Safety, Health, & Environment

Environmental Performance

It is the policy of the Sakhalin-1 Project and its operator, Exxon Neftegas Limited (ENL), to conduct its business in a manner that is compatible with the balanced environmental and economic needs of the Sakhalin-1 Project communities. ENL recognizes the environmental sensitivities offshore Sakhalin Island and believes that the Sakhalin-1 resources can be developed in an environmentally responsible manner, by combining careful design practices and mitigation measures to avoid or minimize impacts.

In order to achieve these objectives ENL has invested over US$ 700 million through 2007 on environmental safeguards, equipment and studies, including various archaeological, ornithological, bathymetric, meteorological, seismic, topsoils, fisheries, stream crossing, waste management, bioremediation and oil spill response studies.

ENL is committed to continuous efforts to improve environmental performance throughout its operations.

Accordingly, ENL's policy is to:

Comply with all applicable Russian Federation environmental laws and regulations and Sakhalin-1 PSA and apply responsible standards where laws and regulations do not exist;
Encourage concern and respect for Sakhalin Island environment, emphasize every employee's responsibility in environmental performance and ensure appropriate operating practices and training;
Work with the Russian Federation government and industry groups to foster timely development of effective environmental laws and regulations based on sound science and considering risks, costs and benefits and effects on energy and product supply;
Emphasize accident prevention through design and operating procedures;
Respond quickly and effectively to incidents resulting from project operations, cooperating with industry organizations and authorized government agencies;
Conduct and support research to improve understanding of the impact of the Sakhalin-1 Project on the environment, to improve methods of environmental protection, and to enhance its capability to make operations and products compatible with the environment. ENL has engaged a wide range of Russian organizations including research and design institutes, universities, the Academy of Sciences and environmental consultants to assess the environmental impact of the Sakhalin-1 Project;
Fulfill obligations under the Production Sharing Agreement and provide full information on project activities and plans to Russian authorities pursuant to the rigorous formal review processes established by Russian legislation. These processes provide for a professional and objective review mechanism with comprehensive public consultation. (Click here to learn about the Positive Conclusion of the State Ecological Expert Review of the Ministry of Natural Resources for Phase One of the Sakhalin-1 Project);
Communicate with the local community on environmental matters and share ENL's experience with others to facilitate improvements in industry performance;
Undertake appropriate reviews and evaluations of project operations to measure progress and to ensure compliance with this policy.

ENL is an industry leader in safety, health and environmental performance. We are committed to ensuring the safety of people, the environment, the community and our operations. Excellence in these aspects of our operations is important not only for societal reasons, but for business reasons as well. Without success in these areas, we cannot expect the company to be successful in operational or financial terms. Our goal is to create environmental protection programs that best suit unique challenges of the Sakhalin-1 Project.

Just a few key examples of our environmental policy in action include:

The Sakhalin-1 Project is incorporating modern technical solutions to reduce potential environmental impacts on the marine environment. For example, the Project is using world-class Extended Reach Drilling technology that allows wells located onshore to be drilled beneath the seafloor to oil and gas targets more than five miles offshore. This eliminates the need for some offshore structures, pipelines and associated activities. In addition, drilling muds, cuttings and produced water from all Sakhalin-1 drilling platforms and drilling sites are re-injected into the geological formations. Pipeline design includes safety features such as shut off valves, leak detection systems, and extra wall thickness at sensitive locations.
Since 1994, the Sakhalin-1 Project has spent US$ 48 million through 2006 on environmental field studies and surveys, both onshore and offshore. These include:

Onshore

1995: Ornithological study of northeast Sakhalin island
1999-2000: Baseline data collection and detailed site assessments of Chayvo and Odoptu areas
2001: Baseline data collection and detailed site assessments of planned project areas
2003-2008: Data collection and monitoring associated with construction
2004-2008: Steller's Sea Eagle monitoring program and Artificial Nest and Perch program

Offshore

1994: Marine baseline survey
1996-2000: Environmental monitoring for exploratory wells

Steller's Sea Eagles ("Orlans")

1997-2008: Whale research and monitoring offshore Sakhalin
1998-2001: Fisheries surveys offshore Sakhalin
1999-2001: Baseline data collection
2002: Baseline data collection and fisheries survey
2003-2008: Data collection and monitoring associated with construction

Western Gray Whale

A small Western Gray Whale population inhabits the area off the northeast coast of Sakhalin Island during the summer and fall months. The Project recognizes the environmental sensitivities offshore Sakhalin Island and is committed to developing the Sakhalin-1 resources in an environmentally-responsible manner, which protects the safety of these whales and the marine environment.

Sakhalin-1 support of the gray whale population research program dates back to 1997. Since 1997 and through 2007, the Sakhalin-1 Consortium has spent over US$ 17 million on studies of the gray whales and measures to protect them. This research has expanded the knowledge base about the species, and involved prominent Russian and Western whale scientists. The Project is committed to on-going support of the gray whale research program and continues to work with Russian marine research institutes and the industry to study the population, behavior and habitat use by the whales, as well as characterize the natural environment including ambient sound.
The Sakhalin-1 Project's concern for the Western Pacific Gray Whale population was also demonstrated by the 2001 Odoptu seismic program, where the Project implemented the most extensive protection measures ever undertaken by industry. This included a 4-5 km protection zone between the seismic vessel and the gray whales and shutting down operations if the whales were present within this protection zone. Gray whales continued to feed within their historical feeding grounds throughout the seismic survey.
Future gray whale research planning will be developed to ensure scientifically credible data on the gray whale population are available as the Project moves into future developments and subsequent production operations offshore Sakhalin Island.

Steller's Sea Eagle

Artificial Nest Construction

Drawing upon advice of recognized Russian experts, Sakhalin-1 has developed and is implementing a protection plan for the Steller's Sea Eagle ("Orlan") population that inhabits the marine coasts of Sakhalin and Khabarovsk Krai.

The Sakhalin-1 Project began funding Russian ornithological studies in 1995. This work continued in 1999-2002, when ornithological studies in the area of proposed Project facilities and the pipeline right-of-way were done. Additional ornithological studies were conducted in 2003-2006. These baseline studies were used to identify Steller's Sea Eagle habitat, as well as the habitat of other rare bird species, and included mapping of nests and hunting areas, surrounding vegetation and surface hydrology. They also provided valuable information on habitat for all coastal birds. Dr. Vladimir Masterov, Moscow State University, has developed a "Rare, Threatened and Endangered (RTE) Species Mitigation Plan" for ENL that contains practical measures to protect Steller's Sea Eagles and other RTE species in regard to future Sakhalin-1 Project activities.
In 2004, ENL initiated two programs to help protect Steller's Sea Eagles: Steller's Sea Eagle monitoring program and Artificial Nest and Perch program.

The primary goal of the Steller's Sea Eagle monitoring program is to help conserve the population of a valuable, but potentially vulnerable species. The spatial structure of the population is the key indicator for tracking the condition of the Steller's Sea Eagle population over time. Dr. Masterov was contracted to conduct field studies to collect information on nest and perch locations, abundance, age and sex composition, reproduction success and other factors. As part of this program, a database for storage of pertinent eagle information for each of the Sakhalin-1 Project areas was developed. The database includes historical baseline data that will be used to track information on individual nests and activity with these nests by Steller's Sea Eagles over multiple years.
A certificate for each nest was developed that contained information regarding the structural elements for individual eagles and their nests (e.g., boundaries, area, main and alternative nests, favorite perches, and hunting territory). Changes in these parameters over a number of years allow experts to evaluate Steller's Sea Eagle population dynamics.

Artificial Hunting Perches in Frequent Use

The artificial nest and perch program was enacted in the summer of 2004. Under this program 13 new nest and 14 perch sites were built in the area and the eagles are carefully monitored to determine the extent to which they utilize these enhancements. The primary objective of the program is to create preconditions to attract sea eagles to new coastal sites away from Sakhalin-1 Project Facilities. Construction of artificial nests may also increase the capacity of nesting habitat. Researchers discovered that predation by agile climbing brown bear is perhaps the single largest factor in fledgling eagle mortality. Approximately 20 metal sheathing devices have been installed on trees where the new nests are located and on neighboring trees with existing nests to discourage bear predation. In 2006, Steller's Sea Eagles used an artificial nest for the first time, near the Chayvo well site.

ENL has also implemented a variety of protection measures, including the establishment of "buffer zones" for occupied nests.

Young Orlan

Activities in the buffer zones are restricted and carefully monitored during the season when the birds are present to avoid impacts to the sea eagles or their habitat.
If a sea eagles nest or a new nest is identified in the vicinity of operations and it is not possible to avoid the nests, alternative mitigation strategies will be implemented in close cooperation with Russian experts and regulatory authorities. ENL has not been faced with this scenario since the successful implementation of the artificial nest program.

ENL will continue to conduct ornithological studies and monitoring and mitigation programs to verify the results from previous studies and validate the effectiveness of the current measures used to help protect rare, threatened, and endangered species including the Steller's Sea Eagle.

Pipeline Design

The design and construction of the Sakhalin-1 pipelines has drawn on the most advanced technology, and this technology has improved significantly over the last 25 years. Because the area where the pipelines have been laid onshore is not permafrost, pipelines were buried. During the construction period, pipeline crossings in rivers and streams were kept to a minimum and were undertaken seasonally, usually in the winter freeze-over period, to minimize impacts to fisheries. Pipeline design safety features for the Sakhalin-1 project include:

Installation of Bear Predation Prevention Devices

Pipeline design that accounts for a rupture strength in the case of seismic hazards with a return period of 1,000 years for onshore pipelines and 2,000 years for offshore pipelines;
A leak detection system and an automatic shutdown system, including high accuracy flow and pressure meters at both intake and discharge ends, is installed on the main export line from OPF to De-Kastri;
Emergency shut-off (isolation) valves located every 30 km along the pipeline route;
Modern investigative techniques to measure wall thickness and detect corrosion;
Monitoring current potential to ensure the integrity of the cathodic corrosion protection system;
Routine pipeline inspections;
Pressure testing prior to start-up and at predetermined periods.

Oil Spill Response

The Sakhalin-1 Project's oil spill response measures have been developed and are being implemented within the framework of Russian legislation and ExxonMobil's and the International Petroleum Industry Environmental Conservation Association's industry-leading multi-volume Oil Spill Response Guidelines and will include:

A focus on aggressive prevention measures;
Extensive training for oil spill response specialists;
In the unlikely event of a spill, rapid response with an established, well-trained and equipped response organization.

In December 2006, MChS of Russia approved the Sakhalin-1 "Oil and Petroleum Product Spill Prevention and Response Plans" for the maximum allowed duration of five years.