Major Project Siting A Positive Case Study Glenn McGinnis Chief Executive Officer Arizona Clean Fuels Yuma SESSION 1

Presentation Overview  Arizona Clean Fuels Yuma Refinery (ACFY) project – Background, Overview and Impacts  Yuma County Community – Overview and Impacts  Maricopa County / Yuma County - Contrasts  ACFY Community Approach Strategy  Assessment of Results  Lessons Learned – “Do’s and Don’ts”

Arizona Clean Fuels Yuma Project  Proposed new oil refinery – 150 kBD  Original location in Maricopa County – moved to Yuma County due to Air Permit Issues / Public concern  Complex Refinery - $4 billion project including new pipeline from west coast of Mexico  Construction requires 3000 people – Operations requires 500 people  Air Permit issued by ADEQ – emissions less than 50% of those from existing refineries

Yuma versus Maricopa County Sites  Maricopa County site: within “Ozone non-attainment area” In an area targeted for significant population growth Subject to environmental justice concerns Local opposition – political and community – project viewed negatively “Not a Good Choice”  Yuma County Site: In remote area with little population & low land values Local population interested in economic benefits – jobs, taxes, etc. Active local support – political and community – project viewed positively

ACFY selected site – 45 miles from Yuma Refinery Location

Yuma County Community Overview  Yuma County located in the SW corner of Arizona – bordering California & Mexico  County population is approximately 100,000 in summer – approaching 200,000 in winter  Closest town – Wellton is 10 miles west of the site – with population of 2,000  Farming area 3 miles northwest  Population in area is sparse  City of Yuma is 45 miles away – military and farm economy – growing industrial and commercial

Project Community Impacts  Construction – worker housing and services Rely on “Trailer Parks” with some temporary housing Company to provide transportation and on-site services Traffic around the site  Operations – expect 500 employees & contractors Will require housing – Yuma, Tacna, Dateland Impact on Schools, Recreational Facilities, etc. ACFY working with local Community College on training programs for local hiring

Community Concerns  Emissions impact on local environment – impact on farm crops assessed by Arizona Department of Environmental Quality in Permit Technical Support Document  Water use minimized by design – zero discharge  Local traffic and community services Arizona Dept. of Transport/ACFY planning new interchange on I-8 Impact minimal versus “Snowbirds”  Emergency Response capability and impact on local services  Impact on land values - positive

ACFY Community Outreach Strategy  Meet with local politicians and community leaders – early and often!  Provide details of project and its impacts – “good” and “bad”  Address key community concerns and be willing to “invest in community” – Training, Infrastructure  Be diplomatic to detractors – “Take the high ground”  Ensure State and Federal politicians and bureaucrats are briefed  Be proactive and available to the press

Assessment of Success  Excellent relationship with Yuma County Administration “The way ACFY has approached Yuma has been a textbook model – one that everyone appreciated from the very first day” – C. Prochaska, Yuma County Supervisor  Public meetings are well attended with more supporters than detractors  Air Permit re-issue actively supported by ADEQ, State Administration, Governor  No “organized” opposition during zoning hearings, permit hearings, public meetings  Frequent exposure in local and national press, radio and television

Lessons Learned  Find a location with minimal negative impact potential  Address key community concerns up-front and commit to good corporate citizenship  Be a champion for open communication  Deal with the tough issues and detractors  Build a network of influential supporters