Document ID: USCG-2016-0258-0002
Agency: uscg
Document Type: Supporting & Related Material
Title: 
Posted Date: 2016-05-10T04:00Z

Supporting Statement

for

Waterfront Facilities Handling Liquefied Natural Gas (LNG)

and Liquefied Hazardous Gas (LHG)

OMB No.: 1625-0049

COLLECTION INSTRUMENTS:  Instruction 

A.  Justification  

1.  Circumstances which make the collection of information necessary.  

The Coast Guard has regulations that provides safety standards for the
design and construction, equipment, operations, maintenance, personnel
training, and fire protection at waterfront facilities handling
liquefied natural gas (LNG) and liquefied hazardous gases (LHG) (33 CFR
Part 127).  These regulations implement the Ports and Waterways Safety
Act of 1972 (PWSA), as amended by the Port and Tanker Safety Act of 1978
(33 U.S.C. 1225), and are necessary to prevent or mitigate the results
of an accidental release of LNG or LHG at a waterfront facility.  They
would reduce the probability that an accident could occur, and would
reduce the damage and injury to persons and property should an accident
occur.  

The regulations contain information collection requirements in the
following sections:

	A.	127.007			Letter of Intent (LOI)  

	B.	127.015			Appeals  

	C.	127.017			Alternatives  

	D.	127.019,	127.305,	127.1305	Operations Manual  

	E.	127.019,	127.307,	127.1307	Emergency Manual  

	F.	127.301,	127.1301		Certification of person in charge  

	G.	127.317,	127.1317		Declaration of Inspection   

	H.	127.409,	127.1409		Records of maintenance

	I.               127.007                                         
Waterway Suitability Assessment (WSA)

This information collection supports the following strategic goals:

Department of Homeland Security

Prevention

Protection

U.S. Coast Guard

Safety

Protection of the Natural Resources

Prevention Policy & Response Policy Directorates (CG-5P & CG-5R)

Reduce crewmember deaths and injuries on U.S. commercial vessels

Reduce the amount of chemicals entering the environment

Reduce the consequences of pollution incidents

2.  Purpose of the information collection.  

A.  The LOI is needed to alert the U.S. Coast Guard Captain of the Port
(COTP) that a waterfront facility plans to conduct transfers of LNG or
LHG, in bulk.  It also provides a point of contact at the facility. 
Once a letter has been received, the COTP can direct the necessary
enforcement activity to ensure that the operator complies with the other
requirements in 33 CFR 127.  The LOI also provides the information used
by the COTP to determine the suitability of the waterway, on which the
waterfront facility is located, for LNG or LHG vessel traffic.  Changes
to the information in the LOI are required to be submitted whenever they
occur.  Without the LOI, COTPs would not learn of the opening or
reopening of a waterfront facility handling LNG or LHG far enough in
advance to allocate resources, to enforce construction and design
standards, and to plan enforcement strategy.  Also, COTPs would not have
the information necessary to properly evaluate the suitability of a
waterway for vessels carrying LNG or LHG.

B.  Any person directly affected by an action taken under these
regulations may appeal that action to the District Commander.  If still
not satisfied with the Coast Guard's decision, that person may appeal
the decision to the Assistant Commandant for Prevention Policy, in
Washington, DC.  If the appeal is not made in writing, the operator's
request for an appeal cannot be properly evaluated.

C.  If it is impractical for the operator of a waterfront facility
handling LNG or LHG to comply with the requirements in these
regulations, and an alternative is available that provides at least the
same degree of safety as the regulations, the operator may request
permission to use an alternative procedure, method, or equipment
standard.  The operator must submit the request for an alternative in
writing to the COTP.  Without a written request the COTP cannot properly
evaluate the proposed alternative.

D.  The owner or operator of a waterfront facility handling LNG or LHG
must develop and submit to the COTP two copies of the facility’s
Operations Manual.  If the manual is found not to be in compliance with
section 127.305 or 127.1305 of the regulations, transfer operations
cannot be conducted at the facility.  The Operations Manual is a
critical part of the enforcement strategy. Without it, the COTP cannot
determine if safe operating procedures and an effective training program
are set up by the waterfront facility operator.

E.  The owner or operator of a waterfront facility handling LNG or LHG
must develop and submit to the COTP two copies of the facility's
Emergency Manual.  If the manual is found not to be in compliance with
section 127.307 or 127.1307 of the regulations, transfer operations
cannot be conducted at the facility.  The Emergency Manual is a critical
part of the enforcement strategy. Without it, the COTP cannot determine
if effective procedures have been set up by the waterfront facility
operator to respond to emergencies (such as fires and releases of LNG or
LHG) on the facility.

F.  The operator of an LNG or LHG waterfront facility must certify in
writing that each person in charge of shoreside transfer operations
meets the qualifications set forth in the regulations.  A copy of each
certification must be made available for inspection at the facility. 
During routine inspections of the facility, the COTP examines these
certifications to ensure that the persons in charge of shoreside
transfer operations are qualified.  Without these certifications, the
COTP would have to develop and administer tests or would have to observe
qualification training in order to verify that the person in charge is
properly qualified.  Both of these means would create a greater burden
than operator certification.

G.  Before LNG or LHG transfer operations begin, the person in charge of
shoreside transfer operations must complete, with the person in charge
of vessel transfer operations, a Declaration of Inspection.  The
Declaration of Inspection is a check-off list of transfer requirements
which helps to reduce human error and equipment failure, thereby
preventing accidental releases of LNG and LHG.  It identifies each
person in charge, who must sign it, and places the responsibility for
safely conducting the transfer on that person.  The Declaration of
Inspection must be retained for 30 days after completion of the
transfer.  During routine inspections of the facility, the COTP will
examine these Declarations of Inspection to ensure that they have been
completed properly before each transfer.  The COTP also uses this
information to identify the responsible person in charge when a
violation of the requirements occurs.  Without the Declaration of
Inspection, the COTP could not verify that persons in charge are
following proper transfer procedures and the probability of human errors
or equipment failures resulting in LNG or LHG releases will increase.

H.  Tests and inspections of the LNG and LHG transfer system must be
conducted on a regular basis to ensure that these systems will not fail
and release LNG or LHG.  Records of these tests and inspections must be
retained at the facility for 24 months.  During routine inspections of
the facility, the COTP examines these records to ensure that the
required tests have been completed.  Without these records the operator
would have to wait for a Coast Guard inspector to witness the tests to
verify that they were done, thereby increasing the burden on both the
operator and the Coast Guard.  If the tests and inspections are not
conducted, the incidence of LNG and LHG releases due to equipment
failures will increase.

I.  All LNG owners and operators seeking authorization to site,
construct, and operate new LNG import or export facilities or those
seeking authority to make modifications to existing or approved LNG
import or export facilities must file a request to participate in the
pre-filing process with FERC.  The FERC regulation requires LNG owners
or operators to file their LOI and WSA with the Coast Guard at the same
time they make their initial filing with FERC per their pre-filing
procedures in 18 CFR 157.21.

3.  Considerations of the use of improved technology.  

Information may be submitted by mail, fax or electronically via e-mail
to the COTP at the local CG Sector Office.  Contact info for CG Sector
Offices can be found at—  HYPERLINK "http://www.uscg.mil/top/units/" 
http://www.uscg.mil/top/units/ .  At this time, we estimate that 67% of
reporting requirements are done electronically. 

4.  Efforts to identify duplication.  

The Coast Guard monitors State and local regulatory activity in this
field.  To date no equivalent State or local programs have been
identified that require similar information, and no other Federal
agencies have equivalent regulatory requirements.

5.  Methods used to minimize the burden to small businesses if involved.
 

The Coast Guard believes that these requirements do not have a
significant economic impact on small entities.  Few, if any, small
entities are involved in the costly and highly technical operations of
LNG and LHG waterfront facilities.  All existing LNG waterfront
facilities are owned and operated by multi-million dollar corporations
and all are large companies based on industry size standards available
at the Small Business Administration’s website.  Most LHG waterfront
facilities are also operated by large entities.  Those LHG facilities
operated by small entities generally handle small quantities of LHG and
can avoid the burdens of this regulation by receiving packaged shipments
of LHG instead of bulk shipments.

The appeal and alternatives requirements are intended to reduce the
burden on small entities by allowing them to request less burdensome
procedures where justified by small scale or simplified operations at a
small waterfront facility.

6.  Consequences to the Federal program if collection were conducted
less frequently.  

A,D,E,F.  The LOI, the Operations Manual, and the Emergency Manual are
submitted only once, before the facility begins transferring LNG or LHG.
 The certification for persons in charge is completed each time a new
individual is qualified as a person in charge.  Less frequent collection
of this information would have the same consequences as not collecting
the information.

B,C.  Appeals and alternatives are submitted whenever the operator makes
a request.  Less frequent collection would prevent the waterfront
facility operator's requests from being considered.

G.  Declarations of Inspection are collected for each transfer.  Less
frequent collection would prevent the COTP from verifying that persons
in charge are following proper transfer procedures for each transfer. 
This would increase the probability of human errors or equipment
failures resulting in LNG or LHG releases will increase.  It would also
make identification of the responsible person in charge more difficult
when a discharge does occur.

H.  The recordkeeping requirements are recorded whenever each event
occurs.  If they were reported and recorded less frequently, facility
operations would be delayed until the COTP sent his representative to
obtain the information needed to verify compliance, evaluate the
request, or witness the procedure.

I.  A WSA is a risk-based assessment process designed to document and
address all safety and security concerns related to the movement of LNG
in U.S. ports and waterways.  Since 2005, FERC regulations have required
that prospective applicants for FERC authorization to site, construct
and operate LNG terminals submit WSAs to the Coast Guard.  Less frequent
collection would prevent the waterfront facility operator's requests
from being considered.  

7. Special collection circumstances.  

This information collection is conducted in manner consistent with the
guidelines in 5 CFR 1320.5(d)(2).

8.  Consultation.  

A 60-day Notice will be published in the Federal Register to obtain
public comment on this collection.  

9.  Provide any payment or gift to respondents.  

There is no offer of monetary or material value for this information
collection.

10.  Describe any assurance of confidentiality provided to respondents. 

There are no assurances of confidentiality provided to the respondents
for this information collection.

11.  Additional justification for any questions of a sensitive nature.  

There are no questions of sensitive language.

12.  Estimates of annual hour and cost burdens to respondents.  

The estimated number of respondents is 156.  

The estimated number of responses is 4,729.  

The estimated hour burden is 5,019 hours.  

The estimated cost burden is $460,059.  

There are a number of facilities in the United States that handle LNG
and LHG.  Many of these facilities also handle dangerous cargos or oil
in bulk, and are therefore also regulated under 33 CFR 126 or 154,
respectively.  The annualized costs and burden to the respondents for
the collection of information is based upon the following assumptions: 

an hourly wage rate for management personnel equivalent to O-5 (Out
Gov’t) 

an hourly wage rate to perform a WSA equivalent to O-4 (Out Gov’t) 

an hourly wage rate to review WSA and write LOR equivalent to O-4 (In
Gov’t) 

an hourly wage rate for technicians equivalent to O-3 (Out Gov’t) 

an hourly wage rate for clerical personnel equivalent to E-4 (Out
Gov’t) 

The calculations for each reporting/recordkeeping element of this
collection for LHG and LNG facilities are found in Appendixes A and B
respectively.  The appendixes include the annual number of respondents
and responses, as well as the estimated annual hour burden and cost
(totals may not sum due to independent rounding).  A description of
assumptions for each collection element is below.

A.  LOI:  Only one LOI is required during the lifetime of the facility
unless the owner or operator plans new changes on an existing facility
or the facility is deactivated or the owner /operator changes.  Past
experience with bulk liquid facilities indicates that approximately 6%
of the facilities submit a new or resubmit a LOI each year.  

B.  Appeals:  Appeals are very rare, but to account for their
possibility, we assume an average of 1% of respondents will submit an
appeal per year.  

C.  Alternatives:  Past experience with bulk liquid transfer facilities
indicates that approximately 1% of the facilities submit an alternative
request per year.  

D.  Operations Manual Development:  Operations Manuals only need to be
developed once during the lifetime of a facility.  Based on our
experience, we assume that approximately 3% of facilities will be
replaced by newer facilities in a given year.  

E.  Operations Manual Amendments:  Certain changes to facility systems
will require facility owners to amend their Operations Manual.  We
assume that 6% of facilities will update their Operations Manual
annually.  

F.  Emergency Manual Development:  Same as paragraph D.

G.  Emergency Manual Amendment:  Same as paragraph E.

H.  Person in Charge Qualification and Certification:  An employee need
only demonstrate the required qualification and be certified as a Person
in Charge once for the duration of his or her employment with a
facility.  New qualification and certification must therefore only be
conducted to for the new employees.  Large facilities, operating with
three shifts, will typically employ three Persons in Charge plus one
alternate.  Using the conservative estimate of employee turnover at 33%,
facilities must recertify, on average, one-third of their four Persons
in Charge.  Restated, each facility will, on average, conduct
certification of 1.33 Persons in Charge each year.  Each facility is a
respondent, and the number of responses is the population of LNG and LHG
facilities multiplied by 1.33.  

I.  Declaration of Inspection:  The Coast Guard estimates that LHG
facilities will, on average, each conduct approximately 26 transfers per
year.  Each facility is therefore a respondent, and the number of
responses may be calculated by multiplying the population of LHG
facilities by 26.  We estimate that LNG facilities make on average 46
transfers per year.  

J.  Maintenance Records:  Each LHG and LNG facility must conduct and
record a series of tests and inspections.  Both the number of
respondents and the number of responses is therefore equal to the
population of LNG and LHG facilities.  

K. Waterway Suitability Assessment:  The WSA requirements have been in
place for several years.  As a WSA is required when an owner/operator
seeks authorization to site, construct, and operate new facility or
seeks authority to make modifications to existing facility, we assume an
average of 1 submission per year.  We estimate that it takes about 704
hours per WSA.

13.  Total of annualized capital and start-up costs.  

There are no capital, start-up or maintenance costs associated with this
information collection.

14.  Estimates of annualized Federal Government costs.  

The estimated annual Federal Government cost is $40,444 (see Appendix
C).  This wage rate for officers was derived by averaging the standard
“in government” rates for pay grades O-3 and O-2.  The rate for
enlisted time uses the average standard “in government” rates for
pay grades E-6 and E-5.  

15.  Explain the reasons for the change in burden.  

The change in burden is an ADJUSTMENT due to a change (i.e., decrease)
in the estimated annual number of respondents.  There is no proposed
change to the recordkeeping requirements of this collection.  The
recordkeeping requirements, and the methodology for calculating burden,
remain unchanged.  

16.  Plans for tabulation, statistical analysis, and publication.  

This information collection will not be published for statistical
purposes.

17.  Approval to not display expiration date.  

The Coast Guard will display the expiration date for OMB approval of
this information collection. 

18.  Exception to the certification statement.  

The Coast Guard does not request an exception to the certification of
this information collection.

B.  Collection of Information Employing Statistical Methods  

This information collection does not employ statistical methods.

  Of the active LNG facilities in the United States (including storage
facilities), this collection is relevant to the current shoreside
facilities (including expansion projects) as well as proposals for new
facilities that require an initial LOI.  

  In addition, this collection accounts for the cost and time that is
required for an LNG or LHG facility to conduct and perform a WSA.  On
October 18, 2005, the Federal Energy Regulatory Commission (FERC)
published a final rule in the Federal Register (70 FR 60426)
implementing the Energy Policy Act of 2005 and requiring pre-filing
procedures for reviewing LNG terminals and other natural gas facilities.
 The FERC rulemaking amended the regulations in 18 CFR parts 153 and 157
by requiring LNG and other natural gas facility owners and operators
(referred to collectively herein as “LNG owners and operators”) to
submit a WSA to the U.S. Coast Guard pursuant to 33 CFR 127.007 and 18
CFR 157.21(a) and (d).  

  Upon receiving an LNG owner or operator’s request to participate,
the Director of the Commission’s Office of Energy Projects (Director)
determines whether the LNG owner or operator has adequately addressed
the requirements of 18 CFR part 157 and may begin the pre-filing
process.  The FERC regulation requires LNG owners or operators to file
their LOI and Preliminary WSA with the Coast Guard at the same time they
make their initial filing with FERC per their pre-filing procedures in
18 CFR 157.21.  The LNG owner or operator must submit the LOI and the
Preliminary WSA to the COTP.  Under the rules, the LOI submission
requirements for an LHG facility will differ from an LNG facility. 
Applicants for LHG facilities must submit an LOI to the COTP no later
than the date when the applicant files their permit application with the
lead State or Federal agency having jurisdiction.  However, in all cases
it must be at least 1 year prior to the start of construction.  At the
time the applicant submits an LOI, the applicant must also submit a
Preliminary WSA to the COTP.  Finally, a Follow-on WSA must be submitted
to the COTP at least 180 days prior to the start of construction.  

  Hourly wage rates taken from COMDTINST 7310.1 (series)

  See Appendix B.  

  Hourly wage rates taken from COMDTINST 7310.1 (series)

1625-0049

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