Effective Risk ManagementINTERTANKO TokyoMay 15, 2009
Charles W. ParksVice President - Marine
Tesoro Corporation
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Anacortes, Wa
•120 mbpd
•Key product:Gasoline
Mandan, ND
•58 mbpd
•Key products:Gasoline & Diesel
Salt Lake City, Utah
•58 mbpd
•Key products:Gasoline & Diesel
Kapolei, Hawaii
•93 mbpd
•Key product: Jet
The Tesoro System
Corporate Office
Singapore
Office
Auburn Office
LongBeachOffice
Martinez, Ca
•166 mbpd
•Key products:CARB Gasoline &CARB Diesel
Los Angeles, Ca
•97 mbpd
•Key products: CARBGasoline & CARB Diesel
CalgaryOffice
Tesoro System Highlights
•7 Refineries
•664 mbpd total crude capacity
•Retail network of over 870 sites
•5,600 Employees
RETAIL BRANDS
Kenai, Alaska
•72 mbpd
•Key product: Jet
2
Tesoro Today
2008
Fortune “150”
# 91
Global “500”
# 388
Revenues
$ 28 billion
Operating Income
$ 471 million
Refining & Marketing
100%
3
Tesoro Marine – 2008 Statistics
•# of cargo transfers 4,400
•Total barrels moved 315 million
•Vessels vetted 740
•Rejection rate 4.1%
–Poor SIRE reports
–Past experience with vessel/owner
–Inadequate mooring system
•Spills 3
–Volume spilled Trace
4
Tesoro Time Chartered Fleet
• 2 – Suezmax
• 3 – Aframax
• 5 – MR’s
•10 – Barges (U.S. West Coast & Hawaii)
- All are double hull -
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Vetting Importance
•Protection of people
•Protection of the environment
•Financial exposure
•Business disruption
•Our relationship with stakeholders
•Our reputation as a publicly owned company
•In Alaska we are the oil spill plan holder
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Vetting Importance
•We don’t think we know how to operate yourtankers better than you do,
BUT,
–Not all tankers are the same
–Not all crews are the same
–Not all operators/managers are the same
–Not all owners are the same
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Vetting Infrastructure
•Two tiered vetting system
–Corporate level
–Local level
•Experienced mariners
–Captain Tim Plummer – Head of Operations & Vetting
–Vetting Superintendent based at Tesoro headquarters(Captain Debra Cobb)
–Tesoro Marine Superintendent at each waterborne refinerylocation
•Tesoro Assessment & Ship Clearance (TASC) system
–Centralized data capture
–Links to SIRE, Q88, LMIU, industry databases
•Vessel performance feedback
•OCIMF member and SIRE submitting participant
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Vetting Process
•Vetting requests are submitted in TASC
•Detailed review of:
–Lloyd’s MIU
–SIRE
–U.S. Coast Guard PSIX
–Equasis & Tokyo MOU
–Internal Facility Feedback & Facility specific acceptability
•Draft, mooring, KTM, DWT, LOA, Beam, etc.
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Vetting Process
•Facility specific recommendation is made to approveor reject
•Final determination to approve or reject is made andsent to requestor
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General Criteria
•Key criteria in Tesoro system
–Hawaii SPM (official dwt, BMA, draft)
–Alaska (draft, cargo volume, mooring)
–Puget Sound (dwt)
–San Francisco (draft, KTM)
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Summary
“We really don’t think we know how tooperate your tankers better than you do,but we have a lot on the line as well.”