Intertanko Vetting SeminarAthens – May 15, 2007

Tim PlummerPresident

Tesoro Maritime Company

Tesoro Corporation

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4Tesoro Today

2006

Fortune “150” # 132

Global “500” # 406

Revenues $ 18.1 billion

Refining & Marketing 100%

Enterprise Value $ 5.1 billion*

First refinery operated 1969

* As of January 26, 2007

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Anacortes, Washington

• 115 mbpd• 8.2 complexity• Key product:

Gasoline• 69 retail sites

Mandan,North Dakota

• 58 mbpd• 7.8 complexity• Key products:

Gasoline & Diesel• 112 retail sites

Salt Lake City, Utah• 58 mbpd• 6.3 complexity• Key products:

Gasoline & Diesel• 117 retail sites

Kapolei, Hawaii• 94 mbpd• 4.5 complexity• Key product: Jet• 34 retail sites

The Tesoro System

Corporate Office

Denver Office

London Office

Singapore Office

Auburn Office

Long Beach Office

Martinez, California• 166 mbpd• 13.5 complexity• Key products:

CARB Gasoline & CARB Diesel

• 89 retail sites

Los Angeles, California• 100 mbpd• 16.4 complexity• Key products: CARB

Gasoline & CARB Diesel• Approximately 310

retail sites Calgary Office

Tesoro System Highlights• 7 Refineries• 663 mbpd total crude capacity• 9.7 complexity• Retail network of over 860 sites• Over 6,000 Employees

RETAIL BRANDS

Kenai, Alaska• 72 mbpd• 4.9 complexity• Key product: Jet• 96 retail sites

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Growth through Strategic Acquisitions Improve Financial Performance

Acqu

isitions

Improve Financial Performance

Over 500% Total Shareholder Return Since 2003

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Golden Eagle Acquired

Salt Lake City & Mandan Acquired

KapoleiAcquired

Anacortes Acquired L.A. Refinery

Acquisition Announced

7Marine Structure

Tesoro Corporation

Tesoro Maritime Company

Gold Star Maritime Company

Tesoro Far EastMaritime Company

U.S. Flag Activity Non U.S. Flag Activity

8Refinery Associated Berths -1

• Hawaii SPM Terminal– Kapolei Refinery on Oahu

– Crude & Products

– Max dwt = 150,000

– Max LOA = 945 ft. – Max Draft = 57 ft. – UKC = 12 ft.

• KPL Dock – Nikiski, Alaska– Kenai Refinery

– Crude & Products

– Max dwt – 125,000 (summer) – 70,000 (winter)

– Max LOA = 850 ft. – Max Draft 37 ft. – UKC = 5 ft.

– Max cargo volume = 500,000 gross bbls.

9Refinery Associated Berths - 2

• Anacortes Outside Berth– Anacortes, Washington Refinery

– Crude & Products

– Max dwt = 125,000 (State of Washington restriction)

– Max LOA = 987 ft. – Max Draft = 45 ft.

• Amorco Wharf – Golden Eagle Refinery, Martinez, California

– Crude

– Max dwt – 190,000

– Max LOA = 1000 ft. – Max Draft 38 ft. FW

10Refinery Associated Berths - 2

• Long Beach Terminal Berths 84A & 86– Los Angeles, California Refinery

– Crude & Products

– Max dwt = 130,000

– Max LOA = 1000 ft. – Max Draft = 45 ft.

11Tesoro Time Chartered Fleet

• 2 – Suezmax

• 3 – Aframax

• 5 – MR’s

– 9 are Double Hull, 1 is Double Bottom

• 11 – Barges (U.S. West Coast & Hawaii)

– 10 are double Hull

Vetting

13IMPORTANCE

• Protection of people

• Protection of the environment

• Financial exposure

• Business disruption

• Our relationship with stakeholders

• Our reputation as a publicly owned company

• In Alaska we are the coil spill plan holder

14WHEN

• Tesoro Corporation policy requires that all vessels

must be vetted and approved before they can:

Be chartered-in

Perform under a COA

Carry cargo which Tesoro has an interest

Call at a Tesoro facility

15WHY

• To ensure ships comply with applicable rules,

regulations and accepted industry practices in

respect to safety, pollution prevention and

operational procedures.

• To ensure that the quality of the ship, crew and

owner meet our requirements

• To ensure that a ship can safely arrive, moor and

depart our facilities in respect to a vessel’s

particulars, draft and mooring capabilities

16WHY

• We don’t think we know how to operate your

tankers better than you do,

BUT,

– Not all tankers are the same

– Not all crews are the same

– Not all operators/managers are the same

– Not all owners are the same

17HOW

• A dedicated vetting system - TASC

• A designated vetting group

• An established process

• Clearly established general criteria

18VETTING SYSTEM - TASC

• TASC – Tesoro Acceptance & Ship Clearance System

• Internet based

• Covers, tankers, barges & bulk carriers

• Linked with Q-88

• Linked with LMIU (Lloyd’s Marine Information Unit)

• One process and one set of records

• Feedback from Terminal feature

• Developed & supported by Marine Information Systems

19VETTING GROUP

• Designated group of seven

– 5 Marine Superintendents

– 1 Port Captain

– Myself as GM Shipping Operations

• All Unlimited Masters

20VETTING PROCESS - 1

• Vetting requests are submitted in TASC

• Detailed review of:

– Tesoro Vessel Questionnaires (owners submit

questionnaires via Q-88 (www.Q88.com)

– Lloyd’s MIU

– SIRE

– U.S. Coast Guard PSIX

– Equasis & Tokyo MOU

– Internal Facility Feedback

21VETTING PROCESS - 2

– Facility specific acceptability

• Draft, mooring, KTM, DWT, LOA, Beam, etc.

• Facility specific recommendation is made to

approve or reject

• Final determination to approve or reject is made

and sent to requestor

22GENERAL CRITERIA

• Red flags

– Single hulls

– CBT (Clean ballast tankers)

– Tankers without IGS

– OBO’s over 12 years old

– OBO’s not in continuous wet service for at least 3

consecutive voyages

– Vessels with non-approved P&I Club

23GENERAL CRITERIA

• Key criteria in Tesoro system

– Hawaii SPM ( official dwt, BMA, draft)

– Alaska (draft, cargo volume, mooring)

– Puget Sound (dwt)

– San Francisco (draft, KTM)

24EXPERIENCE

• Will vet 600 – 700 vessels per year

• Rejection rate - 6.4% since Jan 06

– Poor SIRE reports

– Past experience with vessel/owner

– Inadequate mooring system

25SUMMARY

We really don’t think we know how to

operate your tankers better than you do,

but we have a lot on the line as well.

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Thank you !!