“VPP In Tough Economic Times, In a Word, Absolutely” Keys to a Strong Sustainable Safety Program Regional VPPA Conference – Tucson April 4, 2013 John Roller

“Building Safety and Environmental Stewardship into Your Operation” 2

t Safety, Environmental Stewardship and Regulatory Conformance 3 “Building Safety and Environmental Stewardship into Your Operation”

t t Overview t t Culture t t Safety and Environmental KPI’s t t Results of a Strong Corporate Culture t t It’s an Attitude t t Organizational Perspective t t Operational Fundamentals t t Building Structure to Ensure Success t t Employee Ownership t t Safety and Environmental Performance Measurement and Goals t t Closing Remarks – Outline the NPV and IRR of VPP in tough economic times t t Question & Answers Agenda

t t One of the largest independent petroleum pipeline and terminal operators in the U.S. 8,417 miles of crude oil and refined product pipelines 86 terminal facilities and four crude oil storage facilities Over 94 million barrels of storage capacity t t One of the largest asphalt refiners and marketers in the U.S. 14,000 barrel per day Refinery in San Antonio, TX Two asphalt refineries capable of processing 104,000 bpd of crude oil NuStar Overview

t Employees come first “Take care of the employees – they will take care of the unitholders and communities” No layoffs All-employee bonus Community Involvement Great employee programs Recognition programs Wellness programs Employee events You Make a Difference Awards Star Performer Awards Safe Fund Grants Employee Ownership Regular roundtable meetings Helps attract and retain industry’s best workforce Culture is the Key to Your Success

NuStar Culture In The Spotlight

Strong Corporate Culture  Results of a strong corporate culture  Your return on investment!  Employee morale is increased  Reduces Absenteeism  Promotes ownership and trust at all levels of the organization – Especially at the hourly level!  Promotes Employee Involvement, Loyalty & Volunteerism  Promotes Accountability – No fear mentality

 Most Important Results  Minimizes or Eliminates Safety and Environment Incidents  Gives employees Ownership of their operation  Promotes Operational Excellence – (No Incidents, No Spills, 100% Customer Satisfaction)  Promotes a strong organization and enables growth opportunities Strong Corporate Culture

Building Safety and Environmental Stewardship Into Your Operation t t Some organizations - culture is focused on production “Move the juice” was motto, even if meant taking risks Minimal formal safety training and equipment Extensive deferred maintenance Employee concerns not heard No community identification or involvement t t NuStar culture focused on the employee Take care of the employee – they will take care of the unitholders and the community Safety – the most important way of taking care of employees Environmental Stewardship – the best way the take care of our community

It all Starts with Leadership t t Safety and Environmental Stewardship – Must be a Core Value of Leadership All incidents are preventable Clarify safety expectation and be accountable Field presence and demonstration – Walk your talk Create an atmosphere for open discussion Not alone, share with each other

It all Starts with Leadership t t Safety and Environmental Stewardship – Core Value of Leadership Applaud proactive efforts, report extensively when reactive Encourage and reward employee involvement (listen and react to your people) Begin every meeting with safety and environmental (HSE) Be consist in your message! Develop an organization that facilitates the “culture”

Organization Perspective Vice President and General Manager HR / Public Relations Director Manager Public Relations Supervisor Regional Reporting Regional Buyer Non-exempt HSE Director (4) Supporting Positions (1) Non-exempt Maintenance Manager Engineering Manager Project Engineer SR Area Manager - SW Selby / Stockton and Wilmington (18) Non- exempt positions Area Manger - NW Tacoma / Vancouver and Portland (35) Non- exempt positions Normal Organizational Chart – Top Down Do you see anything wrong with this Org Chart?

Vice President and General Manager HR / Public Relations Director Manager Public Relations Supervisor Regional Reporting Regional Buyer Non-exempt HSE Director (4) Supporting Positions (1) Non-exempt Maintenance Manager Engineering Manager Project Engineer SR Area Manager - SW Selby / Stockton and Wilmington (18) Non-exempt positions Area Manger - NW Tacoma / Vancouver and Portland (35) Non-exempt positions Organization Perspective Lateral Organizational Philosophy

Organizational Perspective Hourly Leadership Support Leadership Executive Leadership Bottom Up Organizational Philosophy

Getting Employees Involved – Changing the Culture t t Clarify expectations and empower employees It is not OK to have injuries Internalize hazard recognition behaviors Expectation is to stop and talk “Pull the chain and stop the train” Allocate resources – It is not a priority or a “core value” unless you are willing to invest t t Get employees involved Toolbox meetings Safety Meetings / Committees Open lines of communication - Roundtables – formal and informal Field discussions – be involved and available Give the operation to the people who do the work

Getting Employees Involved t t Employee driven safety committees Only effective if real hazards are identified – and resolved May have to customize per site t t Incident investigations Employees participate All stakeholders must be engaged t t Stand downs Per event stand downs – region and company wide

Operational Fundamentals – The Foundation for your Culture – Value Added  Keys to Success  Safety and Environmental Performance must be your most important Key Performance Indicator (KPI) - Period  Strong Corporate Culture – Employees First Mentality  Implement PSM – regardless of regulatory requirement  Attitude – Walk Your Talk – All Incidents and Accidents are Preventable  Operate with Principles  Be accountable - and hold others accountable  Be a resource and provide the resources necessary to be successful  Understand your “Current Reality”  Develop a “Vision”  Stay the course and be consistent

Operational Fundamentals – StructurePoliciesProcedures Process Flow / P&ID’s Forms / Work Instructions Records Include Training Doc’s (JPV’s / JPM’s) VPP Employee Ownership / Participation Process Pyramid VPP Employee Ownership / Participation

PSM - Implementation t PSM Process Safety Information Process Hazard Analysis Operating Procedures Training Mechanical Integrity Contractors Management of Change Pre-startup Safety Review Hot Work Permits Compliance Audits Trade Secrets Employee Participation Emergency Planning and Response Incident Investigation

t t NuStar prides itself on a strong safety and environmental commitment Received many national safety honors over the last several years with our TRIR and LTIR far better than industry averages Presented with the International Liquid Terminal Association’s Platinum Safety Award – the Highest Safety Award in the Terminal Industry Continuous Improvement – Performance Health, Safety & Environmental NuStar West Region Injury Incident Frequency Rates TRIR – Total Recordable Incidents Rate LTIR – Lost Time Incidents Rate TRIR – Total Recordable Incidents Rate LTIR – Lost Time Incidents Rate 2009 through 2012 DART = 0

Continuous Improvement – Performance Health, Safety & Environmental

23 No LTIR Incidents DART = 0

Closing Remarks  To be successful in building Safety and Environmental Stewardship into your operation you must:  Develop and implement a Corporate Culture that places employees first and gives the employees the Ownership of the operation  Maintain Safety and Environmental Stewardship as your Key Performance Indicator – This is more important than any other KPI  Start and end everything with HSE (Health, Safety and Environmental)  Develop and ingrain an Attitude of all accidents and incidents are preventable  Implement the fundamentals of PSM into your operation regardless of the regulatory requirement  Include the work force in everything – give them ownership in their operations t

What is the Return on Investment? t Our VPP sites and our sites that work safely are more profitable! t Operations excellence provides a market advantage over your competition “No accidents, No Incidents and 100% Customer Satisfaction” t VPP sites go beyond the expectation therefore, are more compliant and receive less NOV’s t Employees have ownership which drives costs down t But…the most important return is your employees remain safe on the job site! 25

26 NYSE: NSH Curt Anastasio - CEO & President February 11, 2009 COVER SLIDE QUESTIONS & ANSWERS