Select Committee on Environment, Food and Rural Affairs Memoranda


SUPPLEMENTARY MEMORANDUM FROM THE ENVIRONMENT AGENCY FOLLOWING HEARING ON 19 NOVEMBER 2003

Introduction

1.  The Environment Agency appeared as witnesses to the Environment Food and Rural Affairs Committee's urgent inquiry into 'Ghost Ships' (decommissioned US government owned vessels) held on 19 November 2003. The Agency is providing this written briefing to help put into context understanding of the events and the background to a complex area of legislation. Throughout the Agency's prime objective has been to ensure the protection of the environment.

Background

2.  Earlier this year, Able UK Ltd, a company based on Teesside, won a contract

for the dismantling of 13 redundant United States naval auxiliary vessels.

The contract was awarded by the US Maritime Administration (MARAD), the

statutory body in the US responsible for the decommissioning of obsolete

vessels in the US National Defence Reserve Fleet.

3.  The US Environmental Protection Agency (USEPA) was involved as the

Agency's counterpart environmental regulator for US domestic regulation and in particular as the competent authority of dispatch for transfrontier shipment of waste control. A MARAD/USEPA team inspected and approved the Able UK Graythorp site as one that was capable of meeting the requisite US standards of environmentally sound management for the recovery of the vessels.

The Vessels

4.  The 13 vessels are all of immediate post war design and are no more environmentally hazardous than other vessels of a similar age. They do not carry a cargo of waste, "toxic" or otherwise, but, in common with other vessels built up to the early 1970s they contain, as part of their construction, hazardous materials such as asbestos and materials which may contain elements of Polychlorinated Biphenyls (PCBs). MARAD gave an undertaking to remove all equipment containing liquid PCBs prior to departure.

5.  Overall, around 95% by weight of the vessels comprise metals, mainly iron and steel, which is intended to be recovered for smelting and re-use. Annex 1 is information provided to the Agency by Able UK on the 16th October 2003. It was indicated to be the most up to date inventory of the four vessels that are now in Able UK's Graythorp facility.

6.  The PCB content relates to contaminated equipment such as cables and is usually found in low concentrations around the limit for definition of a PCB (50 parts per million). Solid wastes with these lower concentrations of PCBs as contaminants may be disposed of at a suitably licensed landfill site. Able UK's nearby Seaton Meadows landfill facility is not licensed to accept PCBs for disposal. Any waste with higher concentrations of PCBs is to be identified and disposed of at a suitable dedicated facility such as a high temperature incinerator. The total amount of PCB to be disposed of is difficult to determine exactly but is likely to be in the order of kilogramme quantities rather than any higher range.

7.  Asbestos, usually used as thermal insulation in panels and pipe lagging, will be removed in accordance with the requirements of the Health and Safety Executive and they also require that it be disposed of at the Seaton Meadows landfill.

Transfrontier Shipment of Waste

8.  By way of background, a number of multilateral agreements have been put in place relating to the transfrontier shipments of waste in recognition of the need for these to be properly monitored and controlled. The UN Basel Convention in 1989 established a global framework control system and the 1992 OECD Decision (updated in 2001) established a streamlined system for controlling waste for recovery between developed countries within that overall framework.

9.  Obligations of EU Member States under these agreements have been implemented by Council Regulation (EEC) No 259/93 (known as the "Waste Shipment Regulation") which is directly applicable in Member States. The UK gave effect to relevant enforcement and administrative powers through the Transfrontier Shipment of Waste Regulations 1994. The overall result is a complex yet structured system of international and domestic law.

Proximity Principle

10.In accordance with the relevant international agreements, management of

wastes moving for disposal is subject to the proximity principle. Moreover

the Government has published a statutory Plan (the United Kingdom

Management Plan for Exports and Imports of Waste, 1996) which expressly

prohibits the import of waste for disposal except under special

circumstances. However, the proximity principle does not apply to wastes,

such as these US vessels, which are moving for recovery.

Waste for Recovery

11.There are overall advantages in the movement of waste for recovery. It

enables products that have come to the end of their lives to be moved to

other manufacturing countries so as to replace virgin raw materials and it

avoids the disposal of recoverable waste.

12.The current pattern is for much industrial manufacturing of finished goods

and fabricated components using basic raw materials, such as steel for

cars, to be carried out overseas and often in developing countries outside of

the OECD. Much recoverable waste arises in the UK from end of life

products such as cars and white goods. If the UK was not able to export

these types of waste for recovery, it would not be possible to recycle all of

them economically in the UK, and they would accumulate here requiring

disposal.

Notification of Shipment

13.For imports and exports of waste into and from England and Wales the

Environment Agency is the designated competent authority. The movement

of the vessels could only take place once the express written consent of all competent authorities had been given. MARAD submitted an application under the Waste Shipments Regulation to the Agency on 26 June 2003 for the ships to be transferred from the US to the Able UK Graythorp site for recovery. The Agency had 30 days in which to consider the application and to decide to object or consent to the proposed shipment.

14.The main focus in relation to such notifications is on whether the proposed

shipment represents genuine recovery or is disguised disposal (called

""sham recovery") and whether the centre where recovery is to take place

has adequate technical capacity for the recovery of the waste in question under conditions presenting no danger to human health or to the environment. Shipments are required to have a Financial Guarantee in place that provides funding to deal with problems arising with the completion of the intended operations including the repatriation of the waste to the country of origin if required.

15.The question of whether the ships were in a suitable condition to be towed

across the Atlantic to the UK was not a matter for the Environment Agency

but the US Authorities. The US Coastguard issued the Load Line certificates

after conducting a survey that concluded that the vessels were suitable to

cross the Atlantic. The Environment Agency was aware that the UK

Maritime Coastguard Agency/Secretary of State's Representative had taken

steps to satisfy themselves that the vessels would not present an

unacceptable risk to UK waters.

The Graythorp Facility

16.Able UK's facility at Graythorp, Hartlepool includes a 24 acre dock that, in

the past, when used for the construction of North Sea Oil Rigs, had

moveable dock gates (not now in place) which allowed the dock to be

drained. The facility is located in an area of heavy industry.

17.The Waste Shipments Regulation notification was considered on the basis

that all 13 ships would be transferred to the Able facilities and that,

following the placement of the 13 ships in the dock, a bund/cofferdam

would then be constructed and the dock pumped dry so that the scrap metal could be recovered from the ships in dry dock conditions.

18.It was the Agency's understanding that, in the future, Able UK planned to

re-construct the dock gates and remove the bund to allow the passage of

vessels in and out of the dry dock facility. This would enable the company

to bid for further ship dismantling and recovery work in the future.

Waste Management Licensing

19.The Able UK Graythorp facility requires a Waste Management Licence

under the Environmental Protection Act 1990 from the Agency to authorise

the recovery operations. The company's existing licence already permitted the deposit, treating and recovery of controlled waste, including offshore structures, but needed to be varied to increase the authorised tonnage of waste and to include ships within the categories of waste that could be dealt with on the site. This modification was viewed as an administrative matter that could reasonably be completed before any shipment occurred.

20.The Agency consented to the shipments on the 22nd July 2003 because -

  the Agency was satisfied that this was a genuine recovery operation;

  the proposed method of recovery in dry dock conditions was regarded as low risk; and

  the facility had the adequate technical capacity required subject to the waste management licence requiring modification to accept ships and to increase the tonnage of waste.

Consideration of application to vary the Waste Management Licence

21.On the 30th July 2003, Able UK Ltd submitted to the Agency an application

for a modification of the existing waste management licence to increase the

tonnage permitted to be handled at the site and to include ships as waste

which could be dealt with at the site. The Agency had two months to

consider the application for this modification.

22.Because of the proximity of the Able UK site to the Teesmouth and

Cleveland Coast Special Protection Area which is a designated European

site under the Habitats Directive, the Agency considered whether the

application for the modification to the Waste Management Licence was likely

to have a significant effect on that European site. The application was

assessed for the purposes of the Habitats Directive on the basis that a bund

/cofferdam would be constructed, and the dock drained prior to the recovery

of the scrap metal. On that basis, the assessment concluded that the

proposed modification was not likely to have a significant effect on the

European site.

23.Following correspondence received from Friends of the Earth on 22nd

September, the Agency conducted a fresh assessment on the same basis of

dry dock working to include the likely effect of the proposed modification in

combination with other permissions granted or proposed by other

competent authorities including the planning authorities and port

authorities.

24.The Agency again considered that the proposed modification was unlikely to

have a significant effect on the European site. No objections to the proposed

modification of the Waste Management Licence were received from Statutory

Consultees (Hartlepool Borough Council, the Health and Safety Executive

and English Nature) and the Agency approved the modification to the waste

management licence to include ships and to increase the tonnage on 30

September 2003.

Other Relevant Permissions

25.In order to construct the bund/cofferdam, Able UK require and are

responsible for obtaining planning permission, (Hartlepool Borough Council

is the Local Planning Authority); two separate Food and Environmental

Protection Act licences for the deposit of rocks etc on the sea bed and the

deposit of dredgings at sea (Defra are the responsible body) and may require

a lease from the Crown Estate for the cofferdam.

26.On 1st July 2003 the Agency were present at a meeting where it was

suggested to Able UK by English Nature that the planning permission for

the bund construction had expired. Able UK suggested that preliminary

works begun in Autumn 2002 were sufficient to have avoided any expiry.

On 14th August Hartlepool Borough Council confirmed to the Agency that

there might be some debate over Able UK's 1997 planning permission to

build the bund. On 20th August the Council communicated a preliminary

view that the planning permission had lapsed. On the 30th September the

Council noted in a meeting with other regulators including the Agency that

the planning issue was still unresolved.

27.On the 7th October the Council wrote to Able UK explaining that, in the

Council's view, the planning permission for the bund was not in place to

construct the dry dock and made this information public. This was and still

is disputed by Able UK who contend that they have carried out preliminary

works in pursuance of the planning permission.

28.The status of the planning permission for the bund was not a relevant

consideration for the Agency's decision to grant the modification to the

waste management licence. If the Agency had taken into account the

existence or absence of this planning permission it could have been

judicially reviewed by Able UK.

29.Throughout these developments, the Environment Agency kept MARAD and

the USEPA informed. It also brought the relevant domestic regulators

(English Nature, Defra, and Hartlepool Borough Council) together to share

information. On the 12th and 16th September the Agency drew the attention

of MARAD to the uncertainty about whether Able UK had a valid planning

approval to build a bund to create a dry dock and requested MARAD

contact Hartlepool Borough Council to clarify the situation.

30.The Agency informed both Able UK and MARAD on 3 October 2003 and

subsequently, that since all the necessary permissions to enable the ships

to be recovered in dry dock conditions as planned were not in place it would

be preferable for the ships to not leave the US until the issues had been

resolved. The Waste Shipment Regulation consent, once given, could not be

withdrawn. Following a court hearing in the United States (to which the

Environment Agency was not a party) that ruled that the first four vessels

could leave the US, the first two MARAD vessels left under tow on the 6th

October.

31.Hartlepool Borough Council wrote to Able UK on 7 October explaining that

in the Council's view planning permission for the bund was not in place to

construct the dry dock. The information was made public and was

forwarded to MARAD. On the 17th October the second pair of MARAD

vessels left the US.

32.On 6th October 2003 Able UK confirmed that it was the company's

intention to undertake the dismantling activities in the dry dock if possible.

However the company raised the possibility with the Agency that, if it was

unable to resolve the dispute with the Borough Council over planning

permission for the bund in its favour it may seek to dismantle ships in wet

dock conditions without a bund/cofferdam in place. The potential effect on

the European site of this method of working had not been assessed by the

Agency for the purposes of the Habitats Directive and Regulations.


Review of Waste Management Licence Modification

33.During October, in anticipation of judicial review of its decision, the Agency

reviewed the 30th September modification to the Waste Management

Licence. The Agency's consideration of the application had been on the

assumption that dismantling would take place in the dry dock after a coffer

dam/bund had been constructed. The Agency concluded that, amongst

other matters, since wet dock working had not been assessed for the

purposes of the Habitats Directive and Regulations and since the waste

management licence as modified did not prevent wet dock working, the

modification of the 30th September could not stand.

34.The Agency's policy, as a responsible public body, is not to waste court time

or incur further expenditure if it considers that a decision is unlikely to

withstand challenge in the Courts. The Agency advised both Able UK and

MARAD of the situation in late October.

Storage of Ships

35.The UK Government considered with the US authorities the possibility of

the four ships returning to the US immediately. A shared view was reached

that it would be imprudent for them to do so, not least because of concerns

about the weather at this time of the year, and because there was no

suitable alternative storage site. It was considered that temporary storage in

Hartlepool for the ships best met the objectives of safety and environmental

protection.

36.An assessment of the first two ships has been carried out by the MCA in

conjunction with Environment Agency assessments to ascertain the

integrity of the vessels' structures and safety systems following their

passage from the US. The MCA surveyors concluded that the ships posed

no risk to the environment.

37.The priority for the Agency has been to ensure that the ships pose no threat

to the environment and that they remain in a condition so that they can, if

necessary, return to the US. Therefore, on the 12th of November the Agency

modified the conditions of the Waste Management Licence for the Able UK

Hartlepool site to ensure that no dismantling, cutting or breaking of the

ships can take place and that appropriate pollution prevention measures

are put in place together with environmental monitoring.

38.The remaining nine ships in the contract remain in the US and are subject

to a US Court Order restraining their movement until a hearing set for April

2004.

Disputes

39.The Waste Management Licence modification of 30th September 2003 and

whether the Agency was correct to decide that the modification should not

stand came before the High Court on the 8th December. The Court decided,

dismissing Able UK's arguments to the contrary, that the Agency's decision

that the modification of 30th should be quashed was correct. Full reasons

for the Judgement were given on the 11th December 2003.

40.There is a limitation in the waste management licence (disputed by Able

UK) on the amount of waste that can be received at the site. In the Agency's

view, an application for a new waste management licence is required if

Able UK wish (1) to recover ships at the site and (2) to increase from

24,500 tonnes per annum the quantities of waste which can be received and

deposited at the site.

41.Hartlepool Borough Council decided on 30th September 2003 that a

permission granted to Able UK in 2002 for the continuation of the use of

their facility at Hartlepool provides permission for the dismantling and

refurbishment of ships. This is being challenged by some residents of

Hartlepool on various grounds. An injunction to prevent the dismantling of

the ships was granted as interim relief in this case. This case is due to be

heard by the High Court in full on the 15th and 16th December.

42.The dispute between Able UK and Hartlepool Borough Council concerning

whether the 1997 planning permission for the bund has lapsed remains

unresolved.

43.It appears that the recovery of the vessels cannot currently be completed as

planned. The legislation provides in these circumstances that the waste

should be returned unless it can be recovered in an environmentally sound

manner. The US government has indicated its willingness to take back the

vessels if environmentally sound recovery cannot be arranged.

Wider Issues

44.There is a need for appropriately located and regulated facilities to be

developed in Europe for ship dismantling and recovery to take place in

conditions which protect workers' health and the environment. A growing

number of ships are due for dismantling worldwide as they reach the end of

their useful lives.

45.There are bans on certain tankers by the EU following major pollution

incidents such as the Sea Empress and Prestige over the last few years. Up

to 2000 single hull tankers flying the flags of EU Member States and

Accession States will need to have been phased out by 2015 at the latest. At

present some 80 to 90 per cent of the world's ship dismantling takes place

in developing countries without adequate safeguards for workers or the

environment.


 
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Prepared 15 December 2003