8. Environmental
Impact Management

Sakhalin Energy conducts environmental management based on environmental protection laws and regulations of the Russian Federation and in line with international standards and best oil and gas industry practices.

8.1. General information

Sakhalin Energy's environmental policy has been integrated into the corporate Business Principles, Sustainable Development Policy and HSE&SP Policy. Relevant commitments are included in the HSE&SP Plan, standards and procedures, as well as other corporate documents.

The HSE&SP management system is described in Section 3.5 above. It has been certified according to ISO 14001 and OHSAS 18001 international standards.

For continuous improvement of environmental performance, the system follows a repeating cycle: planning — implementation — evaluation — review. External and internal audits are held to monitor and evaluate the system's efficiency. Company`s assets are audited on a regular basis for compliance with environmental laws and regulations and corporate standards and procedures.

Sakhalin Energy also promotes the development of vendors and suppliers through “one team approach”, experience sharing and contractor compliance monitoring.

The company places special focus on proactive risk management and environmental impact assessment. The company has developed and implemented a risk management system (see Section 5.4 above) to reduce environmental impacts and pollution risks.

The company is implementing an administrative and technical action plan to gradually reduce negative environmental impacts and to develop competencies of the company and contractor personnel, as well as to develop and implement programmes for industrial environmental control and monitoring of natural environment and biodiversity.

In 2018, Sakhalin Energy was once again ranked first in the annual Environmental Responsibility Rating of Russian Oil and Gas Companies (OGERR) conducted by the World Wildlife Fund (WWF) Russia and CREON Energy, a provider of advisory services, in partnership with the UNDP/GEF/RF MNR project “Mainstreaming Biodiversity Conservation into Russia’s Energy Sector Policies and Operations.”

A total of twenty-two companies were selected by OGERR based on their annual production of liquid hydrocarbons (at least 1.5 mln t per year).

Speaking at the ceremony, Alexey Knizhnikov, Head of Environmental Policy Programme at WWF Russia, said, “My congratulations to Sakhalin Energy on keeping up the good work and demonstrating high environmental safety performance adhering to the WWF criteria. We would like Sakhalin Energy, which has been leading the list of environmentally safe companies for a few years now, to use every opportunity to share their best practices.”

8.2. Industrial Environmental Control

8.2.1. General information

Sakhalin Energy exercises industrial environmental control of its assets to ensure the compliance with legislation on environmental protection, to observe the established environmental regulations, and to provide the rational use of natural resources and fulfilment of the plans for minimising the environmental impact.

The company exercises industrial environmental control in the following areas:

  • air emissions;
  • water use and impact on water bodies;
  • waste management.

The company tracks and controls emissions and discharges, greenhouse gases and ozone-depleting substances from hydrocarbon production and transportation assets and the LNG asset it operates; special attention is given to waste management, energy consumption and associated petroleum gas utilisation issues.

The company has developed and has been implementing the Air Emissions and Energy Management Standard, Water Use Standard, and Waste Management Standard.

8.2.2. Impact on Atmospheric Air

Sakhalin Energy seeks to minimise environmental impact, including by reducing air emissions.

In order to reduce emissions, the company uses gas turbines equipped with low-NOx burners. A system that increases gas turbulence is used on flaring units, which facilitates soot-free gas flaring.

To reduce atmospheric pollutant emissions, measures are implemented to improve operational reliability and fail safety of equipment and to monitor compliance with the operating mode of gas turbines. To ensure timely elimination of potential gas leaks at the company’s assets, the company performs inspections and diagnostics of equipment using fixed and portable gas analysers and infrared cameras and carries out any required repair and maintenance. To assess the impact of greenhouse gas and ozone-depleting substances emissions on the atmospheric air, records are kept of their emission sources and consumption (see Section 8.2.6. Greenhouse Gas and Ozone-Depleting Substance Emissions).

The company conducts monitoring of fixed sources for compliance with established standards for maximum allowable emissions. Monitoring of air quality is carried out at the boundaries of sanitary protection zones around the company’s production assets.

In 2018, total gross emissions remained the same as in the previous year. A slight increase in carbon oxide emissions was mainly caused by a scheduled repair of gas compressing units at the OPF.

Monitoring of air quality at the boundaries of sanitary protection zones of the Prigorodnoye production complex, OPF, and BS 2 showed neither non-compliance with established standards, nor any increase in pollutant concentrations.

Gross Air Emissions in 2015–2018, thousand t

Pollutant

2015

2016

2017

2018

Carbon oxide

4.1

4.4

4.1

4.2

Nitrogen oxides (in NO 2 equivalent)

4.1

4.3

4.3

4.3

Methane

1.0

1.1

1.2

1.1

Sulphur dioxide

0.04

0.03

0.04

0.03

Other pollutants

1.1

0.97

0.8

0.7

Total

10.3

10.8

10.4

10.3

 

Specific Air Emissions in 2015–2018, by areas of activity

Activity

2015

2016

2017

2018

Hydrocarbon production, kg/toe

0.19

0.19

0.18

0.19

Hydrocarbon transportation, kg/thousand t-km

0.06

0.08

0.06

0.08

LNG production, kg/toe

0.24

0.25

0.23

0.20

Measures implemented to improve operational reliability and fail safety of equipment, as well as the monitoring of the correct operating mode made it possible to maintain the specific emission values at the same level as in the previous years, even though the company increased its production volumes.

8.2.3. Impact on Water Bodies

The company strives to reduce water consumption for production needs and to minimise the environmental impact from wastewater discharge.

The intake of water from surface and groundwater bodies for domestic, drinking and industrial purposes is carried out on the basis of water use agreements and licenses for subsoil use. To ensure compliance with the established standards for maximum allowable discharges of pollutants to water bodies and rational use of water resources, the company monitors efficiency of sewage treatment plants and carries out quality control of sewage, surface and groundwater, as well as monitors compliance with the established water use and water discharge limits. Water intake and treatment facilities are maintained in good order; water bodies’ water protection zones are monitored on a regular basis. Groundwater monitoring is performed to identify areas of possible changes in groundwater levels or areas of possible contamination caused by the operation of the company’s production assets.

In 2018, the water use figures remained the same as in the previous year. Increased water disposal on the surface is due to the flow of stormwater as a result of active snow melting at the OPF in spring. Personnel mobilisation during the LNG plant shutdowns and the beginning of the main construction works under the OPF Compression project have resulted in the increased water intake from groundwater sources. Reduced water consumption to maintain reservoir pressure is due to the scheduled repair of the PA-A reservoir pressure maintenance system.

Consolidated Figures of Water Use in 2015–2018, thousand m 3

  Parameter

2015

2016

2017

2018

Water intake, including:

29,489.71

30,160.90

30,050.94

28,290.83

from surface sources

28,225.09

29,260.99

29,228.98

27,507.64

from underground sources

310.19

329.32

326.27

347.43

Water consumption, including:

28,573.81

29,631.45

29,593.53

27,893.77

production needs (not including reservoir pressure maintenance needs)

22,126.72

22,750.15

22,520.46

21,458.08

reservoir pressure maintenance needs

6,104.22

6,505.06

6,689.23

6,077.11

Water discharge, including:

23,212.21

23,439.71

23,163.00

22,062.96

into surface water bodies

22,988.01

23,317.13

23,047.10

21,944.30

on the surface

193.56

92.43

86.54

88.13

Environmental monitoring did not reveal any adverse impact on the water bodies located in the area of the company’s production assets.

Specific Water Use in 2015–2018, by areas of activity

Activity

Water consumption for in-house needs

Disposal of polluted water into surface water bodies

2015

2016

2017

2018

2015

2016

2017

2018

Hydrocarbon production, m 3/toe

1.0

1.1

1.0

1.0

0.002

0.005

0.004

0.004

Hydrocarbon transportation, m 3/thousand t-km

0.001

0.001

0.001

0.001

LNG production, m 3/toe

0.01

0.01

0.01

0.01

0.001

0.005

0.006

0.006

Specific water consumption indicators remained the same as in the previous year. Only 1% of the wastewater was insufficiently treated, 2% of the wastewater was treated to minimum standards, and the other 97% met minimum standards without treatment.

8.2.4. Waste Management

The company’s waste management activities were aimed at meeting Russian and international requirements and optimising waste management processes in order to reduce the adverse environmental impact.

Most of the company’s waste is classified as low-hazard (Hazard Class IV and V); it is mainly drilling waste and solid domestic waste.

To prevent an adverse environmental impact, the company continued injecting drilling waste through special disposal wells into deep underground horizons with necessary insulating formations to ensure their full containment and safe disposal. This is one of the best available technologies for the disposal of waste associated with oil and gas production (according to engineering manual ITS-17 2016 Disposal of Industrial and Consumer Waste).

During 2018, the company continuously monitored the injection process and took all reasonable measures to reduce the volume of drilling waste. In the area of underground drilling waste disposal assets, to confirm the elimination of its adverse environmental impact, the company continued monitoring the sea water condition in the bottom layer, sediment and benthic communities. Based on the monitoring results for the previous two years, Rosprirodnadzor has confirmed the fact that the disposal of drilling waste had caused no adverse impact on the environment.

At the production assets, waste is collected separately for subsequent disposal and treatment in order to reduce the amount of waste disposed at landfills; timely removal of waste is performed; the company conducts inspections of waste storage sites.

All Hazard Class I–III waste is transferred to licensed contractors for disposal or treatment. All Hazard Class IV–V waste is sent to specially equipped landfills that conform to the Russian requirements. The company searches for cost-effective methods of management of Hazard Class IV–V wastes in order to reduce the proportion of waste disposed at landfills.

Waste Breakdown by Hazard Class in 2018 (not including drilling waste),%

Waste Management Indicators (including drilling waste) in 2015–2018, thousand t

Parameter

2015

2016

2017

2018

Amount of waste at the beginning of the year (all Hazard Classes)

0

0.14

0.11

0.15

Waste generated in the reporting year (all Hazard Classes)

30.52

36.86

36.58

27.13

Waste disposed during internal production

0.02

0

0

0

Transferred to other organisations for disposal and treatment

1.81

2.73

3.47

2.89

Transferred to other organisations for burial at landfills, including:

2.01

1.63

1.66

1.89

in the Sakhalin Oblast

1.82

0

0.21

0.45

outside the Sakhalin Oblast

0.19

1.63

1.45

1.45

Waste disposed at own assets (burial of drilling waste)

26.54

32.52

31.41

22.50

Amount of waste at the end of the year (all Hazard Classes)

0.14

0.11

0.15

0

The total amount of waste decreased by 26% compared to the previous year mainly due to the reduction of drilling waste generation.

In 2018, the amount of waste transferred for treatment and disposal was less by 16%. It resulted from increased waste transferred for treatment in 2017, which was caused by the replacement of the filter bed at the LNG gas drying unit and by the write-off of materials and equipment that had become unusable due to physical wear or expiration date.

However, as the result of maintenance and repair of equipment and industrial facilities, generation of certain kinds of Class IV and V low-hazard and practically non-hazardous waste was increased at OPF, LNG plant and offshore platforms, which entailed increased amount of waste disposed at landfills.

8.2.5. Energy Production and Consumption

The company is striving to use energy resources efficiently, and this is stated in its policies, standards, and commitments on gas flaring and energy management.

The company’s assets have been designed in line with international best practices, and new depletion compression facilities under construction incorporate the latest technological advances. All production assets use independent power supplies.

Energy saving and efficiency improvement efforts are organised under the company’s Continuous Improvement Programme (see Section 4.3. Continuous Improvement Programme) and in accordance with the principles of process optimisation. Green House Gas and Energy Management Plans have been developed for the offshore platforms, the OPF and LNG plant.

Natural gas has the biggest share in the energy use mix of the company. Diesel fuel is used for backup, with low-sulphur diesel used in most cases. The power supply for the company’s infrastructure in Yuzhno-Sakhalinsk and Korsakov comes from the public electrical grid, with independent power supplies in place. Energy consumption balance is shown in the table below.

Energy Generated* and Consumed in 2015–2018, million GJ

Parameter

2015

2016

2017

2018

Primary energy generated

846.85

868.06

910.28

895.63

Primary energy sold, incl.:

790.36

807.92

858.07

839.04

provided to Russian party

38.61

39.12

39.83

39.99

Primary energy consumed, incl.:

58.26

58.74

59.29

59.08

direct energy consumed (natural gas)

56.45

56.95

57.49

57.19

primary energy purchased (diesel fuel)

1.81

1.79

1.80

1.89

Indirect energy purchased/consumed (electricity)

0.11

0.12

0.12

0.13

 

* The company does not produce energy from renewable sources of energy and currently has no plans to do so. Sakhalin Energy is the operator of the Sakhalin-2 project under a Production Sharing Agreement and builds its activity plan based on the works programme, oil and gas fields development plans and cost estimates approved by shareholders, Russian party and Supervisory Board on an annual basis (see Sections 4.1, 5.3).

2018 energy consumption breakdown by activity is shown in the diagram. The LNG plant is the main consumer of energy. In 2018, the total and activity-specific energy consumption remained the same as in the previous year.

Energy Consumption in 2018, by areas of activity, %

Energy Intensity in 2015–2018, by areas of activity

Activity

2015

2016

2017

2018

Hydrocarbon production, GJ/t hydrocarbons produced

0.71

0.68

0.64

0.63

Hydrocarbon transportation, GJ/Kt-km

0.14

0.16

0.15

0.15

LNG production, GJ/t LNG produced

4.01

4.00

3.85

3.88

 

Sakhalin Energy’s assets have high energy efficiency compared to international industry benchmarks.

E.g. in 2017–2018, the energy intensity of the company’s assets was 0.63–0.64 GJ/t hydrocarbons produced. The data from the International Association of Oil & Gas Producers indicate that the average 2017 energy intensity among the international oil & gas companies was 1.5 GJ/t hydrocarbons produced.

Sakhalin Energy’s LNG plant remains a world leader in reliability, production performance and energy efficiency.

8.2.6. Greenhouse Gas and Ozone-Depleting Substance Emissions

Russia signed the Paris Agreement in 2016. According to this agreement, each party defines its own contribution to global climate change prevention and takes internal measures to adapt to the changes and achieve the goals.

The company shares the concern about the global climate change problem and annually measures and controls GHG emissions. Emissions from both production and non-production assets of the company are taken into account, both direct and indirect emissions associated with the purchase of electric energy. Greenhouse gases include the following substances: carbon dioxide, methane, dinitrogen monoxide, and hydrofluorocarbons (HFC).

In 2018, total and specific GHG emissions remained the same as in the previous year. There is a slight growth of emissions as a result of an increase in the volume of gas flared during the maintenance and repair of the company’s gas facilities.

GHG Emissions in 2015–2018, mln t of СО2 equivalent

Parameter

2015

2016

2017

2018

Direct emissions
(scope 1)

3.699

3.708

3.740

3.768

Indirect emissions
(scope 2)

0.005

0.008

0.008

0.009

Total

3.705

3.716

3.748

3.777

 

GHG Emissions in 2018, by areas of activity, %

Specific Emissions of GHG in 2015–2018, by areas of activity

Parameter

2015

2016

2017

2018

Hydrocarbon production, t СО 2 eq./t of hydrocarbons produced

0.054

0.050

0.048

0.052

Hydrocarbon transportation, t СО 2 eq./thousand t-km

0.008

0.010

0.009

0.009

LNG production, t СО 2 eq./t of LNG produced

0.242

0.242

0.231

0.230

 

Structure of GHG Emission Sources in 2018, %

 

To ensure effective management of risks associated with greenhouse gas emissions, comprehensive plans for energy management and GHG emissions control have been developed for all company’s production assets. These plans contain the assessment of current results and outline actions aimed at reducing GHG emissions.

8.2.7. Utilisation of Associated Gas in Production

The company strives to reduce associated gas flaring to a minimum. Associated gas produced at PA-A and PA-B platforms is transported via offshore pipelines to the shore, and it goes though the onshore pipelines to the OPF, where it is mixed with LUN-A gas for further transportation. Some of the associated gas is used as fuel for production assets.

Currently, the company does not re-inject associated gas into the reservoir.

The company has included targets for associated gas utilisation in the Reservoir Management Plans for PA-A, PA-B, and LUN-A platforms. The actual associated gas utilisation in 2018 was 96.5%.

Utilisation of Associated Gas in Production in 2018, %

8.2.8. Environmental Protection Costs and Payments for the Negative Impact

To comply with the international and Russian legislation requirements, Sakhalin Energy implements environmental conservation measures. The current cost of implementation in 2018 was RUB 4,566 mln.

Sakhalin Energy’s environmental conservation activities are controlled by the state supervisory authorities at federal and regional levels, including:

  • Ministry of Natural Resources and Environment of the Russian Federation;
  • Federal Service for Surveillance on Consumer Rights Protection and Human Wellbeing (Rospoterbnadzor);
  • Federal Subsoil Resources Management Agency;
  • Federal Service for the Supervision of Natural Resources (Rosprirodnadzor);
  • Amur Water Basin Committee of the Federal Water Resources Agency;
  • Ministry of Natural Resources and Environmental Protection of the Sakhalin Oblast.

Two inspections were conducted by the federal supervisory authorities in the reporting year, one of which revealed a minor gap in documentation relating to the quality of groundwater intake.

Payments for Adverse Environmental Impact in 2015–2018, thousand roubles

Parameter

2015

2016

2017

2018

Air emissions

4,931.253

987.595

898.409

806.52

Discharges into water bodies

91.602

29.045

72.008

157.21

Waste disposal

13,263.975

1475.297

180.882

680.15

Total

18,286.830

2,491,937

1,151.299

1,643.88

Increased payments in 2018 were mainly due to the absence of landfill disposal limits for Class IV–V hazardous waste. The fees for exceeding the disposal limits were 51% of the total payment.

Current Environmental Costs in 2018, %

8.3. Environmental Monitoring and Biodiversity Conservation

8.3.1. General Information

The implementation of environmental monitoring in the potential impact zones during the operations phase ensures Sakhalin Energy's compliance with the requirements of the State Environmental Expertise for in-process environmental monitoring and local monitoring.

The environmental monitoring programmes are carried out to assess the condition and restoration of the environment in the areas of the company’s production assets, to identify signs of the impact, and to develop actions to mitigate it, if necessary.

The implementation of the corporate Biodiversity Action Plan (BAP) fulfils the company’s obligations with respect to impact mitigation, development and implementation of measures aimed at protecting both rare and endangered species and environmentally significant and vulnerable habitats.

In 2018, the activities of the Biodiversity Working Expert Group of the Ecological Council under the Sakhalin Oblast Governor were focused on the protection of marine mammals in the coastal waters of the Sea of Okhotsk, as well as the study and protection of the Sakhalin taimen on the island. The Biodiversity Working Expert Group devoted particular attention to Sakhalin Energy’s actions to mitigate its impact on gray whales during seismic surveys and to the development of the regional programme for studying and protecting the Sakhalin taimen.

In 2018, specialised organisations were involved in environmental monitoring and biodiversity preservation activities addressing the following areas:

  • soil cover;
  • river ecosystems;
  • flora and vegetation;
  • wetlands;
  • protected species of birds, including the Steller's sea eagle;
  • marine environment and biota in the waters of the oil and gas fields;
  • marine environment and biota in the area of Prigorodnoye port and ballast water control;
  • gray whales and marine mammals protection.

The results of the environmental monitoring and biodiversity conservation measures have confirmed that the company is minimising the impact of its production activities on the environment through its environmental protection management system, which includes risk assessment, and prevention and prompt mitigation of identified risks.

8.3.2. Soil Monitoring

The system of regular soil monitoring allows identification of tendencies towards possible changes. The company assesses the soil condition along the route of the onshore pipelines, at the infrastructure assets, and within the areas around the Prigorodnoye production complex and the OPF at certain intervals of time prescribed in the monitoring programme.

In 2018, soil landscape monitoring included:

  • obtaining data on physicochemical and agrochemical characteristics of soils along the onshore pipelines route (in the areas of land remediation and in adjacent territories);
  • analysing the content of pollutants in soils in the territory of the Prigorodnoye production complex.

The territory of the Prigorodnoye production complex is characterised by man-made gleic soil with heavy and dense particle-size distribution and basic rubble, while turf layer is fairly developed. The floodplain of the Goluboy Stream has preserved its natural meadow-bog soils. In general, the values of petroleum hydrocarbons, heavy metals and detergents in the soils of the Prigorodnoye production complex were significantly lower than permitted levels (or levels in baseline soils) or are below the detection limit using standard methods. In 2018, the content of petroleum products as the main ecotoxicant in the soils (in the 0–25 cm layer) was 53–130 mg/kg, which is comparable with data for the previous year (from <50.0 to 94.9 mg/kg) and significantly lower than the permissible level (1,000 mg/kg).

The content of organic substances in the soils beyond the territory of the Prigorodnoye production complex (in the 4 km potential impact zone) varies significantly, from increased (in black bog soils) to relatively low (in raised bog soils) and low (in brown forest soils). In 2018, no disturbance to the soil layer or instances of soil degradation associated with LNG/TLU activities were identified at the monitoring sites; no petroleum products or benzo(a)pyrene were detected in the soils at the monitoring sites. The average levels and maximum concentrations of benzo(a)pyrene in the upper soil layers at the monitoring sites around the Prigorodnoye production complex were below the permitted level (20 µg/kg).

The pipeline right-of-way is characterised by man-made disturbed soils: the northern parts are characterised by significant areas of man-made disturbed peat bog soils, peat gley soils, gley soils, and podzolic soils, while the areas in the central and southern parts of the island have man-made disturbed brown forest soils, alluvial meadow soils, and alluvial turf soils. Data for 2018 suggest that the condition of the soil cover is stable; no signs of water erosion or soil collapse have been detected along most of the pipeline right-of-way. The bulk density parameters for the upper layers of the man-made disturbed soils indicate the absence of overcompaction. The content of humus in the areas subject to vegetation layer backfilling is similar to the average values of this parameter in the upper layers of natural soils. The man-made disturbed soils in the northern and central parts of the pipeline route are characterised by insufficient humus content.

Man-made disturbed soils in the most part of the pipeline route are characterised by an average or a high content of accessible forms of phosphorus, potassium and nitrogen. This facilitates the reinstatement of vegetation along the right-of-way. Soil fertilisation and vegetation reinstatement measures are planned for the areas characterised by low content of labile soil nutrients.

The monitoring in 2018 did not reveal any land contaminated with oil and petroleum products as a result of work in the territories of the company's assets.

At the end of 2018, the area of disturbed land was 79.15 ha, including 5.03 ha disturbed in connection with the OPFC project.

8.3.3. River Ecosystems Monitoring

The onshore pipeline system covering virtually the whole territory of Sakhalin Island crosses more than a thousand water bodies (rivers, streams, lakes and canals) from Chaivo Bay in the north to Aniva Bay in the south. During the design stage and construction, the company conducted baseline studies and operational monitoring of all crossings of water bodies. For the operations stage, a comprehensive observation programme was developed to monitor environmentally significant and hydrographically complex watercourses, which allows the company to monitor any changes, to identify critical areas, to develop and take timely corrective measures.

River ecosystem monitoring comprises several areas: the monitoring of the quality of surface waters, bottom sediments, and benthos. The quality of river ecosystems primarily recognises the nature and specifics of potential impact on the aquatic ecosystems during the operation of pipeline and infrastructure facilities. The other objective of monitoring is to identify any potential adverse impacts from natural factors on the Sakhalin-2 project infrastructure.

The monitoring of river ecosystems includes:

  • determination of hydrological and hydrochemical characteristics of streams;
  • assessment of bottom sediment condition in river beds;
  • identification of hydromorphological changes (river bed and bank erosion in the areas of pipeline route crossings);
  • assessment of benthic community and abundance (ground species);
  • assessment of area and quality of potential Pacific salmon spawning areas.

In 2018, the monitoring of hydrological and hydrochemical characteristics and condition of bottom sediments was implemented in the following water bodies:

  • 26 watercourses crossed by the pipelines,
  • the Vazi and Firsovka rivers, whose under-river crossings were performed using the horizontal directional drilling (HDD) method;
  • the Vatung River in the area of potential impact from the OPF;
  • the Mereya River and the Goluboy Stream in the area of the Prigorodnoye production complex.

Monitoring was performed during three hydrological seasons: summer low water, autumn high water and winter low water. Sampling was carried out at two cross sections: the upstream baseline (with no impact from the company’s infrastructure assets) and downstream monitoring sections.

On most investigated river-crossing sites (from the upstream to the downstream cross sections) no significant horizontal or vertical deformations of river beds were found. The crossings are in satisfactory condition, and no damage to utility lines was found.

The physicochemical properties of surface water met the regulatory criteria in all observation seasons. The properties of the surface water at the upstream and downstream cross sections of each watercourse changed equally and had similar quantitative and qualitative characteristics.

The oxygen regime of surface water was within the standard limits during all observation periods. The exception was the Vatung River (both cross sections during summer), which was the result of natural causes. Insignificant seasonal variations in concentrations were observed for suspended substances. Of all the biogenic substances analysed (ammonium ions, nitrites, nitrates, and phosphates), the content of nitrates varied most significantly: their values were higher in summer than in autumn. All measured parameters of biogenic substances met the concentration requirements for the quality of fishery water bodies (MPCf). The highest concentration of nitrates over the entire observation period was recorded in autumn in the Seredka River (1.56 mg/dm3, with MPCf = 40 mg/dm3).

None of the monitored watercourses contained readily oxidizable organic matter specified by the BOD5 index.

Of all the studied metals, concentrations of iron and copper showed the highest variability. In most of the watercourses, the content of these metals exceeded the corresponding MAC standards. Elevated concentrations of iron and copper is a natural phenomenon, characteristic of the surface waters in Sakhalin.

The monitoring did not reveal surface water contamination with oil products. All measurement values were insignificant and in line with MACf standards. The highest concentration of petroleum products (0.085 mg/dm3) was recorded at the upper (baseline) section of the Dagi River in the summer period (MACf = 0.05 mg/dm3).

The content of petroleum products in bottom sediments did not significantly change from season to season. The measurements of their concentrations made at the upper sections were the same as those made at the lower ones.

The particle size distribution of bottom sediments in all of the watercourses was heterogeneous in all seasons and was mainly dominated by the particles with a diameter of 10 mm and more. The share of these particles in the summer and autumn periods was more than 50% of the total mass.

Benthos monitoring studies in streams continued in 2018. The analysis of habitat conditions (such as bed type, current speed, sediment type, depth), quantitative and qualitative indices of macrozoobenthos showed that the variability of the composition, state and structure of bed communities between the baseline and control sections of the watercourses under study is due to natural variability, in particular the heterogeneity of biotopes and hydrologic-hydrochemical indicators at monitoring stations.

In view of the low numbers of humpbacked salmon in Aniva Bay and the almost total absence of spawners in the Goluboy Stream in 2017, no fry migration in the spring of 2018 was recorded. The timing of the spawning migration of humpbacked salmon spawners in the Goluboy Stream in 2018 was close to the average timing for the rivers of the Tonino-Anivsky Peninsula. The figure for use of the spawning grounds in the Goluboy Stream was significantly lower than the long-term average, while the number of spawners that entered the area in 2018 was estimated at 700. Around 70% of the total number of fish who entered the area actually spawned in the stream, while the rest were killed by poachers. The majority of salmon failed to get further than the bridge across the federal road. Most humpbacked salmon spawning grounds were recorded within the protected area of the LNG plant and in the area from the LNG plant to the federal road. No significant obstacles for the migration of Pacific salmon were identified in the course of monitoring.

Overall, the outcomes of river ecosystems monitoring in 2018 did not reveal any impact from Sakhalin Energy`s production assets on the quality of surface waters or their flora and fauna.

8.3.4. Flora and Vegetation Monitoring

Sakhalin Energy implements the Environmental Monitoring Programme for vegetation cover, which allows assessing the current vegetation condition and timely respond to any adverse environmental impacts from the operating assets.

The Monitoring programme includes the following objectives:

  • to control the condition of vegetation on the areas adjacent to the company’s assets;
  • to evaluate and forecast natural and man-induced changes/successions in the plant communities;
  • to control the state of rare and protected species of plants, lichens, and mushrooms;
  • to control the restoration of vegetation within the rights-of-way and generate recommendations for additional works required in some areas.

In 2018, flora and vegetation monitoring, including protected species, was conducted in the area of the Prigorodnoye production complex and around OPF at a distance of 6 km from Lunsky Bay. Within the onshore pipeline impact area only the habitats of protected species were inspected. 163 species of vascular plants have been identified in the course of vegetation survey in sampling sites around production assets.

The vegetation cover around the Prigorodnoye production complex is mainly represented by dark coniferous and larch and dark coniferous forests. The structure and species composition of vegetation communities in sampling sites remain unchanged. No reduction in the number of trees that was recorded in previous years in certain sites due to windfalls has been identified. The species composition of subordinate layers in all sampling sites surveyed has not changed. The habitats of 11 protected species of vascular plants have not been violated. The vegetation is not impacted in any way be the activities of Prigorodnoye production complex.

The vegetation cover around the OPF is represented by boggy larch forests and larch and dark coniferous forests. Wetlands are spread to the north of the OPF. It is found that standing timber in woodlands is not impacted by OPF activities. The identified insignificant variations in the number of trees are due to natural processes in phytocenoses, such as undergrowth ageing and natural death of old trees. The species composition of layers in all sampling sites surveyed has not changed. The natural habitats of the only protected species of vascular plants, Sakhalin Ephippianthus, located south-west of OPF, have not been violated. As of today, these habitats, identified in the course of monitoring, are the northernmost on Sakhalin.

Some epiphytic lichens in the area of potential impact of the company`s assets (both along the pipeline route and around Prigorodnoye production complex and OPF) are still affected to a certain degree by the change in the microclimatic conditions (stronger lighting and wind, decreased air humidity at the boundaries of open areas and forest parts). On the other hand, the sprouting of thalluses of these species of lichens is observed, which suggests the preservation of the species composition and the general restoration of the lichens cover.

The studies of habitats and condition of 18 protected species of vascular plants along the onshore pipeline route, three of which are on the IUCN Red List (Chosenia Arbutifolia, Sakhalin Spruce, and Japanese Yew), indicate their good condition. In one of Sakhalin Spruce habitats located in the Mereya River floodplain, the hydrological regime was reinstated as a result of engineering and technical measures taken in recent years.

The excellent degree of grass cover reinstatement was recorded for more than 85% of the right-of-way, many sites are characterised with a developed dense grass canopy. Individual lightly overgrown areas still persist on steep slopes and in some areas in the northern districts of the island, which is due to the lack of fertility on sandy and clay soils. Despite this, even these areas show positive dynamics: vegetation is gradually reinstated on the right-of-way.

8.3.5. Wetlands Monitoring

Wetlands are especially important and vulnerable ecosystems of Sakhalin Island. Their importance is due to their water protecting and water regulating features. The Sakhalin-2 pipelines cross about 200 boggy areas (including peat bogs), almost half of which are represented by sparse birch and larch, as well as alder and larch woodlands. Sakhalin Energy regularly monitors the restoration of natural bog vegetation on the right-of-way and in the potential pipeline impact zone. This approach is due to the risks of possible violation of the hydrological regime, draining or swamping of the territory, irreversible transformation of the bog lands, and reduced water inflow into rivers and streams.

The objectives of the Wetlands Recovery Monitoring Programme, which is implemented by the company, include:

  • to monitor wetlands recovery processes after the construction;
  • to monitor the condition of vegetation and soil cover in the adjacent areas;
  • to assess all potential adverse impacts on wetlands resulting from onshore pipeline operations;
  • to develop impact mitigation measures, if necessary.

In 2018, 24 wetland areas were surveyed along the entire pipeline route. The surveyed areas belong to the category of acid bogs characterised by poor mineral nourishment of peat soils, acidic environment, and a peculiar plant species composition. Particular attention is given to the species composition of the vegetation so that it will be possible to identify, in a timely manner, cases of invasive species on the right-of-way.

It was noted that the degree of grass cover reinstatement on the right-of-way is good. The grass cover in all areas is above 50%, with the average being 70%. Recovery of natural wetland ecosystems can be observed on the right-of-way in 19 wetland areas, which account for 79% of the surveyed territory. In five areas surveyed in 2018, vegetation is further reinstated with species typical for the vegetation cover of adjacent wetlands, as well as species not typical of these ecosystems. This process is characteristic of the initial stages of disturbed vegetation recovery. Positive dynamics of the recovery of moss, lichen, and shrub covers is observed. For some parts of the right-of-way, actions were developed and implemented to normalise the hydrological regime of adjacent wetland ecosystems.

The only natural habitat of Pogonia Japonica (a protected plant species from the orchid family), identified on Sakhalin Island during wetlands monitoring, is not violated, and the plants are in good condition. The 2018 monitoring season did not identify any aggressive invasive species on the right-of-way at the crossings of wetland ecosystems.

Generally, monitoring of the wetlands in the right-of-way shows that their recovery goes with slow but sustainable pace.

8.3.6. Monitoring of Protected Bird Species

In 2018, the company continued the monitoring of bird species, which covered bird populations in the Chaivo split pipeline landfall area and studies of the Long-billed Murrelet in the area potentially affected by OPF and OPFC.

The Chaivo split (Sakhalin-2 pipeline landfall area) is part of the key bird protection area in the Russian Far East (“Sakhalin North-East Coast Lagoons”) and is characterised by a wide variety of bird species, a unique bird population and high abundance of birds during the migration period.

The multi-year monitoring of birds in the Chaivo split area has resulted in the recording of 193 bird species, including 37 protected species listed in the Sakhalin Red Book. During the nesting period of 2018, 96 bird species were recorded in the Chaivo split area, including 17 rare and protected species. This included the first recordings of the Eurasian Bittern and the Eagle Owl. It is also the nesting area of the Sakhalin Dunlin, which is endemic to Sakhalin island. The counting of nesting pairs of the Sakhalin Dunlin in the potential pipeline impact area in 2018 showed favourable reproduction conditions for this species, with 100-120 pairs recorded by the experts, which is above the long-time annual average.

Abundance of the Aleutian Tern, another key monitored species using the Chaivo split as a nesting ground on a massive scale, varies from year to year due to the species’ specific biological features. Aleutian Terns come to the monitored area in late June — early July after having experienced unsuccessful nesting in other locations. Out of 1,344 individuals recorded in 2018, 833 were sighted on nesting grounds. This is significantly higher than in 2016, when just 310 individuals of this species were registered.

Abundance of other bird groups that nested at the Chaivo split in 2018 — ducks, divers and grebes — was comparable to the long-term average annual numbers. However, the number of Common Goldeneyes’ hatching have reduced, while the Horned and Red-necked Grebes have on the contrary grown in numbers. Nesting success for the latter two species was also notably higher than during the previous seasons. For some of the wetland bird species, the Chaivo split nesting area is on the boundary of their occurrence range, which explains the year-to-year abundance changes. The structure of the bird communities at the Chaivo split remains generally stable.

The Long-billed Murrelet, a key monitored species in the area of potential impacts from OPF and OPFC, is listed in the Red Books of Russia and Sakhalin Oblast. This bird is unique for spending most of its life at sea and coming onshore only to nest on branches of larch trees. For feeding the chick, both parents twice daily, early in the morning and late at night, migrate between the sea and the nest, which is often at a considerable distance inland. Most pairs pass the OPF site in transit to other locations, but some birds stay to nest in the adjacent forests. The monitoring established that the nesting grounds of the Long-billed Murrelet are to the north and to the south-west from the onshore production assets. Seven (7) nesting areas were registered within the 4 km zone outside the boundaries of the OPF and OPFC in 2018, which is in line with the previous periods’ monitoring results.

Long-billed Murrelets may be potentially affected by lighting, noise and flaring. However, the monitoring has shown that in their daily flights between the offshore feeding areas and the onshore nests, most of the birds tend to detour the production assets, choosing north-east and south-west directions. As a result, Long-billed Murrelets avoid adverse impacts from the production assets. A total of 433 individuals were recorded during the morning and evening counts in 2018.

The results of the 2018 monitoring show no negative impacts on the protected and migratory bird species from the operation of the Sakhalin Energy production assets.

8.3.7. Steller's Sea Eagle Monitoring

Steller's Sea Eagle is the world's largest fish-eating bird of prey. This species is listed in the IUCN (International Union of Conservation of Nature) Red List (Category VU, Vulnerable), in CITES (the Convention of International Trade in Endangered Species) Appendix II, in the Bonn Convention, in bilateral agreements on the protection of migratory birds between Russia and the USA, Japan, and South Korea, in the Red Book of Russia (Category III, Rare), and in the Red Book of the Sakhalin Oblast (Category II, Rare).

Pursuant to Federal Law On Wildlife Protection No. 52 dated 24 April 1995 (Articles 22 and 24), the protection regime for rare species includes a number of restrictive measures concerning users who perform business activities in these species’ habitats. Legal entities and individuals who perform business activities within the onshore and offshore habitats of animals listed in the Red Books are responsible for the preservation and conservation of these animals in accordance with the laws of the Russian Federation and its constituent entities.

As early as the project feasibility study stage, Sakhalin Energy used the results of baseline studies to develop measures to protect nesting areas of Steller’s sea eagle located within the production assets potential impact area, in line with the requirements of Russian legislation and international best practice.

The company monitors Steller’s sea eagles and has implemented impact mitigation measures for Steller’s Sea Eagle and White-Tailed Eagle during construction, modification and operation of assets under the Sakhalin-2 project.

Monitoring is conducted in Nogliki District within the 2 km corridor along the onshore pipelines route, within the 3 km zone around OPF boundaries, and in the control zone at a distance of up to 2 km from the northern part of Lunsky Bay shoreline.

During the field study of 2018, 193 nests were inspected and their status was determined; one individual of the white-tailed eagle and 91 individuals of Steller’s sea eagle were identified.

In 2018, 113 eagle nesting areas were inspected within the pipeline impact area. It was found that along the onshore pipeline route, 12 nests were abandoned, 23 nests were not occupied, 11 nests were visited on a rare basis, six nests were occupied by birds, and 13 nests were used by birds for breeding. 48 nests were recorded to have disappeared. In four nests, there were two chicks per nest, and in eight nests, 1 chick per nest. One nest was destroyed by a bear, and at least one chick was killed. In total, 16 chicks flew the nests in the area near the infrastructure facilities. This indicates the effectiveness of the measures taken by the company to mitigate negative impacts and suggests that the species can adapt to living in proximity to man.

In the control zone located in the northern part of Lunsky Bay (evidently the less productive and the more developed part), 71 nesting areas were inspected. There were found to be seven active nests, 13 occupied nests, 23 nests visited by birds, 18 vacant nests and 3 abandoned nests. Seven nests in the control zone were recorded to have disappeared. Of the seven active nests, two nests were destroyed by a bear, and at least one chick in each nest died. One more chick died after falling from the nest. In four remaining nests, the following was observed: three nests had one chick each, and one nest had two chicks. In total, five chicks flew from four nests located in the control zone in 2018.

The average size of the brood in the pipeline impact area was 1.33 chicks, and in the control zone, 1.25 chicks.

The impact of bears on the eagle population (i.e. the predator pressure) in 2018 may be characterised as significant. One nest was destroyed in the potential pipeline impact area, and two in the control zone.

In the OPF potential impact area, nine nesting areas were inspected in 2018. There was one occupied nest, one visited nest, two vacant nests and two abandoned nests. Three nests in the OPF impact area had disappeared.

The future health of Steller’s sea eagle population depends on its young, so the number of birds in this group is an indirect indicator of its condition. In stable eagle populations, the percentage of young birds should be 25-30% of the total. 2018 monitoring results showed that, in the monitored population of Steller’s sea eagles, 12.1% were young immature birds, while 87.9% were adults.

The condition of the nesting pool in the potential impact area, as well as in the control zone, can be characterised as good. Within the potential pipeline impact area, 62% of all nests are in good or satisfactory condition, with the corresponding figure for the control zone near Lunsky Bay being 66%.

The analysis of variations in nesting site occupancy in the control zone (northern part of Lunsky Bay) and the pipeline impact area in 2004–2018 indicates a continuing downward trend in the number of nesting (breeding) eagle pairs, which is probably typical of the whole population of eagles inhabiting the north-eastern coast of Sakhalin, and is not a specific feature of the territory under consideration.

8.3.8. Monitoring of Marine Biota and Its Environment

Environmental monitoring of the potential impact of offshore production assets is carried out to timely identify any impacts and forecast the development of the processes affecting the quality of seawater, bottom sediments, and the condition of biological communities.

As part of the 2018 Industrial Environmental Monitoring (IEM) programme, the company continued to monitor the state of the marine environment and marine biota near the north-eastern coast of Sakhalin Island and in Aniva Bay. Field studies in the northern area where the PA-A, PA-B and LUN-A platforms and the subsurface assets for drilling waste are located, were conducted during the autumn using the „Gennadiy Nevelskoy” modern platform supply vessel; the southern area covering the OET and LNG jetty area in Prigorodnoye port in Aniva Bay was studied using the company`s tug boats.

Based on the comparative analysis of the 2018 survey results and taking into consideration the spatial and temporal variability of the parameters from previous monitoring years, the following conclusions were made.

  • Hydrochemical characteristics of the water near offshore production assets, including pollutants such as petroleum hydrocarbons, heavy metals, phenols and detergents, were within the baseline value range for these sea areas and complied with the standards established for water bodies extensively used for commercial fishery (MPCf).
  • Concentrations of chemicals (phenols, detergents, petroleum hydrocarbons) in bottom sediments were distributed unevenly due to the specific geological features of the region and the distribution of different types of soil. Overall, concentrations of pollutants in bottom sediments varied within baseline ranges typical for these offshore areas and were mainly lower than the values causing initial biological effects at the organism and marine ecosystem community levels.
  • Baseline concentrations of petroleum hydrocarbons in the near-bottom layer and bottom sediments at the boundaries of drilling waste disposal did not exceed the established limits. The maximum recorded concentration of petroleum hydrocarbons in seawater was 0.03 mg/dm3, which is 1.6 times less than the MPCf. The maximum concentration of petroleum hydrocarbons in seabed sediment was 0.021 mg/g, which is considerably less than concentrations that may have biological impact. Assessment of annual fluctuations demonstrated consistency with previous survey years.
  • Depending on the depth and type of seabed sediments, areas around offshore platforms are inhabited by several types of bottom communities. Benthic communities identified in the course of monitoring are typical for the water areas of the Sea of Okhotsk and are characterised by rich species diversity with high qualitative indicators comparable to background values.
  • The biomass of benthic communities is mainly formed by sea urchins, actinias, bivalves, gastropods, polychaetes, and crustaceans. Amphipods and polychaete worms dominate by species abundance, bivalves and gastropods are characterised by richness of species. No trend towards the depletion of biomass was identified for this area.

In general, the results of long-term research show the stability of indicators for local marine ecosystems in the areas of offshore production assets at the operation stage and the absence of any impact of production activities on the quality of seawater, bottom sediments, and the condition of marine biota in the water areas of the Piltun-Astokhskoye and Lunskoye fields and Prigorodnoye port in Aniva Bay. This indicates that environmental standards are observed at the company`s production assets.

8.3.9. Ballast Water Control

Every year, over 200 standard oil and LNG cargoes have been loaded to oil and gas tankers arriving to the Prigorodnoye production complex mainly from the ports of Asia Pacific Region.

The ballast water taken at the port of departure may contain dangerous invasive marine (alien to the local environment) organisms, which, under favourable conditions, can adapt to the local environment, and dangerous aggressive invasive species able to disturb the balance of the ecosystem of Aniva Bay.

Sakhalin Energy has developed a package of preventive measures to ensure ballast water management, which is based on international and national regulations and best international practices. Currently one of the most effective measures to prevent the introduction of alien species is the exchange of ballast water on the high sea. This method is imperative in accordance with the International Convention for the Control and Management of Ships’ Ballast Water and Sediments (Convention), which was adopted in 2004. Following the innovation strategy, the company included this requirement in the corporate Ballast Water Management Policy in 2009 prior to start of large-scale hydrocarbons transportation. Russian Federation ratified the Convention in 2012, and since September 2017, ballast water of ships shall be controlled by all the countries and carriers according to the Convention.

The ballast water monitoring and control of each tanker to be loaded in Prigorodnoye port includes:

  • checking vessels’ logbooks for ballast water exchange in deep waters of the Pacific Ocean and the Sea of Japan;
  • express analysis of physicochemical characteristics of ballast water;
  • planktonic organisms sampling.

A vessel is only allowed to commence discharging ballast water in the area of the port and loading of hydrocarbons when prior exchange of ballast water in deep waters is confirmed. In addition to this, environmental, taxonomic and biogeographic analysis of organisms found in ballast tanks is carried out.

The research results of phyto- and zooplankton species in the ballast water in 2018 confirm compliance with ballast water exchange in open deep waters. No dangerous invasive species have been found. However, potentially toxic phytoplankton species are occasionally encountered among those species alien to Aniva Bay. Since such microalgae are encountered in ballast water only on rare occasions and in low quantities, the risk is extremely low. Such species were not found during Prigorodnoye port 2018 environmental monitoring. However, the monitoring of the offshore strip of Aniva Bay will be continued.

As a result of the long-term monitoring of Aniva Bay flora and fauna, over 600 species of phytoplankton, over 90 forms of zooplankton, about 40 species of ichthyoplankton and 160 species of benthos have been identified. Also recorded are new species of seaweed and animals, which were never before recorded in Aniva Bay. Biogeographic and environmental characteristics indicate they are local inhabitants.

No protected species of flora and fauna have been observed during the environmental monitoring of the waters of Prigorodnoye port.

8.3.10. Gray Whale Monitoring and Marine Mammal Protection

23 species of marine mammals, including 17 species of cetaceans (whales, dolphins, porpoises) and six species of pinnipeds (seals), can be found in the area of the Sakhalin-2 project in the coastal waters of the Sea of Okhotsk. Of these, 7 species are listed in the Red Book of the Russian Federation — the gray whale, the bowhead whale, the North Pacific right whale, the fin whale, the Cuvier’s beaked whale, the harbour porpoise, as well as pinnipeds such as the Steller sea lion. The Okhotsk-Korean (Western) gray whale subpopulation, which also has a high conservation status on the Red List of the International Union for Conservation of Nature (IUCN), feeds near the Sakhalin Energy`s offshore production assets during the ice-free period. The company therefore pays much attention to the monitoring and conservation of gray whales, as well as other mammal species.

The implementation of the corporate Marine Mammal Protection Plan (MMPP), updated in 2018, makes it possible to take into account all the risks associated with production activities, and to take timely measures to reduce the negative impact. This includes establishing special corridors for vessels to bypass the main feeding areas of gray whales, imposing speed restrictions and prescribing specific minimum distances between vessels and marine mammals to ensure their safety. One of the key components of the MMPP is the presence of marine mammal observers on the company’s vessels, which has been run as a separate observation programme since 2003. According to the long-term data, the most common species in the waters washing the north-eastern coast of Sakhalin are cetaceans such as the harbour and Dall’s porpoises, the minke whale, the gray whale; and pinnipeds such as the largha or spotted seal, the northern fur seal, and the Steller sea lion. Individual specimens of other rare species, including the Cuvier’s beaked whale, the Short-finned pilot whale, the northern right whale dolphin, and the North Pacific right whale have been observed over the years of monitoring.

In 2018, Sakhalin Energy conducted geophysical surveys in the Piltun-Astokhskoye and Lunskoye license areas. The company received a positive conclusion of the RF State Environmental Expert Review for the project, and it was implemented in strict compliance with Russian legal requirements, international standards, and industry best practices. Based on the recommendations of experts from the IUCN Western Gray Whale Advisory Panel (WGWAP), the company developed a plan for monitoring and mitigating the impact on marine mammals. The implementation of the plan, which involved more than 30 experienced Russian and foreign experts, ensured the prevention of incidents with marine mammals during the seismic surveys.

As in the previous years, Sakhalin Energy in close cooperation with the Sakhalin-1 operator continued implementing the Joint Monitoring programme near the north-eastern coast of Sakhalin Island. In 2018, the operator of the Ayashsky license block — part of the Sakhalin-3 project — joined in the programme. This expanded the capabilities for vessel monitoring in the offshore area.

The field work for the coastal photographic identification of gray whales was executed with the use of unmanned aerial vehicles (drones), the effectiveness of which was proven by research experience in previous years. Photographs obtained from the drones made it possible to identify a part of the whales feeding in the remote areas around Piltun.

During the 2018 field season, 155 whale individuals were preliminary identified, including 10 calves and two new adult whales. Updates have been made to the Sakhalin photo catalogue, currently numbering 297 animals (including another whale, photographed in 2017, but reidentified as a new whale in 2018).

Number of Gray Whales Included in the Sakhalin Photo Catalogue, individuals

Year

2015

2016

2017

2018

Gray whales

259

274

283

296

In addition to field studies, considerable efforts were focused on making an interdisciplinary analysis of the data collected over the past years, and preparation of research results for publication in peer-reviewed scientific journals. This analysis served as a basis for a comprehensive assessment of the environmental capacity to support gray whales in the feeding areas off the north-eastern coast of Sakhalin Island that was conducted in 2018.

The results of the long-term monitoring indicate the well-being of the gray whale feeding aggregation that comes near to the company`s offshore production assets. According to international experts from the WGWAP, the number of individuals in the subpopulations has seen an annual increase of 2–5%. Taking this increase into consideration, IUCN has changed the category of Western gray whale subpopulation in the Red List from Critically endangered (CR) to Endangered (EN).

Not a single incident of impacting marine mammals has been registered since the start of Sakhalin Energy’s operations on the north-eastern shelf of the island. All of this supports that the management of the environmental aspects of the company’s activities and the measures applied to minimise the impact are effective.

In the autumn of 2018, the X International Conference „Marine Mammals of Holarctic“ took place in Arkhangelsk. Sakhalin Energy was one of the primary sponsors of the event. During sections devoted to the study of gray whales, nine reports were presented on the results of the joint monitoring programme, and two reports on the results of the company’s MMPP implementation. The presentations were highly regarded by the scientific community. Research materials were subsequently published in collections of articles and abstracts of the conference.

8.4. Pipeline Right-of-Way Maintenance

In 2018, regular monitoring and geotechnical surveys were carried out along the pipeline right-of-way. Their results have been recorded in order to have relevant actions taken.

The list of right-of-way monitoring actions included:

  • helicopter fly-overs and photoshooting;
  • river crossing surveys;
  • river surveys based on geomatics principles;
  • monitoring of river hydrological characteristics;
  • surveys of geological hazards, cover thickness;
  • plant growth and local soil monitoring;
  • groundwater surveys;
  • satellite surveys of the pipeline right-of-way;
  • wetland surveys.

Based on right-of-way monitoring outcomes, a right-of-way maintenance plan has been developed. Repair and maintenance of the right-of-way were completed in December 2018, as planned. Work was performed at three plots and included eliminating the consequences of natural erosion as well as repairing existing anti-erosion structures.

No pipeline damage occurred in 2018.

During 2018, landslide mitigation activities started in 2017, as well as repair of two existing bank protection sites, were completed.

8.5. Oil Spill Prevention and Response Preparedness

8.5.1. General Information

Oil spill prevention and oil spill response (OSR) preparedness are the top priorities for Sakhalin Energy. The company applies a complex approach to addressing this important mission.

The company has established a Crisis Management Team, an Emergency Coordination Team, and a Duty Dispatcher Service that are on duty 24/7 to coordinate the response in emergency situations.

The company has developed the OSR Plans for all onshore and offshore assets; all necessary approvals and expertise have been obtained from appropriate state agencies.

The company has concluded contracts for OSR services to be provided by the professional emergency response teams of CREO, Ecoshelf and Sakhalin branch of the Rosmorrechflot Offshore Rescue Service for offshore assets.

Furthermore, the company’s own certified Non-Professional Emergency Response Teams (NERTs) have been established at Sakhalin Energy`s production assets.

The OSR vessels with appropriate equipment are continuously on standby near the offshore platforms and in Prigorodnoye port.

The number and volume of oil spills have decreased significantly in recent years, with only 28 emergency oil spills totalling 119 litres reported between 2010 and 2018 versus 21 emergency spills releasing 3,504.46 litres of oil in 2008−2009.

In 2018, there were four crude oil and/or petroleum products spills from the company’s assets totalling less than 1 litre (0.62 litres).

In 1999–2018, the total hydrocarbons produced amounted to over 539 MMbbl, the total hydrocarbons spilled was 26.5 bbl, which is less than 0.000005%.

Since the commencement of the project, none of the crude oil and/or petroleum product spills from the company’s assets has been defined as an emergency situation.

Global practices of providing response to large-scale emergencies have proven that an effective response to major oil spills is possible only with an integrated application of mechanical and non-mechanical technologies. Namely, using dispersants and in-situ burning allow significantly mitigating the environmental damage, reducing the response, and rescuing unique wildlife species. Sakhalin Energy has conducted a net environmental benefit analysis (NEBA) that confirmed the effectiveness of combining mechanical recovery methods with non-mechanical — dispersants use and in-situ burning — in response to large-scale spills.

Emergency Coordination Team members receive Level I and II OSR programme training, as well as Level I (ICS-100), Level II (ICS-200) and Level III (ICS-300) Incident Command System training. Level I of the programme is basic and is designed for regular rescuers and emergency responders, while Level II is designed for training supervisors, leaders of oil spill response teams and groups. Level III training is intended for Asset Managers, Department Heads and Emergency Response Coordinators.

In order to increase the personnel’s OSR preparedness and improve their practical skills, the company conducts monthly practical and theoretical training sessions at all company`s assets.

Integrated corporate emergency oil spill response drills took place at onshore pipeline system and Lunskoye field in May and August 2018.

According to observers, the company and contractors acted in a well-coordinated and effective manner during the drill. The objectives of the drill were fully realised. As a follow-up to the drill, recommendations were developed and appropriate measures were taken to improve the OSR systems. The analysis of the drills and exercises conducted by the company showed it to be fully prepared to respond in the event of an emergency oil spill at any Sakhalin-2 asset, whether offshore or onshore.

8.5.2. Oiled Wildlife Rehabilitation

Oil spills can cause serious harm to coastal and marine fauna. Coastal bays and lagoons temporarily or permanently inhabited by birds and other wildlife species, many of which are protected species, as well as rivers and wetlands, are especially vulnerable to oil spills. Animals affected by the impact of crude oil and petroleum products need prompt and proper rescue actions, including capturing, rehabilitation, and subsequent release into the wild. This task can be carried out only by properly trained staff.

In keeping with its commitments to environmental protection and biodiversity preservation and in line with the international best practices, Sakhalin Energy has been training personnel under the Oiled Wildlife Rehabilitation programme since 2005.

The programme was developed in cooperation with the International Fund for Animal Welfare (IFAW) and the International Bird Rescue Research Centre (IBRRC), taking into account Sakhalin’s ornithologic fauna and severe climate. The programme provides opportunity for the participation of all employees of the company and contractors involved in oil spill response.

In addition to oil spill response plans, a number of corporate documents were developed as part of the programme, the main one being the Oiled Wildlife Response Plan, which identifies the necessary resources and procedures for coordinating actions between corporate units and external entities.

Since 2011, Sakhalin’s rehabilitation centre for oiled wild animals has been operating in the territory of the Prigorodnoye production complex. This is the first in Russia and the only one in the Pacific Region.

To implement the programme, the company installed specialised equipment in the central and northern parts of the island, at OPF near Lunsky Bay, and at the pipeline maintenance depot (PMD) in Gastello.

The company organises annual training for oiled wild animals rescue. During 2018, training was successfully provided for 39 employees.

The training programme included two response modules: (1) repelling, capturing and transportation of birds, and (2) cleaning and stabilisation of birds at the rehabilitation centre for oiled wild animals.

The first module was carried out as part of regular OSR exercises. In July 2018 exercises were conducted in the waters of Aniva Bay in the territory of Prigorodnoye port and in August 2018 — on the shoreline strip and the waters adjacent to Nyisky Bay, near the Kaigan port. In the course of practical training programme, participants practised the skills of repelling animals from the sites of oil spills, catching polluted animals from small boats and transporting them to the shore, and consolidated their theoretical knowledge of preventing injury to birds and maintaining their welfare during transportation.

The second module was carried out in October 2018 and included work at the rehabilitation centre for oiled wild animals, located in the territory of the Prigorodnoye production complex. During the training, the participants received theoretical knowledge of providing assistance in the rehabilitation of oiled birds and animals, including feeding them, monitoring their general state and sampling. They also developed practical skills of capturing, holding and carrying oiled birds and animals. The participants also were acquainted with the equipment for giving first aid, and received practical experience in cleaning birds from oil products.

More than 500 people from 25 organisations operating in Sakhalin have been trained through the oiled animals rescue programme over the years. Trainings in repelling, capturing and rehabilitating oiled animals have also become an integral part of Sakhalin Energy’s corporate culture.

8.6. Sanitary Protection and Safety Zones

To ensure the safety of the population and in accordance with Federal Law No. 52 Federal Law On the Sanitary and Epidemiological Welfare of the Population of 30 March 1999, a special-use area, i.e. a sanitary protection zone (SPZ), was established around assets and production sites that may impact human habitat and health. The size of such a zone is set to mitigate the impact of pollution on the atmosphere, keeping it in line with health standards and acceptable health risk levels.

The sanitary protection zone boundaries confirmed by the Chief State Medical Officer of the Russian Federation for the Prigorodnoye production complex, OPF, and BS 2 were not changed in 2018.

The onshore main pipelines run in the same right-of-way and are clearly designated with special signs. A safety zone is established along the entire pipeline route, and its boundaries are clearly marked with signs.

A safety zone was established for the main pipelines to prevent any possible damage to them. This zone is mandated by the Rules for Main Pipelines Protection, approved by Ruling No. 9 of Gosgortekhnadzor (currently, Rostekhnadzor, the Federal Service for Environmental, Technological, and Nuclear Supervision) of the Russian Federation of 22 April 1992 and Governmental Degree No. 1083 on Approval of Rules for Main Gas Pipelines Protection dated 08 September 2017. The safety zone along the pipelines transporting oil and natural gas is a strip of land extending 25 m on either side of the pipeline.