PHILLIPS 66 CAP MEETING SUMMARY MONDAY, NOVEMBER 24, 2014

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1 PHILLIPS 66 CAP MEETING SUMMARY MONDAY, NOVEMBER 24, 2014 CAP MEMBERS: Frank Brosnan, Norma Clerici, Bryan Craig, Culoz Cookie Davis, Deborah Drake, Ridge Greene, Mike Kirker, Jerry Littleton, Clover Mahn, Ron Wilson, Fr. Larry Young PHILLIPS 66: Mark Evans, Aimee Lohr, Larry Silva STAFF: Tom Stewart, Facilitator; Marina Gottschalk, Scribe WELCOME On Monday, November 24, 2014, a dinner meeting was held at the Phillips 66 Refinery in Rodeo. Selfintroductions were made. REFINERY MONTHLY UPDATE Operations, Turnaround, Maintenance Mark Evans reported that the plant was running well after the turnaround. Old equipment will be demolished over the next few months. Scaffolds will be erected over the next few weeks. The skyline will be changed and the refinery will be less visible to the community and from the freeway. A turnaround is to begin on Jan. 7, It will not be a big one, and is to last a few weeks. Another project is to take place in mid-year. Asked about the refinery s maximum operating capacity, Mark responded that it all depends on the unit. He would like it to be in the high 90 percent range for crude. As an example, hydrocrackers are designed to go for three years at 80 percent. Some refineries shut down everything, while some maintain limited operations of units not involved in a turnaround. Sometimes a choice is made to produce more of a certain product instead of another one, i.e. diesel versus gasoline; this is because more money can be made or more product can be made. For downstream operations, if crude oil costs can be reduced, then the refinery could run more as opposed to scaling back when costs are high. Environmental, Health, and Safety Larry Silva reported that a CWS notification was made on Oct. 29 due to an odor abatement compressor shutdown. A malfunction occurred on a tank and the compressor shut down. The vapors from the tanks were directed to the flare and flaring occurred. By sending it to the flare, there was no odor in the community. Mark added that repairs were made so it won t recur. 1

2 Larry reported that the only injury this year, at SFR and Santa Maria, occurred in October to the machinist working on the lathe (reported at the October meeting). If no other injuries occur by the end of 2014, it will be the refinery s safest year ever. Mark noted that there were several fatalities at a DuPont plant in Houston, TX as the result of a mercaptan leak within a building. Mercaptans are a class of sulfur-containing compounds having an extremely offensive, garlicky odor, and are used as odorants in gases used for heating and other purposes. Mercaptan is shipped in railroad cars. In this case, a worker went to check and was overcome by the fumes. Two other workers followed, then several others attempting to assist the workers and were also overcome by the fumes. Apparently, at least one rescuer took off his face mask to render assistance rather than remove the downed worker to a safe location... Three died at the site and one was still in the hospital in critical condition. Phillips 66 Santa Maria Rail Project: Larry Silva Larry announced that the presentation on the Santa Maria Rail Project was being made at the request of Frank Brosnan. The Phillips 66 Santa Maria site is in Arroyo Grande, in San Louis Obispo County, close to Santa Maria. Built in 1955, it takes up 200 acres of a 1,780 acre parcel. There are 135 full-time employees. The refinery processes 44,000 barrels of crude oil into distillate and gas oil daily. Secondary products include petroleum coke and sulfur. The distillate and gas oil is shipped is shipped to SFR and elsewhere via common carrier pipeline that is regulated by the state Public Utilities Commission (PUC). Larry noted that anyone can ship on the pipeline if they pay the tariff and meet the specifications. However, Phillips 66 is the primary customer. The Santa Maria Refinery does not have water access or a dock and currently the only way of bring crude oil into or refined liquids out of the site is by pipeline. Under the proposed project, the Santa Maria Refinery could receive up to 80-car unit trains, three to five days a week. Larry stressed that it would not change the amount or type of crude the Santa Maria refinery receives heavy, sour crude such as is produced in California. In order to process a different type of crude, modifications would have to be made to the crude unit at the Santa Maria Refinery. Mark Evans commented that it is unknown what type of crude will be shipped in three years. This is a project designed to increase the flexibility and viability of Santa Maria. In order to get favorable shipping rates, the trains need to be turned around in 24 hours. The reason for the proposed project is basic economics. California crude oil production is declining and has been for many years. In order to receive crude from elsewhere, modifications would have to be made to the refinery. Larry noted that there is a permit capacity and physical constraints in terms of the amount of crude that can be received. The Trinity retirement community was built near the refinery. Trees were removed and sand blows into the homes. Most of the property adjacent to the refinery is used grazing land and strawberry fields. A draft environmental impact report (EIR) was prepared and San Luis Obispo County elected to have the EIR revised and recirculated. The public comment period will end in a few weeks. The Planning Commission is scheduled to discuss the project in early February. The state Attorney s General Office 2

3 commented on a similar project in California, and San Luis Obispo County elected to change the way rail projects were evaluated. Asked about the potential for receiving a different type of crude, it is possible; however, it is not planned at this point. Clover Mahn noted that she attended a Contra Costa County Planning Commission the previous week at which many things were said (by those in attendance) that were untrue, based on her reading of the EIR. (Note: This was related to the Liquified Petroleum Gas project, not the Santa Maria Rail Project). Culoz Davis expressed her appreciation for the presentation made by Tony Semenza of CAER at the October meeting. Noting that she has lived in Rodeo since 1955, as a child, she remembers tank cars sitting on the track for a long time in front of the Bayo Vista housing that had nothing to do with the refinery. She also commented that SFR is the best outlet for the Santa Maria crude due to its design and historically receiving Central Valley crude. In response to a comment made regarding hazards, Mark noted that many things are shipped by rail that are worse than crude, including ethanol. Ethanol cannot be shipped by pipeline as it will corrode the pipes. Community and Government Relations: Aimee Lohr distributed a community calendar for scheduled events in November and December, as well as those currently scheduled for Flyers were also distributed for: 11/30 - Annual Holiday Tree Lighting 12/07 - Crockett Community Holiday Party and Tree Lighting The CAP Holiday Dinner will be Dec. 16 at the Dead Fish in Crockett. Membership: Tom announced that a new person has been selected as the Director of Economic and Workforce Development at Contra Costa College, and is to begin Dec. 1. Her name is Kelly Schelin. Tom will reach out to her to see if she is interested in becoming a CAP member. John Swett Careers Academy: Tom announced that through a cooperative effort of Alameda and Contra Costa counties, two grants a $16 million Career Pathway Trust Grant was awarded, and that John Swett Careers Academy is to receive $250,000 over a three-year period to increase STEM (science, technology, engineering and math) visibility in career and technical education, and in the manufacturing areas as well as health care. It is hoped that the CAP can become more involved in career technical pathways, and have more presentations in this area. Aimee Lohr noted that a contract company hired a young man who went through the Careers Academy. He stayed in school because he enjoyed the academy. The young man, who had overcome some challenges in his life, just bought his first home. 3

4 Tom commented that something to consider is how students from John Swett Unified School District get into some of the programs as do students from El Cerrito, Emeryville, Berkeley, etc., and get into a technical career, and be hired by a company such as Genentech. The Careers Academy Executive Committee meeting is scheduled for Dec. 18. CAP Topics: Tom asked the CAP to think about potential topics for He noted that some of the topics identified for 2014 were not addressed, and will be rolled over for re-consideration. Community News: Port Costa: Ridge Greene reported that a parking lot for the school is being worked on. The Bay Trail, near the school, is a viability of the school. Fire sprinklers and the electrical system are improved through small occasional grants. Crockett Veterans Hall: Ron Wilson announced a benefit concert that included five bands put on by Toots Tavern on Veterans Day raised $1,143 and that the Crockett Community Foundation put in $1,000. John Swett School District: Norma Clerici reported that the new school board member offered to be a CAP delegate, or as an alternate with her. The district was on a Thanksgiving week break Crockett Fire District Jerry Littleton thanked Phillips 66 for removing the old Associated Oil dock. He said that more injuries are expected to occur on the Carquinez Scenic Trail due to recent modifications. Some people will not use it due to more bicyclists on the trail. Rodeo-Hercules Fire District Bryan Craig reminded everyone to change their clocks and batteries due to the time change. He reported that two arson fires occurred on First Street in Rodeo, probably caused by a homeless person in an abandoned building. The building will be torn down. A historical Hercules home on pilings was burned. The department will deliver Santa to the upcoming tree lighting. The department is still facing financial problems. Cindi Erickson is to work with Fire Chief Hanley on a letter to County Assessor Gus Kramer on behalf of the CAP supporting a reassessment of SFR s assessed value, as it affects the department. Comments are to be made at a Board of Supervisors meeting. Fence line Monitoring: Frank Brosnan reported that an independent audit is to be done Dec, 12 at a cost of $20,000. Per the Memorandum of Understanding (MOU) there is $5,000 per year set aside for independent audits of the fence line monitoring equipment with a maximum of $20,000 to be used at one time. 4

5 RMAC: Debra Drake reported that the RMAC meeting was changed to the previous Thursday, and a presentation was made by Don Bristol on the LPG project, and Aimee Lohr and Larry Silva were there. Tony Semenza is to be invited to make a presentation on Crude by Rail in Clover Mahn thanked Phillips 66 for the purchase of a stove for the Rodeo Senior Center and was appreciative that now they can properly heat for the Senior Food Program. Adjourn: The CAP meeting was adjourned. The next meeting will be held on January 26,

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