S. Department of Energy, Washington, p 
77, Dec 2004
    \5\ Waterway Suitability Assessment, Navigation and Vessel 
Inspection Circular 05-05, U.S. Coast Guard, Washington, June 2005.
---------------------------------------------------------------------------
    With the current security regime that ``surrounds'' a LNG ship when 
it is underway or anchored in a port, I do not see how a terrorist can 
successfully attack the ship as to cause substantial damage. The US 
Coast Guard is on record \6\ stating that shoulder fired missiles will 
not damage LNG ships. The only other way a LNG ship could be attacked 
is by a fast boat or a dinghy loaded with explosives that can actually 
approach the ship, and set off the explosives in very close proximity 
of the ship. [As pointed out in my written direct testimony presented 
to this Committee, a LNG ship has two hulls separated by at least a 2 m 
(6 ft) separation distance. Such a double hull construction provides 
considerable protection against LNG releases from scale attacks]. If 
the boat bomb scenario is credible, one expects this to occur in or 
near a port because a port represents a high population density (and 
that is what a terrorist may be interested in causing damage to). This 
scenario of attack, at least, in US may be an extraordinary feat to 
achieve. For example, every LNG ship that makes a port call into Boston 
Harbor is escorted by a flotilla of US Coast Guard and other law 
enforcement vessels manned by armed personnel. A terrorist boat must 
get through this gauntlet; the chance of success is therefore very 
small to essentially zero. As I argued earlier, a terrorist will seek 
to maximize his success for his efforts and, therefore, may redirect 
his attention towards other softer and less well guarded targets that 
will produce comparable, if not, greater casualties than those 
resulting from an attack on a LNG ship. While, I cannot state 
categorically that an attempt at a LNG ship will not be made or if made 
will not cause some damage to the ship, I can state with a good deal of 
certainty that the probability of a successful attack on a LNG ship in 
the harbor waters of any US port is extremely small. This statement is 
based entirely on my judgment as an engineer and my practical 
experience in conducting field experiments and suffering failures in 
best-laid test plans executed with cooperation and help from the best 
professionals. Success in any mission, however well planned, is not 
guaranteed under the best of circumstances, let alone when it is 
actively and vigilantly opposed.
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    \6\ Testimony by Vice Admiral Solerno before the Homeland Security 
Committee of the US House of Representatives, March 21, 2007.

    Question 4: According to your written testimony, focusing only on 
consequences of perceived worst cases rather than on the overall risk 
from activity will result in poorly utilized improperly allocated 
resources. I disagree with this assessment. We should be concerned 
about the worst-case scenario. Why you recommending otherwise?
    Response 4: Mr. Chairman, it was not my intent in the testimony to 
suggest that worst-case scenarios should not be considered in hazard 
assessment. My point was that a worst-case scenario alone, without 
consideration of its chances of occurrence (in comparison with other 
activities that our society is subject to involuntarily or accepts 
voluntarily), cannot and should not form the only basis of a regulatory 
decision-making. I will elaborate this contention below.
    The true potential for harm by any activity, industrial or 
personal, can be gauged only by a process of comparing the range of 
detrimental effects of that activity with other similar activities 
undertaken either by the society at large or by an individual by own 
volition. This approach is termed the ``Risk Analysis.'' Risk analysis, 
which presents a true measure of the both economic and physical 
problem, considers a spectrum of events, their probabilities of 
occurrence and their detrimental effects. This is in contrast to a 
worst-case analysis, which only highlights a situation where the 
ability of people to actively or passively manage the situation once it 
is very limited. In the case of an industrial plant when one focuses on 
the very worst case, one is not looking at the possibility of it 
occurring with any degree of certainty within the lifetime of a plant. 
Focusing only on the worst case and trying to obtain solutions to it 
tantamount to making the risk zero, which is impossible. In the words 
of late Sen. Moynihan, The function of risk assessment, is not drive 
risks to zero, which would rarely be possible, but to illuminate 
choices, costs and priorities. The first discovery in applying risk 
assessment to the real world is that zero risk is not a prudent 
objective.'' \7\
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    \7\ Quotation attributed to US Senator Daniel Patrick Moynihan by 
William (past Administrator of EPA) in the foreword to the book ``Human 
and Ecological Risk Assessment; Theory Practice, ``Edited by Dennis 
Paustenbach, A John & Sons Publication, New York, 2002.
---------------------------------------------------------------------------
    If worst case scenarios were the only basis of public policy and 
regulatory regimes then many of the activities that we, as a human 
society and the US as an industrial society, would not be able to 
undertake. For example, there have been at least two major disasters 
involving explosives and detonable cargo transported in ships leading 
to many fatalities.\8\ Yet explosives and other chemicals that explode 
do get transported every day in ships and vehicles that drive through 
populated areas. Similarly, airline disasters have killed many people 
over the past 100 years, yet billions of people have traveled and 
continue to travel in airplanes without fears. There have been dam 
bursts, chemical releases, and other industrial accidents, all of which 
can be termed ``worst-case'' occurrences resulting in associated public 
injuries and fatalities. After every disaster the safety systems are 
improved and systems to prevent future happenings are incorporated in 
the design. No single industry has been prevented from participating in 
the economic activity or has been stopped by regulations anywhere in 
the world because of these historical occurrences. This is because the 
regulatory process has understood that while the ``risk'' has to be 
minimized, and efforts must be made to reduce the chances of ``worst-
case'' scenarios from occurring, there is no way to completely 
eliminate them.
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    \8\ The first one occurred in the port of Halifax in 1917 in an 
ammunition carrier, ``Mount Blanc.'' The second incident occurred in 
1947 in Texas City, involving two ships (``Grandcamp'' and ``High 
Flyer'' loaded with ammonium nitrate fertilizer, which exploded.
---------------------------------------------------------------------------
    If worst-case scenarios are the only guiding principles for a human 
society to function, all activities will have to stop and progress, as 
we know it, will not exist. In the context of the LNG industry and the 
associated activities, I provide the following examples of the impact 
of ``worst-case'' analysis.
         In a recent DFEISEIR \9\ related to the siting of a 
        LNG import facility in the Port of Long Beach (PoLB) it is 
        stated (by considering only the worst case scenarios) that the 
        best guess frequency of a terrorist attack on a LNG plant is of 
        the order of once in 150,000 years. This conclusion is based on 
        the statistics of all chemical facilities in the US and 
        historically realized or thwarted attacks. Considering that LNG 
        plant is well guarded and that the infrastructure (tanks) is 
        much more robust compared to those in chemical plants, it can 
        be argued that a successful attack on a LNG storage tank 
        leading to the release of its entire inventory is smaller than 
        once in 1- 1/2 million years. This scenario of the release of 
        entire contents of the storage tank and its effect will 
        constitute the worst-case condition.
---------------------------------------------------------------------------
    \9\ http://elibrary.fere.gov/idmws/search/results.asp: Draft 
Environmental Impact Report for the Long Beach LNG Import Project under 
CP04-58 et al., FERC, 10/07/2005,
---------------------------------------------------------------------------
    The odds of a LNG release as described are about the same as the 
odds of a large asteroid (of size greater than 1 km in diameter) 
hitting the earth (approximately, once in one thousand to once in a 
million years).\10\ The consequences of such an asteroid hitting the 
earth will spell a disaster of proportions that have never been 
experienced by human beings. However, the public does not seem to be 
concerned at all but is pursuing all activities, industrial, personal 
or political without much regard to this worst-case scenario.
---------------------------------------------------------------------------
    \10\ http://geo.arc.nasa.gov/sge/jskiles/fliers/all_flier_prose/
asteroid_toon/asteroid_toon.html
---------------------------------------------------------------------------
     Consider another example a more probable and highly 
disastrous asteroid hitting the earth. In December 2004 scientists 
announced \11\ that a space rock named 2004 (of diameter 1/4 mile or 
400 m) had about a 1-in-40 or 2.6 % chance of striking Earth on April 
13, 2029.\12\ The asteroid is large enough to cause considerable local 
or regional damage were it to hit the planet. What are we doing about 
this potentially a very large catastrophe?--nothing. That is because 
the problem is so huge that unless a very large magnitude of resources 
are imposed nothing much can be done to prevent the accident. 
Fortunately, the situation with regard to LNG shipping is far better. 
Steps have been taken to minimize, with human innovativeness, with 
intelligence information and technology, the occurrence of such very 
large disasters.
---------------------------------------------------------------------------
    \11\ http://www.space.com/scienceastronomy/
astroid_update_041227.html
    \12\ Recent news reports on the internet allude to other scientific 
assessments, which indicate that this asteroid will come close to the 
earth, but will not collide with the earth in 2029; the same asteroid 
will make another pass in 2035, but the risk of collision with the 
earth cannot be calculated at this time.
---------------------------------------------------------------------------
    The case of preparing and planning response procedures only on the 
basis of very large, catastrophic scenarios of LNG release without 
considering the evaluation of smaller ``accidental'' or other ``smaller 
attack'' scenario releases leads to misallocation of resources and 
leads to ineffectiveness. Should a relatively small incident occur, it 
is human nature to respond with the and only plan developed on the 
basis of the scenario, which will affect a very large number of people. 
Such a plan may call for massive evacuation or at the very least 
require informing a very large number of people on what to do, in a 
very short time. Such approaches will only exacerbate the problem 
resulting in physical as well as communication gridlocks, not to speak 
of the wrong information it conveys to people.
    In my recent assessment of the consequences of potential release 
scenarios at the Everett, MA LNG facility, the emergency responders of 
the city of Everett (The Fire Chief and the Police Chief) requested me 
to consider only those scenarios that are realistic, credible and 
exclude the scenario of release of the entire contents of the LNG tanks 
(40 million gallons) because it represents an extremely incredible 
event (an event that had the probability of occurring, if at all, once 
in a million years or more). This is because of the realization that 
the release of the entire contents of even the smaller of the two tanks 
(15 million gallons) would be an incredible event, the response to 
which would take an extremely large amount of financial, equipment and 
manpower resources that neither the city of Everett nor the surrounding 
communicates could afford to tie up. Therefore, while the worst-case 
scenario may be considered for analysis, it cannot form the only basis 
of any decision-making including for emergency response.
    Over the past 30 years of safely transporting LNG in highway trucks 
there have been three instances in which the LNG trucks overturned (due 
to traffic accidents) without leaking LNG. In all of these instances 
the local authorities chose to shut arterial highways for over 8 hours 
creating traffic havoc, inconvenience, lost economic opportunities and 
direct expenses, all on a scale completely The reason for this is 
simple; the emergency responders today are taught (incorrectly, in my 
opinion) that LNG is very dangerous and they are always taught to 
expect the ``worst.'' As a scientist I can state that a gasoline road 
tanker in a similar situation will be far worse both from the 
perspective of the potential for a spill (gasoline tankers are less 
strongly built than LNG tankers), fire and explosion and other vehicles 
and people in the vicinity. Yet, I have never heard of highways being 
shut down for whole day due to a traffic accident involving a gasoline 
tanker without fire or spill.. This is because, gasoline is widely used 
and its hazards, normal or worst case, are accepted by the society.
    A recent report by Sandia National Lab (4) recognizes 
the limitations of conducting just a worst-case analysis related to LNG 
shipping and concludes:
    Because costs to prevent and mitigate the potential consequences of 
an extreme event such as an LNG spill can be extensive, performance-
based risk management approaches can be used to ensure that public 
safety and property are effectively protected.
    Therefore, Mr. Chairman, it is my considered opinion that analysis 
alone should not be the basis for any regulation or decision-making. It 
has to be considered in the context of other events associated with the 
activity of concern and has to be viewed from the perspective of the 
risk posed by a spectrum of events, their likelihood of occurrence and 
the hazards they cause.

 Questions from the Honorable Peter T. King, Ranking Member, Committee 
                          on Homeland Security

    Ouestion 1: You mention in your written testimony that the 
mathematical modeling used today is based on data that is 30 years old, 
and that you're concerned about the ``scale.'' Can you explain why a 
smaller LNG spill or fire might behave differently than a larger LNG 
spill or fire?
    Response 1: There are a number of phenomena related to LNG release 
(especially from a ship) that have to be modeled before a calculation 
of the overall hazard from the release can accurately be made. The 
models applicable to these phenomena may be broadly as, (i) Source 
models, (ii) LNG behavior models, and (iii) Hazard-effect models. A 
majority of the experimental research conducted to date has focused on 
understanding and quantifying LNG behavior phenomena (such as the 
characteristics of pool fires, vapor fires, vapor cloud explosions, 
etc). Not much experimental work has been undertaken to model or 
describe either the ``source'' or the effects that constitute hazard to 
people and objects. To a very limited extent laboratory test data exist 
on radiant heat effects on the human skin. Only theoretical models 
exist for the source and characterizing hazard effects.
    The principal concern in regard to hazards from a LNG spill is the 
effect of a fire. As the GAO has indicated in its report,\13\ the 
formation of a large pool fire on water and the radiant heat emission 
(and its effect on people) is the single most important issue in LNG 
hazards analysis. A number of pool fire studies were conducted in 1970s 
in the US and up to 1987 in Europe. The largest sizes of pool fires 
tested in the US are, 6 m (20 ft) diameter on land and 15 m (50 ft) 
diameter on water. In Europe the largest pool fire on land tested was 
35 m (115 ft) diameter on an insulated concrete dike.
---------------------------------------------------------------------------
    \13\ ``Public Safety Consequences of a Terrorist Attack on a Tanker 
Carrying Liquefied Natural Gas Need Clarification,'' Report GAO-07-316 
to Congressional Requesters, US Government Accountability Office, 
Washington, February 2007.
---------------------------------------------------------------------------
    The less than 50 ft diameter LNG fire tests showed a very clean 
burning, highly radiative yellow colored fire. These types of fires 
were found to radiate heat energy at a high level over \14\ all of the 
visible size of the fire. However, as the size increased by just a 
factor of about 2 (from 15 m diameter to 35 m diameter) the fire 
characteristics were found to be completely different in that the 
larger fire produced copious amounts of black soot which shrouded much 
of the surface of the fire resulting in substantially reduced emission 
of heat from the fire. In addition, it was noticed that the heat output 
from the fire was not uniform from bottom to again due to the effects 
of smoke.
---------------------------------------------------------------------------
    \14\ The radiant heat output from a fire is generally expressed as 
its ``Emissive Power'' or ``Radiance'' and is measured in units of 
energy radiated per unit ``ideal'' surface area of the fire and 
expressed in either kW/m\2\ or Btu/hr ft\2\. The fire is considered as 
a cylindrical body (even though the flame has many folded surfaces) and 
it is the surface of this cylindrical envelope that is considered in 
defining the emissive power.
---------------------------------------------------------------------------
    The conventional wisdom as to why large fires behave differently 
(and put out less net radiant heat than small fires) are based on the 
following observations:
        (i) As the size of the fire increases, it becomes more and more 
        difficult for air to diffuse to the center of the fire in time 
        so that the fuel vapor burns efficiently and completely. The 
        reduction in burning efficiency (or the burning chemistry) 
        results in the formation of black soot in such an amount as to 
        start shrouding the fire from the outside.
        (ii) The fuel vapor emanating from the boiling liquid pool 
        surface forms a bubble of gas in the bottom core of the fire. 
        This gas bubble has the capacity to absorb the heat from the 
        fire above and thus reduce the amount of heat that gets passed 
        on to the liquid for evaporation. Both of these phenomena are 
        size dependent phenomena that do not occur in smaller (less 
        than 20 m) fires but are pronounced in fires larger than about 
        30 m.
        (iii) Once the diameter of the fire increases above a certain 
        critical value (and what this critical value is for LNG pool 
        fires is at present unknown), the fire no longer bums as a 
        single unit but instead breaks up into several individual and 
        distinct collection of columns of fire. This phenomenon, which 
        is observed in forest fires when a very large area is burning, 
        is termed the ``mass fire.'' The air for burning no longer 
        comes from the sides but from the top in the form of downdrafts 
        feeding individual columns. This is an extremely complicated 
        phenomenon, which has not been observed in any of the largest 
        LNG fire experiments to date (35 m diameter tests in France). 
        If this should occur in LNG pool fires, the result would be a 
        much shorter vertical extent of the fire and, hence, a much 
        reduced hazard distance.
    The significance of the large fire phenomena on the overall hazard 
distance can be described as follows.
         In general the larger the LNG fire diameter the larger 
        is the distance from the fire to a specified level of hazard 
        (in kW/m\2\ in heat flux level). However, for a specified level 
        of hazard the ratio of the hazard distance to the diameter 
        decreases substantially for larger fires compared to the value 
        for smaller fires. This is primary due to the less radiative 
        characteristics of a larger sooty fire.
         Since hazard distances from large LNG pool fires 
        result in large distances, the absorption of radiant heat by 
        the intervening atmosphere becomes very important in reducing 
        the radiant heat to the objects. The reduction in hazard 
        distance to diameter ratio of larger fires is therefore due to 
        both the sootiness of the fire as well as due to the 
        significance of the atmospheric absorption.
         In large fires the emissive power varies significantly 
        from the base to the top of the fire. The bottom parts of the 
        fire are more radiative than upper parts of the fire. Hence, if 
        the lower parts are masked (either by a wall or by some other 
        obstruction), then the reduction in the hazard distance will be 
        very significant.
         In the case of a larger LNG pool fire on water, the 
        high radiative emission from the bottom parts of the fire will 
        result in the water surface near the fire to be heated to such 
        an extent that it produces significant amount of water vapor. 
        The thus generated water vapor will act as an additional and 
        significant absorber of radiant heat emission from the bottom 
        parts of the fire resulting in substantial reduction in the 
        hazard distance.

    Question 2: As an expert in the study of LNG, can you take a moment 
to compare the different dangers between LNG and gasoline? Is LNG so 
much more dangerous than gasoline? Does it fire faster?
    Response 2: Gasoline and LNG (methane) are fuels that belong to the 
saturated hydrocarbon chemical group. The combustion properties of all 
saturated hydrocarbon fuels are very similar. For example, the heat 
produced when a pound of any one of these saturated hydrocarbons is 
burned in air \15\ is the about the same, namely 20,000 Btu (within 
5%). Also, the pounds of air required to bum completely one pound of 
any of these fuels are also about the same, namely, 15.5 ( 3%) except 
for methane, which requires a larger quantity of air. The consequence 
of the similarity in combustion properties is that the fires all of 
these fuels have, within  100 F the same temperature. (The laboratory 
measured fire temperature in a gasoline fire is 3580 F and that in a 
methane fire is 3410 F)
---------------------------------------------------------------------------
    \15\ In a quantity of air (called the ``stoichiometric'' amount), 
which contains the chemically required amount of oxygen to react with 
the hydrocarbon for complete combustion.
---------------------------------------------------------------------------
    Itemized below are comparisons of important gasoline and methane 
properties that have a bearing on the extent of hazard that each fuel 
poses. Also included are discussions on the effect of each property on 
the overall hazard.
         Vapor flammabilitv limits in air: The gasoline limits 
        are 1 % to 7.6 %, whereas the methane limits are 5% to 15%. 
        This means that gasoline vapors are flammable even at very low 
        concentrations posing a larger vapor area of hazard for a given 
        mass of spill.
         Energy content per unit volume: Gasoline (liquid) has 
        an energy content of 116 kBtu/gal whereas the LNG value 72 
        kBtu/gal. That is, a gasoline tanker of the same volume 
        capacity as a LNG tanker has almost 60 % more energy content 
        than the LNG tanker.
         Density of vapor: The density of vapor of gasoline 
        emanating from the evaporation of a pool of spilled gasoline is 
        4.4 kg/m \3\ (or 3.67 times heavier than air). The LNG vapor 
        given off from a boiling pool of LNG is 1.84 kg/m \3\ (or 1.53 
        times heavier than air). Therefore, for a given volume of vapor 
        generated by the evaporation of the pools of gasoline and LNG, 
        the gasoline vapor gets diluted at a much slower rate, lingers 
        much longer and spreads to a much greater distance before 
        becoming non flammable. That is, the dispersion of vapor 
        generated by a gasoline spill poses a greater dispersion 
        distance and flammable vapor area danger than from the release 
        of an equivalent quantity of LNG vapor. Also, LNG vapor can get 
        heated by the substrate (ground or water) or the sun and become 
        neutrally buoyant further reducing the area of dispersion to 
        lower flammability limit. This does not happen with gasoline 
        vapors, which are essentially at ambient temperature during 
        dispersion and therefore stay heavy and close to the ground.
         Ignition temperature: The ignition temperature of 
        gasoline vapor in air is between 500 and 745 (440 F and 880 
        F) depending upon the gasoline blend. This is compared to 
        methane, which has a higher ignition temperature of 660 K (1088 
        F). The higher the ignition temperature, the more difficult it 
        is to ignite a mixture of vapor and air. Therefore, a gasoline 
        air mixture is more easily ignitable than methane air mixtures 
        by hot surfaces.
         Flame/Fire temperature: The gasoline and methane fires 
        have about the same temperature (3580 F for gasoline and 3410 
        F for methane fire). Therefore, it is expected that the 
        radiant heat output from each would be about the same. For a 
        given (small) diameter pool fire gasoline fire is sootier than 
        an LNG fire of the same size. However, as the fire diameter 
        increases and the shrouding effect of black soot produced in 
        the fire becomes dominant it can be argued that both gasoline 
        and LNG fires will show similar radiant heat output 
        characteristics. Unfortunately, there are no experimental data 
        for either large gasoline fires or large LNG fires (of sizes in 
        the hundreds of meters in diameter).
    The above facts clearly indicate that an LNG fire is no more 
dangerous than an equivalent size gasoline fire. I do wish to point out 
to the Committee that large gasoline pool (of tens of meters in 
diameter) are dangerous and no one, to the best of my knowledge, has 
successfully put out such size fires with any of the conventional 
techniques used in Therefore, large LNG pool fires and gasoline pool 
fires pose similar dangers; neither is better or worse than the other.

    Question 3: In your testimony you mention three missiles striking a 
LPG carrier and the resulting fire. Did the cargo explode? Did the ship 
survive?
    Response 3: To the best of my knowledge the cargo carried by the 
Fountain at the time of its attack (October 12, 1984) in the Persian 
Gulf carried 18,850 tons of liquefied petroleum gas (LPG). The 
information I have is from the article presented in a conference.\16\ 
According to this paper, the ship was hit by three air-to-ground, 
guided and armour-piercing Iranian ``Maverick'' missiles. The ship 
suffered extensive damage to the deck plate and to one of the LPG 
tanks. There was an extensive fire on the deck and in some of the crew 
quarters from the exploding missiles. However, the flammable cargo, 
LPG, did not explode. There was however, leak of propane gas through a 
gash in the roof of one of the tanks. The fire burned as a torch fire 
(similar to a flare normally seen in petrochemical refineries).
---------------------------------------------------------------------------
    \16\ Captain J. A. Carter, Salvage of Cargo from the War-Damaged 
Gaz Fountain, Paper presented at the 1985 Gastech Conference held at 
Nice, France.
---------------------------------------------------------------------------
    All of the crew abandoned the ship and were saved. The ship itself 
was towed Dubai, to the remainder LPG cargo unloaded safely and 
repaired. The ship not only survived the missile attack but also (after 
repair) is said to be back in the same service.

    Question 4: The GAO report recommend the DOE (1) incorporate into 
its current LNG study the key issues identified by the panel of experts 
assembled GAO and (2) that DOE examine the potential for cascading 
failure of LNG tanks. Will the two principal research recommendations 
in the GAO report, if implemented, provide sufficient knowledge you as 
an expert scientist need to perform an accurate prediction of the 
extent of the hazard?
    Response 4: The GAO has identified only two of the principal area 
for further research. I am of the opinion that there are a number of 
equally important issues that have not been highlighted in this report, 
which have considerable influence on the assessment of hazards. 
Therefore, my response to your question, Mr. King, is that while better 
assessments of the hazard can be performed with better confidence, if 
the research recommended by GAO is successfully carried out, it will 
not provide all of the answers to performing an ``accurate'' prediction 
of the extent of the hazard. I will elaborate my answer below.
         Hazard assessment is dynamic process in which many of 
        the phenomena considered may change as technology and 
        procedures change. For example, larger LNG ships than the ones 
        in service now are being and in the near future will join the 
        world fleet. What issues these ships (which in some cases have 
        twice the carrying capacity of present day ships) may bring to 
        the forefront in terms of potential hazards be envisioned at 
        present.
         Focusing one or two phenomena for research to the 
        abandonment (or reduction in emphasis) of other issues may not 
        be a very good policy decision.
         In addition, what constitutes a significant hazard 
        cannot be based on polling expert opinion only. It has to be 
        worked out by a careful assessment of the various phenomena and 
        their interplay with one another. In effect one needs conduct a 
        thorough study of the failure modes and effects analysis.
         GAO ranks the study of cascading failures as the 
        second highest priority. The statistical basis on which such a 
        conclusion was arrived at is not clearly indicated by the GAO. 
        Ten experts suggested a ``great need'' for conducting research 
        on ``Comprehensive modeling allowing different physical 
        processes to interact'' whereas only 5 experts said the same on 
        ``Cascading failure.'' Therefore, it is difficult to reconcile 
        as to why this particular research need is ranked #2. The top 
        six scores for the ``research types'' are relatively close and 
        can be considered to have the same statistical significance. 
        Votes of ``experts'' can be a guide to policy decision-making 
        only when the ``experts'' have the relevant expertise in the 
        technical matter of interest. Not all ``experts'' have 
        expertise in all aspects of release and behavior of LNG. It is 
        my recommendation, therefore, that prior to making any policy 
        decisions experts in the field of metallurgy and ship design 
        should be consulted and their views on the importance (or not) 
        of this problem should be taken into consideration.
         It also is evident from the GAO report (and this shows 
        the bias of some of the experts towards the very worst case 
        scenario consideration) that the frequency of occurrence of 
        events of different types and magnitudes was not considered in 
        making the recommendations. As I have argued in response to a 
        question from the Chairman, without performing a detailed risk 
        assessment, making policy decisions using only one type of 
        hazard or consequence size consideration leads to non-economic 
        application of resources (in this case scientific resources).
    There are a number of very important phenomena that GAO has not 
even alluded to in its report nor was discussed with the experts. These 
include the fate of LNG released into water and its rapid evaporation 
and production of very large volume of vapor close to the spill source 
and its possible ignition and burning in the form of a large fireball. 
The remaining un-vaporized liquid will spread on the water surface as a 
pool, and will sustain a pool fire. Because of the possible initial and 
substantial evaporation the volume of liquid remaining to spread is 
smaller thus posing a smaller pool fire hazard. Similarly, the GAO 
report has not identified research into the effects of winds and waves 
on the movement and expansion of the liquid pool. There are such 
numerous other phenomena, each of which affects to a great extent the 
calculation of the hazard.
    Therefore, I submit that if the GAO report recommendations are 
implemented, and the research results are obtained without leading to 
the identification of additional phenomena of concern or complications, 
they will provide some but not all of the information for me as an 
expert scientist to perform an accurate prediction of the extent of the 
hazard from LNG releases from a ship.

Questions from the Honorable Bennie G. Thompson, Chairman, Committee on 
                           Homeland SEcurity

                    Responses from AJ. Mark Robinson

    Question 1.: Does the Federal Regulatory Commission (FERC) have the 
personnel and assets needed to oversee the additional LNG facilities? 
If not, what will will FERC need?
    T2Response: Yes. In 2004, the LNG Engineering Branch was formed to 
conduct engineering and safety review of the increasing number of 
proposed facilities. In 2006, the LNG Compliance Branch was created to 
provide oversight of construction and operation of LNG facilities under 
jurisdiction. Later that same year, the Office of Energy Projects hired 
six engineers for positions in the LNG Engineering and Compliance 
Branches to meet the current and expected workload from LNG import 
terminal applications and construction. Engineers in these branches 
ensure a thorough safety oversight through the three phases 
authorization; pre-construction, and pre-operation) of project review 
at the Commission.

    Question 2.: It has been over 5 years since 9/11, why is there 
still disagreement amongst the experts concerning the security on LNG 
tankers?
    Response: The GAO study reports substantial agreement among the 
expert panel concerning many of the potential public safety 
consequences of a terrorist attack on an LNG tanker including thermal 
radiation from a pool fire, unconfined vapor cloud explosions, burns, 
asphyxiation, and rapid phase transitions. The findings of the GAO 
expert panel are also consistent with those in the FERC staffs 
assessment of LNG facilities. With respect to the December 2004 Sandia 
report, eleven of the fifteen experts judged the distance calculations 
as either accurate or overly conservative.
    The U.S. Coast Guard (Coast Guard), the lead federal agency 
responsible for waterway safety and maritime security, has issued 
nation-wide guidance to ensure that a uniform approach is taken in 
assessing security issues related to LNG vessel transit. The guidance 
issued in Navigation and Inspection Circular 05-05 is used by 
applicants, the Coast Guard, and port stakeholders to perform an 
objective review of whether a waterway is suitable with respect to 
navigation safety and maritime security. The conclusions of this port-
and project-specific review are used by both the Coast Guard and the 
FERC in deciding whether to issue federal authorizations for the LNG 
vessel transit and the on-shore facility.

    Question 3.: According to GAO, more research is needed. Why hasn't 
this research been completed already?
    Response: Sandia National Laboratories has two research initiatives 
currently underway: one on threat, breach and hazard modeling and 
assessment for larger LNG ships; and the other on safety hazard testing 
and modeling of large LNG spills on water. These efforts are planned to 
continue through 2007 and 2008 with interim results at intermediate 
dates. Sandia has conducted periodic briefings for our staff and other 
federal agencies on the progress of each project. We fully support the 
research by Sandia and anticipate that the results will validate the 
conservatisms in our hazard modeling.

    Question 4.: Please provide us with information about the measures 
FERC undertakes to ensure the security on the LNG facilities.
    Response: As referenced in my March 21,2007 testimony, the 
Commission shares security responsibilities for these facilities with 
the Coast Guard, which has primary responsibility under the Maritime 
Transportation Security Act of 2002. The Commission has a role related 
to facility security at all phases of project development. During the 
pre-construction review, the preliminary plans to secure the facility 
intentional acts are evaluated and discussed at the cryogenic design 
and technical review conference for the proposal. Prior to starting 
commissioning activities, engineering staff confirms that all plant 
security systems are in place (personnel, cameras, and other 
equipment), and that the Facility Security Plan is current. During 
project operation, engineering staff reviews the facility security as 
part of the annual inspection to ensure sufficient levels of security 
provided by surveillance cameras; intrusion detection systems; security 
fencing; and on-site access control plans.

    Question 5.: While there have been no major LNG incidents, there 
have been groundings. How does FERC use the lessons learned to improve 
the safety and security of all the facilities?
    Response: Our environmental impact statements (EIS) disclose the 
more significant LNG ship incidents including several groundings in 
international waters that resulted in bottom damage but no cargo tank 
damage. We are aware of LNG vessel groundings in U.S. waters but they 
did not result in any damage.
    Our EISs also disclose the accidents that occurred at Cove Point, 
Maryland in 1979 and at Skikda, Algeria in 2004. The lessons learned 
from these incidents have resulted in revising equipment design and 
adding hazard detection to improve the safety of all LNG facilities, 
both under review and in operation under FERC jurisdiction.

    Question 6.: Five FERC approved LNG facilities are currently under 
construction--Louisiana; Freeport, Texas; Sabine, (two); and Cove Point 
Maryland. Please provide us with an update at their construction. When 
will the construction be completed?
    Response: The LNG import terminals and expansions currently under 
construction have targeted in-service dates of: March 2008 for LNG 
(Phase I) in Freeport, Texas; April 2008 for Cheniere's Sabine Pass LNG 
(Phase I) in Sabine, Louisiana; October 2008 for Cameron LNG (Phase I) 
in Hackberry, Louisiana; November 2008 for the Cove Point Expansion in 
Cove Point, Maryland; and April 2009 for Golden Pass LNG in Port 
Arthur, Texas.

 Questions from the Honorable Peter T. King, Ranking Member, Committee 
                          on Homeland Security

    Question 7.: Has FERC ever denied a LNG licensing request? If sO, 
when? how often do companies withdraw from the FERC process?
    Response: In an Order issued on July 5,2005, the Commission denied 
a proposal by KeySpan to convert its existing LNG peak shaving facility 
in Providence, Rhode Island to an LNG import terminal.
    In accordance with the Energy Policy Act of 2005, all LNG project 
applicants must participate in the mandatory prefiling process 
specified under 18 CFR 157.2 1. The prefiling process, as well as the 
subsequent formal filing of an application, requires a substantial 
commitment of resources by the project sponsor, thereby discouraging 
frivolous applications. We are aware of sponsors that have considered a 
project, but have never filed a proposal before the Commission. To 
date, project sponsors that have either filed applications or have 
entered the pre-filing process have not withdrawn their proposals.

    Question 8.: How does the LNG industry compare with the oil 
industry in terms of safety records? Your testimony indicates that a 
LNG ship has never had a major spill. What constitutes a major spill of 
LNG?
    Response: My testimony identified the commendable safety record of 
LNG shipping since its beginning in 1959, and explained the current 
process for coordinating reviews with the Coast Guard to ensure the 
safety and security of the LNG vessel transit to a proposed import 
facility. While our impact statements have not included a comparison 
with the oil industry, we are certainly aware of large cargo releases, 
fires and explosions involving petroleum tankers, both in U.S. and 
international waters, but note that these have not occurred with LNG 
vessels.
    None of the LNG vessel incidents that are disclosed in our 
environmental impact statements resulted in a breach or failure of a 
cargo tank. In those incidents where an LNG release occurred, they were 
relatively small volumes that occurred during the cargo transfer. A 
major spill would require a large breaching of a cargo tank.

    Question 9.: Has there ever been an explosion at a LNG facility? 
What is the relative risk of an explosion LNG when compared with 
gasoline?
    Response: The Reliability and Safety Section of each EIS for an LNG 
import project describes an incident that occurred in 1979 at the Cove 
Point import terminal in a building in which one operator was killed 
and another injured. Nevertheless, we do not believe vapors an LNG 
spill would explode.
    With the exception of the higher surface emissive power and larger 
flame heights estimated for LNG fires, the public hazards associated 
with LNG vapors are not markedly different than from other fuels such 
as gasoline. For example, while gasoline may ignite at a lower 
concentration, LNG vapors have a wider flammability range.
    Question 10: Can you explain the Commission's role in enforcing the 
cost-sharingplans required by the Energy Policy Act of 2005?
    Response: Both the Energy Policy Act of 2005 and Commission Orders 
authorizing LNG terminals require that we approve an Emergency Response 
Plan prior to authorizing any construction. Further, the Emergency 
Response Plan must include a cost-sharing plan. The plan must identify 
the mechanisms for funding all project-specific security costs and 
management costs that would be imposed on state and local agencies. The 
cost-sharing plan must what the LNG terminal operator will provide to 
cover the cost of the state and local resources required to manage the 
security of the LNG terminal and LNG vessel. Commission staff carefully 
reviews the plan to ensure that the state and local resources required 
for security and emergency management have been adequately addressed 
and that no resource gaps remain. The potential costs that are 
considered fall into three categories: (1) per-transit costs (for 
example, overtime for police or fire department personnel); (2) capital 
costs for equipment and personnel base (for example, patrol boats, fire 
fighting equipment); and (3) annual costs for specialized training and 
for conducting exercises.

Questions from the Honorable Bennie G. Thompson, Chairman, Committee on 
                           Homeland Security

                  Responses from Rear Admiral Salerno

    Question 1: From what countries do we receive LNG? Are all of these 
countries compliant with the International Ship and Port Facility 
Security Code?
    Response: Our primary suppliers of LNG are Trinidad, Algeria, Egypt 
and Nigeria. Over the last ten years we've received cargoes from 
Malaysia, Oman, Qatar, UAE and even Australia.
    The Coast Guard's International Port Security (IPS) Program has 
visited Trinidad, Algeria, Nigeria, Malaysia, Oman, Qatar, and 
Australia. With the exception of Nigeria, each of these countries was 
found to be substantially implementing the International Ship and Port 
Facility Security (ISPS) Code. When visiting Nigeria, the Coast Guard 
was only able to visit facilities in the port of Lagos. Thus, Nigeria 
was found to be provisionally implementing the ISPS Code. We have not 
completed an assessment of Nigeria because of political unrest and 
potential danger to Coast Guard personnel. When security conditions 
improve, another visit to Nigeria will be scheduled. Visits to Egypt 
and UAE are anticipated to be completed by March 2008. All the 
countries listed have reported their compliance with the ISPS Code to 
the International Maritime Organization in accordance with Safety of 
Life at Sea security regulations and the ISPS Code.
    Question 2: Please outline for the Committee the additional 
safeguards placed upon U.S. mariners with the Transportation Worker 
Identification Card (TWIC).
    Is it true that the additional security requirement of a TWIC is 
only to be applied to U.S. mariners? Why are foreign mariners not 
vetted in the same manner?
    Response: The Maritime Transportation Security Act of 2002, 46 USC 
Sec. 70105, requires a biometric transportation security card for U.S. 
mariners issued a license, certificate of registry, or merchant mariner 
document. The TWIC does provide additional safeguards for U.S. mariners 
by providing a biometric credential which is common to the maritime 
industry. Whereas the current mariner documents (MMD, license, 
Certificate of Registry) are only used by the population of individuals 
who work on certain vessels, the TWIC will be used by a larger 
population and will be more widely recognized. Having a common 
credential increases the chances that a security guard will be able to 
identify signs of tampering or forgery of the credential as well as 
easing access for the mariner. Inclusion of a biometric on the 
credential provides the ability to ensure that the person who presents 
the TWIC for access is the person to whom the card was issued by 
matching their fingerprint to the biometric template on the card. This 
is not a feature currently available on mariner documents. The TWIC 
also has limited personal information printed on the face of the card 
than the MMD currently has; therefore, if the TWIC was stolen, the 
thief would be unable to retrieve as much information on the holder 
than if the MMD was stolen. Thus, presenting the TWIC as the preferred 
identification document protects mariners' personal information from 
theft.
    Yes, it is true that the TWIC is only required for U.S. mariners. 
The TWIC is not required for foreign mariners.
    Foreign mariners are already vetted prior to entering the United 
States. Foreign mariners must possess a visa issued by the Department 
of State in order to be eligible to enter the United States. The visa 
application process includes a face-to-face interview and vetting 
performed by the Department of State. Additionally, ninety-six hours 
prior to arrival to a U.S. port, a notice of arrival, including a list 
of all persons onboard a vessel, must be sent to the Coast Guard. The 
persons are then vetted through various databases. Finally, upon the 
vessel's arrival at a port facility, Customs and Border Protection 
conducts face-to-face interviews with those foreign mariners who 
request shore leave. Even with a visa, however, a foreign mariner will 
be required to be escorted through secure areas of MTSA regulated 
vessels or facilities, because he/she will not hold a TWIC.
    It is also not clear that requiring foreign mariners to obtain a 
TWIC would provide any security benefit since it is unlikely that a 
foreign seafarer will have a criminal record in the United States. The 
additional background checks are done during the U.S. Department of 
State visa application and Customs and Border Protection screening 
processes, as outlined above. In addition to the uncertain security 
benefit, foreign mariners would not likely have the means to get to 
enrollment centers or to return to claim and activate their 
credentials, nor would any be able to present the appropriate identity 
documents, or meet the requirement for lawful presence under the TWIC 
program. Requiring foreign seafarers to obtain a TWIC would mean that 
before being allowed off of a foreign vessel, each foreign seafarer 
would need to come to the United States to enroll in the TWIC program, 
and then again to pick up their TWIC. Finally, placing such 
requirements on foreign seafarers could effect reciprocal requirements 
for U.S. mariners in other countries.
    Question: To what extent can we improve communication between shore 
side first responders and a LNG ship's crew and officers if they are 
speaking in the same first language and have similar cultural 
backgrounds?
    Similarly, would it not be beneficial for the safety of the vessel 
and its cargo if both officers and crew communicated in their native 
language?
    Response: Current international standards satisfy the safety 
concern raised in this question. In accordance with Safety of Life at 
Sea (SOLAS) Regulation V/14.3, every foreign vessel, even those with 
multi-national, multi-cultural crews, is required to have a common 
working language that permits effective crew performance. Furthermore, 
every Master and Deck officer on vessels subject to SOLAS Chapter I 
that engage in ship to ship or ship to shore safety communications must 
speak English, unless both parties speak another common language.
    Question: Are you concerned about the frequency and the nationality 
of stowaways that have been confirmed on international vessels, 
particularly from international ports that have been vetted by the U.S 
Coast Guard?
    Response: The answer to this question is not releasable to the 
public and therefore must be provided via a secure venue. The Coast 
Guard is available to provide this information at your earliest 
convenience.
    Question: We have heard today, that energy companies have submitted 
32 applications to build additional LNG facilities. Does the Coast 
Guard have the assets to protect the additional LNG tankers and 
facilities? If not, what will the Coast Guard need to successfully 
fulfill this new mission?
    Response: The Coast Guard continues to utilize a waterway 
suitability assessment and report process to identify safety and 
security measures required to mitigate the port-wide risk posed by new 
Liquefied Natural Gas (LNG) facilities. Based on the results of these 
assessments, resources may be identified from the Coast Guard, state 
and local agencies, or the private sector to mitigate that risk. The 
President's budget represents the Coast Guard's highest priority 
resource needs, including the continual evaluation of the assets 
required to mitigate the impact of Certain Dangerous Cargoes (such as 
LNG).
    Question: Is it true that the additional security requirement of a 
Transportation Worker Identification Card is only to be applied to U.S. 
mariners? Why are foreign mariners not vetted in the same manner?
    Response: The Maritime Transportation Security Act of 2002, 46 USC 
Sec. 70105, requires a biometric transportation security card for U.S. 
mariners issued a license, certificate of registry, or merchant mariner 
document. The TWIC does provide additional safeguards for U.S. mariners 
by providing a biometric credential which is common to the maritime 
industry. Whereas the current mariner documents (MMD, license, 
Certificate of Registry) are only used by the population of individuals 
who work on certain vessels, the TWIC will be used by a larger 
population and will be more widely recognized. Having a common 
credential increases the chances that a security guard will be able to 
identify signs of tampering or forgery of the credential as well as 
easing access for the mariner. Inclusion of a biometric on the 
credential provides the ability to ensure that the person who presents 
the TWIC for access is the person to whom the card was issued by 
matching their fingerprint to the biometric template on the card. This 
is not a feature currently available on mariner documents. The TWIC 
also has more limited personal information printed on the face of the 
card than the MMD currently has, therefore, if the TWIC was stolen, the 
thief would be unable to retrieve as much information on the holder 
than if the MMD was stolen. Thus, presenting the TWIC as the preferred 
identification document protects mariners? personal information from 
theft.
    Yes, it is true that the TWIC is only required for U.S. mariners. 
The TWIC is not required for foreign mariners.
    Yes, it is true that the TWIC is only required for U.S. mariners. 
The TWIC is not required for foreign mariners.
    Foreign mariners are already vetted prior to entering the United 
States. Foreign mariners must possess a visa issued by the Department 
of State in order to be eligible to enter the United States. The visa 
application process includes a face-to-face interview and vetting 
performed by the Department of State. Additionally, ninety-six hours 
prior to arrival to a U.S. port, a notice of arrival, including a list 
of all persons onboard a vessel, must be sent to the Coast Guard. The 
persons are then vetted through various databases. Finally, upon the 
vessel's arrival at a port facility, Customs and Border Protection 
conducts face-to-face interviews with those foreign mariners who 
request shore leave. Even with a visa, however, a foreign mariner will 
be required to be escorted through secure areas of MTSA regulated 
vessels or facilities, because he/she will not hold a TWIC.
    It is also not clear that requiring foreign mariners to obtain a 
TWIC would provide any security benefit since it is unlikely that a 
foreign seafarer will have a criminal record in the United States. The 
additional background checks are done during the U.S. Department of 
State visa application and Customs and Border Protection screening 
processes, as outlined above. In addition to the uncertain security 
benefit, foreign mariners would not likely have the means to get to 
enrollment centers or to return to claim and activate their 
credentials, nor would any be able to present the appropriate identity 
documents, or meet the requirement for lawful presence under the TWIC 
program. Requiring foreign seafarers to obtain a TWIC would mean that 
before being allowed off of a foreign vessel, each foreign seafarer 
would need to come to the United States to enroll in the TWIC program, 
and then again to pick up their TWIC. Finally, placing such 
requirements on foreign seafarers could effect reciprocal requirements 
for U.S. mariners receive in other countries.

    Question:: More specifically, will the Coast Guard have the assets 
to continue the following security measures for all of the new 
facilities including--Inspection of security and tanker loading at the 
port of origin.
    Occasional on-board escort by Coast Guard ``sea marshals.''
    96-hour advanced notice of arrival of an LNG tanker.
    Advance notification of local police, fire, and emergency agencies, 
as well as the Federal Aviation Administration and the U.S. Navy.
    Enforcement of security zones.
    Suspension of overflights.
    Inspection of adjacent piers for bombs by police divers.
    Posting of sharpshooters on nearby rooftops.
    Response: All of the activities listed above may not be necessary 
or appropriate for each new facility. The appropriate risk mitigation 
strategies necessary to ensure the safety and security of new shoreside 
LNG facilities, and the resources to carry out such activities, are 
determined on a case by case basis during the waterway suitability 
assessment and analysis process for each project. Unfortunately, due to 
the large number of potential projects, along with the expectation that 
only a fraction will actually be constructed, the Coast Guard is unable 
to estimate the overall needs associated with future LNG terminals 
until construction of each individual terminal is actually approved by 
FERC. Once an applicant has received their construction permit from the 
Federal Energy Regulatory Commission (FERC), the Coast Guard is then 
able to look at the unique needs that will accompany that new facility, 
and whether the Coast Guard has the resources in place, balanced 
against our other legislatively mandated mission-programs, to meet 
those needs. If additional resources are necessary in that geographic 
area, the Coast Guard will determine whether those resources are 
available elsewhere in the Coast Guard or if a new resource request is 
necessary.
    Question: How does the LNG industry compare with the oil industry 
in terms of safety records?
    Response: Transportation of LNG by marine carriers has a long 
record of safe operation. Since 1959, when the commercial 
transportation of liquefied natural gas began, there has never been a 
shipboard death or significant incident involving liquefied natural 
gas. As of March 1, 2007, the world fleet of LNG tank ships consisted 
of 224 carriers which have safely delivered over 40,000 shiploads while 
covering more than 100 million miles. The outstanding LNG shipping 
safety record is attributable to continuous improvement of technology, 
safety equipment, comprehensive safety procedures, training, equipment 
maintenance by responsible ship owners/operators and effective 
government regulation and oversight.
    Over the history of LNG shipping, there have been no collisions, 
fires, explosions or hull failures resulting in a loss of containment 
for LNG ships in ports or at sea. According to a Sandia National 
Laboratories 2004 report to DOE, over the 45-plus year life of the 
industry only eight marine incidents worldwide have resulted in 
accidental spillage of LNG and none of the spills have been as a result 
of a failure or breach of a containment system. In the cases of 
accidental spillage, no fires occurred and only minor structural damage 
was noted. Seven additional marine-related incidents have occurred with 
none resulting in release of cargo. No explosions or fatalities from a 
cargo spill have ever occurred aboard an LNG carrier.
    By comparison, the number of marine carriers in the world fleet 
which carry oil is significantly larger, but marine carriers have been 
transporting oil for a much longer period of time. In 2006, the oil 
carrier industry was 120 years old. Since the first oil carrier set 
sail in 1886, the oil carrier fleet has grown dramatically in both size 
and volume of oil transported worldwide. According to a July 2006 
report from the U.S. Maritime Administration (MARAD), there were 
approximately 4,454 oil and chemical carriers in the world fleet. The 
exact number of those which are oil carriers in operation is unclear, 
but the International Maritime Organization (IMO) places the number at 
over 3,500. Statistical data and information on the complete safety 
record of oil carriers since their entry into the world trade market is 
unknown. A recent paper submitted to IMO in December 2006 included an 
assessment which looked at casualties on the world fleet of oil 
carriers covering a period of 15 years (1990 to 2005). The paper 
reported that in the time frame studied, worldwide, there were a total 
of 564 lives lost on oil tankers due to various causes and 484 due to 
accidents caused by fire and explosion.
    Using these comparison standards, the safety record associated with 
LNG marine carriers is much better than the safety record associated 
with marine carriers of oil.
    Question: I understand that the Coast Guard requires crew manifests 
be submitted 96-hours prior to the arrival of a ship into port. Are 
U.S. mariners on these ships vetted against the same lists?
    Response: Yes, U.S. Mariners are vetted against the same federal 
terrorism, immigration, and law enforcement databases as foreign 
mariners.
    Question: The Coast Guard is frequently commended for their risk-
based resource allocations. In the Coast Guard's opinion, would a ship 
crewed by U.S. mariners provide less a risk than a ship crewed by 
foreign citizens?
    Response: The Coast Guard believes the existing screening process 
and security checks conducted for all crews on arriving foreign-flag 
vessels, combined with the employer vetting process, significantly 
reduce the likelihood that an unauthorized crewmember could 
surreptitiously join the crew of an LNG vessel.
    While a U.S. crew on a U.S. flag LNG vessel could reduce the risk 
from internal sabotage, this measure would not mitigate the greatest 
risks to the vessel (i.e. a vessel-borne explosive device or an attack 
from a stand-off weapon).
    Question: There has been some discussion as of late to require U.S. 
mariners to crew foreign-flagged LNG carriers offloading in the United 
States. Would the Coast Guard provide a ship crewed entirely by U.S. 
citizens less of a security envelope compared to a ship with some 
foreign citizens?
    Response: While a U.S. crew on a U.S. flag LNG vessel could reduce 
the risk from internal sabotage, this measure would not mitigate the 
greatest risks to the vessel (i.e. a vessel-borne explosive device or 
an attack from a stand-off weapon).
    Question: What actions or investments has the Coast Guard taken to 
prevent a USS Cole or T/V Limberg incident from occurring to a LNG 
vessel? Is the Coast Guard's Research and Development Center involved?
    Response: The President's Fiscal Year 2008 Budget includes several 
items which contribute to improving the overall multi-mission 
capability of the Coast Guard. Specifically, the President's Fiscal 
Year 2008 budget request supports the following initiatives to increase 
specialized forces and intelligence capability to meet the small boat 
Improvised Explosive Device (IED) threats.
         Nationwide Automatic Identification System
         Maritime Security Response Team Shoothouse
         Response Boat-Medium
         Rescue 21
         Deployable Operations Group
         Coast Guard Counterintelligence Service
    Addressing the threat of small vessel attacks in the U.S. requires 
continual review of security gaps and coordination with small vessel 
stakeholders, including commercial and recreational vessel operators in 
U.S. waters. To further such dialogue with these stakeholders, the 
Department of Homeland Security has scheduled a National Small Vessel 
Security Summit for June to begin a robust conversation to fully 
understand the gaps in maritime border security and collaboratively 
develop measures of closing those gaps. Additionally, the Coast Guard 
is vigorously exploring a number of ways to close existing gaps 
including: unambiguous warning capability to determine intent of small 
craft approaching high value assets; technologies appropriate for use 
within crowded ports to deter or stop small vessel attacks, including 
non-lethal options; regulations expanding current requirements for 
tracking of small vessels; and improved sensors (radars, offshore 
buoys, etc.).
    The Coast Guard's Research and Development (R&D) Center is starting 
a new project to addresses challenges faced by Coast Guard boat forces 
units conducting waterside security operations. These include Level I 
Port, Waterway, and Coastal Security (PWCS) units such as Sectors, 
Maritime Safety and Security Teams (MSSTs), Port Security Units (PSUs), 
and Maritime Force Protection Units (MFPUs). This project directly 
supports the Coast Guard's Small Vessel Response Task Force Final 
Report recommendation to vigorously pursue technology to deter or stop 
small vessels threats within the port environment.
    The R & D Center's Project Objective is to provide Coast Guard 
program managers with recommendations for the best short, mid & long 
term solutions to close capability gaps in domestic ports. The desired 
end-state is to ensure Coast Guard program managers have actionable 
information to select and implement changes to policy and procedures, 
and new use of force tools. This array of improvements to domestic port 
security capabilities will serve to mitigate and reduce risk in the 
maritime environment.

                                 
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