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Tesoro Releases TOP Report on 2010 Incident at Anacortes Refinery

This article appears in the July/August 2011 issue of Inspectioneering Journal

SAN ANTONIO – July 21, 2011 – Tesoro Corporation (NYSE:TSO) today announced the release of the TOP (Triangle of Prevention) Investigation Team Report on the April 2, 2010, incident at the Anacortes Refinery in Washington State. The incident occurred when a heat exchanger in the refinery’s Naphtha Hydrotreater unit ruptured, causing an explosion and fire that fatally injured seven employees.

Investigation Process

The TOP program is a worker-led, company-supported Health and Safety Program designed to identify the cause of an incident and make recommendations to help prevent a similar incident in the future. The TOP investigation team consisted of Tesoro personnel with both technical and operational refinery expertise. It was led by and included Tesoro personnel who are members of the local chapter of the United Steelworkers (USW) union and also included non-represented personnel.

The TOP investigation was initiated immediately after the Anacortes incident. The investigation team reviewed thousands of pages of documents, interviewed numerous individuals and consulted with independent experts. The team also reviewed results of the extensive on-site and laboratory testing that was performed on the failed heat exchanger.

Key Report Findings

As detailed in the TOP Report, examination of the damaged exchanger identified high temperature hydrogen attack (HTHA) as the cause of the failure. Weakened by HTHA damage, the steel shell of the failed exchanger could not withstand operating pressures resulting in the shell rupture and subsequent fire.

The HTHA damage to the carbon steel was visible in laboratory samples under high magnification but could not be identified through normal visual inspection. Prior to the incident, specialized inspection for HTHA was not performed on the exchanger that subsequently failed as corrosion experts did not recommend the failed exchanger for an HTHA inspection in any of the five corrosion reviews conducted between 1990 and 2008.

Implementing and Sharing Recommendations

The TOP Report provides an important set of findings and recommendations, some of which Tesoro has already implemented, including:

  • Issuing a revised HTHA inspection procedure that provides an increased margin of safety above industry standards for determining equipment subject to HTHA testing.
  • Issuing a new procedure for the conduct of enhanced corrosion reviews.
  • Retaining a third-party engineering firm, that completed a comprehensive engineering evaluation of the company’s hydro-processing units and related piping and equipment. As a result of this evaluation, Tesoro has conducted additional inspections, installed additional instrumentation, and has established new integrity operating windows in pertinent hydro-process units.
  • Constructing new exchangers that are designed to further minimize the risk of HTHA.

The company has shared information about the incident in industry forums and with the appropriate American Petroleum Institute (API) task group; fully cooperated with the Washington Department of Labor & Industries (L&I) during its investigation; continues to fully cooperate with the U.S. Chemical Safety Board (CSB) and respond to requests from the U.S. Environmental Protection Agency (EPA). To date, Tesoro has made its employees available for over 100 agency interviews and provided tens of thousands of documents to the agencies.

The full TOP Report is available on Tesoro’s home page at www.tsocorp.com.

About Tesoro

Tesoro Corporation, a Fortune 150 company, is an independent refiner and marketer of petroleum products. Tesoro, through its subsidiaries, operates seven refineries in the western United States with a combined capacity of approximately 665,000 barrels per day. Tesoro’s retail- marketing system includes nearly 1,200 branded retail stations, of which over 375 are company operated under the Tesoro®, Shell®, Mirastar® and USA GasolineTM brands.

Contact:

Investors: Louie Rubiola, Director, Investor Relations, (210) 626-4355

Media: Mike Marcy, Manager of External Affairs, (210) 626-4697


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