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2005 ANNUAL REPORT Pipeline Licence 12 Beverley Pipeline Document Number S-25-209BEV-AR-G-003 February 2006

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2005 ANNUAL REPORT

Pipeline Licence 12

Beverley Pipeline

Document Number S-25-209BEV-AR-G-003

February 2006

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Table of Contents 1 PURPOSE .............................................................................................................. 4 2 SCOPE ................................................................................................................... 4 3 TECHNICAL ASPECTS.......................................................................................... 4 4 SUMMARY OF OPERATIONAL ACTIVITIES FOR 2005 ....................................... 5

4.1 Risk Management Review................................................................................ 5 4.2 Training ............................................................................................................ 5 4.3 Operations and Maintenance Activities ............................................................ 5

5 INCIDENT REPORTING ........................................................................................ 8 6 LAND MANAGEMENT ........................................................................................... 8

6.1 Land Owner Liaisons ....................................................................................... 8 6.2 Pipeline Safety Awareness............................................................................... 8 6.3 Pipeline Location and Referral services ........................................................... 9

7 ENVIRONMENTAL MANAGEMENT ...................................................................... 9 8 EMERGENCY RESPONSE.................................................................................... 9 9 REGULATORY COMPLIANCE ............................................................................ 10 10 RISK MANAGEMENT ....................................................................................... 10 11 MANAGEMENT SYSTEM AUDITS................................................................... 11

11.1 Environmental ............................................................................................. 11 11.2 Health and Safety ....................................................................................... 11 11.3 Management Audit...................................................................................... 11

12 REPORTS ISSUED DURING 2005................................................................... 12 13 VOLUME OF PRODUCT TRANSPORTED....................................................... 12 14 PROPOSED OPERATIONAL ACTIVITIES FOR 2006...................................... 12 15 STATEMENT OF EXPENDITURE .................................................................... 12 16 KEY PERFORMANCE INDICATORS ............................................................... 12 17 CONCLUSION .................................................................................................. 13

APPENDIX A - ASSESSMENT OF DECLARED OBJECTIVES.............................. 14 APPENDIX B - PIPELINE CATHODIC PROTECTION DATA ................................. 23

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LIST OF ABBREVIATIONS ALARP As Low As Reasonably Practical AS2885 Australian Standard 2885 – Pipelines-Gas and Liquid Petroleum CFS Country Fire Service CMMS Computerized Maintenance Management System (Maximo) CP Cathodic Protection CPU Cathodic Protection Unit Cu/CuSO4 Copper/Copper Sulphate EMS Environmental Management System HAZOP Hazard Operability MAP Moomba to Adelaide Pipeline MFS Metropolitan Fire Service MLV Mainline Valve PIRSA Primary Industries and Resources of South Australia PL12 Pipeline Licence No. 12 PLC Programmable logic control unit RTU Remote Terminal Unit SCADA Supervisory Control and Data Acquisition SEO Statement of Environmental Objectives SES State Emergency Service SMS Safety Management System SRB Sulphate Reducing Bacteria SWER Single Wire Earth Return UHF Ultra High Frequency VHF Very High Frequency

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1 PURPOSE This report is submitted in accordance with the requirements of Pipeline Licence 12 and the South Australian Petroleum regulations 2000.

2 SCOPE The Beverley Pipeline is owned by Heathgate Resources and is operated and maintained under agreement by Epic Energy. This report reviews operations and maintenance activities carried out in 2005 and proposed operations for 2006. In accordance with the Petroleum Regulations, a performance assessment is also provided with regard to the Statement of Environmental Objectives, for the Beverley Pipeline.

3 TECHNICAL ASPECTS Table 1 provides technical information on the Beverley Pipeline. The pipeline was constructed in accordance with AS 2885.

Table 1 Beverley Lateral Technical Information Date Constructed 2000 Date Commissioned 11 July 2000 Length 14.4km External Diameter 88.9mm Wall Thickness - Normal - Special Crossings (creek beds, roads)

4 mm

5.5 mm Pipe Grade API 5LX-56

API 5LX-42 at Creek Crossing MAOP 10,200kPa Normal Operating Pressure 3,750kPa Fluid Natural Gas Material Electric Resistance Welded Steel Coating Yellow Jacket Main Line Valves None installed Scraper Stations None installed - Provision made for

future facilities if required Meter Stations One – Inlet

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4 SUMMARY OF OPERATIONAL ACTIVITIES FOR 2005

4.1 Risk Management Review An informal AS 2885 5 yearly risk assessment was completed in 2005. This informal assessment did not identify any significant changes or additional threats to the pipeline over and above those identified during the previous risk assessment. A formal AS 2885 risk assessment will be completed in 2006 as part of the 5 yearly Risk Assessment review on the MAPS.

4.2 Training Epic Energy continued to develop the skills of the employees to meet the operational needs of its business. During 2005 staff training was conducted both in-house and externally and covered a range of items including: • Senior First Aid training (conducted by St John Ambulance Australia) • Defensive driving (Collision avoidance and 4WD training) • Pipeline excavation training • Permit to Work training • Emergency Response Site controller training • AS2885 Awareness training • CP monitoring training (conducted by the Australian Corrosion Association) • CP advanced training (conducted by the Australian Corrosion Association) • Manual Handling training • Atmospheric Testing training • Confined Space entry • Work Zone traffic management • First Five minutes Fire training • Pipeline locator use • Pipeline Surveillance and easement activities training • Introduction to Pigging training • Security Awareness training The above list is a representation of the training conducted and Epic Energy also utilizes a number of self paced training modules for its employees.

4.3 Operations and Maintenance Activities All routine and corrective maintenance activities are specified in Epic Energy’s CMMS and scheduled by this system which generates work orders for maintenance staff to complete. Some of the key items in the maintenance schedule include:

• Monthly pipeline patrols • Quarterly Meter Station testing • Six Monthly Pressure Reduction station maintenance • Six Monthly Cathodic protection system surveys • Annual Emergency response equipment inspections

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A description of the Operations and Maintenance activities for 2005 is provided below.

4.3.1 Pipeline Patrol Activities Monthly road patrols were completed in accordance with AS 2885.3 requirements ensuring the following: • Signage is in a serviceable condition and if not repairs are effected as soon as

is practically possible and scheduled to be addressed in the near future. Any issues not addressed during the patrol are entered into the CMMS and scheduled to be addressed in the near future

• There are no unauthorized activities occurring along the pipeline route or at any of the facilities

• Soil erosion due to wind and water is addressed and restored in accordance with the SEO.

• There are no leaks occurring at any of the pipeline facilities or along the pipeline route.

• All sites are secure and kept in a good, clean and tidy state. • Maintenance activities including touching up above ground pipe coating

condition, restoring fences, gates, padlocks, signage and fire extinguishers, weeding and other housekeeping activities are addressed at the meter station and pressure reduction facility associated with the lateral.

During 2005 no material issues occurred during the patrolling or other routine maintenance activities on the Beverley lateral.

4.3.2 Leakage Detection Epic Energy monitors the Beverley pipeline for leakage during the routine ground patrols or any other site visit to the pipeline system facilities. This is done by observing local vegetation in the area as well as by Control Room staff monitoring system pressures and operating alarms, which would indicate a leak in the system. Furthermore, leak detection issues that may be observed on site or reported by Heathgate Resources personnel and their contractors are addressed. If a significant leak occurred on the Beverley pipeline system a leak detection model used by the Epic Energy Control Room would detect the loss allowing isolation of the lateral in a timely manner. During 2005 there were no instances of any leaking valves or equipment on the Beverley pipeline.

4.3.3 Coatings No DCVG coating condition surveys were conducted during 2005 with the next scheduled survey in 2007 as per the maintenance plan. There is no evidence to suggest significant coating deterioration given the pipeline age (5 years old).

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4.3.4 Cathodic Protection The effectiveness of the CP system is monitored by carrying out two full line potential surveys annually; one at the end of summer and the other at the end of winter. The Beverley pipeline routine full-line CP surveys were completed during 2005 with results from these surveys presented in Appendix B. The Beverley lateral CP is connected to the MAPS CP system and although there are no transformer rectifiers directly connected to the lateral, two monthly inspections of the transformer rectifiers supplying the MAP system in the vicinity of the lateral pipeline were carried out in accordance with Australian standards to ensure maximum protection of the Heathgate Lateral. As the data shows in Appendix B, the CP protecting the Beverley pipeline is between the recommended level ranges of – 850 mV to – 1200 mV.

4.3.5 Electrical & Instrumentation maintenance activities Quarterly custody transfer meter Accuracy Verification Tests were completed in accordance with Epic Energy’s maintenance plan. Routine six monthly electrical and instrumentation inspections were carried out at the Epic Energy meter station supplying the Beverley pipeline. These tests included: • Hazardous area electrical equipment inspections to ensure the installed

equipment remains fit for purpose and meet the relevant Australian standard • Pressure gauge calibrations • Pressure and Temperature instrument calibrations • Earth system checks as per Australian standards • Battery maintenance • Electrical fitness for purpose inspection of the site equipment No significant electrical or instrumentation equipment issues were identified or required rectification during 2005.

4.3.6 Mechanical Maintenance activities Routine annual inspection and overhaul of the Tartarinni pressure regulators at the Beverley pipeline pressure reduction facility were completed in 2005. Six monthly mechanical maintenance inspections at the Epic Energy meter station supplying the Beverley lateral was undertaken including: • Pressure regulators, relief valves & slam shut valve operation • Filter inspections • Above ground pipe and ground entry points coating condition inspection

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Corrective maintenance repairs were required at the Beverley pressure reduction station to address reported “high outlet” pressure readings recorded at the plant. During 2005 Epic Energy replaced the meter station “Active Monitor” single bodied pressure reduction regulator with two “Fisher Type 627H” regulators configured in an “Active Monitor” arrangement. This modification was carried out in accordance with Epic Energy’s engineering change control processes and did not alter the redundancy or original design intent of the site. With the exception of the “Active Monitor” regulator change-out no other significant mechanical issues were carried out during 2005.

4.3.7 Communications During 2005 a number of minor communications system faults were addressed by the maintenance staff with no significant interruptions to the SCADA system data acquisition from the site.

5 INCIDENT REPORTING There were no significant incidents to report on the Beverley pipeline during 2005.

6 LAND MANAGEMENT

6.1 Land Owner Liaisons There is one landowner on the Beverley pipeline system. This landowner was contacted by an Epic Energy representative and briefed on the requirements when working in the vicinity of the pipeline system. In addition to this as part of Epic Energy’s awareness program the landowner was issued with an Epic Energy calendar reminding the landowner of pipeline safety. A new revised pipeline safety brochure was also developed and provided to the landowner.

6.2 Pipeline Safety Awareness The Beverley pipeline is located in a remote part of South Australia with no communities in the immediate vicinity. It is approximately 530 km north of Adelaide. While there are no direct communities in the area around the Beverly pipeline, the nearest Emergency Services personnel are located in Peterborough or Hawker. As part of Epic’s awareness program for the MAPS and Liquids pipeline these areas were previously briefed and have been scheduled to occur in 2006 again. These presentations covered general pipeline safety and what “not to do” without consulting

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Epic Energy first. The presentation specifically covers the safety issues relating to the transportation of high pressure natural gas as well as product details and any safety considerations that the emergency services groups may need to know should they be called upon to assist in an emergency situation.

6.3 Pipeline Location and Referral services Epic Energy provides a free service to locate any pipeline that they own or operate on behalf of third parties. This service is primarily used by other companies and third parties carrying out civil works in the vicinity of the pipelines. Given the location of the Heathgate Resources Beverley Lateral pipeline in the far north of South Australia, no pipeline locations were requested using the free call 1100 “Dial before you Dig One Call” system in 2005. There were no third party encroachments on the pipeline easement in 2005. 7 ENVIRONMENTAL MANAGEMENT During 2005 Epic Energy complied with all its environmental requirements as detailed in the Statement of Environmental Objectives. One item, “Total cover of perennials and dominant perennial reach 80% of cover compared to relevant control sites” was deemed to have been partially achieved as significant improvement occurred in 2005 but this is still considered an ongoing objective. Appendix A contains the “Assessment of Declared Objectives” completed for the Beverley Lateral.

8 EMERGENCY RESPONSE Pipeline Licence 12 states that an Emergency Exercise is to be conducted on the Beverley pipeline once every two years and in addition to this exercise a set of Emergency Response procedures is to be developed and maintained. These procedures are detailed in Epic Energy’s “Emergency Response Manual”. During 2005 Epic Energy conducted three Emergency response exercises business wide. One directly involved the Beverley lateral and was designed to: • Test staff emergency response preparedness • To provide realistic training to external parties who may be called upon to assist

Epic Energy personnel in the event of a real emergency, including permanent contractors and all emergency service organizations

• Ensure a continuous improvement process to refine emergency response preparedness • Gain a broader understanding of response requirements, roles and

responsibilities within the Epic Energy team when dealing with a variety of emergency situation scenarios.

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Given the objectives of the emergency exercises conducted Epic Energy considers these exercises relevant and that the learning experiences gained can be applied to all of the pipelines owned by Epic or operated and maintained on the behalf of others. The scenario used for this exercise involved an out of control heavy vehicle which crashed through the Epic Energy meter station barriers and came to rest against the inlet pipework with a resultant significant gas leak. There were no field mobilizations with the entire exercise confined to the Epic Energy maintenance depot emergency Control Room located at Dry Creek South Australia. No material issues were identified. The exercise was conducted on the 5 August 2005 and a copy of the report has been submitted to PIRSA.

9 REGULATORY COMPLIANCE Every endeavor is made to ensure that design, manufacture, construction, operation, maintenance and testing of all appropriate facilities, is carried out in accordance with AS2885. There are no known non compliances for the Beverley pipeline that Epic Energy is aware of against: • The Petroleum Act & Regulations 2000 • The Pipeline Licence (PL12) • The Statement of Environmental Objectives Any non-compliance identified is logged in the CMMS where it is tracked to conclusion. Significant items are reported through Heathgate Resources and PIRSA and any other issues are raised at the Quarterly meetings between PIRSA and Epic Energy.

10 RISK MANAGEMENT Epic Energy continually reviews operational risks with assessments including inputs from experienced gas industry personnel and emergency services representatives providing an insight into potential new risks and assisting in the development of appropriate management strategies. Epic Energy utilizes the following risk management strategies to minimise risks to ALARP. • Aerial & ground monitoring of the pipeline easement activities • Permit to Work system • Routine maintenance activities to ensure all of the pipeline facilities are

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maintained in accordance with best industry practices and the relevant codes and standards that apply

• Pipeline & Safety awareness program • Land ownership and use notification system • Landholder and stakeholder contact program • Participation in state forums for external risk management • Free “1100” Dial before You Dig information system

11 MANAGEMENT SYSTEM AUDITS

11.1 Environmental Badman Environmental carried out an annual rehabilitation Survey of the Beverley pipeline in September 2005. The report identified that: “No alien species were recorded in the pipeline corridor that does not already occur in the surrounding countryside. No alien species recorded in the rehabilitation corridor has significantly different distribution to its occurrence at control sites”. “Dry conditions since 2001 had prevented the successful establishment of perennial plant species along most of the pipeline corridor, but the situation improved slightly following useful falls of rain in the second half of 2004 and the first half of 2005. Biennial and annual species responded well to these rainfall events and there has been an increase in cover of long-lived perennial species.” There were no major deficiencies found requiring further action. An audit against the “Assessment of Declared Objectives” in the SEO was also completed as provided in Appendix A.

11.2 Health and Safety During 2005 Epic Energy conducted health and safety audits of its pipeline facilities. There were no issues identified relating specifically to the Beverley pipeline system requiring follow up action. Given the location and the lack of complexity of the pipeline system this was not unexpected.

11.3 Management Audit A compliance audit into the Land Management Consultation system was conducted in 2005. The audit focused on ensuring that all relevant stakeholders and landowners were contacted and aware about pipeline safety and the requirements when working on or near the pipeline easement. No major issues were found with the Beverley lateral requiring further action.

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12 REPORTS ISSUED DURING 2005 The following reports were generated and forwarded to Heathgate Resources (and PIRSA) for the Beverley Lateral in 2005: • PL12 2004 Annual Report. • Beverley Lateral 5 Yearly Fitness for Purpose Report. • Emergency Exercise “Operation Heathgate” Report

13 VOLUME OF PRODUCT TRANSPORTED Refer to the Addendum to the PL 12 Annual Report 2005.

14 PROPOSED OPERATIONAL ACTIVITIES FOR 2006 During 2006 the following activities are proposed for the Beverley pipeline: • Complete all scheduled routine maintenance activities and corrective maintenance

identified • Complete a formal “AS 2885 5 Yearly” Risk Assessment • Submission of a 2006 Annual Report in early 2007

15 STATEMENT OF EXPENDITURE Commercially Sensitive

16 KEY PERFORMANCE INDICATORS The following key performance indicators have previously been established to monitor performance of operations and maintenance activities on the Beverley Lateral Pipeline. 2005

Target2005

Actual 2005 Comment

Cathodic Protection Percentage of the pipeline protected to the AS2885-1997 level

100% 100% This represents a satisfactory level of protection over the entire length of the pipeline.

Third Party Incident Number of times pipeline is damaged

0 0 No damaged occurred to the pipeline during the reporting period

Number of near misses (digging within 1m of pipeline)

0 0 No activities of this nature that involved Epic Energy the owner or a third party were identified during the reporting period

Exposure of pipeline due to 0 0 During the reporting period, there were

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washout and wind erosion no instances of the pipeline cover being eroded due to wind or water

SCADA and Leak Detection Reliability of SCADA and Leak Detection System

100% 99.9% A number of minor communication system failures occurred throughout the year, which resulted in loss of SCADA information. In all cases these outages were dealt with in a timely manner by the maintenance staff.

Environmental Number of uncontrolled hydrocarbon releases

0 0 No uncontrolled Hydrocarbon releases were recorded during the reporting period

Earth Tremor Surveillance Vehiclar surveillance immediately after an earth tremor or flood

100% 100% No floods or earth tremors were reported during 2005

17 CONCLUSION The maintenance and inspection programs carried out on the Beverley Pipeline in 2005 indicated the pipeline is in sound condition and is capable of operating at set parameters with no restrictions. The CP Survey results supplied in Appendix B indicate the protection level meets the targeted performance levels for this system. The pipeline is considered to be in good working condition and well maintained.

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APPENDIX A - ASSESSMENT OF DECLARED OBJECTIVES

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ASSESSMENT OF DECLARED OBJECTIVES Beverley Pipeline Objectives and Assessment Criteria1

OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

1. Minimise vegetation and habitat clearance outside of the approved pipeline trench

1.1 The pipeline will be installed parallel to the mine access road for its entire length (except for the last 100m). Therefore the road will be used for construction access and a pipeline easement of 4m only will be cleared for pipeline construction (refer Heathgate letter 3/2/2000 an additional 1m will form part of the road verge). Vegetation and habitat clearance is minimized by adhering to these easements for construction. Note that audit program will assess unauthorized off ROW activity (DEF Section 10)

ROW does not exceed 4m on the road section.

Achieved During 2005 no activities were undertaken by Epic Energy that would cause any habit or vegetation clearing on the Beverley pipeline lateral

1.2 No-unauthorised off-ROW activity No evidence of unauthorised off-ROW activity.

Achieved During 2005 no activities were undertaken by Epic Energy off of the ROW that would cause any habit or vegetation clearing on the Beverley pipeline lateral. Badman Environmental Consultants confirm that this objective has been met.

2. Minimise the period and extent of vegetation and habitat loss around the pipeline trench

2.0 The extent of vegetation and habitat loss is assessed by the criteria for Objective 1.

ROW does not exceed 4m on the road section.

Achieved No Trenching or excavation activities were undertaken by Epic Energy on the pipeline or easement during 2005.

3. Rare and endangered species managed in accordance with stated protocols

3.0 Refer Heathgate 2000b. “The mine access road and pipeline route were assessed for cultural significance by Native Title Claimants, and a consultant ecologist was present during the survey of the route. During this assessment and others throughout the EIS process, no rare or endangered species were

No GAS criteria for this objective. Evidence that stated protocol (Heathgate 2000b) has been followed where

Achieved During 2005 no activities were undertaken by Epic Energy that would impact on any of the rare or endangered species that

1 Assessment criteria have been developed to be “black and white”. Professional judgement is required to assess whether non-compliance is minor or major. It is necessary to

ensure that adequate information is available to enable this judgement to be made.

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OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

recorded along the ROW. However, the strategy for the observation for rare and endangered species is as follows: · If adjacent to the ROW-the area will be flagged off and contractors notified its possible significance; · If on the ROW-the area will be assessed and either the pipeline route deviated around the area of significance, the construction activities work delicately around the significant area, or the rare and endangered species moved to an adjacent location (assuming plant species), and or the seeds collected and propagated. The most likely rare and endangered species to be observed will be of Forrest's Mouse and it is expected that this would move away from any disturbances. The strategy used will be dependant upon the size and type of rare and endangered species encountered. If it is possible to work around it, then this will be the first option. It should be noted that the ROW for the pipeline already exists. Increasing this by a mere 2 to 4 metres is not expected to disturb or encounter additional rare and endangered species. If rare and endangered species exist along the pipeline, they will exist within the surrounding country side also. The ROW is not in itself an extensive disturbance.

applicable.

habitat the pipeline easement.

4. Prevent the establishment of additional alien species

4.1 Based on historical experience, the introduction of weeds is unlikely, (DEF, Section 9, EIS Sec 6.13.4). Workers are not permitted to bring plants into the region and drivers are required to remove excess soil and plant debris from their vehicles prior to entering the area. Refer to monitoring program in DEF Section 10. No alien species on ROW (after “one month audit”)

Evidence that procedures in place to prevent workers bringing plants on site, and have been implemented, (to be addressed in post-construction environmental audit). Evidence that procedures are in place requiring drivers to clean vehicles prior to entry on site, and have been implemented, (to be addressed in post-construction

Achieved The level of activity by Epic Energy on the pipeline easement is minimal and therefore the spread of alien species is considered to be negligible. The Badman report confirms this.

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OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

environmental audit). Monitoring program demonstrates no alien species introduced.

4.2 No alien species on ROW (annual audits)

Evidence that procedures in place to prevent workers bringing plants on site, and have been implemented, (to be addressed in post-construction environmental audit). Evidence that procedures are in place requiring drivers to clean vehicles prior to entry on site, and have been implemented, (to be addressed in post-construction environmental audit). Monitoring program demonstrates no alien species introduced.

Achieved The Badman Environmental report states “While there are alien species present they are the same species as those found on adjacent land in equivalent quantities and one of the monitored sites did return a negative GAS value however overall this goal is considered to be achieved.”

5. Design and construct the pipeline trench to avoid where possible, and to minimise where not, impacts on major creek habitats

5.1 It is noted that there will be minimal impact at the creek crossing as a result of pipeline construction, as the crossing has already been cleared for the road. Heathgate letter dated 3/2/2000 states that river sand will be removed at the Paralana Creek crossing down to a firm base to allow pipeline trench construction. Pipeline will be buried 2m below firm base.

No evidence of construction waste on ROW. No additional clearance of long-lived tree and tall shrub removal at creek crossing site (over and above clearance for the access road).

Achieved No trenching or excavation activities undertaken during the reporting period

6. Avoid the entrapment of vertebrates in the pipeline trench during construction

6.1 Construction and filling of trench will be progressive.

No GAS criteria for this objective. Evidence that ramps installed if trench is left open overnight.

Achieved No trenching or excavation activities undertaken during the reporting period

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OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

7. Ensure the protection of heritage sites in accordance with State and Commonwealth legislation.

7.1 Refer also to EIS S7, S9.9, S12. Note that there has been consultation with Aboriginal groups on the location of facilities (EIS S7.1.2)

No GAS criteria for this objective. Pipeline route selected to avoid camp locations etc identified in Aboriginal Heritage Surveys In the event of discovery of Aboriginal Sites during construction, requirements of Aboriginal Heritage Act 1988 Flagging where areas of significance are encountered.

Achieved No trenching or excavation activities nor any other activities undertaken during the reporting period that would have any impact on heritage sites

8. Minimise the generation of waste

8.1 General objective. No GAS criteria for this objective.

Achieved Given the limited activities and the nature of these activities Epic energy consider that no waste is generated in the day to day operation and maintenance of this pipeline system

9. Minimise the impact on the environment of waste handling and disposal methods

9.1 This includes criteria for disposal of hydrotest water. Hydrotest water will contain no additives (e.g. biocide), and will be disposed either via evaporation ponds or injected into the Northern Area Disposal Array, an approved disposal site (Heathgate 2000a)

No evidence of construction waste on ROW. All rubbish skips or bins will be covered to prevent animals getting in and rubbish blowing about. Rubbish will be removed periodically to the Beverley mine site Evidence that hydro test water is disposed of in Beverley Mine evaporation ponds or into Northern Area Disposal Array.

Achieved Given the limited activities and the nature of these activities Epic energy consider that no waste is generated in the day to day operation and maintenance of this pipeline system

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OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

10. Maximise opportunity for rehabilitation success of right-of-way

Section 10 of the DEF lists the following rehabilitation strategies: 10.1 Stockpiling & respreading of topsoil where appropriate for re-use on rehabilitation areas. 10.2 Stockpiling & respreading of vegetation where appropriate for re-use on rehabilitation areas (ie; where ROW passes through vegetated areas) 10.3 Supplementary seeding using locally collected seed or respreading of stockpiled vegetation. Supplementary seeding will only be used where first annual monitoring results record no new seedlings, (refer Heathgate 2000a). 10.4 Surface scarifying or ripping where appropriate or necessary. 10.5 Site cleanup to remove construction solid wastes (refer Objective 9).

Topsoil has been stockpiled and respread on ROW Where vegetation has been cleared, it has been stockpiled and respread on ROW Supplementary seeding has been employed in areas where first annual monitoring results record no new seedlings. All compacted soil areas have been ripped / scarified. No evidence of construction waste on ROW.

Achieved

The Badman report considers the GAS criterion for this objective to have been achieved.

11. Total cover of perennials and dominant perennial reach 80% of cover compared to relevant control sites

11.1 The monitoring program is carried out on an annual basis. Rehabilitation is considered complete when 80% of the total cover of perennials calculated from control sites is achieved. In addition rehabilitation must also have 80% of the cover provided by the dominant perennial species. However, no fixed time frame is attached to this. In order to assess revegetation after a given

Revegetation consists of annuals, biennials and perennials, but there are some bare patches which are inconsistent with the surroundings

Partially Achieved (Still Ongoing)

As stated in the Badman Environmental consultants report “due to the lack of rainfall in this area since 2001 making the re-establishment of vegetation along the pipeline route almost impossible. Good

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OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

time frame, GAS criteria is based on the Cooper Basin wellsite criteria after 5 years is proposed (PIRSA 1998).

rains in 2005 have assisted this problem and biennial and annual species responded well to these rainfall events and there has been an increase in cover of long-lived perennial species.” This objective will continue to be closely monitored.

12. Risk to the safety of the public and property during construction are acceptable and ALARP

12.1 The licensee must ensure that risks to the public during construction are minimised. Heathgate 2000a addresses fire risks and mitigation Measures.

No GAS Criteria for this objective. Controls and procedures in place to ensure that public are excluded from the construction area. Licensee demonstrates that the pipeline is designed and constructed in accordance with AS 2885-1997. Appropriate fire protection measures are developed and implemented during construction.

Achieved No construction activities or any other activities were undertaken during the reporting period that would cause risk to the public

13. Risk to the safety of the public and property operation are acceptable and ALARP

13.1 The risk to the public and property is addressed if the pipeline is designed and constructed in accordance with AS2885.1-1997. This includes completion of the AS2885 Risk Assessment process. On going safety is maximized by continued adherence to the requirements of AS2885.3-1997.

No GAS Criteria for this objective. Risk assessment report demonstrates that the pipeline risks are Negligible, Low or ALARP, in accordance with AS 2885 Section 2. Licensee demonstrates adherence to AS 2885.3-1997, via annual reports, emergency response reports and fitness for purpose reports, (refer to

Achieved Epic Energy maintain and operate the pipeline system in accordance with AS2885 and therefore this objective is considered to be met

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COMMENTS

Petroleum Regulations 1999).

14. Ongoing monitoring of rehabilitation carried out

14.1 Annual monitoring for ROW revegetation required until Revegetation goals achieved (refer to DEF Section 10)

No GAS Criteria for this objective. Results of revegetation monitoring provided in Annual Report.

Achieved Heathgate Resources have used the services of Badman Environmental to carry out an environmental rehabilitation monitoring program during September 2005. No significant issues were identified requiring action.

15. Environmental management and rehabilitation carried out in accordance with construction objectives for any operational dig-ups

15.1 At various times over the life of the pipeline, dig-ups may be required. These should be carried out in such a way that rehabilitation success is maximized.

Refer to appropriate construction criteria.

Achieved No excavation activities conducted during the reporting period.

16. Compliance with the requirements of Petroleum Bill 1999, Petroleum Regulations 1999

16.1 Reports to be submitted on time. Content of reports complies with requirements of legislation.

No GAS Criteria for this objective.

Achieved Epic Energy operates and maintain the Heathgate Resources Beverley lateral in accordance with AS2885 and the Petroleum Act 2000 and therefore consider this objective to be met.

17. Supply of Moomba to Adelaide is not affected by an emergency on the Beverley Pipeline

17.1 An emergency constitutes either a loss of containment from the pipeline, or a loss of supply.

No GAS Criteria for this objective.

Achieved Epic Energy’s Emergency Response management procedures and the Emergency Management team will ensure that any Emergency situation that may arise on the Heathgate Resources Beverley Lateral will have minimal impact on the Moomba to Adelaide pipeline system.

No Emergencies occurred during the reporting period

18. Environmental management and rehabilitation carried out in accordance with

18.1 In the event of an emergency, stockpiling of top soil and

Refer to construction criteria. Refer to Achieved There were no emergency

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OBJECTIVE GOAL(S) MEASURE/ NOW ACHIEVED/NOT ACHIEVED

COMMENTS

construction objectives for any emergency dig-ups

vegetation etc., are not a consideration. Appropriate rehabilitation action should be taken once the emergency has been dealt with. This may involve measures such as ripping compacted ground, seeding etc.

appropriate GAS criteria, (including 8.1, 9.3, 9.4).

situations on the Heathgate Resources Beverley Lateral during the reporting period and therefore there were no excavations.

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APPENDIX B - PIPELINE CATHODIC PROTECTION DATA

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Beverley Lateral Corrosion Protection On/Off Potentials 2005 Surveys Protection On/Off potentials taken in August and March 2005 indicated that the pipeline was polarized to potentials more negative than minus 850mV Cu/CU SO4 on its entire length. The pipeline shows improved CP characteristics since being coupled to the mainline gas pipeline impressed current system although both were within the required protection levels.

Table 1 – March & August 2005 Results

Beverley Lateral Full Line Surveys 100.0% of readings are above 850mV.

File No. 6351.27 Date:Mar 05 Tech: Vic Treicis

Signed:

KP ON OFF mA Note (where applicable). Beverley take off U/S 0.0 1770 960 Beverley take off D/S 0.0 1770 950 Test post 1 1.4 1730 900 Test post 2 2.8 1830 960 Test post 3 4.2 1820 1000 Test post 4 5.6 1800 980 Test post 5 7.0 1790 970 Test post 6 8.4 1760 940 Test post 7 9.8 1710 900 Test post 8 11.2 1750 930 Test post 9 12.6 1780 960 Heathgate Plant entry U/S 14.0 1800 980 Heathgate Plant entry D/S 14.0 0.080/0.064

Beverley Lateral Full Line Surveys 100.0% of readings are above 850mV.

File No. 6351.27 Date:Aug 05 Tech: Vic Treicis

Signed:

KP ON OFF mA Note (where applicable). Beverley take off U/S 0.0 1950 1070 Beverley take off D/S 0.0 1950 1070 Test post 1 1.4 1960 1060 Test post 2 2.8 1970 1070 Test post 3 4.2 1950 1080 Test post 4 5.6 1950 1080 Test post 5 7.0 1940 1070 Test post 6 8.4 1930 1070 Test post 7 9.8 1910 1050 Test post 8 11.2 1920 1060 Test post 9 12.6 1910 1050 Heathgate Plant entry U/S 14.0 1890 1030 Heathgate Plant entry D/S 14.0 .090/.068

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Beverley Lateral Full Line Surveys

500

600

700

800

900

1000

1100

1200

1300

1400

1500

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0

Kilometres

mV

Aug 05 Mar 05