1 Transport and Station Observations and Recommendations January 26, 2005 TOMA – Diesel Fuel Marketers Seminar Nashville, TN TRANSPORTATION OF ULSD MAP.

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Transport and Station

Observations and Recommendations

January 26, 2005

TOMA – Diesel Fuel Marketers Seminar

Nashville, TN

TRANSPORTATION OF ULSD MAP SYSTEM TESTING

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ULSD Timeline

80% pool

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Diesel Marketing - Low Sulfur or ULSD?

Who are your customers?

What are your logistical capabilities – tanks, lines, dispensers?

What are your supply options?

What is your risk tolerance?

Pricing?

HOW DO YOU ENSURE PRODUCT QUALITY?

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Light Product Distribution System Pre-Test Observations

Barges, Pipelines, Terminals, Transports have little or no experience in handling ultra low sulfur diesel product

Protecting the sulfur quality of ULSD while transporting it presents a challenge as difficult as when handling Jet Fuel

Industry has a new distribution challenge that has not been completely quantified. Additional transportation system testing and sharing of test data will be required.

Industry will spend millions of dollars to make facility and procedural changes to our transportation systems to minimize the risk of sulfur contamination

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Objective of MAP ULSD Testing

Evaluate the capability of barge, pipeline, terminal, transport and retail facilities to

deliver ≤ 15 ppm ULSD to the retail customer.

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MAP ULSD Testing Background Barge transportation, loading and unloading operations

Originating tank and manifold piping

Pipelines from 6” through 20” – up to 500 miles in length

Destination manifolds and tank piping

Terminal Aboveground Storage Tanks

Transport loading and unloading operations

Retail Station Underground Storage Tanks

Third party pipeline companies ability to move ULSD

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Test Scenario ExampleGulf Coast to Louisville

~ 24,000 bbls ULSD ~250 samples

Third Party Acquisition

Barge

Louisville Algonquin Terminal

Lexington TerminalTest flushing procedures on the barge loading piping. Product was not loaded on barge.

Tank 36-96

Tank 24-829

Retail Facility

Transport Truck

(Gulf Coast)

(Lexington, KY) (Louisville, KY)

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Terminal Operations

Observations & Recommendations

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Observations - Terminal Operations

Distillate aboveground storage tanks, after receipt of ULSD, showed indications of product (sulfur) stratification

A single tank sample will not represent the overall sulfur level of the product in the tank

Tank turns (heel mixing) for above ground storage tanks may not be effective for converting tanks to ULSD

Header displacement tests indicate that dead leg piping will displace

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Recommendations - Terminal Operations To obtain the sulfur level of ULSD in a

tank, several samples at different liquid heights will be required

Tanks must be emptied and have two turnovers, emptying the tank each time, before the tank can protect ULSD

Contamination from dead legs remains a possibility.

Each terminal must be thoroughly analyzed for dead leg contamination

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Transport Operations

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Objectives of Transport Testing Determine the sulfur contamination impact

of transport heels

Establish if the transport type, flat vs. slope bottom, contributes differently to contamination

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Transport Testing Background Two scenarios included transport testing

Louisville 4/16/04 Macon 5/31/04

Previous contents of the transports were jet fuel at 1425 ppm sulfur

Transports were compartmented One loaded “as is” One drained down at rack prior to loading One flushed at rack prior to loading

300 gallons loaded in each compartment

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Observations – Flat Bottom Transports GRAPH T-4

Scenario 1 - Transport Load Test 4 Flat Bottom Trailer #345 - 4/16/04

14.0

10.9

12.6

8

9

10

11

12

13

14

15

Su

lfu

r -

pp

m

Load Arm

Compartment Sample

11.8

Load Arm -ULSD Sample

"As Is" Test Compartment 2

Drain At RackCompartment 3

FlushCompartment 4

Repeatability of ULSD Test Method is ±1.2 ppm

1/2 gal contamination with 1425 ppm Jet

Fuel

13.0

14.2

1/4 gal contamination with 1425 ppm Jet

Fuel

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Observations – Slope Bottom TransportsGRAPH T-3

Scenario 1 - Transport Load Test 3 Conical Sloped Bottom Trailer #400 - 4/16/04

8

9

10

11

12

13

14

15

Su

lfu

r -

pp

m

Load Arm

Compartment Sample

11.8

10.9

11.7

12.3

Load Arm - ULSD Sample

"As Is" Test Compartment 1

Drain At RackCompartment 3

FlushCompartment 4

Repeatability of ULSD Test Method is ±1.2 ppm

1/2 gal contamination with 1425 ppm Jet Fuel 14.2

13.01/4 gal contamination with 1425 ppm Jet Fuel

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Transport Operations Observations Transports need to be completely drained when

switching from higher sulfur products to ULSD A flat bottom transport can present significant

contamination issues when loading ULSD Sloped bottom transports had little if any

contribution to contamination Draining compartments at the loading rack

reduced flat bottom contamination Flushing compartments with ULSD prior to

loading effectively removed any residual sulfur contamination in both transport types

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Transport Operations Recommendations Transport operators will need to adopt

procedures to protect ULSD quality Transport operators should consider

complete drain down capability prior to loading ULSD

More testing needs to be done

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Retail & Station Operations

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Objectives of Station Testing

Determine how stations can successfully convert to ULSD from low sulfur diesel

Ascertain the impact of manifolded underground storage tanks

Establish if/when product stratification occurs

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Station Testing Background Louisville 4/16/04

Truck Stop A Truck Stop B Gas Station Minimized Inventories

Macon 5/31/04 Truck Stop C Truck Stop D Normal Inventories

Samples were pulled from each station before and after drops

Top, middle, and bottom samples from each tank A nozzle sample (random dispenser)

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Macon Station Tank MixingMacon Area Stations

Tank Heel Mixing Tests - 5/31/04

38

7

17

8

42

4

17

0

39

2

82

.4

42

6

14

0.3

38

0

16

1

42

9

16

3.7

0

50

100

150

200

250

300

350

400

450

500

Truck Stop C Before Drop

Truck Stop C After Drop

Truck Stop D Before Drop

Truck Stop D After Drop

Location

Su

lfu

r -

pp

m

Station Tank Nozzle

Station Tank 1

Station Tank 2

Notes: The sulfur values shown as "After Drop" are averages of

top, middle and bottom samples. Drop made

into this tank

Drop made into this tank

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Louisville Area Stations Tank Heel Mixing Tests - 4/16/04

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1

41

.8

14

9

28

.5

19

.6

35

7

35

5.5

17

7

25

.1

15

4

34

.8

17

.2

90

.9

20

8.3

63

.5

14

7.7

23

.3

22

.7

15

8.3

38

.6

0

50

100

150

200

250

300

350

400

Truck Stop ABefore Drop

Truck Stop AAfter Drop

Truck Stop BBefore Drop

Truck Stop BAfter 1st Drop

Truck Stop BAfter 2nd Drop

Gas StationBefore Drop

Gas StationAfter Drop

Location

Su

lfu

r -

pp

m

Station Tank Nozzle

Station Tank 1

Station Tank 2

Station Tank 3

Drop made into this tank

1st drop made into this tank

2nd drop made into this tank

Notes: The tank sulfur values shown are

averages of top, middle and bottom samples. No tank sample available for

SSA- Before Drop

Louisville Station Tank Mixing

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Station Drop Volume Correlation

LOUISVILLE% Drop Volume Stratify?

Truck Stop A * Indicates drop tank

Tank 1 * 70% No

Tank 2 66% No

Tank 3 70% No

Truck Stop B

Tank 1 86% No

Tank 2 * 77% No

Gas Station

Tank 1* 25% Yes

MACON% Drop Volume Stratify?

Truck Stop C

Tank 1 * 58% Slight

Tank 2 49% Yes

Truck Stop D

Tank 1 63% No

Tank 2 62% No

% Drop Volume = Volume of Load Delivered

Total Inventory After Delivery

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Station Mixing Calculations

Station Tank 1

Actual Sulfur ppm

Calculated Sulfur ppm

% diff

Truck Stop A

25.1 60.9 - 58%

Truck Stop B – Drop 1

34.6 42.6 - 23%

Truck Stop B – Drop 2

17.2 18.9 - 10%

Truck Stop C

82.4 177.43 - 115%

Truck Stop D

140.3 171.7 - 22%

Average sulfur content in UST before the drop

Inventory in tank before the drop

Volume of ULSD load Sulfur content of

ULSD Linear mixing

assumptions

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Station Observations Mixing does occur across manifolded tanks Stratification in USTs can occur if the drop

volume is less than 60% of the final UST inventory

Multiple drops into different tanks promote better mixing

Stations should be able to successfully provide ≤ 15 ppm with planning multiple drops into each tank

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Station Recommendations Minimize inventory levels in tanks prior to

receiving ULSD loads to minimize stratification

Drop into each tank on site to promote mixing and quicker conversion

Estimate number of loads necessary to convert a station using historical sulfur content, tank inventories, and site sales

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CONCLUSION