Environment

Environment

Environment

2016 Environmental Performance Chart

At Tesoro, we are committed to being stewards of the environment. We strive to operate in a way that limits our environmental impact on our communities and their surrounding ecosystems. We work to continually improve our procedures, programs, tools and systems to mitigate risks and advance our environmental performance. We also engage stakeholders to garner feedback and hold ourselves to a high standard as a responsible corporate citizen.

As environmental metrics for Tesoro Logistics do not significantly change our overall performance indicators, this report does not include metrics for standalone Logistics assets, except regarding environmental spills and incidents.

Air Emissions

To reduce our environmental impact, we carefully manage air emissions from our operations – including nitrogen oxides, sulfur dioxide, carbon monoxide, carbon dioxide, volatile organic compounds and particulate matter. We monitor, track and report emissions data on a regular basis in accordance with federal and state laws and regulations, which allows us to take specific actions to improve air quality and mitigate our impact on the environment.

In 2016, we implemented operational efficiencies and installed new equipment, such as flare minimization, flare gas recovery, ultra-low nitrogen oxide burners, and sulfuric acid plant improvements, as part of long-term investments that we expect will further reduce emissions.

Greenhouse Gas Emissions

We recognize that climate change is an important global issue of interest to many key stakeholders, and we work to proactively reduce both direct and indirect greenhouse gas emissions throughout our operations. We manage our GHG emissions by focusing on energy and process efficiencies, reducing flare activity where safely possible, monitoring for steam leaks and repairing them promptly, and minimizing energy loss through equipment insulation. We also closely review all new projects and evaluate potential impacts, including energy usage and associated emissions.

There are many factors that can influence GHG emissions, such as planned and unplanned maintenance throughout the year. In 2016, our GHG emissions increased slightly, due in large part to lower refinery utilization in the first half of the year, but remained within a normal range of fluctuation for our operations.

We work closely with several renewable energy companies to assist in the commercialization of technologies that produce less carbon-intensive fuels. In 2016, we acquired Virent, an innovative renewable fuels and chemicals company, as part of our broader renewable fuels strategy. We aim to foster the development of high-quality, lower-carbon renewable feedstocks and blendstocks that can either be co-processed in existing refineries or blended seamlessly with traditional fuels.

Spill Prevention and Emergency Preparedness

Protecting the safety and well-being of our communities is a Core Value. We fully acknowledge that converting and transporting crude oil and refined products present risks to communities and ecosystems, particularly in the environmentally sensitive areas where we operate.

Spills of any volume are unacceptable, so we constantly refine our operational procedures to minimize risk. Our emergency response plans are reviewed and approved by federal, state and local regulatory entities and help us to anticipate potential emergencies specific to each operation. We also develop contingency plans to help us anticipate, prepare for and respond to events effectively. We provide our employees with thousands of hours of training each year in the latest incident response techniques.

In 2016, we conducted 78 equipment deployment and emergency response drills to enhance our emergency preparedness – a 160 percent increase from 2015, as our preparedness activities have scaled in step with our operations. We also worked with external partners and agencies, including leading oil spill response organizations, to conduct oil spill response exercises, building relationships and gaining feedback for our continuous improvement.

Tioga

In 2013, a Tesoro Logistics underground pipeline in North Dakota developed a leak that resulted in a spill of approximately 20,000 barrels of crude oil. To date, we estimate that we have treated about 70 percent of the impacted soil, and we remain fully committed to completing the remediation and restoring the property to agricultural use.

Water

Responsibly managing our use of fresh water is critical to our business, especially in areas where water is scarce, so we are always on the lookout for opportunities to reduce our water use and improve water quality. We use water for cooling, steam generation and production, and removing pollutants and particulate matter from our air emissions. Any water used in these processes is treated – at or above regulatory standards for wastewater discharge – so that it is safe to release back into the environment.

In partnership with local municipalities, we are also working to incorporate more recycled water into our operations, reducing consumption of fresh water and discharge. For example, at our Los Angeles Refinery in 2016, 30 percent of the water used was recycled wastewater, decreasing municipal water use by 27 percent.

Waste

Waste volume fluctuates from year to year based on maintenance and turnaround activities. We proactively seek ways to reduce, reuse and recycle materials in our operations to minimize the amount of waste generated. When we dispose of waste – both hazardous and nonhazardous – we do so in a safe and environmentally responsible manner that meets federal and state regulations. Over the past several years, we’ve focused on processes that allow us to reuse materials rather than dispose of them, such as reclaiming catalyst used in various process units.