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HERTFORDSHIRE COUNTY COUNCIL

CABINET

MONDAY 17 SEPTEMBER 2007 at 2.00 p.m.

BUNCEFIELD OIL STORAGE DEPOT: A VIEW ON THE SITE’S FUTURE DEVELOPMENT

Report of Head of Safety Emergency & Risk Management Unit (SERMU) and Director of Environment

Authors: John Boulter (01992 555951) and John Wood (01992 555200)

Executive Member: Derrick Ashley

1. Purpose of report:

To advise Cabinet about the intentions of the site operators to recommence fuel distribution operations at the Buncefield Oil Storage Depot and to seek a view from Cabinet on the County Council’s position in response to those intentions.

2. Summary

On Sunday, 11 December 2005 an explosion at the Buncefield fuel depot and resulting fire destroyed most of the depot and had a devastating impact on the adjacent industrial area, Maylands Industrial Estate.

The future prosperity of the industrial estate is dependent upon the future use of the depot.

One of the site operators has initiated efforts to recommence on-site operations. Local partners have responded to those intentions and are now asking the county council to support them in their opposition to operations on the site.

This report sets out the background, the intentions of the operator and response of local partners, and asks Cabinet to consider a position.

3. Conclusion

Cabinet is asked to consider what position it wishes to take in relation to the operator’s intentions.

4. Background

The Buncefield site

4.1 Prior to the morning of 11 December 2005, the depot which had been in existence since 1968, received petrol, aviation fuel, diesel and other fuels by underground pipeline. It stored and then distributed these fuels by pipeline and road tanker to London and South East England, including to Heathrow and Gatwick airports. The depot, contained three sites which are so-called ‘top-tier’ sites under the COMAH Regulations[1] and were operated by three different companies:

• Hertfordshire Oil Storage Ltd (HOSL) – a joint venture between Total UK and Texaco

• British Pipeline Agency ltd (BPA) – a joint venture between Shell and BP

• BP Oil ltd

The site handled 8% of overall UK fuel supplies into the market and supplied, via underground pipeline, 40% of Heathrow’s demand for aviation fuel (c.11 million litres per day).

The incident

4.2 In the early hours of Sunday 11 December, 360 tonnes of unleaded petrol overflowed from tank 912 operated by HOSL. Much of this fuel turned to a vapour and at 6:01 a.m. that vapour ignited causing an explosion which created an earth movement of 2.4 on the Richter scale, caused structural damage to properties up to 3 miles from the site and caused a fire which engulfed over 20 large oil storage tanks on site - creating one of the biggest fires of its kind in Western Europe since the Second World War.

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Impact

4.3 The Buncefield depot is close to the Maylands Industrial Estate, home to some 630 businesses which in December 2005 employed about 16,500 people. It is estimated that one in three of the Hemel Hempstead workforce derived their employment either directly or indirectly from that industrial estate. The explosion and subsequent fire resulted in 350,00 sq. ft. of land completely destroyed and a further 200,000 sq. ft of land and property in need of repair.

4.4 Dacorum BC has calculated that over 1,000 jobs have been lost as a direct result of the incident with a further 2,000 still at risk. 17 businesses (500 jobs) have permanently relocated and 1,400 jobs have been temporarily relocated.

4.5 Not surprisingly, business confidence in the area around Buncefield is very fragile and there remains a great deal of concern about the uncertainty of what reconstruction and or redevelopment will be undertaken by the three principal operators on the Buncefield site.

4.6 The loss of Buncefield has also had significant repercussions for Heathrow airport as well as significantly reducing the resilience of the UK fuel supply which now has a much reduced capacity and capability should any additional disruption be caused to the supply network. Whilst the oil industry has been able to make up 50% of the shortfall to Heathrow, the airport is still experiencing significant difficulties as there is no feasible alternative to underground supply. The development of Terminal 5 (which will also reduce fuel storage capacity on site), and the projected growth in the number of flights will further increase the demand for aviation fuel and increase the pressure for additional fuel supply lines from Buncefield.

5. Current position and operator’s intentions

5.1 Whilst a significant part of the site was largely destroyed by the explosion and subsequent fire, other areas, most notably the part of the site occupied by BP, suffered less damage. BP has now initiated efforts to recommence on-site operations and is currently restoring and upgrading the whole of their plant and infrastructure. Their intention is initially to resume the underground supply of aviation fuel to Heathrow storing fuel in three of the seven tanks available to them.

5.2 BP’s stated longer term objective is also to import gasoline and diesel fuels and to recommence tankering operations delivering fuel across the south east of England. Both phases are dependent on receipt of appropriate approval for building work, applications for which have recently been submitted; one for the installation of filtration plant (phase 1) and the enhancement of a new bund which it anticipates will be completed by June 2008 (phase 2).

5.3 The two other operators have confirmed their wish to resume some form of operation on the Buncefield site likely to include overground storage of fuel. However, to date little detailed information has been forthcoming as to their longer term plans for the site.

6. The County Council’s role

6.1 The county council has worked very closely with Dacorum BC to support the affected community, in particular to support for the recovery and longer term development of the Maylands business park.

6.2 Under COMAH regulations, it is the county council that has the responsibility for producing an off-site emergency plan. This plan details the multi-agency response arrangements for an incident on site which would have off-site consequences. The Authority received the BP safety case (upon which the off-site plan is based) in May this year and has now produced a draft off-site plan. The first draft of this plan is currently out for consultation with relevant emergency response partners (emergency services, Environment Agency, HPA, DBC etc.). It is anticipated that a public consultation will be held in early October involving relevant local members and interest groups – assuming that Dacorum BC has by then approved the planning application which BP has submitted for modifications to the site.

7. Dacorum BC’s and other local partners’ position

7.1 The Borough Council recently outlined its position in a letter to Hazel Blears, MP, Secretary of State for Communities and Local Government, a copy of which is attached at Appendix 1, together with the request for the County Council to make its views known. Other stakeholders have also written to BP and their position is shown in Appendices 2 and 3.

8. The County Council’s position

8.1 The Buncefield site is clearly significant nationally in terms of the distribution of aviation, road and heating fuels for south-east England. Equally, the Maylands industrial estate if one of the biggest in the East of England and its success is critical regionally, but more significantly critical to the future prosperity of Hemel Hempstead and west Hertfordshire.

Any position which supports Buncefield retaining some role in the fuel distribution network would be accompanied by the insistence that risk was kept to a minimum and that the highest possible safety standards should be met.

9. Financial implications

There are none arising directly from this report.

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[1] Control of Major Accidents and Hazards Regulations 1999(COMAH)

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Agenda Item No.

Other Part 1 business

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