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Exponent (Energy Clients)


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Exponent (Energy Clients)

  1. 1. Exponent, Inc. (Energy Clients) March 1, 2010
  2. 2. Company Profile Exponent is a scientific and engineering consulting firm that provides solutions to complex technical problems. Our multidisciplinary team of scientists, engineers, physicians, and business consultants performs in-depth research and analysis in more than 90 technical disciplines. At Exponent, we pride ourselves on the high quality of our approximately 900 employees. More than 600 are degreed technical professionals, and more than 350 have earned an M.D. or Ph.D. Operating in 19 regional offices and 4 international locations, Exponent is publicly traded on the NASDAQ exchange under the symbol EXPO. Over the years, we have received recognition for assisting clients with their most important challenges or dire disasters. We have investigated most of the major industry crises that make the news: the grounding of the Exxon Valdez, the walkway collapse at the Kansas City Hyatt, the flooding of downtown Chicago, and the attack on the World Trade Center. However, most of our work is actually helping clients assess their daily technical issues and make informed business decisions. The problems that Exponent tackles take many forms other than disasters or accidents involving a product or property. It may be a technical, health, or environmental issue related to a developing product, such as potential radiation from cell phones, whose resolution needs to be accurate, innovative, and cost effective. A regulatory issue may have a critical impact on a client's future business, and may turn on how the product can be sold or serviced. Often, a client calls because a production facility is suffering unusual down time, or a production machine has failed, or the recently received component parts just don't seem to work right. We assist clients contemplating any business transaction that requires careful scientific research and analysis as part of the due diligence, including assessments of the value of intellectual property and patents. When a major disaster strikes, the media is not far behind, and an affected client needs answers now. Our team will perform either in-depth scientific research and analysis, or very rapid-response evaluations, to provide our clients with the critical information they need. The Exponent name is recognized for its integrity, objectivity, independence, and professionalism. Our corporate core values drive a commitment to client service that enables us to provide consistently high quality to client's world wide. We are proud to say that our in-house quality management system is certified to ISO 9001. Exponent is also authorized by the General Services Administration to provide professional engineering services to federal agencies. Our clients include a wide range of manufacturers, utilities, insurers, industry groups, government agencies, venture capital companies, and law firms. Our professionals have provided consulting services to many of the Fortune 500 companies and numerous government agencies. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 2 of 26
  3. 3. Practice Areas and Offices Exponent's integrated practices offer a multifaceted perspective that leads to innovative solutions that produce bottom- line results. Through our network of U.S. and international office locations, we offer more than 90 different disciplines, including capabilities in: Environmental Sciences Engineering Ecological & Biological Sciences Biomechanics Environmental & Earth Sciences Buildings & Structures Health Sciences Civil Engineering Electrical & Semiconductors Chemical Regulation & Food Safety Engineering Management Consulting Epidemiology & Computational Biology Materials Science & Engineering Exposure Assessment Mechanical & Aeronautical Occupational & Environmental Health Thermal Sciences Toxicology & Mechanistic Biology Vehicle Engineering Other Sciences Sectors Human Factors Construction Statistical & Data Sciences Defense Technology Development Energy Medical Devices & Pharmaceuticals Visual Communications ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 3 of 26
  4. 4. Main Service Areas The four main areas of consulting that Exponent provides are: Failure Analysis & Prevention, Environmental & EcoSciences, Health Sciences, and Technology Development Failure Analysis and Prevention Our Failure Analysis and Prevention practice is the nation's largest and most experienced consulting group that specializes in the investigation, analysis, and prevention of failures and accidents. Whether we are investigating an incident that happened in the past, or assisting in the development of a new product or service, Exponent offers specialized knowledge and resources to assist its clients in making informed decisions. We believe in a multi-disciplinary approach to scientific problems that provides new perspectives and insights and enables development of creative, cost-effective solutions. During the past 40 years, we have conducted more than 30,000 investigations in areas such as fires and explosions, human performance, electrical engineering, civil and structural engineering, product and process risk assessment, and biomechanics. Environmental and EcoSciences Exponent's Environmental Sciences and EcoSciences practices have a large and diverse team of scientists, biologists, toxicologists, natural resource analysts, and engineers that provide proven, cost-effective, scientifically defensible, and realistic assessments and solutions to complex environmental issues related to contaminated land and water, industrial and other development, and sustainability and restoration of resources, and technologies and products. Our practices are nationally and internationally recognized for their expertise in environmental risk and impact assessment, ecotoxicology, natural resource damage assessment (NRDA), and ecological restoration. Our services include environmental air quality evaluation, ecological and human health risk assessment, environmental economics analysis, natural resource damage assessment, site investigation and liability management, toxic tort claims investigation, toxicology consultation, and water resources and water quality management. We offer technical, regulatory, and litigation support to industries that include mining and minerals, petrochemicals, forest products, shipbuilding, railroads, aerospace, and defense, along with trade associations and law firms. Health Sciences Exponent's Health Sciences practice specializes in solving complex problems related to health and the environment, especially problems that require an experienced, multidisciplinary team of scientists and regulatory consultants. Exponent has one of the foremost health sciences consulting practices in the United States. Our scientists, physicians, and regulatory specialists provide unparallel, interdisciplinary expertise to evaluate the full range of environmental and public health issues that face our nation and the world. These issues include potential health effects associated with environmental agents, chemicals, consumer products, food safety and nutrition, and pharmaceutical products. Indeed, members of our staff are leaders in developing the risk assessment methodologies that are essential to address the complexities of these health issues. Our national and international clients rely on us for incisive and objective assessments that address physical, chemical, and biological phenomena in order to arrive at solutions that can be relied upon to make important decisions. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 4 of 26
  5. 5. Technology Development Exponent's Technology Development practice helps our Department of Defense clients stay current with and benefit from rapidly evolving civilian technologies. Drawing on our multidisciplinary engineering, testing, and failure analysis and prevention expertise, we identify and leverage the best in COTS (commercial off-the-shelf) technologies to create integrated combat systems and modules cost-effectively, without sacrificing reliability. Our engineers and scientists work in the field alongside Soldiers, Sailors, Airmen, and Marines to ensure we understand your problems and to rapidly deliver solutions. Additional Facilities and Resources Vehicle Test and Engineering Center: Exponent operates a 147-acre Test and Engineering Center (TEC) in Phoenix, Arizona. This laboratory facility provides product development and testing support for a variety of industries. We study vehicle performance and re-create on- and off-road collisions under virtually every condition, for vehicles ranging from bicycles to tractor-trailers. We develop specific test methodologies to assist our clients with their product development efforts. Our test facility includes a two-mile oval track, durability course, 10-acre skid pad, and 1,200-foot crash rail, allowing engineers to study vehicle performance and recreate collisions under virtually every condition, for vehicles ranging from bicycles to tractor-trailers. Materials Analysis Laboratory: Exponent operates laboratory facilities that provide comprehensive materials analysis services, including scanning electron microscopy (SEM), energy dispersive x-ray spectroscopy (EDS), high-magnification metallography, hardness testing, and surface evaluation. We provide lab capabilities for mechanical testing, electronic testing, and chemical and thermal evaluation. We integrate our lab with a number of Exponent's other 90 technical disciplines to offer complete programs in failure analysis, materials evaluation, and failure prevention. Visual Communication: Exponent's visual communications staff combines art and science to help clients create compelling, fact-based visual displays that communicate complex subject matter, conveying important information to audiences unfamiliar with the matters at hand. We rely on pictures — printed, displayed on a computer, projected onto a screen, or presented as virtual reality — to reveal and explain what words alone cannot. Specific components include animation, graphics, multimedia, video, and photography. Through these media, we present comprehensible explanations of complex issues, conveying important information to audiences unfamiliar with the matters at hand. Comprehensive Database: Exponent also maintains one of the largest collections of computerized failure, accident, and incident data in the world. Our databases contain more than 350 million accident and incident records on motor vehicles, air crashes, consumer products, fires, occupational injuries, and most other accident- related topics. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 5 of 26
  6. 6. Construction Project Advisory Services Overview Exponent’s construction consultants represent a multidisciplinary team that offers Project Advisory Services to support your project from the programming and design phase, through project planning, throughout the course of construction, and to project completion and close-out. Our Project Advisory Services include but are not limited to: Critical Path Method (CPM) Schedule — Preparation and Review Exponent provides Critical Path Method (CPM) scheduling services, including baseline schedule and update preparation. These services also include CPM schedule reviews to ensure conformance with contract specifications and other project requirements. Project Team, Documentation, and Process Evaluation Successful construction projects are the result of multiple decisions made by contrasting team members. Exponent has the experience and tools to evaluate the project team and its decision-making, operational, and administrative processes, to enhance its probability of succeeding. Industry studies have shown that the final cost and schedule of a project are strongly influenced by the quality and effectiveness of the project team. 4D Modeling/Design Conflict Analysis Exponent has specialized expertise in 4D modeling, which combines a 3D model of a project design with the project schedule and/or cost and resources in order to create a “virtual” project model. 4D models help your project team become more effective in communicating, planning, analyzing, and optimizing project scope and schedule. Exponent also provides 3D design conflict analysis services, which can be applied during the project’s design phase to identify potential design errors and omissions (E&O) or constructability issues that could lead to delays and/or increased project costs. These services eliminate the tedious manual checking of 2D drawings to significantly reduce the expensive consequences of incomplete and inaccurate design. Exponent can also provide after-the-fact E&O design conflict analysis services for use in dispute resolution. Change Order Evaluation With our broad experience and background in the construction industry, Exponent assists our clients with the preparation, review, and evaluation of change orders to determine and quantify changes with respect to scope, time, and/or price. These services ensure that a client is fully considering the effects of a change on both the contract price and time. Time Extension Evaluation In addition to our CPM scheduling services, Exponent provides time extension evaluation and Time Impact Analysis (TIA) services in the case of project delays and/or impacts, appropriately allocating the associated responsibility and cost for such delays and/or impacts. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 6 of 26
  7. 7. Cost Recovery Audit The construction industry continues to find itself challenged by the administration and resolution of unexpected changes and claims. An alternative to the more traditional methods of dispute resolution is a “cost recovery” process that blends the positive aspects of these traditional dispute resolution methods and attempts to reduce or eliminate some of the more unpleasant aspects of those methods. Exponent’s Construction Consulting professionals have the experience and expertise to assist in developing, implementing, and managing a Cost Recovery Audit. Fraud Consulting, Investigations, and Internal Audit Co-Sourcing Exponent’s staff has the ability to assist in the development of project controls, including ways to avoid fraud, waste, and abuse. The use of appropriate controls, verifying to see that controls are properly implemented, and effective project team communications can minimize losses in this area. This experience also assists in the effective implementation of Sarbanes-Oxley procedures. Exponent engineers and accountants can also manage or assist internal audits with investigations of the project operations as a whole, or with specific allegations, if necessary. Contract Compliance Reviews and Contract Closeout Modern-day construction contracts incorporate many requirements, from material specifications to MBE compliance reporting to specific costing and billing processes. Exponent can enhance owner efforts to determine whether or not the work bargained for was installed or invoiced in compliance with contract documents. Our geotechnical, structural, civil, and building technology engineers and auditors can enhance an owner’s capacity to monitor these issues. This service can be performed at project end or on an interim basis. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 7 of 26
  8. 8. Independent Engineering / Engineering Economics Overview Energy is a broad field for lenders, encompassing oil and gas projects, midstream pipelines and terminals, fertilizer and biofuels plants, downstream polymer and petrochemical facilities, and thermal power generating stations with private sector and state- owned company sponsors. Exponent provides expert engineering and other services on behalf of lenders during loan origination and, upon financial close, during the construction and operations phases of energy projects. Exponent is highly qualified to assist during the origination phase of energy project financings, providing technical due diligence and market analysis services on behalf of lenders. Such services have included review of major equipment procurement contracts, supplier capabilities, the technical capacity of sponsors and their contractor(s) to effectively manage and perform, design plans, conformance of project specifications with local and international norms and standards, necessary permits and approvals from local authorities, EPC contracting strategy and structure, quality assurance/quality control (QA/QC) plans, and project economic assumptions. We can validate the suitability of the sponsor’s projections for project construction costs and assess the probability of cost overruns (estimate contingencies). We evaluate the sponsor’s timetable for construction given the scope of an energy project and external factors such as resource limitations. Affected markets in need of analysis might include fuel supplies for a power project, or raw material and product markets for a project in the downstream segment. We are often called upon to provide risk assessments, audit borrower’s financial models or estimate project cash flows for analysis of key financial ratios. Exponent makes recommendations to complete or improve the project’s investment and operations plans, if appropriate. To assist financial institutions in administrating projects in their portfolios, Exponent has experienced and knowledgeable personnel for construction and operations phase monitoring of energy or oil and gas projects. We work together with lenders to assure that the liquidated damages, cost controls, contingencies, and insurance policies proposed by the sponsors for both construction and operation are sufficient. Once loan agreements are executed, Exponent provides oversight services during the project construction phase including cost monitoring and reporting as well as monitoring for contract compliance; engineering design, procurement and construction progress; environmental damage mitigation efforts; and schedule impacts related to major equipment fabrication and delivery as well as cost monitoring and reporting. In addition, we inspect for the development of required infrastructure for a project and provide certifications to the lenders with regards to financing at closing, disbursements, technical completion, and final completion, as necessary. During operations, we review the annual budgets for projects, including operating and maintenance expenses and sustaining capital expenditures, and assess (when applicable) project expansion plans. Exponent can evaluate the operating management plan and technical aspects of all contractual material related to performance guarantees and operations, and compliance with applicable provisions and requirements. We have been asked to assess trends in raw material and products markets, including furnishing updated estimates of supply and demand in markets affecting project profitability and margins, and to provide review and comment on the borrower’s forecasts and projections. As part of the review of operating and maintenance cost projections, we provide annual (or more frequent) monitoring reports during the operations phase. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 8 of 26
  9. 9. Exponent’s energy consultants, business analysts, and discipline engineers provide support to lenders throughout the design and construction process. Our capabilities extend to analyzing or supporting claims during project construction. Moreover, we can address complex engineering problems on energy projects either in construction or operations. This technical, market analysis and project economics support is not just for lenders – we also provide support to project companies, and as needed/requested, the attorneys whom support the transactions. Exponent has helped energy and alternative fuels project developers with site selection studies, marketing plans and strategies, feasibility studies, process technology assessments, preliminary capital and conversion cost estimates, analysis of supply chain logistics, and development of project economics/financing models and project memoranda. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 9 of 26
  10. 10. Energy Economics Overview Technology comparisons frequently come down to a need to make decisions involving engineering economics. Companies developing energy projects or considering investments in alternative or renewable energy technologies need reliable and considered views of competing technology options and their comparative economics. Exponent’s experienced staff provides clients with expert advice on energy-industry economics and the key drivers for oil, gas, and chemical projects. Grounded in a thorough knowledge of the underlying engineering principles, our specialists are highly qualified to analyze technical and economic aspects at each step in the value chain, from wellhead or mine mouth to burner tip. We have experience in evaluating hydrocarbon processing and power project revenues and costs. Exponent analysts understand energy markets, and plant and pipeline operations, and this broad expertise allows us to assist clients in acquiring a fundamental grasp of conversion costs, transportation costs, and supply- chain logistics. We can assist in determining upstream, midstream, and downstream oil and gas project feasibility. If you have issues that involve exploration and development costs, reserves growth, overall plant production costs, returns on capital employed, debt service coverage ratios, assessment of risk, or the economics of capacity expansions, Exponent provides the technical and business consultants to support your analysis. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 10 of 26
  11. 11. Fossil Plant Services Overview Fossil fuels—coal, oil, and natural gas—are a non-renewable source of energy. Formed from plants and animals that lived up to 300 million years ago, fossil fuels are found in underground deposits. The fuels are burned to release the chemical energy that is stored within them. Over 85% of our energy demands are met by the combustion of fossil fuels. The burning of fossil fuels produces carbon dioxide, of which it is estimated that natural processes can absorb only about half, so there is a net increase of atmospheric carbon dioxide per year. Carbon dioxide is one of the greenhouse gases that is alleged to contribute to global warming, causing the average surface temperature of the Earth to rise, which some climate scientists believe will cause major adverse effects. We provide our clients with a team of engineering, construction, environmental, risk, and health specialists that is unique in the industry. The value that Exponent brings to its clients includes: Proven experience on high-profile projects of national and international significance Current, in-depth functional knowledge of engineering fundamentals: mechanical, structural, metallurgical, chemical, electrical, environmental, and others Scientific understanding and experience in environmental and health perspectives Convergence of our skills in risk, reliability, and vulnerability analyses Operational knowledge of the fossil plant industry, from construction to O&M to public health and ecological risk management. Exponent’s engineering services address the utility industry’s needs for design, construction, repair, and retrofit, with a focus on: Risk and Reliability Assessment Reliability and Maintenance Programs Remaining-Life Assessment Safety and Process Risk Management Thermal Sciences (Fires and Explosions) Material Deterioration (Metal, Concrete) Pipe/Boiler Integrity Electrical Engineering Corrosion Science and Engineering Construction Consulting Structural Performance Root-Cause and Corrective-Action Assessment Exponent has been asked to evaluate environmental and health issues relating to utility generating plants for many years. We have evaluated cutting-edge issues and technologies, and monitored and assessed ecological and human health impacts. Our expert environmental services include a broad range of capabilities, such as: ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 11 of 26
  12. 12. Greenhouse Gas Emissions Mercury Deposition Air Quality Studies/Permitting Air Dispersion Modeling Human Health Risk Assessment Ecological Assessment Water Quality and Hydrology Site Investigation and Remediation Consulting. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 12 of 26
  13. 13. Nuclear Plant Services Overview Exponent offers unparalleled multi-disciplinary expertise and rapid response capabilities to provide stewardship in addressing complex engineering and scientific problems. We provide our clients with a team of engineering, construction, environmental, risk, and health specialists that is unique in the industry. The value that Exponent brings to its nuclear power generation clients includes: Proven experience on high-profile projects of national and international significance—often in a dispute resolution setting Deep, functional knowledge of engineering fundamentals: mechanical, structural, metallurgical, chemical, electrical, and more Nuclear power generation operational knowledge Scientific depth in environmental and health perspectives Convergence of our skills in risk, reliability, and vulnerability analyses Exponent entered the nuclear power consulting business in 1974, when the firm, then known as Failure Analysis Associates, was selected to provide technical support to the Electric Power Research Institute (EPRI) in the areas of structural integrity, materials behavior, and life prediction. Since then, we have entered into commercial services, instrument manufacturing, and sales of computer software in direct support of electric utilities and original equipment manufacturers. Our staff has provided expert testimony for a wide range of industrial and governmental clients. We continue to rank among one of the largest consulting firms in the number of plant component remaining-life assessments and failure investigations conducted, as well as in the volume of sponsored research and development contracts awarded. In addition, we have invested our own funds in developing advanced services and equipment for power- plant maintenance, asset management, and failure prevention. Exponent’s project experience includes nuclear component reliability and remaining-life assessments for reactor pressure vessels, steam generators, and primary piping. In addition, Exponent has evaluated hundreds of equipment failures for the nuclear power generation industry, spanning a wide range of component types, including steam generators, reactor pressure vessels, reactor coolant pumps and pump seals, diesel generators, valves, piping, electric generators, and turbines. With conversion, upgrade, development, and commercialization projects around the world, Exponent is reputed for creating innovative approaches to new electric power-plant configuration and maintenance management of existing plant equipment and systems. By combining the methods of component and plant condition assessment with reliability analysis and economic optimization, we help utilities reduce costs and increase productivity. In addition to plant mechanical integrity-related services, Exponent personnel have experience in various aspects of power system design, control, operation, and maintenance. Our experience includes development of procedures for outage/maintenance management, design for reliability, reliability-centered maintenance for high-voltage substations, on- and off-line diagnostics for transformers and breakers, control and protection systems, plant O&M training, and failure analyses. Exponent’s engineering services address the utility industry’s needs for design, construction, repair, and retrofit, with a focus on: ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 13 of 26
  14. 14. Business improvement consulting Licensing and regulatory compliance Human performance Risk and reliability assessment Safety and process risk management Reliability and maintenance programs Root cause and corrective action assessment Engineering (equipment and systems) Remaining-life assessment Thermal sciences (fires and explosions) Material deterioration (metal, concrete) Pipe/boiler integrity Corrosion science and engineering Construction consulting Structural performance Environmental consulting Health and safety Spent-fuel storage and transportation Nuclear utility work has required stringent quality assurance requirements. Exponent is ISO 9001 certified and conducts work in strict accordance with a quality control program that meets 10 CFR 50, Appendix B. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 14 of 26
  15. 15. Combustion Equipment Overview The consultants at Exponent perform engineering analyses of boiler and turbine systems for the power generation industry. Our multi- disciplinary engineering team has experience with the equipment, processes, and controls associated with combustion turbines, steam turbines, and power boilers. We consult on issues related to radiant and convective heat transfer; multiphase fluid flow; solid, liquid, and gaseous fuel combustion; pollutant formation and abatement; material suitability; and control system failures. Exponent engineers are principal members of the NFPA 85 (Boilers & Combustion Systems) technical committee of the National Fire Protection Association, and the C-16 (Thermal Insulation) and F-03 (Gaskets) technical committees of the American Society of Testing and Materials (ASTM). Turbines Exponent has investigated many steam and combustion turbine failures. Our expertise in the interaction between high-temperature fluids and rotating machinery is recognized internationally. Specifically, our thermal and fluid experts perform acoustic, fluid dynamic, and vibrations analyses. We are familiar with turbine control systems and their limitations under operational upset conditions. We have consulted on the consequences of fuel changes in combustion turbines. Boilers Exponent has consulted on all aspects of boiler design and operation and for all sizes and styles of boilers. Often we are called upon to investigate breaches in pressurized water or heat-transfer fluid vessels and piping, fuel explosions, structural failures, water chemistry and corrosion, and burner safeguards. We have performed third-party reviews of the configuration of combustion instrumentation and controls, and their adherence to relevant fire protection standards. Air Pollution Control Exponent engineers have analyzed issues related to rapid performance degradation of SCR catalyst systems for NOx control. We have developed methods for estimating release rates of particulate matter from fabric filter baghouses with one or more failed bags. Our experts have consulted on carbon burnout issues in coal flyash, and rates of mercury volatilization (and downstream particulate recapture) in coal combustion. Materials We have addressed problems associated with refractory degradation and premature thermal insulation failure. We consult on steam blowouts from failed gaskets, and we interact with metallurgists in our Materials practice to assist with fluid or thermal issues that can create conditions for boiler tube or turbine blade failures. Our experts have testified on the historical use of asbestos insulation and gaskets in power generation, including the chronology of suitable alternatives becoming available. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 15 of 26
  16. 16. Managing Energy Industry Vulnerabilities to Climate Change Overview Depending on projections from climate model(s) or from historical trends, climate change could lead to substantial impacts on properties, facilities, and the workforce or it may have minimal to no influence. The various outcomes reflect regional variations as well as uncertainties in the methods for estimating impacts. Whether the concern is physical, ecological, or human health impacts, catastrophic or mild effects, immediate or long-term consequences, there can be little doubt that climate change will affect the ways that companies conduct business and manage risk. The quantification of future potential impacts and associated uncertainties requires understanding the drivers, effects, and potential management strategies at regional levels for enterprise risk management. Areas of particular importance for risk management include: Climate-related changes to the financial value or performance of client’s operations and assets Impacts of the clients’ emissions upon the biological, ecological, and physical environment Extreme weather events such as drought, flooding, and hurricanes Impact on company staff of infectious disease, heat stress, waterborne diseases, and injuries from extreme weather events Integrating climate change in traditional catastrophe modeling Liabilities associated with corporate climate change management Litigation associated with business continuity such as interruptions in the supply chain, utility services, and communications Litigation and liabilities associated with contract disputes from transactions and acquisitions Climate change also presents business opportunities for new products and services for mitigating and offsetting greenhouse gases, and encouraging sustainable practices that lower risk profiles and vulnerability. Exponent provides energy industry clients with sophisticated analyses that combine the results and reliability of regionally-relevant climate models with available trend analyses. This analysis provides a range of predictions and associated probabilities along with the consequences. This information provides the technical bases for judging risks to assets and operations. It can also be used for estimating risk exposure and for developing appropriate risk management strategies meaningful to specific client needs and degree of vulnerability. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 16 of 26
  17. 17. Exponent Climate Change Services Analysis of climate change models and uncertainty analysis within a regional context and in a format that can then be applied to management decision-making Application of a transparent and comprehensive vulnerability framework to provide risk analysis and risk management recommendations that are specific to the challenges facing a specific energy industry company, or the industry as a whole Economic exposure analysis from climate change risks Land-use planning and management analysis of natural resources such as forestry, agriculture, and wetlands to mitigate climate change effects Identification and analysis of sustainable business practices to decrease exposure to climate change risk Product liability analysis of green technologies Analysis of the liabilities that might arise from carbon-offset projects Creation of vulnerability maps for various outcomes and associated probabilities ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 17 of 26
  18. 18. Utility Risks & Impacts in Carbon Capture & Storage Overview Over 85% of U.S. energy demands are met by the combustion of fossil fuels (coal, oil, and natural gas). This process also produces carbon dioxide, which is a greenhouse gas (GHG). Carbon Capture and Storage (CCS) is one of the solutions being proposed to reduce GHG emissions. CCS is really a group of technologies for capturing CO2 at a power plant before it is emitted, transporting it to a suitable storage site, and storing it on a long-term basis. Carbon Capture Carbon capture involves removing some or all of the CO2 rather than releasing it to the atmosphere. Doing so may involve process modifications at the pre-combustion (gasification), combustion (oxy-fuel), or post-combustion (solvents/sorbents) stages. The success of carbon capture depends on the technical and cost effectiveness of the project, and demonstration of regulatory compliance. Engineering economic studies should be conducted to evaluate the operational risks and cost of carbon capture at the plants. These would include comparison with other alternatives to reduce GHG emissions, such as boiler efficiency upgrades or co-firing with biomass. Generators also need to consider financial options that may be available, such as purchasing carbon offsets, in managing their GHG emissions. To reach that end, Exponent offers the following skills: Regulatory compliance reviews Process performance evaluations Design reviews and feasibility studies Cost/benefit analyses Risk analyses Chemical analysis Mechanical, electrical, and structural evaluations Combustion equipment performance Reliability, availability, maintainability (RAM) studies Metallurgy/materials evaluation Corrosion science and technology Transportation Once the CO2 has been captured, it will need to be transported to a suitable site for long-term storage. Because of the volumes, current thinking is that it will be transported via pipelines either as a gas or compressed into liquid form. In either case, it will probably require additional preparation at the site, which may involve new treatment facilities. Exponent has extensive experience evaluating natural gas and liquid natural gas pipelines and is familiar with the technical and regulatory aspects of that industry. Based on that experience, Exponent can provide assistance in the following areas: Evaluation of treatment required for transport Loss-of-product risk in transport evaluations Hazard risk in transport analysis Metallurgy/ materials evaluation Corrosion science and technology Cost and liability assessment and strategy development ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 18 of 26
  19. 19. Carbon Storage Currently, the leading candidate options for long-term storage include depleted oil and gas reservoirs, operating oil reservoirs (where the CO2 is used for enhanced recovery operations) and deep saline formations (both onshore and offshore). Some of these potential sites may already be well characterized, while others may require more extensive analysis to assess their suitability. Our staff has the needed geological, geotechnical, and geochemical skills and experience to assist with site characterization. Once the site is selected, wells will be constructed using technology and techniques that have been developed in the oil and gas industry. Because of our involvement in major projects in that industry, our staff is very familiar with the associated technology. Monitoring will be necessary to demonstrate secure storage on an on-going basis. Direct monitoring tools and techniques can be used to measure concentrations of CO2 near the well bore; however, most monitoring will be undertaken by indirect methods such as seismic, gravity, electromagnetic surveys, and satellite imagery. Our staff has experience with these techniques. Requirements for decommissioning after the storage site is full will undoubtedly be included in the future regulations governing CCS. At the very least, a decommissioning plan will have to be prepared, submitted, and maintained. That plan will most likely have to include quantification and modeling of residual risk. Our staff has helped prepare many such plans. With expertise in local, state, and federal regulatory requirements, environmental impact assessment, ecology, toxicology, chemistry, chemical forensics, geology, hydrology, and environmental engineering, our staff provides a range of services that includes the following: Formation geochemistry Geological engineering Reservoir engineering Aquifer engineering Salt dome engineering Site characterization Geotechnical testing Geochemical and operational consulting Environmental chemistry and formation geochemistry Environmental analyses of drilling fluids, and drilling pits and ponds Containment monitoring Drilling technology Occupational health Civil engineering (subsidence, heave, and hydraulic fracturing) ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 19 of 26
  20. 20. In summary, our staff performs risk analysis ranging from compliance to total business-based approaches, and addresses the critical issues. We provide our clients with a team of engineering, construction, geology, environmental, risk, and health specialists that is unique in the industry. The value that Exponent brings to its clients includes: Proven experience on high-profile projects of national and international significance Current, in-depth functional knowledge of engineering fundamentals: mechanical, structural, metallurgical, chemical, electrical, geological, environmental, and others Ability to integrate technical and business disciplines in solving complex problems Scientific understanding and experience in regulatory and environmental matters Convergence of our skills in risk, reliability, vulnerability, and cost/ benefit analyses Extensive experience and operational knowledge of both the fossil plant industry and the oil and gas industry, from construction to O&M to public health and ecological risk management. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 20 of 26
  21. 21. LNG - Risk & Reliability Overview Exponent staff has broad experience performing LNG hazard analyses, as well as qualitative or quantitative risk assessments for LNG plants. This experience covers LNG liquefaction facilities, LNG receiving terminals (both onshore and offshore), and LNG storage and peakshaving plants. Exponent’s risk analysis services include: LNG hazard analysis for onshore and offshore facilities LNG spill and pool spreading Vapor dispersion exclusion zones From storage, transfer, and process equipment areas or impoundments From transfer-area trenches Integral models (DEGADIS) and CFD (Fluent) Thermal radiation exclusion zones Exponent has performed thermal radiation hazard distance calculations, for spills into impoundments as well as spills over water, using a variety of models, such as LNGFIRE3 and other variations of the solid flame model. Exponent has extensive experience using CFD fire modeling tools, such as the Fire Dynamics Simulator (FDS), for both small- and large-scale fires; CFD tools such as FDS can be used to model LNG pool fires in cases where the fire is significantly affected by the presence of buildings or other obstructions. Probability of ignition of LNG vapor clouds Waterways suitability assessment Hazard zones for large vessels Flash fire hazard distances Review and comments on LNG standards and regulations 24 CFR 51 (HUD) 49 CFR 193 (DOT) 33 CFR 127 (USCG) API 521 NFPA 59A EN 1473 Hazard Identification (HAZID) and Hazard and Operability (HAZOP) Studies, and Quantitative Risk Assessment (QRA) External hazards such as docking and maneuvering of ships and aircraft crashes Natural hazards such as lightning, floods, and earthquakes Internal hazards such as leaks from LNG piping, storage, and process areas in the terminal Special cases hazards such as neighboring LPG/gasoline storage, vehicle traffic, electric installations, and communication failure between ship and terminal ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 21 of 26
  22. 22. Variations in gas quality can raise reliability concerns for pipeline companies, multi-user LNG import terminals, LNG traders and marketers, gas distributors, and especially end users of natural gas fuel such as power-station owners. The potential for downstream problems related to imported natural gas is compounded by a lack of industry-wide agreement on parameters for measuring and assessing gas quality and interchangeability. “Natural gas” is not pure methane; it contains a variety of heavier hydrocarbons, inert species, and other components. Every gas source has a different proportion of these constituents. Interchangeability is the ability to substitute one gaseous fuel for another without materially changing the performance and safety of pipeline systems and end-use equipment. Common parameters that have been used to define an acceptable operating range are gas heating value, the “Wobbe Index,” specific gravity, and restrictions on components such as heavy hydrocarbons and inert gases (nitrogen and carbon dioxide). Exponent can analyze these issues and their effect on a company’s operations. Solutions need to be found that protect the performance, safety, and emissions of natural gas equipment without unduly restricting the LNG supplies that can be used. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 22 of 26
  23. 23. Clean Coal Technologies Overview The United States is the Middle East of coal. For companies looking to expand the use of this indigenous resource in more environmentally suitable ways through the use of advanced and emerging technologies, Exponent provides technical, economic, and market analysis skills and expertise. We offer specialized consulting services to technology providers, project sponsors, project developers, and special-purpose project companies seeking to deploy clean coal technologies to develop coal resources in the United States, and in other countries such as India, China, and Australia. We also can assist Engineering & Construction (E&C) firms designing clean coal facilities, and the financial institutions and attorneys that support these projects. The types of assistance that the energy experts at Exponent can offer include project cash-flow analysis, financing model development, techno-economic comparisons of available technologies, end-product market analysis, assistance with solutions for CO2 issues, and project risk assessments. Exponent consultants have conducted market study investigations of coal-to-liquid (CTL) and gas-to-liquid (GTL) products, and provided scoping and screening studies of petroleum coke and coal gasification projects. Our engineers have assessed available coal gasification technologies (both above ground and underground) and evaluated integrated gasification combined cycle (IGCC) and various co-production (polygeneration) schemes using coal, petcoke, and blended feedstocks. Exponent has expertise in performing reliability, availability, and maintainability (RAM) studies for particular clean coal project configurations. Our consultants have worked with the major power- block equipment suppliers and can recommend whether project sponsors should consider purchase or self-generation for a project’s electricity or fuel needs. We have experience with direct and indirect coal liquefaction processes, and the production of power, steam, and hydrogen in utility islands using gasification and steam reforming technologies for supply to host facilities such as oil refineries. Once the synthesis gas is generated, we have evaluated the suitability of different cleanup technologies and the options for carbon capture and conversion of the syngas into marketable clean fuels, petrochemical intermediates, and end-use commodities. Among the processes that our consultants have considered are methanol, nitrogen fertilizers, synthetic natural gas (SNG), methanol to gasoline, and Fischer-Tropsch synthesis. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 23 of 26
  24. 24. Renewable Energy Services Overview Exponent offers unparalleled multi-disciplinary expertise and rapid response capabilities to provide stewardship in addressing complex business, engineering, and scientific problems. We provide our clients with a team of business, engineering, construction, environmental, risk, and health specialists that is unique in the industry. The value that Exponent brings to its clients faced with the rapidly evolving renewable energy area is: Power generation, transmission and distribution regulatory, systems, and operational knowledge Organizational assessment, change management, and business startup expertise Deep, functional knowledge of engineering fundamentals: mechanical, structural, metallurgical, chemical, electrical, economics, and more Convergence of our skills in risk, reliability, and vulnerability analyses Proven problem solving experience on high-profile projects Implementing state and national renewable energy policies including carbon reduction and energy efficiency creates change for existing market participants as well as creating new entrants. Exponent’s expertise in technical and business facets of the energy system and markets provides a one-stop shop for support in this critical area. Exponent’s veteran energy industry staff have hands on technical and managerial experience including but not limited to the areas of technical/equipment assessments, organizational assessment, process and procedure development, change management, regulatory support, environmental assessments, NERC compliance, climate change evaluations, energy economics, corrective action plans, financial transaction support, maintenance and construction advisory services, risk management, and business startup activities. Exponent can assist utilities, renewable energy developers, transmission developers, and investors from the project feasibility stage thorough commercial operations. Exponent’s approach in assisting clients with their renewable energy projects is broken into three phases: Situational Assessment, Detailed Implementation Plan and Budget Preparation/ Business Case, and Plan Execution. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 24 of 26
  25. 25. Engineering Management Consulting Exponent’s Engineering Management Consulting practice is focused on helping its clients achieve their goals. Exponent’s veteran energy industry staff have hands on technical and managerial experience including but not limited to the areas of technical/equipment assessments, organizational assessment, process and procedure development, change management, regulatory support, environmental assessments, NERC compliance, climate change evaluations, energy economics, corrective action plans, financial transaction support, maintenance and construction advisory services, risk management, and business startup activities. In addition, through its alliance partners, Exponent is able to provide transmission system analysis and market assessments using proven industry models. Electrical Systems Exponent has worked closely with electric utilities in matters related to power generation, distribution, and transmission. These studies and investigations range from line-siting studies to the failure analysis of major electrical equipment. Exponent has the expertise needed to analyze complex problems in power plant generating equipment and electrical and control systems; transformers, switchgears, circuit breakers and related relay and control systems; and other electrical power handling equipment. Our staff has expertise in both AC and DC transmission systems. In addition to conducting root-cause analyses related to equipment and system failures, electrical system configurations and breaker/relay coordination, Exponent has successfully mobilized interdisciplinary teams in electrical, mechanical, and thermal areas to investigate fires and explosions due to electrical origin. Environmental Sciences Exponent’s scientists and engineers provide proven, cost-effective, scientifically defensible, and realistic assessments and solutions to complex environmental issues. Our services include: environmental forensics, particularly advanced chemical fingerprinting; chemical transport and fate analyses in air, soil, surface water, sediments, and groundwater; technical support for regulatory compliance; real estate transactions and brownfield development; economic analyses; sustainability assessments; site remediation; product liability evaluations; and human health and ecological risk assessments. Our ecological scientists, biologists, toxicologists, and natural resource analysts provide scientifically defensible solutions and strategic support on complex environmental issues related to contaminated land and water, industrial and other development, and sustainability and restoration of resources, and technologies and products. Exponent is recognized nationally and internationally for its expertise in environmental risk and impact assessment, ecotoxicology, natural resource damage assessment (NRDA), and ecological restoration. Mechanics & Materials Exponent’s metallurgists, polymer and corrosion scientists, electrochemists, and ceramists have many years of experience in the prevention and analysis of material failures. As a result of this close familiarity with all types of materials, our scientists and engineers have a unique ability to provide advice on how to avoid problems early in the design cycle, when materials are being selected. Exponent provides clients with a thorough comprehension of current or potential designs to determine vulnerabilities before failures occur, develop appropriate mitigation methods, and provide post-failure investigations. Consultants review the reliability of processes and products for a variety of industries, including transportation, heavy industry, energy, and consumer products. Our projects range from modeling fluid flow characteristics in a system, to predicting the remaining lifetime of structures and components, to establishing design and operating envelopes for processes and technologies. ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 25 of 26
  26. 26. Zuhair M. Ibrahim, Ph.D., P.E. Senior Engineer Thermal Sciences Los Angeles (310) 754-2707 Professional Profile Dr. Ibrahim applies mechanical engineering, thermodynamic, and fluid dynamic principles to the study of processes in turbomachinery, fires, explosions, and a variety of other combustion devices. Dr. Ibrahim is especially interested in investigation and analysis of problems related to turbo machinery and combustion. He has analytic and experimental experience with the analysis of thermo-acoustic instabilities in gas turbines. Prior to joining Exponent, Dr. Ibrahim worked as a combustion consultant at Solar Turbines Incorporated. His research involved developing tools to predict and mitigate the impact of combustion-driven acoustic instabilities on gas turbines used for power generation. He has also worked as a research engineer at United Technologies Research Center (Pratt and Whitney R&D group), where he carried out numerous studies related to the investigation, optimization, and enhancement of turbine, afterburner, and rocket performance. Dr. Ibrahim also served as a country consultant with the United Nations Development Programme in East Africa where he helped oversee the implementation of several infrastructure projects. Credentials & Professional Honors Ph.D., Aerospace Engineering, University of California, San Diego, 2007 M.Sc., Management, Rensselaer Polytechnic Institute, 2002 M.Eng., Aerospace Engineering, University of Alabama, Huntsville, 2000 United Technologies Research Center’s Outstanding Technical Achievement Award, June 2003 AIAA award for 2nd Place Technical Paper in South-Eastern Student Conference, April 2000 ©2010 Exponent, Inc. All Rights Reserved. 888.656.EXPO Page 26 of 26