/ Project: / Valero Terminaling and Distribution
Training Outlines and Support Services
MONTHLY STATUS REPORT
Date: / August 30, 2007 / Page 1 of 13
To: / Andy Szabo, Brian Guzzo, Gordon Stewart, Mike Elvert
From: / Kim B. Simmons
Subject: / Monthly Status Report – Progress through the end of August, 2007

Initial Project Scope: (Since this is the first formal report on this project, I have included several elements of the project’s origin as a basis for discussion.)

 At the end of 2006, we developed a proposal to accomplish the following for the Valero Terminals in the Memphis Area:

We will work directly with terminal personnel and managers to
  • Identify key procedures and processes for which renewed training outlines will be developed.
  • Revise or create effective process or activity maps of these processes.
  • Build short, concise and understandable training outlines which can be utilized effectively by terminal personnel.
  • Incorporate pictures, drawings, and other visual aids into the learning processes.
Ensure that terminal personnel “drive” the content and format of these materials so that the materials are truly usable and applicable to day-to-day, week-to week activities and requirements.

Initial proposal to Jay Kruckman attached. This proposal was used to initiate development of a Master Services Agreement between Valero Terminaling and Distribution and Whitewater Strategies and the associated compliance processes (ISNetworld, DISA, etc.)

A note about our process:

  • In order to achieve the second key element above (ensure that terminal personnel “drive” the content…) these outlines require face to face time with knowledgeable employees and leaders to sort out the real steps and relevant concerns. Our process involves:
  • Initial review of current outlines (if they exist)
  • Photographing key equipment or process elements
  • Building an initial process map identifying key step in the process.
  • Merging the detail from the current outline with the process map (or developing a draft outline) with knowledgeable resources
  • Completing a draft of the process and connecting photos
  • Reviewing and editing for a final draft.
  • The steps sometimes take significant time “on-site” with associates but the results continue to prove much more real and usable for both the current employees and new employees who will be trained.

Progress To Date:

Overall Progress

  • Scope:
  • Over the past eight months we have focused mainly on the West Memphis Terminal. 105 practices or procedures have been identified at this time which should have One Point Outlines developed for them.
  • In June we added the Memphis Terminal to our focus and began working on several procedures for that group. Initially 29 practices or procedures have been identified for One Point Outlines but a full list has not been brainstormed as yet.
  • Recently we have begun to extend some of the materials to Riverside and Collierville terminals. Only a few practices from the work at WM and Memphis terminals has been extended to this site at this time. Effort to identify a list of needed outlines has not yet been completed.

 Numerical Summary to date

In-Progress or Completion Status
Procedures Earmarked for Development / Total In Progress or Complete / % In Progress or Complete / % Ready for Approval / Word Outline Started / PPT & Pictures Started / PPT Detailed & in Review / PPT/PDF ready for Approval
West Memphis / 106 / 50 / 47% / 21% / 20 / 3 / 5 / 22
Memphis / 29 / 14 / 48% / 14% / 7 / 2 / 1 / 4
Riverside / 3 / 3 / 100% / 67% / 1 / 2
Collierville / 2 / 2 / 100% / 0% / 2
Total / 140 / 69 / 49% / 20% / 28 / 5 / 6 / 28

 Specific Outlines Developed by Site and Area and ready for Approval:

  • West Memphis

Inspections / HS&E / Equipment / River Dock
•Tank Inspection Daily
•Valve Manifold Inspection / •Field JSA & Work Permitting
•Field JSA Form
•Storm Water Sampling Monthly
•Storm Water Sampling Quarterly / •Tank Landing Roof
•Tank Floating Roof
•Tank Sampling Standpipe
•Tank Sampling Tap
•Tank Stripping
•Truck Rack Troubleshooting Guide
•Valve Terminal Manifold
•Vapor Combustion Unit
•Water Draw
•WMT Pipeline Receipt
•Additive Receiving and Unloading / •Barge Pump Operation
•Barge Unloading
•Dock Inspection
•Dock Repositioning
•Dock Barge Drip Pan Pump System
  • Memphis

Inspections / HS&E / Equipment / River Dock
• / •Field JSA & Work Permitting
•Field JSA Form
•MT Emergency Shutdown
•Foam Fire Suppression System / •
  • Riverside

Inspections / HS&E / Equipment / River Dock
• / •Field JSA & Work Permitting
•Field JSA Form / •
  • Collierville

Inspections / HS&E / Equipment / River Dock
• / •Field JSA & Work Permitting
•Field JSA Form / •

 Specific Outlines Developed by Site and Area and currently under development:

  • West Memphis

Inspections / HS&E / Equipment / River Dock
•Tank Farm Inspection
•Inspection Self – Monthly
•Operational Priorities / •Emergency Shutdown
•Power Interruption
•Inspection Fire Extinguishers / •Proving of Meters
•Oil Water Separator Operation
•Oil Water Separator Cleaning
•Oil Water Separator Inspect Start Stop
•Pipeline Batch Switch
•Pipeline Receipt Alignment to a Tank
•Roof and Dike Drain / •Dock Line Hydrostatic Testing
•Barge Loading
•Dock Barge Inspection Checklist
•Dock Contract Personnel Checklist
•Dock Line Displacement to Tank
•Dye Addition to a Tank or Barge
•LineWash - Barge Unloading
•Terminal and Dock Hump Valve
•Dock Line Hydrostatic Testing
  • Memphis

Inspections / HS&E / Equipment / River Dock
•MT Inspections Weekly
•MT Inspections Shift / •MT Foam Fire Suppression
•MT Fire Monitors / •
  • Riverside

Inspections / HS&E / Equipment / River Dock
• / • / • / •Dock Line Hydrostatic Testing

Immediate Action Plans

  • Next 4 weeks
  • West Memphis

Complete the following:

Tank Farm Inspections

Emergency Shutdown

Power Interruption

Proving of Meters

Review and set priorities for the next set including preparation of an outline for contractor safety on site.

  • Memphis Terminal

Review the list of procedures planned for development – add to list and prioritize.

Complete the following:

Inspections Weekly

Inspections Daily

Foam Fire Suppression

Fire Monitors

  • Riverside Terminal

Identify procedures from the West Memphis and Memphis Terminal current set that should be formatted and reviewed to apply to Riverside. Begin building these.

  • Collierville Terminal

Meet with Mike Elvert and discuss:

What priorities they have for development of outlines.

Share what has been done and make a list of procedures that may be formatted and reviewed to apply to Collierville.

  • General Work

During this week we identified a numbering system for the documents and are in the process of revising each document, adding a control number to it – and sorting out the numbering system.

Numbering Convention – {Type-Number-Location}

Type / INS / Inspections
HSE / HS&E (Health Safety & Environmental)
EQU / Equipment
RD / River Dock
Number / Three Digits (A process that is basically the same for each site but modified only for that site should have the same number.
Location / WM / West Memphis Terminal
MT / Memphis Terminal
RS / Riverside Terminal
CT / Collierville Terminal

We are developing an approval process for each of the completed documents. In this way we will:

Gain some control over which documents have been review and are in place, and

Insure each employee has reviewed and agreed to comply with the process outlined. A first draft of this control sheet is attached.

Additional Ongoing Work in association with the Refinery.

  • Memphis Refinery Quality Management System
  • I continue to work with Fred Price finalizing and improving the Quality Management System at the Refinery. We have completed outlines for:

Jet A

ULSD

Gasoline

  • Each of these products includes interaction with the Memphis and West Memphis terminals and procedures have been developed which overlap into our current work.
  • We are currently working on LPG manual.
  • Please note that Bryan and Gordon have spent significant effort during this work in the development of their sections of the manual as well as rewriting and developing PSM procedures to comply with the new Quality standards. To date we have revised or developed nine (9) procedures for West Memphis that took the place of approximately 20 separate procedures. These may be found in the Memphis Refinery Quality Management System Manual and Sec0900 files.
  • MemphisRefineryRiver Dock
  • I have been asked to work with the River Dock to completely review and revise their PSM system and Coast Guard Compliance Manual. This work has begun and I expect the outlines developed to have easy and direct application to the West Memphis River Dock should you choose to incorporate this work.

Budget Review

  • Invoiced Expenditures – January – July 2007

Amount / Comments
Consulting Fees / $70,700.00 / Based on 2006 proposal, amount adjusted in July to reflect less time planned.
Expenses / $18,398.56
Total YTD / $89,098.56
  • Expected Expenditures August

Amount / Comments
Consulting Fees / $8,300
Expenses / $2,000
Total YTD / $10,300

Please note – These rates were discounted to reflect the long term relationship Whitewater Strategies maintains with the Memphis Refinery. For your reference, our published rates as included with our master services agreement are attached as attachment 2.

Additional Notes

  • A CD is available with all the current One Point Outlines and the Refinery Quality Management System.
  • As soon as all outlines all final outlines have been numbered and an approval process confirmed, we should begin the final review and distribution of these forms. I will have all the renumbering and file checking completed by September 10, 2007.
  • I’m looking forward to a regular accounting for this process and the opportunity to support your strategy for improving overall training and development within the Terminal Group. Thanks

Kim Simmons

Whitewater Strategies, Inc.. -- 996 S. 650 W. -- Salem, UT 84653 – 801.358.9074 fax 801.423.0198

/ Project: / Valero Terminaling and Distribution
Training Outlines and Support Services
ATTACHMENT 1 -- PROPOSAL
Date: / August 30, 2007 / Page 1 of 13

Whitewater Strategies, Inc.. -- 996 S. 650 W. -- Salem, UT 84653 – 801.358.9074 fax 801.423.0198

/ Project: / Valero Terminaling and Distribution
Training Outlines and Support Services
ATTACHMENT 2 – GENERAL SERVICES SCHEDULE
Date: / August 30, 2007 / Page 1 of 13

Whitewater Strategies, Inc.. -- 996 S. 650 W. -- Salem, UT 84653 – 801.358.9074 fax 801.423.0198

Training Outline Review and Approval Form (DRAFT)
One Point Outline #:
Title:
Date Developed:
Developed for this specific location:
Applicable to the following locations:
Comments:
Approvals / Name or Signature / Date
Site Manager Name
Site Manager Approval Signature
Andy Szabo Approval
Leroy Anderson Approval
Steve Fite Approval
Intranet File Posting Date: / By:
Filename/Link:

Employee Acknowledgement and Review

By signing this Coversheet, I acknowledge that I have reviewed, understand and agree with the procedure described above. / By signing this Coversheet, I acknowledge that I have reviewed, understand and agree with the procedure described above.
Print Name / Signature / Date / Print Name / Signature / Date