Contents

Executive
summary                                                            I

1                      Introduction                                                                       1

1.1                   Purpose of the Report                                                    1

2                      Environmental Status                                                    2

2.1                   Project Area                                                                         2

2.2                   Environmental Sensitive Receivers                          2

2.3                   Major Construction Activities                                  2

2.4                   Monitoring Schedule of The
Reporting Month 2

2.5                   Status of Environmental Approval
Documents      2

2.6                   Community Liaison Group Meeting                          3

2.7                   Summary of non-compliance with the
environmental quality performance limits                                                          4

3                      Environmental Issues and Actions                          5

3.1                   Previous Environmental Deficiencies
and Follow-up Actions   5

3.2                   Implementation Status on
Environmental Protection Requirements     7

3.3                   Environmental Monitoring                                        7

4                      Future Key Issues                                                                 9

4.1                   Key Issues for the Next One Month                           9

4.2                   Impact Prediction for the Next One
Month       9

4.3                   Works and Monitoring Schedule for
the Next One Month 9

LIST OF TABLES

Table 2.1    Summary of
Works Undertaken During the Reporting Period

Table 2.2    Summary of Environmental Licensing, Notification and
Permit Status

LIST OF ANNEXES

Annex
A    Water Quality
Monitoring Stations, Water Quality and Ecological Sensitive Receivers

Annex
B     Project Location

Annex
C    Implementation
Programme of Mitigation Measures

Annex
D    Cumulative Complaints
Statistics

EXECUTIVE SUMMARY

The construction works for the Permanent
Aviation Fuel Facility resumed on 9th July 2007.  This tenth monthly Environmental
Monitoring and Audit (EM&A) report presents the EM&A works carried out
during the period from 1st to 31st August 2007 in
accordance with the EM&A Manual.

Breaches
of all Action and Limit Levels

No breaches of action or limit levels
occurred during the reporting month as no monitoring was undertaken.

Complaint
Log

No environmental complaint was received
during the reporting period.

Notifications of any Summons and Successful
Prosecutions

No environmental
summon or prosecutions was received in this reporting period.

Reporting Changes

There were no
reporting changes in the reporting period.

Future
Key Issues

·
Arrangements for baseline water
quality monitoring for the commencement of dredging works;

·
Noise from operating machinery
and equipment;

·
Capability of temporary
drainage system to properly collect, treat and dispose of site runoff;

·
Dust release and suppression.

1
Introduction

Leighton Contractors (Asia) Limited (LCAL) has appointed ERM-Hong
Kong, Limited (ERM) as the Environmental Team (ET) to implement the
Environmental Monitoring and Audit (EM&A) programme for the Permanent
Aviation Fuel Facility (the Project) during construction works.

The construction works for PAFF was
commenced in November 2005 based upon the previous EIA (EIAO Register Number
AEIAR-062-2002) conducted and the Environmental Permit EP-139/2002 granted on
the 28th August 2002.
Due to minor changes to the detailed layout of the site and the site
boundary, application for Variation to the Environmental Permit (VEP)
(VEP-133/2004) was submitted to the Director of Environmental Protection (DEP)
for approval.  The variation to the
EP (EP-139/2002/A) was granted by EPD in February 2004.

However, the decision by EPD to grant the
above Environmental Permit was subject to a Judicial Review.  The Judicial Review sided in the favour
of the DEP, as did the subsequent Judgement from the Court of Appeal from the
High Court for Judicial Review in March 2005.  However, the DEP’s decision to
grant the EP was quashed by the Judgement of the Court of Final Appeal of July
2006.

The construction works were stopped
following the Judgement of the Court of Final Appeal of July 2006.  As such, in order to continue with the
construction of the project, the project went through the statutory procedures
under the EIAO again with a new design in order to obtain an environmental
permit.  The revised EIA was
submitted in 2007 and the environmental permit (EP-262/2007) was granted in May
2007.

The construction works and EM&A
requirements were resumed on 9th July 2007 following the latest
requirements of the EP-262/2007 and EM&A Manual.  Details regarding the EM&A
requirements and changes should refer to the updated EM&A Manual.  For the marine works, all piling
activities were completed before the previous suspension of construction works
in 2006.

1.1
Purpose
of the Report

This is the 10th EM&A Report
which summarizes the monitoring results and audit findings for the EM&A
programme during the reporting period from 1st
August to 31st August 2007.

2
Environmental Status

2.1
Project
Area

The project area is in Area 38 of Tuen Mun
and the pipelines are located in Urmston
Road between Tuen Mun Area 38 and Sha Chau.  The site is illustrated in Annex B.

2.2
Environmental
Sensitive Receivers

No air and noise sensitive receivers were
identified close to the project area.
However, water sensitive receivers and ecological sensitive receivers
were identified in the EIA study, and are shown in Annex A.

2.3
Major
Construction Activities

A summary of the major works undertaken in
this reporting period is shown in Table 2.1.

Table 2.1         Summary
of Works Undertaken During the Reporting Period

Area

Works undertaken

Tuen Mun Area 38

Tank Farm and Bund Wall Construction

Permanent Drainage Construction

Operational & Fire Services Buildings Construction

Minor Jetty Works (Non-piling)

Site Investigation

2.4
Monitoring
Schedule of The Reporting Month

No
monitoring was conducted during the reporting period.  Water monitoring is expected to commence
towards October 2007.

2.5
Status of Environmental Approval
Documents

A summary of the relevant permits,
licences, and/or notifications on environmental protection for this Project
since July 2007 is presented in Table 2.2.

Table 2.2         Summary
of Environmental Licensing, Notification and Permit Status

Permit/ Licenses/ Notification

Reference

Validity Period

Remarks

Environmental
Permit

EP-262/2007

Throughout
Project

Issued on 31 May
2007 (EP-139/2002 originally granted on 28 August 2002 and EP-139/2002/A
granted on 24 February 2004 were superseded)

Chemical Waste
Producer Registration

WPN 5111-421-L2174-25

Throughout
Project

Issued on 10
November 2005

Notification of
Construction Works under Air Pollution Control (Construction Dust) Regulation

H2104/U1D/5542/DG/DH/PL

Throughout
Project

Notification on
6 July 2007

Construction
Noise Permit

GW-RW0372-07

25 July 2007 to

24 January 2008

For air
compressors, breakers, excavators, wheeled loaders, mobile cranes, concrete
lorry mixers, hand-held pokers, bar benders/cutters, wood saws, grinders,
submarine water pump, lorries with crane, dump trucks, rollers, ventilation
fans and generators

GW-RW0427-07

28 August 2007
to 27 February 2008

For concrete
pump derrick barges, hand-held grinders, generators, air compressors, boring machines,
water pumps, tug boat, grout mixers and grout pumps

Wastewater
Discharge License

EP760/421/011399/l

15 March 2006 to 31 March 2011

Issued on 15
March 2006

2.6
Community
Liaison Group Meeting

According
to the EP requirements, a Community Liaison Group (CLG) shall be established
within three months after commencement of construction of the Project.  The major duty of CLG is to advise on
and monitor the proper design, construction and operation of the Project.  The CLG comprises representatives from
Airport Authority, members of Tuen Mun community and academics.  The first CLG meeting cum site visit was
held on 27 July 2007.

The
details of PAFF CLG (including Membership and its Terms of Reference) and the
meeting minutes can be found on the Project website (www.paffhk.com).

2.7
Summary of non-compliance with the
environmental quality performance limits

Summary of Environmental
Non-compliance

No environmental non-compliance was found
during the reporting period.

Summary of Environmental
Complaints

No environmental
complaint was received during the reporting period.  A statistical summary of environmental
complaints since project commencement is presented in Annex D.

Summary of Environmental
Summons

No summons was received in this reporting
period.  A statistical summary of
legal proceeding since project commencement is presented in Annex D.

3
Environmental Issues and Actions

3.1
Previous Environmental Deficiencies
and Follow-up Actions

As no environmental complaint was received
over the last reporting period, no follow-up action was required.

Weekly site inspections were carried out by
the ET on 2nd, 8th, 15th, 22nd and
29th August 2007.  The
inspection on 2nd August 2007 was also carried out by the
Independent Environmental Checker (IEC).
Overall, the site was in good orderly manner and no non-compliance was
found.  Environmental deficiencies
and follow-up actions/mitigation measures were identified during the
inspections, as follows:

Air Quality

·
During the site audit on 29th
August 2007, the construction material at the stockpile area was observed to be
loaded without spraying with water.
The Contractor is recommended to implement good site practice to spray
the loading materials prior and / or during loading to minimise dust
generation.  Corrective
action was taken by the Contractor in the reporting period.

·
Excessive exhaust fumes were emitted from the
drilling rig near the site entrance during the site audit on 29th
August 2007.  The Contractor was
recommended to replace the machine ASAP.
Corrective action was taken by the Contractor in the reporting period.

·
Water tankers were used
regularly to wet the road surface to minimize dust emission.

·
Earth mounds and large
stockpiles were hydro-seeded or covered to avoid dust emission.

·
Site entrance was paved and
wheel-washing facility was provided to avoid dust deposit on the public road.

·
Main access road within the
site (between site office and exit) was paved to avoid dust emission.  Other sections of the major access road
in the construction area were paved with stones.

Noise

·
No noisy activities were
conducted during the audit.

·
All air compressors on site
were operated with a valid noise label.

Water Quality

·
Sediment plume was observed
at the outfall of the temporary drainage system during the site audit on 22nd
August 2007 after a rainstorm.  The
Contractor was recommended to upgrade the design for the temporary drainage
system in order to ensure the quality of discharged water complies with the
standards stipulated under the Water Discharge Licence. Corrective
action was taken by the Contractor in the reporting period.

·
Ponding of rainwater was observed at areas around
tank 1 and tank 3 during the site audit on 15th August 2007 and
outside the site office on 22nd August 2007.  The Contractor was recommended to
provide sufficient pumps to remove the water via the temporary drainage system
particularly after rainstorm.
Corrective action was taken by the Contractor in the reporting period.

·
Site toilets were provided
on site.  A soil soakaway system
with holding tanks was installed to treat the sewage from the toilets.  No effluent discharge out of the site
was made.

·
The site canteen is no
longer in operation and hence no waste water is generated.

Waste Management

·
Construction waste was observed to be disposed of
in the general waste skip outside the site office during the audit on 29th
August 2007. The Contractor was recommended to dispose of the construction in a
proper manner. Corrective action was taken by the Contractor in the reporting
period.

·
Disposal of stockpiled construction waste to public
fill bank resumed.  Trip tickets
were properly kept by the Contractor.

·
Chemical waste was properly labeled and stored in
the two dedicated chemical waste stores on site.

Landscape and Visual

·
The transplanted trees at the new site were in good
and healthy conditions; and,

·
The berm was dominated by vegetation.

Overall, the site was in a good orderly
manner.  Suitable mitigation
measures, such as the use of water truck regularly and tarpaulin covers should
be used to ensure dust emission is avoided on site.

The ET will keep track on the EM&A
programme to ensure compliance of environmental requirements and the proper
implementation of all necessary mitigation measures.

3.2
Implementation Status on
Environmental Protection Requirements

The implementation status of environmental
mitigation measures and requirements as stated in the EIA Report, Environmental
Permits and EM&A Manual during the reporting period is summarized in Annex C.

3.3
Environmental Monitoring

3.3.1
Air and Noise

Air and Noise monitoring was not required
for the project.

3.3.2
Water Quality

Water quality monitoring at the monitoring
stations was not required as no dredging activity was taken place.

According to the Wastewater Discharge
License (Industrial Trade Effluent) issued by the EPD on 15th March
2006, the Contractor is required to conduct grab sampling/analysis on SS at the
discharge point(s) quarterly.  The
Contractor was aware of the sampling and will comply with the requirement.

3.3.3
Waste Management

The Contractor’s revised Waste
Management Plan (Revision 4) (WMP) was submitted to the ET for review on 18th
July 2007.  The review was completed
on 31st August 2007.  The
WMP is expected to be submitted to EPD within the next reporting month.

3.3.4
Cultural Heritage

As no dredging activity was conducted along
the pipe trench during the reporting period, marine archaeological monitoring
was not required.

3.3.5
Landscape and Visual

According to the EIA report and EM&A
Manual, mitigation measures and site inspection are required during the
landscaping/planting works.  The
berm/landscaping bund was dominated by vegetation which was grown during the
project suspension period.  The
transplanted trees were in good and healthy conditions.

The weekly site inspections included audits
on landscape and visual issues to ensure that the site was in orderly
acceptable manner.

3.3.6
Land Contamination, Hazard to
Life and Fuel Spill Risk

According to the EIA report and EM&A
Manual, mitigation measures and design phase audit are required to minimise the
risk of fuel spill and hazards. The Contractor will submit the updated design
audit plan according to the EP requirements.

Pursuant to Condition 3.5 of the EP, the
Contractor submitted two design drawings entitled Fencing and Security Wall
Layout Plan (PAFF/LC/02/DWG/C/0176 Revision A) and Fencing and Security Wall
Section (PAFF/LC/02/DWG/C/0177 Revision A) to the ET for certification on 30th
July 2007.  The ET reviewed the
drawings and offered comment on the design of the security walls and bund
walls, taking into account of Condition 3.5a of the EP, to the Contractor on 31st
August 2007.  Response to comment
from the Contractor is still awaited during the reporting month.

Weekly site inspection covered the waste
management aspects which included measures to prevent land contamination by
chemical wastes.

3.3.7
Ecology

Dolphin Visual
Monitoring

No dolphin monitoring was conducted as
there were no dredging activities during the reporting period.

3.3.8
EM&A Manual

The EM&A Manual for the Project is
being updated by the ET to include the detailed arrangements of setting up a
Community Liaison Group, carrying out design audit and monitoring of Persistent
Organic Pollutants during construction of the Project.  The EM&A Manual is expected to be
submitted to EPD by mid-September 2007.

4
Future Key Issues

4.1
Key
Issues for the Next One Month

Key issues to be considered in the next one
month will include:

·
Arrangements for baseline water
quality monitoring for the commencement of dredging works;

·
Noise from operating machinery
and equipment;

·
Capability of temporary
drainage system to properly collect, treat and dispose of site runoff;

·
Dust release and suppression.

4.2
Impact
Prediction for the Next One Month

Provided that environmental mitigation
measures including good on-site practises are properly implemented, it is not
expected that unacceptable adverse impact will arise.

4.3
Works
and Monitoring Schedule for the Next One Month

Work programme for the next one month
includes jetty platform works (non-piling) and site works (construction works
for tank farm, operational and fire services buildings, drainages, bund wall,
security wall, site investigation etc).
Weekly site inspections will be undertaken.