Contents

Executive summary

1                      Introduction

1.1                   Purpose of the Report

1.2                   Key Contact
Information

2                      Environmental
Status

2.1                   Project Area

2.2                   Environmental
Sensitive Receivers

2.3                   Major Construction
Activities

2.4                   Monitoring Schedule of
The Reporting Period

2.5                   Status of
Environmental Approval Documents

2.6                   Community Liaison
Group Meeting

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

3                      Environmental
Issues and Actions

3.1                   Previous Environmental
Deficiencies and Follow-up Actions

3.2                   Implementation Status
on Environmental Protection Requirements

4                      Environmental
Monitoring

5                      Future
Key Issues and Conclusion

5.1                   Key Issues for the
Next Reporting Period

5.2                   Impact Prediction for
the Next Reporting Period

5.3                   Works and Monitoring
Schedule for the Next Reporting Period

5.4                   Conclusion

LIST OF TABLES

Table 1.1        Contact
Information

Table 2.1        Summary
of Works Undertaken During the Reporting Period

Table 2.2        Cumulative
Quantity of Excavated Materials up to 30th June 2008

Table 2.2        Summary
of Environmental Licensing, Notification and Permit Status

Table 3.1        Environmental
Deficiencies (Observations) from Site Inspections during Reporting Period

LIST OF ANNEXES

Annex A      Project
Location

Annex B      Water Quality and
Ecological Sensitive Receivers

Annex C     Cumulative Complaints
Statistics

Annex D     Implementation
Programme of Mitigation Measures

Annex E      Monitoring
Results and QA/QC Reports of Laboratory Testing for POPs

EXECUTIVE SUMMARY

The construction works for the Permanent Aviation
Fuel Facility resumed on 9th July 2007.  This sixth quarterly Environmental Monitoring and Audit (EM&A)
report presents the EM&A works carried out during the period from 1st April to 30th June 2008 in accordance
with the EM&A Manual.

Breaches of all Action and Limit Levels

No water quality
monitoring was conducted (due to no dredging work) during the reporting period
that required comparison against Action and Limit Levels.

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

·
It
should be noted that dredging activities have been suspended from 1st
April onwards and are tentatively scheduled to resume in September 2008; and,

·
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 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. EP-262/2007 has been
amended to EP262/2007/A and issued by
the EPD on 30 November 2007.

It should be
noted that at the time of reporting, a further Variation to the Environmental
Permit has been approved, primarily to allow for dredging works to continue
during March 2008.  As such, EP-262/2007/A has been amended to EP-262/2007/B and issued by the EPD on
27 February 2008.

The construction works and EM&A requirements
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 sixth EM&A Report which summarizes
the monitoring results and audit findings for the EM&A programme during the
reporting period from 1st April
to 30th June 2008.

1.2
Key Contact
Information

Key contact
information of the Project is presented in Table 1.1.

Table 1.1        Contact
Information

Name

Position

Telephone

Facsimile

E-mail

Airport
Authority Hong Kong – Environmental
Permit Holder

Mr Amin Ebrahim

Assistant
General Manager Aviation Logistics

2183 3108

2824 2786

[email-masked]

Contractor
– Leighton (Asia) Construction Limited

Brian Gillon

Project
Director

2823 1111

2529 8784

[email-masked]

Franchisee’s
Site Representative – ECO Aviation Fuel Development Limited

Philip Siu

Franchisee’s
Site Representative

2963 2820

2563 6311

[email-masked]

Environmental
Team – ERM-Hong Kong Limited

Craig Reid

Environmental
Team Leader

2271 3000

2723 5660

[email-masked]

Independent
Environmental Checker – Hyder Consulting
Limited

Dr Guiyi Li

Independent
Environmental Checker

2911 2233

2805 5028

[email-masked]

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
A.

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
B.

2.3
Major Construction Activities

A summary of the
major works undertaken in this reporting period is shown in Table 2.1.  Table 2.2 presented the cumulative
quantity of excavated materials up to 30th June 2008.

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

Jetty Works (Non-piling)

Submarine Pipeline Route

Dredging Operations

Table 2.2        Cumulative
Quantity of Excavated Materials up to 30th June 2008

Type of Excavated
Materials

Cumulative Bulk Volume (m3)

Contaminated
Mud

105,974

Uncontaminated
Mud

97,815

2.4
Monitoring Schedule of
The Reporting Period

No water quality monitoring was conducted during the
reporting period, hence presentation of the monitoring
schedule is not applicable.

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 2.3.   It was noted that construction noise
permits GW-RW0676-07 and GW-RW0678-07 expired on 19 June and 18
June respectively during the reporting month, and renewal applications were in
progress.  Land and marine based
construction works on general holidays and in between 1900-0700 on regular days
were temporarily suspended from the listed dates until new permits are granted
by the EPD.

Table 2.2        Summary
of Environmental Licensing, Notification and Permit Status

Permit/ Licenses/ Notification

Reference

Validity Period

Remarks

Environmental Permit

EP-262/2007/B

Throughout Project

Issued on 27 February 2008 (EP-262/2007/A on 30 November 2007, EP-262/2007 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-RW0676-07

21 December 2007 to 19 June 2008
(renewal application in progress)

For land-based works including
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-RW0677-07

21 December 2007 to 29 February
2008

For marine dredging operation
including grab dredger, tug boat, split hopper barge and motor sampan

GW-RW0678-07

21 December 2007 to 18 June 2008
(renewal application was in progress)

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

GW-RW0094-08

1 March to 31 March 2008

For marine dredging operation
including grab dredger, tug boat, split hopper barge and motor sampan

Marine Dumping Permit

EP/MD/08-064

13 December 2007 to 29 February
2008

For Type 1 – Open Sea
Disposal

EP/MD/08-065

13 December 2007 to 12 January
2008

For Type 1d & Type 2 marine
disposal

EP/MD/08-071

13 January 2008 to 12 February
2008

For Type 1d & Type 2 marine
disposal

EP/MD/08-090

3 March to 31 March 2008

For Type 1d & Type 2 marine
disposal

EP/MD/08-091

3 March to 31 March 2008

For Type 1 – Open Sea
Disposal

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

During the reporting month, a meeting was
organised by the CLG on 6 June 2008.
Meeting minutes
can be found on the Project website (http://www.paffhk.com).

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

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 C.

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 C.

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 3, 11, 17 and 25 April 2008, 2, 9, 15,
21 and 29 May 2008, and 4, 12, 20 and 27 June 2008.  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 and summarised in Table 3.1.

Table 3.1        Environmental
Deficiencies (Observations) from Site Inspections during Reporting Period

Reporting Month

Observation

Follow-up Action

April 2008

Worker was
observed using unsuitable tool in cutting wood beams, generating smoke and
dust.

Worker stopped
operation and resumed works with suitable tool.

General wastes
were mixed with construction wastes without proper sorting

Contractor reinforced
sub-contractors’ awareness on waste management practice

Oil sheens were
observed on ground near the chemical waste storage

Contractor
arranged clearance of oil sheens.

May 2008

Stagnant water
pools were observed at some locations on site.

Contractor
arranged clearance of stagnant water pools.

Mud and dirt
were observed in the car washing facility.

General wastes
were mixed with construction wastes without proper sorting

Oil sheens were
observed on ground due to improper storage of equipment and chemicals

Some chemical
wastes were not properly labelled.

Contractor
arranged clearance of silt and mud from the water basin.

Contractor
reinforced sub-contractors’ awareness on waste management practice.

Contractor stored
equipment and chemicals in suitable containers to avoid leakages.

Contractors put
back suitable labels onto chemical waste containers.

June 2008

Sediment plumes
were observed in the marine area near the water discharge outlet.

Contractor
cleared sedimentation tank and car wash facility to avoid overflow of silt
and dirt.

Stagnant water
pools wer e observed in some works area and in drip
trays.

Oil sheens were
observed in the workshop and chemical waste storage.

General wastes
were piled up on the ground near the operation building.

Contractor
arranged water clearances.

Contractor
designated a bunded area for cleaning of oily
equipments.  Contractor also
arranged cleaning of chemical waste storage.

Contractor
provided waste skips for collection of general wastes produced.

Overall, the site
was in a good orderly manner.  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
D.

4
Environmental Monitoring

4.1
Air and Noise

Air and Noise
monitoring was not required for the project.

4.2
Water Quality

No dredging activities were scheduled from 1 April 2008 onwards.  Water quality monitoring was therefore
not required for the reporting month.

4.3
POPs Monitoring

No POPs monitoring was undertaken since there was no dredging
operation during the reporting month.
POPs results of monitoring during dredging
activities, collected on 24 March 2008, were received during the reporting
month.  All POPs
(ie total PCBs, total DDTs
and total PAHs) were found to be below detection
limits, except the total PAHs of Control Station C1
during mid-flood tidal condition.  As
C1 is a Control Station, such levels were not considered to be attributable to
works.  Monitoring results and QA/QC reports for POPs
testing are presented in Annex E.

4.4
Waste Management

The Contractor’s
revised Waste Management Plan (Revision 4) (WMP) was submitted to EPD on 20th
September 2007.  Pursuant to EP Condition 3.3, the Contractor submitted
the updated and revised WMP (Revision 5) to the ET on 3rd June
2008.  The ET reviewed the WMP and
offered comments to the Contractor on 16th June 2008.  Response to comment (RTC) from the
Contractor is now in progress.

4.5
Cultural Heritage

In accordance with the EM&A Manual, a marine archaeological Watching Brief of two
sub-surface anomalies was implemented from 21st to 28th
February 2008 during the dredging of the surrounding seabed located within the
route of the twin pipelines from the PAFF tank farm at Tuen
Mun Area 38 to Sha Chau.

A marine archaeological Watching Brief of two
sub-surface anomalies was implemented from 21st to 28th
February 2008.  No archaeological
sites or relics were found and it was considered by the licensed Marine
Archaeologist that the anomalies have no cultural heritage significance.  No additional mitigation measures were
thus required to be implemented by the PAFF project in regard to the anomalies
SS1 and SS2.

The Watching Brief Report, verified by the
Independent Environmental Checker, was submitted to the EPD and AMO on 9th
May 2008.

4.6
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.

4.7
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 (RTC)
from the Contractor was received by the ET on 19th September 2007.  A review of the RTC is now in progress.

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

4.8
Ecology

Dolphin
Visual Monitoring

Dolphin visual
monitoring was not required as no dredging works were scheduled for the
reporting period.

4.9
EM&A Manual

The EM&A Manual for the Project has been
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 (POPs) during
construction of the Project.  No
further actions regarding the EM&A manual were required during the
reporting period.

4.10
Baseline Water Quality
Monitoring

Baseline water quality monitoring was conducted
between 24 October and 30 October 2007 at six designated monitoring stations
(three impact stations and three control stations) established for the Project
in accordance with the EM&A Manual.  The Final Baseline Monitoring Report was submitted to the EPD on 21 November and comments were received from
the EPD on 6th December.  A revised Final Baseline Monitoring Report was submitted to the EPD on 20th
February 2008 with no further comments received and later placed under the EIAO
register.

5
Future
Key Issues and Conclusion

5.1
Key Issues for the
Next Reporting Period

It should be noted that dredging activities have been
suspended from 1st April onwards and are tentatively scheduled to
resume in September 2008.  No
dredging operation will hence be undertaken in the next reporting period.  As such, a key issue to be considered in
the next report period will be:

·
Dust
release and suppression.

5.2
Impact Prediction for
the Next Reporting Period

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

5.3
Works and Monitoring Schedule
for the Next Reporting Period

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

5.4
Conclusion

The EM&A
works were conducted throughout the construction period and the relevant
monitoring was conducted in accordance with the EP’s requirements.  Mitigation measures were used to
minimise the environmental impacts, where appropriate.  Some environmental deficiencies were
observed during the site inspections and the Contractor implemented corrective
action to mitigate the issues.
Overall, the site was in an orderly manner.