Representation by CF Fertilisers UK Limited (CF Fertilisers UK Limited)
- Date submitted
- 16 December 2021
- Submitted by
- Members of the public/businesses
Written Representation of CF Fertilisers UK Limited in Response to the S56 Notice 1. BACKGROUND/CONTEXT 1.1 We are instructed by CF Fertilisers UK Limited (“CFL”) in relation to the development consent application made by Net Zero Teesside Power Limited (“NZT Power”) and Net Zero North Sea Storage Limited (“NZNS Storage”) (together the “Applicant”) for a development consent order (“DCO”) authorising the Net Zero Teesside Project (the “Project”). This Section 56 representation is made on behalf of CFL. 1.2 CFL is best known as being the UK’s premier fertiliser manufacturer making in excess of 1.5 million tonnes of fertiliser products per year which equates to 40% of the UK’s fertiliser needs. 1.3 In addition to producing fertilisers, CFL’s production site in Billingham also produces over half a million tonnes of chemicals and utilities that are supplied to both neighbouring Teesside businesses (Mitsubishi Chemical, Huntsman Corporation, Quorn Foods, Seqens and others) and to nationally critical supply chains in the food and drinks industry. 1.4 CFL products are key building blocks for many other materials and are used in food, pharmaceutical, nuclear and NOx abatement and plastics industries. 1.5 CFL is the only UK manufacturer of ammonia and nitric acid and a significant supplier of CO2; CO2 being a critical chemical used in the food and drinks industry. 1.6 During the recent COVID-19 pandemic CFL was granted Critical Business Status and allowed to operate throughout. 1.7 CFL was recently featured in international and national news headlines after having to halt operations due to spiking gas prices. Such is the criticality of CFL to the UK that, in response, the UK government intervened, producing a support package that enabled the restart of the plant and averting a potential CO2 supply disruption impacting many industries, including food and beverage availability to UK consumers. 1.8 Its Billingham facility is located just to the south of the Order land shown on sheet 1 of the land plans (document No. 4.2) Off Haverton Hill Road (East Gate). 1.9 The proposed DCO and authorised works have the potential to: 1.9.1 adversely affect CFL’s existing pipeline and cabling infrastructure; 1.9.2 compromise Control of Major Accident Hazards (“COMAH”) safety planning and give rise to unacceptable hazards; 1.9.3 prevent access (by CFL and other third parties) to critical infrastructure (owned by both to CFL and other third parties); 1.9.4 prevent the development of proposed new pipelines by CFL (including a planned natural gas pipeline) which is critical to its ongoing operations and future strategic plan for the business; and 1.9.5 inadequately address decommissioning. 1.10 As part of the Project, the Applicant seeks to compulsorily acquire new rights over various plots of land which CFL either owns, occupies or has rights over. The Applicant also proposes to take powers to extinguish, suspend or interfere with CFL’s rights and impose new restrictions on such land. 1.11 CFL supports the Applicant’s project in principle and has a vested interest in the successful installation of the proposed CO2 pipeline but must ensure that the construction and operation of the proposed works do not adversely affect its current and planned future operations (nor those of others for whom CFL is vicariously responsible) or lead to the impacts identified above. It is expected that these concerns can be addressed by the inclusion of appropriate protective provisions in the Order. 2. LAND PLOTS/ISSUES 2.1 The land plots in which the Book of Reference identifies that CFL has an interest are set out below: Part 1 – Freehold interests Plot 10, Plot 12, Plots 14 to 17, Plots 19 to 33 and Plot 36 Part 1 – Occupiers or Reputed Occupiers Plots 1 to 8, Plots 10 to 12, Plots 14 to 17, Plots 19 to 22, Plots 25 to 26, Plots 28 to 31, Plot 33, Plots 35 to 38, Plot 40, Plot 42, Plots 44 to 46, Plots 56 to 59, Plots 69 to 70, Plot 72, Plot 74 to 76, Plot 78, Plot 86, Plots 88 to 90, Plots 93 to 96, Plots 100 to 101, Plot 115, Plots 120 to 121, Plot 124 and Plot 132 Part 3 – Persons enjoying rights over land Plots 1 to 8, Plots 11 to 12, Plot 33, Plots 35 to 38, Plot 40, Plot 42, Plots 44 to 46, Plots 56 to 59, Plots 69 to 70, Plot 72, Plots to 76, Plot 78, Plot 86, Plots 88 to 90, Plots 93 to 96, Plots 100 to 101, Plot 115, Plots 120 to 121, Plot 124 and Plot 132. 2.2 The majority of these plots comprise land over which existing pipeline and cabling infrastructure is present and/or where CFL has rights/plans to install further business critical infrastructure. This includes both above and below ground infrastructure as well as pipe bridges and takes into consideration requirements for temporary allocation of land for constructions (access and laydown etc). 2.3 CFL’s infrastructure includes but is not limited to: 2.3.1 2 x 6” ammonia pipelines; 2.3.2 Intermediate Pressure Steam pipelines; and 2.3.3 CO2 pipelines (low pressure plastic pipeline). 2.4 Non-CFL infrastructure but critical to its ongoing operation includes but is not limited to: 2.4.1 High pressure natural gas infrastructure; and 2.4.2 EHV electricity cables. 2.5 The uninterrupted use, maintenance of and unhindered access to this infrastructure is critical to CFL’s continued operations, since they carry the raw materials on which CFL relies to manufacture its products as well as the ability to run the facilities and to supply its customers. A legacy of history of Billingham Chemical complex, the site infrastructure and businesses are highly integrated. Most on-site businesses rely on CFL Utilities and/or chemicals to be able to operate. CFL’s supply of natural gas, electricity and nitrogen are critical to not only its business but also its customers on-site. In addition, its customer and neighbour, Mitsubishi Chemical’s other key raw materials are transported through the corridor (methanol and acetone cyanohydrin). 2.6 The pipeline corridor identified by the Applicant is also used by others and notably contains the following: 2.6.1 Nitrogen pipeline owned by BOC – critical to the operation of the CFL facility and Mitsubishi Chemical, Seqens and Johnson Matthey; 2.6.2 Methanol pipeline owned by Methanex – critical to the operation of Mitsubishi Chemical; 2.6.3 ACH pipeline owned by Mitsubishi Chemical; 2.6.4 Effluent pipeline and 2 x 11kV electricity cables – owned by Quorn Foods; 2.6.5 2 x 135kV electricity cables connecting Saltholme to Billingham; and 2.6.6 Natural gas pipeline owned by Sembcorp – buried. 2.7 The corridor also contains a number of redundant or currently unutilised infrastructure including: 2.7.1 A hydrogen pipeline; 2.7.2 Light distillate pipelines; and 2.7.3 Liquified petroleum gas pipeline. 2.8 This infrastructure also inherently gives rise to major accident/hazard risks and is subject to either or both of The Pipelines Safety Regulations 1996 and the Control of Major Accident Hazards Regulations 2015 (the “COMAH Regulations”). Both of these Regulations require that the Operator (CFL) ensures that the risks from potential major accidents are assessed and appropriate safety management systems to control those risks are in place. In order to ensure such assessments remain valid it is crucial that additional causes of risk presented by the proposals are thoroughly understood by CFL to allow assessment of how the accumulated risks affect the overall risk profile and its tolerability in line with accepted regulatory standards. It can be anticipated that risks from external impacts will be increased during various phases, however additional domino effects from potential proximate incidents must also be considered. Furthermore, the proposals may lead to safeguards that mitigate existing risks to be weakened and therefore detriment the risk profile. For example, access for safety-related inspections and maintenance may be hindered. 2.9 The Applicant has not yet been able to present CFL with any detailed designs for its proposed infrastructure, precise locations or constructions programmes. Without appropriate protections, there is no guarantee that the Applicant would be able to ensure that its works are suitably timed, located or undertaken in a way that reduces major hazard risk to as low as reasonably practicable. Nor is there any guarantee that access will be maintained for appropriate safety inspections and emergency maintenance. 2.10 The proposed powers include the ability to extinguish, suspend or interfere with CFL’s rights. Unchecked, this is unacceptable in the context of critical infrastructure which must be maintained in situ without interruption and with a continuous right of access for maintenance and major accident prevention reasons. 3. NEW PIPELINE(S) 3.1 Aside from its existing infrastructure, CFL has the benefit of a Deed of Grant enabling it to construct new pipelines in the corridor that spans sheets 1 to 4. It proposes to rely on these rights to construct a new natural gas pipeline (of up to 16” in diameter) between its manufacturing facility at Haverton Hill Road, Billingham and the CATs and/or TGPP gas processing sites in the vicinity of plot 112 on sheet 3 and requires to retain its right to install a further liquids pipeline of up to 6” in diameter. Currently, the Schedule of Interests does not consistently recognise these rights (including both the rights to site these pipelines and associated rights around construction and access), which clearly must be rectified. 3.2 The proposed new natural gas pipeline is critical to the ongoing and future operation of the Billingham site because natural gas is the key raw material utilised in CFL’s processes, with CFL consuming up to 700,000 therms per day of natural gas (equivalent to a large city) – without this pipeline CFL is exposed to a single source of potentially unreliable and cost prohibitive gas from the national grid. 3.3 The Applicant has been made aware of this proposal, but the current draft DCO does not explicitly provide for capacity to be retained within the pipeline corridor for this development or for the developments to be properly coordinated such that construction access and laydown is provisioned for, should the Project commence first. 3.4 CFL’s rights to lay the new pipelines (both in accordance with its rights under the Deed of Grant and any alternative routings) should not be interfered with by the Applicant, who should be under an obligation to ensure that its own works do not prevent or materially increase the costs of implementing CFL’s new natural gas pipeline or potential liquids pipeline. 4. DECOMMISSIONING 4.1 The current draft requirement for decommissioning states: “Decommissioning 32.—(1) Within 12 months of the date that the undertaker decides to decommission any part of the authorised development, the undertaker must submit to the relevant planning authority for its approval a decommissioning environmental management plan in relation to that part. (2) No decommissioning works must be carried out until the relevant planning authority has approved the decommissioning environmental management plan. (3) The plan submitted pursuant to sub-paragraph (1) must include details of— (a) the buildings to be demolished; (b) the means of removal of the materials resulting from the decommissioning works; (c) the phasing of the demolition and removal works; (d) any restoration works to restore the land to a condition agreed with the relevant planning authority; (e) the phasing of any restoration works; and (f) a timetable for the implementation of the scheme. (4) The plan must be implemented as approved unless otherwise agreed with the relevant planning authority.” 4.2 The words “Within 12 months of the date that the undertaker decides to decommission any part of the authorised development” essentially makes this requirement optional and in no way obliges the Applicant to decommission anything. In the case of pipelines in a particularly congested corridor, where capacity is an identified concern, there should be an effective requirement to decommission once use ceases. This should be an objectively identifiable event, as opposed to something at the election of the Applicant. 5. THE PROTECTIVE PROVISIONS 5.1 The protective provisions for CFL are contained in Part 6 of Schedule 12. The current draft fails to adequately protect CFL, particularly in light of the extensive powers sought within the DCO to interfere with critical infrastructure. 5.2 Paragraph 65 of Part 6 qualifies the key protective provisions in paragraphs 66-69 such that they will only apply if CFL’s new pipeline has been installed or works have commenced. This fails to recognise: 5.2.1 the existing infrastructure present in these plots, as identified above, that requires protection and the need for CFL to be provided with works details, as has been offered in the protective provisions for other affected parties; 5.2.2 the need to maintain access at all times for health and safety reasons and major accident prevention; and 5.2.3 that CFL’s pipeline may be brought forward simultaneously with or shortly after the Project, in which case there is no less need for proper coordination and approval of works details. 5.3 The protective provisions also fail to address the extensive powers in the draft DCO which would allow the Applicant to extinguish, suspend or interfere with CFL’s rights. Such rights include the ability to maintain and access its own critical infrastructure as well as lay new pipelines. Any interference with such rights could be disastrous for CFL and may prevent it from: 5.3.1 continuing to utilise such infrastructure; 5.3.2 inspecting such infrastructure in accordance with its duties under the COMAH Regulations; 5.3.3 carrying out maintenance and responding to leak detection swiftly; and 5.3.4 laying new pipelines which may be vital to CFL’s continued competitiveness and long term viability. 5.4 The protective provisions also fail to provide CFL with any ability to approve construction details so that it can continue to comply with requirements under the Pipelines Safety Regulations 1996 and the COMAH Regulations. Powers should not be exercised without the Applicant first having submitted works details including material to demonstrate that such works can be undertaken safely and without interruption to existing infrastructure and access for critical inspection and maintenance activities. Such details must be approved by CFL so that it is able to consider them in the context of its existing hazard studies and risk assessments, and determine and implement any further safeguarding measures that may be required. 5.5 The indemnity provision in paragraph 71 is welcomed but unclear in its scope because it refers back to paragraph 66 which is only triggered in the circumstances that the new CFL pipeline has been constructed or works have commenced. The indemnity should clearly relate to both proposed and existing infrastructure. 5.6 However, CFL is very concerned that an indemnity provision may be inadequate to address all of the potential losses that might arise, should critical infrastructure serving either CFL or surrounding businesses be interfered with. As will be appreciated from the description of CFL’s business, there are numerous connections between it, the surrounding businesses and the wider UK supply chain. It is therefore very important indeed that the Examining Authority considers the ability of the Applicant to meet such potentially vast liabilities. A far better solution would be to offer CFL and similar businesses greater protection in protective provisions. 6. OBJECTION 6.1 For these reasons CFL must currently OBJECT to the DCO application. It is acknowledged that discussions with the Applicant to date are ongoing and that the concerns identified above should be capable of being addressed through protective provisions and requirements. CFL will update the Examining Authority as soon as possible in this regard.