C ALIFORNIA U PDATE Pacific States/British Columbia Oil Spill Task Force Annual Meeting Thomas Cullen OSPR Administrator Portland, Oregon October 1, 2014

Topics Spill trends and 2014 highlights California’s adjustment to shifting trends in crude oil transport

Marine oil spills:

Inland oil spills:

California’s Crude Oil Supply in 2012 Alaska overseas California - offshore California - inland tanker pipeline 52% 30% 13% 5% Where crude comes from How crude gets here

Alaska overseas Bakken/North Dakota California - offshore California - inland 28% 7% 4% 25% Where crude comes from How crude gets here 36% tanker pipeline rail California’s Crude Oil Supply in 2016

8 Total Production

We are here 9 Bakken oil production

Projected Crude-by-Rail Deliveries to California Direct by rail-to-refinery or rail-to-pipeline-to-refinery Valero (Benecia) 25.6 Valero (Wilmington) 21.9 Tesoro (Martinez) 2.0 Plains (Bakersfield) 25.6 Alon (Bakersfield) 54.8 Kern (Bakersfield) unknown Phillips 66 (Santa Maria) 13.5 TOTAL 143 million bbls/yr ~6 trains/day Rail-to-barge via Portland/Vancouver area Capacity will be ~200 million bbls/yr, some of which will be shipped to California via barge Total projected crude-by-rail deliveries to California by to 200 million bbls/yr (Note: 150 million bbls/yr = 25% of Calif’s crude oil supply) 10

Crude-by-Rail Facilities in California Valero/Benecia Plains/Bakersfield 11 Phillips 66/Santa Maria Alon/Bakersfield Kern Oil/Bakersfield WesPac/Pittsburg Targa/Stockton SAV Patriot/Sac Carson Oil/Sac KinderMorgan/ Richmond Questar/Coachella Tesoro/Carson Alon/Long Beach ExxonMobil/Vernon # # # # Currently operational About to be operational Reviewing Draft EIR comments Proposed for future # million bbls/yr capacity If all are operational at full capacity: 233 million bbls/yr (40% of Calif’s oil) ~ 10 trains per day

Possible Routes for Crude-by-Rail Sacramento Stockton Roseville Truckee Redding Richmond Benecia Pittsburg Bakersfield Long Beach Santa Clarita Yuba City San Bernardino Barstow Mojave Fresno Palmdale Chico Santa Maria # of refineries at each location

Possible Routes for Crude-by-Rail 13 7,000+ waterway crossings by railroad

Possible Routes for Crude-by-Rail 14 5,000+ waterway crossings by pipeline

15 Typical crude oil “unit train” DOT-111 tank cars 714 bbls (30,000 gal) per car 64,000 bbls (2.7M gallons) per train COSCO BUSAN

16 Typical crude oil “unit train” DOT-111 tank cars 714 bbls (30,000 gal) per car 64,000 bbls (2.7M gallons) per train Industry’s self-determined “reasonable worst-case scenario” = loss of one tank car

17 Typical crude oil “unit train” DOT-111 tank cars 714 bbls (30,000 gal) per car 64,000 bbls (2.7M gallons) per train Industry’s self-determined “reasonable worst-case scenario” = loss of one tank car Average accident size in 2013 = 20 tank cars

18 Typical crude oil “unit train” DOT-111 tank cars 714 bbls (30,000 gal) per car 64,000 bbls (2.7M gallons) per train Industry’s self-determined “reasonable worst-case scenario” = loss of one tank car + = Average accident size in 2013 = 20 tank cars COSCO BUSAN

Marine Inland The Predicament We Faced OSPR’s efforts were limited to marine oil spills 19

Marine vs Inland Oil Spills 2012 MarineInland # Spills/yr1,0151,145 Volume gal/yr61,1211,024,705 Dedicated Staff1600 Funding/yr$30 million$0 20

Marine vs Inland Oil Spills 2012 MarineInland # Spills/yr1,0151,145 Volume gal/yr61,1211,024,705 Dedicated Staff1600 Funding/yr$30 million$0 21

CA Senate Bill 861 Overview (a.k.a. the “statewide program”) Extends the current 6.5 cent fee to inland and imported crude oil entering CA refineries Creates a single statewide program to cover spills of oil or oil products from all sources in marine and inland waters Applies industry contingency plan, drill, and financial responsibility requirements statewide Stabilizes funding for OWCN and expand the OWCN to inland areas Makes OSPR’s spill response trust fund accessible for responses to all oil spills. Removes 42 gallon threshold for spill response

California’s Oil Supply and Use Where crude comes from How crude gets here Where crude is processed Where product goes Alaska overseas Bakken/North Dakota California - offshore California - inland tanker pipeline rail refineries 100% 51% fee collection points: Refineries and marine terminals 36% 28% 7% 25% 4%

OSPR Implementation Teams Hire new positions Regulations/Contingency plans/Drills Outreach/Communication/Agency Coordination Training Geographic response plans Wildlife operations Field Response Teams (interim and long term) Spill Communication and Data Unit

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26 Key Benefits: Fewer oil spills from all sources Improved spill response Coordinated incident command with agencies and industry Improved efficiency and effectiveness of response Oil Spill Response Organization (OSRO) oversight Reduced impacts, damages, and liabilities Improved public and environmental safety Improved public confidence

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