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THE PROPOSAL

THE PROPOSAL

3 The Proposal

3.1 Background to the Proposal

Terminals Pty Ltd is an Australian company providing service to industry in the form of bulk liquid storage facilities leased to customers at strategic Australian port locations. These port locations are at Port Botany (Sydney), Coode Island (Melbourne), Corio (Geelong) and Osborne (South Australia). Whilst each of these facilities is wholly owned by Terminals, they are situated on land that is leased from the relevant Port Authority.

Port Botany is one of the three major ports in New South Wales with one of the predominant trades being petroleum products, liquefied petroleum gas (LPG), and liquid chemicals. The majority of industries in the Port Botany industrial region are involved in the storage and distribution of these products and are located on Friendship Road in the vicinity of the existing and proposed Terminals storage facility.

Terminals have owned and operated the existing bulk liquid storage and handling facility for hazardous and non-hazardous bulk liquids at Port Botany since 1979. The original facility has undergone three subsequent expansions, each involving the construction of additional storage capacity. A summary of these previous development applications is provided in the table below.

Table 1: Previous Development Applications

 

Number of

Additional

Date of DA and ref (where available)

 

Stage

tanks

Capacity (m³)

Comments

1

20

22,350

1979

 

(original

(original

DA)

capacity)

2

12

5,810

1980

 

3

28

18,820

1987

 

4

4

800

1989

(840/45/D –

 

161/88)

5

12 (actually constructed one - Tank 270)

20,250

1997

(DA 249/96)

Consent for ‘expansion of an existing bulk liquid storage facility with associated loading/unloading facilities, pipelines, safety systems, landscaping and fencing’. Works known as the ‘Stage 5’. This development was legally commenced by the construction of 1 x 5,000 m 3 tank (Tank 270) and the construction of a large hard surfaced area surrounded by a bund wall.

(actually

 

constructed

 

5,000

5A

Additional 2

Additional

September 2009 (DA 249/96 Mod 1)

The proposed modification involves the installation of 2 larger tanks,

20,000

 

each with a capacity of 10,000m 3 , rather than the approved 12 smaller tanks; increasing the storage

capacity from 20,250m

3

to

25,000m 3 . This development was named as ‘Stage 5A’.

THE PROPOSAL

THE PROPOSAL

3.2 Need for the Proposal

Since the time when the consent for DA 246/96 was granted, the demand for particular products has shifted, with the previous modifications to the 1997 consent responding to this change. The original approval was for twelve smaller tanks of varying sizes, designed to be filled with different industrial/liquid fuel products. Due to various factors, only one of the twelve tanks was built (Tank 270). Since the time of the 1997 approval, there has been a shift in the type of fuel needing to be stored, with demand focusing on unleaded and diesel fuel. This trend is to be reflected in the consolidation of the eleven approved smaller tanks into two larger ones.

In April 2009, legislation has been enacted into NSW under the Biofuel (Ethanol Content) Amendment Act 2009, prescribing certain minimum requirements for using Ethanol as a fuel. Clause 6 states:

6

Minimum ethanol requirement for volume fuel sellers

(1) A volume fuel seller must ensure that the volume of ethanol sold by the seller (in petrol-ethanol blend) during a relevant period is not less than the minimum ethanol percentage of the total volume of all petrol (including petrol-ethanol blend) sold by the seller during the relevant period.

(2) The "minimum ethanol percentage" is:

 

(a)

2% for any relevant period before a relevant period to which paragraph (b)

or (c) applies, or

(b)

4% for a relevant period that starts on or after 1 January 2010 other than a

relevant period to which paragraph (c) applies, or

(c)

6% for a relevant period that starts on or after 1 January 2011.

(3) Only ethanol that complies with a biofuel sustainability standard may be counted towards the volume of ethanol sold for the purposes of this section.

8

Regular unleaded petrol to be E10

(1) A primary wholesaler must not sell regular unleaded petrol unless the petrol is E10. "E10" is defined in section 3 (1) to mean petrol-ethanol blend that contains between 9% and 10% ethanol by volume, being ethanol that complies with a biofuel sustainability standard.

(2) This section takes effect on 1 July 2011 or on a later date that is prescribed by the regulations as the start date for the purposes of this section.

To comply with this requirement, it was planned to put ethanol and PULP into existing facility but with other business opportunities it was deemed better logistics of constructing two new tanks at stage V with these chemicals and in fact making room for new chemical storage at existing site. Hence it is proposed to install 2 x 1,750m3 storage tanks for the storage of Ethanol and Premium Unleaded Petrol (PULP). In addition, pipework and blending facilities would be installed in the existing Loading Bay to enable petrol / ethanol blends to be loaded into trucks for subsequent distribution.

It is anticipated that PULP would come into the Terminal via tying to an existing dockline from the Bulk Liquids Berth, whilst Ethanol is anticipated to arrive via road tankers from local Ethanol manufacturers. Some Ethanol could also be imported via the Bulk Liquids Berth.

The proposed development is also important to support the competitive fuels market in NSW. The proposed tanks will support the independent fuels market and petrol station operators. This is particularly relevant in an environment of rising fuel prices as well as broader questions regarding genuine competition in the fuels market.