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Overview

Salalah Methanol Company LLC (SMC) proposes to develop a 1,000 metric tons per day (MTPD) Ammonia Plant on Plot 34 (Ammonia Project), adjacent to SMC’s existing Methanol Plant in Salalah Free Zone (SFZ). The liquid ammonia product from the Ammonia Plant will be exported to the Port of Salalah (POS) by pipeline. The Ammonia Plant will be owned, operated and managed by SMC.

The scope of the development is as follows:

SMC has contracted WorleyParsons for carrying out the Environmental Impact Assessment (EIA) study for the Ammonia Project. The EIA study has been conducted in accordance with the Guidelines for Obtaining Environmental Permits’ issued by the Directorate General of Environmental Affairs (DGEA) at the Ministry of Environment and Climate Affairs (MECA). As an initial requirement an EIA Scoping report was prepared and submitted to MECA (Dhofar Governorate) through SFZ during January 2014. In response MECA made recommendations for the EIA study, which were considered during the study. It must be noted that an Addendum to this EIA study will be prepared and submitted to MECA when the project design will be further detailed.

Process Overview

The Ammonia Project will consist of process units and support utilities for the production, storage and export of 1,000 MTPD of liquid anhydrous NH3. The Ammonia Plant will utilize as feedstock the H2- rich purge gas from the adjacent Methanol Plant and N2 from a new air separation plant as part of the new facility. The process flow diagram is presented in Figure 1 on the next page.

The major process units/operations in the Ammonia Plant will be:

• Air Separation Unit (ASU) – Air Separation Unit (ASU) – Will be a cryogenic unit producing 900,000 kg/d of high pressure nitrogen. Ambient air will be taken into the ASU through twin centrifugal compressors and passed through air filters to remove any particulate matter in the ambient air. The compressed air will be chilled in order to condense out any water content in the ambient air. The chilled will then enter a set of temperature / pressure regenerative air driers to remove moisture and carbon dioxide from the air. The dried is then routed to a cold box consisting of distillation towers, heat exchange systems and a turbo-expander. Here the air will be separated into a high purity stream of nitrogen and a stream of oxygen enriched air. The nitrogen stream from the cold box will be then compressed and sent to the ammonia process compression unit to be mixed with hydrogen (generated in the pressure swing adsorber unit) for ammonia production.

• Pressure Swing Adsorber (PSA) Unit – This unit is the main feedstock purification unit for the methanol purge gas, to be received from the adjacent Methanol Plant, to generate hydrogen for ammonia production. The purge gas from the Methanol Plant will contain significant amount of methanol which will be removed in the wash column in the PSA unit and the recovered methanol stream will be returned to the Methanol Plant. The PSA unit will use mole sieves, activated carbon and activated silica to remove the purge gas impurities (like (CO2, CO, H2O, and other) and provide high purity hydrogen.
• Ammonia Synthesis – Hydrogen from the PSA Unit and nitrogen from the ASU will be mixed to a ratio of 3 to 1 mol/mol and homogenised. The homogenised gas will be preheated and routed to the Haldor Topsoe S-300 reactor, which will serve as the Ammonia Converter wherein the hydrogen and nitrogen gas mixture will be converted to ammonia. The ammonia synthesis reaction releases heat (exothermic). This heat will be recovered and used to generate steam. The ammonia gas will be further cooled and condensed. The final condensation of the ammonia gas will take place in the Synthesis Gas Chillers, where the condensed ammonia product will be separated out and flashed to remove any dissolved synthesis gas before delivery to product storage tanks.
• Product Cooling – Product will be cooled by routing through heat exchangers and refrigeration unit will be used to further cool the product to form liquid ammonia. The refrigeration unit will create refrigeration for several units in the Ammonia Plant, and also will be used to cool down the ammonia product down to -33 °C for atmospheric storage.
• Product Storage and Loading – The liquid ammonia product will be stored in 2×15,000 metric tonne double wall, high integrity refrigerated storage tankage complete with electric holding compressors and a dedicated storage tankage ammonia flare system. Water will be added to the product ammonia to prevent stress corrosion cracking of the storage tank. From storage, the liquid ammonia will be pumped via pipeline to either POS or in future within the SFZ for consumption by other users. The product export pipeline will be of 16" diameter and 4.5 km long, and will be maintained at cryogenic temperature through constant recirculation of cryogenic ammonia circulated in the pipeline and returned via a recirculation line. For loading there will be a custody transfer quality mass flow meter at the jetty loading system for measurement of loaded product to the ship. During ship loading, the pipeline recirculation will be halted (or slowed). It must be noted that the Ammonia Project load out facilities end at the loading arm inlet flange with the loading arm and associated systems designed, owned and operated by POS.

The utilities in the Ammonia Plant will include steam system and power generation (steam turbogenerator-set), electric power from Dhofar Power Company, flare systems (NH3 Plant Flare and NH3 Storage Flare), seawater supply and return system, HVAC system, desalinated and demineralised water supply from Methanol Plant, cooling water system, drainage system, wastewater treatment plant, instrument and utility air, nitrogen supply, natural gas for pilot flame, firewater system

Baseline Conditions

Location - The Ammonia Plant will be developed with a designated industrial zone (SFZ). The plot is surrounded by Methanol Plant, a polyethylene terephthalate and pure terephthalic acid manufacturing plant and cattle feed factory.

Landscape / Topography - The site is almost flat with a wadi channel flowing across from west to east in the northern portion of the plot creating a depression of about 2 m in the northern portion. From site visits and satellite image review it appears that there have been anthropogenic activities on site.

Climate - The site experiences three climatic seasons (winter, summer and monsoon) like the rest of Salalah / Dhofar. The mean temperature varies between 33 ºC and 16 ºC. A strong southwest monsoon brings some heavy rainfall to the area. The average annual rainfall varies from as low as 50 mm in the plains to 300 mm in the mountains. The mean wind speed ranges from 5 to 13 km/h.

Geology and Soil Quality - A geotechnical investigation conducted at the project site revealed a surface layer of uncontrolled fill material with variable density and thickness, typically extending 4 to 5 m overlying weathered limestone, followed by fair quality limestone. The site typically comprises of backfill materials (slightly silty sandy gravel and gravelly sand) followed by solid strata of highly fractured limestone and solid bed rock of bioclastic limestone. Soil samples were collected from the six locations in the site and analysed. The soil is dry and slightly alkaline. Exceedances in some metal contents were observed from a sampling location in the site where foreign soil material was dumped.

Groundwater - Similarly groundwater samples were also collected from six locations within the site and analysed. Analysis showed the groundwater from the site is brackish and hard. The groundwater is not suitable for domestic use without treatment. Further, the groundwater quality is within the contamination criteria.

Terrestrial Ecology - The site is sparsely vegetated, with the vegetation concentrated in the wadi channel. A rapid flora and fauna assessment at the project site, the overhead line route (Dhofar Power Company to the project site) and the export pipeline route documented 40 species of plants and 9 species of birds. All the species of plants encountered during the study are common and none are listed as threatened, rare or endangered. The birds observed are generalist feeders, mainly omnivores and insectivores. These birds use wadi area for foraging and perching.

Marine Environment - Marine surveys were conducted at the Methanol seawater intake and outfall areas. Seawater and sediment samples were collected and analysed in laboratory. Video surveys were conducted along transect line to identify any ecological sensitivity. Physicochemical profiles collected from each site were found to be well mixed and physically similar between sites for all parameters, with the exceptions of depth, temperature and turbidity. Subtidal benthic habitats identified during the survey were homogenous in the wadi and at the intake, but variable within the bay. Intertidal habitats were dominated by bare sediments. One mangrove species (Avicennia marina) was identified in the tributary north of the outfall.

Ambient Air and Noise - The ambient air quality with the exception of particulate matter (dust levels) is compliant with the USEPA National Ambient Air Quality Standards. The high dust levels were due to the construction and land preparation activities ongoing in SFZ near the project site. The ambient noise levels around the construction activities south of Dhofar Power Company and within the POS were higher when compared to the ambient noise level at the project site, where the noise levels are below the applicable standard limit.

Social Setting - The nearest community to the project site is Munshahat in South Raysut which is located at about 700 m westwards from the project site. It has farms and residential properties but the infrastructure in general is limited. Majority of the community members depend on permanent jobs for their livelihood, while a few residents depend on some traditional jobs and crafts as a source of income. A social survey was conducted as part of this EIA study with the objective of understanding the existing social profile of the neighbouring communities and in order to identify and assess the potential social impacts from the project. The survey was conducted through consultations with the local Shura Council member and the community members. The data collated from the social consultations are presented in this report.

Archaeology Sites – there are no archaeological sites or sites of cultural interest within the project site or along the overhead line and export pipeline routes.

Impact Identification and Assessment

The impacts, related to construction and operation of the Ammonia Project, are discussed in this report. The impacts have been identified considering the identified environmental releases from the project and the baseline settings. The identified impacts have been assessed considering the likelihood of occurrence and severity of the impacts for Unplanned Impacts and considering the duration of impact and severity of impacts for Planned Impacts. The impacts are rated using the appropriate impact assessment matrix. The matrix for Planned Impacts is the result of the interaction between the duration and severity of impacts, and the matrix for Unplanned Impacts is the result of the interaction between the likelihood and severity of impacts.

Impacts on natural resources, ambient air quality, ambient noise level, terrestrial ecology, soil and groundwater, socio-economic set-up, and public health and safety for both construction and operation phases of the project were assessed qualitatively, except for operation phase impact on ambient air which was assessed quantitatively by conducting an air dispersion modelling study of the emission sources in the Ammonia Plant. The marine environment at the outfall area will be impacted only during the operation phase; and hence only operation phase impact on marine impact was assessed.

The assessment of the abovementioned impacts for construction and operation phases resulted in the impacts being rated as Low or No impacts.​