IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS

) UNITED STATES OF AMERICA, ) STATE OF ILLINOIS, ) STATE OF LOUISIANA, )
STATE OF NEW JERSE Y, ) COMMONWEALTH OF PENNSYLVANIA, ) NORTHWEST CLEAN AIR AGENCY, ) ) CIVIL ACTION NO. H

- 05

- 258 ) Plaintiffs, ) JUDGE SIM LAKE )

v. ) ) PHILLIPS 66 COMPANY, ) WRB REFINING LP, ) MONROE ENERGY, L LC, ) )
Defendants. ) ) )

FOURTH AMENDMENT TO CONSENT DECREE

WHEREAS, on January 27, 2005, Plaintiff, the United States of America (“United

States”), on behalf of the Environmental Protection Agency (“EPA”), Co

- Plaintiff the State of

Illinois (“Illinois”), on behalf of the Illinois Environmental Protection Agency, Co

- Plaintiff the

State of Louisiana (“Louisiana”), on behalf of the Louisiana Department of Environment al

Quality, Co

- Plaintiff the State of New Jersey (“New Jersey”), at the request and on behalf of the

New Jersey Department of Environmental Protection, Co

- Plaintiff the Commonwealth of

Pennsylvania (“Pennsylvania”), on behalf of the Pennsylvania Department of Environmental

Protection, and Co

- Plaintiff the Northwest Clean Air Agency (collectively “Plaintiffs”) filed a2 complaint in this action against and simultaneously lodged a consent decree with ConocoPhillips

Company (“COPC”);

WHEREAS, on December 5, 200 5, this Court entered the consent decree (the “December

2005 Consent Decree”) that fully resolved the claims in the complaint;

WHEREAS, on May 1, 2007, a First Amendment to the December 2005 Consent Decree

was entered;

WHEREAS, on September 27, 2007, this Court approved a stipulated order adding WRB

Refining LLC, now WRB Refining LP (“WRB Refining”)

, as a party to the Consent Decree for

certain obligations at the Wood River and Borger Refineries as the owner of those refineries;

WHEREAS, on August 11, 200 8, a Second Amendment to the December 2005 Consent

Decree was entered;

WHEREAS, on April 13, 2012, a Third Amendment to the December 2005 Consent

Decree was entered;

WHEREAS, on June 1, 2012, this Court entered an Order substituting Phillips 66

Company (“ Phillips 66”) for COPC as a Defendant in this case because Phillips 66 became the

owner and/or operator of all of the Covered Refineries and assumed all obligations of the

Consent Decree;

WHEREAS the December 2005 Consent Decree as modified by the First, S econd, and

Third Amendments, the addition of WRB Refining as a Defendant, and the substitution of

Phillips 66 for COPC hereinafter shall be referred to as the “Consent Decree” or “Decree”;

WHEREAS this Fourth Amendment relates only to the refinery located in Trainer,

Pennsylvania (“Trainer Refinery”);3 WHEREAS Paragraph 8 of the Consent Decree provides that Phillips 66 may transfer, in

whole or in part, ownership of, operation of or other interest in any Covered Refinery if the

transferee agrees to assume li ability for all of the terms and conditions of the Consent Decree

that apply to the refinery being transferred and the transferee provides a certification that it has

the financial and technical ability to assume the obligations and liabilities under the C onsent

Decree that are related to the transfer;

WHEREAS, on May 17, 2012, in accordance with Paragraph 6 of the Consent Decree,

Phillips 66 notified the United States and Pennsylvania of its intent to transfer ownership and

operation of the Trainer Refiner y to Monroe Energy, LLC (“Monroe Energy”);

WHEREAS Monroe Energy is a Delaware Limited Liability Company that will be

engaged in refining and marketing petroleum products;

WHEREAS in the asset transfer documents between Phillips 66 and Monroe Energy,

Monro e Energy agreed to become a Party to the Consent Decree with respect to the outstanding,

uncompleted obligations and liabilities of the Consent Decree that relate to the Trainer Refinery;

WHEREAS, on June 15, 2012, Monroe Energy provided a certification of its financial

and technical ability to assume the outstanding, uncompleted obligations and liabilities related to

the Trainer Refinery under the Consent Decree;

WHEREAS, on June 22, 2012, Phillips 66 transferred ownership of the Trainer Refinery

to Monroe Energy;

WHEREAS, Paragraph 444 of the Consent Decree provides:

At such time as [Phillips 66] believes that it has satisfied the requirements for termination set forth in Paragraph 443 as to one or more Covered Refineries or as to the entire Decree, [Phill ips 66] will certify such compliance and completion, in accordance with the certification language of Paragraph 440, to the United States
and the Co

- Plaintiffs in writing. Unless, within one hundred twenty (120) days of receipt of [Phillips’ 66] certifica tion under this Paragraph 444, either the United4 States or any Co Plaintiff objects in writing with specific reasons, the Court may upon motion by Phillips 66 order that this Consent Decree be terminated as to such Covered Refinery(ies).

WHEREAS, o n July 12, 2012 , Phillips 66 certified to the United States that it had taken

the following actions at the Trainer Refinery in completion and satisfaction of the Consent

Decree:

a. Installed control technology at its Fluid Catalytic Cracker (“FCC”) to
reduce emi ssions of sulfur dioxides (“SO 2 ”), nitrogen oxides (“NOx”), and particulate matter (“PM”), in compliance with the provisions in Affirmative Relief Subsections V.A, V.B, and V.C of the Consent Decree that pertain to the Trainer Refinery;

b. Demonstrated c ompliance with the carbon monoxide (“CO”) limits and monitoring requirements for the FCC, in compliance with the provisions in Affirmative Relief Subsection V.D of the Consent Decree that pertain to the Trainer Refinery;

c. Demonstrated compliance with th e opacity limits and the monitoring requirements for the FCC Unit Catalyst Regenerators in compliance with the provisions in Affirmative Relief Subsection V.E. of the Consent Decree that pertain to the Trainer Refinery;

d. Installed “Qualifying Controls ” (as that term is defined in Paragraph 94 of the Consent Decree) on certain heaters and boilers at the Trainer Refinery by permanently shutting down Boilers Numbered 6 and 7 and the FCC Unit Feed Heater to realize a 917.2 ton per year reduction in NOx
emi ssions which will be applied to Phillip 66’s corporate commitment under Paragraph 95;

e. Accepted 40 C.F.R. Part 60, Subpart J New Source Performance Standards for its FCC, its sulfur recovery unit and associated tail gas treating unit,
and its Old Yard a nd Acid Gas Flares;

f. Until the refinery was temporarily idled in September 2011, materially and substantially complied with all provisions in the Consent Decree, except for those being transferred to Monroe for completion pursuant to this
Fourth Amend ment;

g. Prior to September 2011, applied for and received permits incorporating the surviving emission limits and standards established under Section V of the Consent Decree (a table of the emission limits and standards5 established under the Consent Dec ree prior to September 2011 is attached hereto as Exhibit 1);

h. Operated each unit specified above for at least one year in material and substantial compliance with the emission limits reported in Exhibit 1;

i. Paid the civil penalty with respect to all Covered Refineries and the stipulated penalties with respect to the Trainer Refinery; and

j. Completed the Supplemental/Beneficial Environmental Projects in
Section VIII that relate to the Trainer Refinery.

WHEREAS the United States, Pennsylvania, Phill ips 66, and Monroe Energy agree that

all Section V obligations of the Consent Decree relating to the Trainer Refinery have been

satisfied except for those set forth in Paragraphs 01, 05, and 06 below;

WHEREAS no stipulated penalties accruing during COPC’s or Phillips 66’s ownership

and operation of the Trainer Refinery are outstanding;

WHEREAS the United States, Pennsylvania, Phillips 66, and Monroe Energy seek to add

Monroe Energy as a Defendant in the above

- referenced case in order to have Monroe Energy

a ssume those obligations of the Consent Decree related to the Trainer Refinery that have not yet

been certified as having been completed;

WHEREAS, simultaneously with Monroe Energy’s assumption of the outstanding,

uncompleted Consent Decree obligations at t he Trainer Refinery, the United States,

Pennsylvania, Phillips 66, and Monroe Energy seek to terminate the Consent Decree obligations

at the Trainer Refinery as to Phillips 66;

WHEREAS the following Subsections of Section V of the Consent Decree (“Affirma tive

Relief “) identify the outstanding, uncompleted obligations that Monroe Energy will be required

to comply with at the Trainer Refinery until Monroe Energy certifies them as complete:

F. NOx Emissions Reductions from Combustion Units (as described in

P aragraph 05 below)6 G. NSPS Applicability of Flaring Devices (as described in Paragraph 04 below)

L. Control of Acid Gas Flaring Incidents and Tail Gas Incidents

M. Control of Hydrocarbon Flaring Incidents

N. Benzene Waste Operations NESHAP Program En hancements

O. Leak Detection and Repair Program Enhancements

P. Incorporation of Consent Decree Requirements into Federally Enforceable
Permits

WHEREAS the United States, Pennsylvania, Phillips 66, and Monroe Energy agree that

Monroe Energy is responsi ble for the obligations in the above referenced Subsections that apply

to the Trainer Refinery only; that Monroe Energy has no obligations with respect to any Covered

Refinery other than the Trainer Refinery; and that the following Paragraphs within the ab ove

referenced Subsections do not contain any obligations relating to the Trainer Refinery: 100A,

105, 106, 107, 108, 109, 110, 111, 112, 114, 122A, 123A, 127 through 135, 136, 170, 174,

179A

– 179C, 180, 204 and 259A

– 259K;

WHEREAS the United States, Pennsy lvania, Phillips 66, and Monroe Energy agree that

the limits set forth in Exhibit 1 will survive the termination of the Consent Decree as to the

Trainer Refinery and that the limits are included as terms and conditions in the Trainer

Refinery’s combined Ne w Source/Operating Permit Number 23

- 00003;

WHEREAS Monroe Energy acknowledges that the Trainer Refinery must operate in

accordance with the limits in Exhibit 1;

WHEREAS, the United States, Pennsylvania, Phillips 66, and Monroe Energy agree that

Monroe Ener gy shall not be responsible for payment of any portion of the civil penalty provided

for in Part X of the Consent Decree, which civil penalty already has been paid in full and that7 Monroe Energy shall not be responsible for payment of any portion of the st ipulated penalty

required pursuant to Paragraph 288B of the Third Amendment of the Consent Decree, which also

has been paid in full;

WHEREAS the interests of Co

– Plaintiffs Illinois, Louisiana, New Jersey, and the

Northwest Clean Air Agency are not implicat ed in nor affected by the matters in this Fourth

Amendment because these Co

- Plaintiffs have no jurisdiction or authority over the Trainer

Refinery and these Co

- Plaintiffs therefore are not necessary parties to this Amendment;

WHEREAS the interests of Defen dant WRB Refining are not implicated in nor affected

by the matters in this Fourth Amendment because WRB Refining has no ownership or

operational interest in the Trainer Refinery and therefore WRB Refining is not a necessary party

to this Amendment;

WHEREA S, the United States, Pennsylvania, Phillips 66, and Monroe Energy recognize,

and the Court by entering this Fourth Amendment finds, that this Fourth Amendment has been

negotiated at arm’s length and in good faith and that this Fourth Amendment is fair, re asonable,

and in the public interest;

NOW THEREFORE, before the taking of any testimony, without adjudication of any

issue of fact or law, and upon the consent and agreement of the Parties necessary to this

Amendment, it is hereby ORDERED, ADJUDGED, and D ECREED as follows:

AMENDED AND RESTATED SECTIONS

The Consent Decree shall remain in full force and effect in accordance with its terms,

except that:8 01. Monroe Energy is added as a Defendant in the above

- referenced case and shall be

liable for those oblig ations of Section V of the Consent Decree related to the Trainer Refinery

that have not been certified as having been completed. Those obligations are as follows:

F. NOx Emissions Reductions from Combustion Units (as described in Paragraph 05 below)

G. NSPS Applicability of Flaring Devices (as described in Paragraph 04 below)

L. Control of Acid Gas Flaring Incidents and Tail Gas Incidents

M. Control of Hydrocarbon Flaring Incidents

N. Benzene Waste Operations NESHAP Program Enhancements

O. Leak De tection and Repair Program Enhancements

P. Incorporation of Consent Decree Requirements into Federally Enforceable
Permits

The capitalized letters set forth above refer to the Subsections within Section V of the Consent

Decree where the obligations are found.

02. Monroe Energy is responsible for the obligations in the above

- referenced

Subsections that apply to the Trainer Refinery only. Monroe Energy has no obligations with

respect to any Covered Refinery other than the Trainer Refinery.

03. On July 12, 2012, Phillips 66 certified to the United States that it had taken the

following actions at the Trainer Refinery in completion and satisfaction of the Consent Decree

and, consequently, the obligations described in this P aragraph 03 are terminated with res pect to

the Trainer Refinery:

a. Installed control technology at its Fluid Catalytic Cracker (“FCC”) to reduce emissions of sulfur dioxides (“SO 2 ”), nitrogen oxides (“NOx”), and particulate matter (“PM”), in compliance with the provisions in
Affirmative R elief Subsections V.A, V.B, and V.C of the Consent Decree that pertain to the Trainer Refinery;9 b. Demonstrated compliance with the carbon monoxide (“CO”) limits and monitoring requirements for the FCC, in compliance with the provisions
in Affirmative Rel ief Subsection V.D of the Consent Decree that pertain to the Trainer Refinery;

c. Demonstrated compliance with the opacity limits and the monitoring requirements for the FCC Unit Catalyst Regenerators in compliance with the provisions in Affirmative Relie f Subsection V.E. of the Consent Decree that pertain to the Trainer Refinery;

d. Installed “Qualifying Controls” (as that term is defined in Paragraph 94 of the Consent Decree) on certain heaters and boilers at the Trainer Refinery by permanently shuttin g down Boilers Numbered 6 and 7 and the FCC Unit Feed Heater to realize a 917.2 ton per year reduction in NOx emissions which will be applied to Phillip 66’s corporate commitment under Paragraph 95;

e. Accepted 40 C.F.R. Part 60, Subpart J New Source Perf ormance Standards for its FCC, its sulfur recovery unit and associated tail gas treating unit, and its Old Yard and Acid Gas Flares;

f. Until the refinery was temporarily idled in September 2011, materially and substantially complied with all provisions in the Consent Decree, except for those being transferred to Monroe for completion pursuant to this Fourth Amendment;

g. Prior to September 2011, applied for and received permits incorporating the surviving emission limits and standards established unde r Section V of the Consent Decree (a table of the emission limits and standards established under the Consent Decree prior to September 2011 is attached hereto as Exhibit 1);

h. Operated each unit specified above for at least one year in material and
subs tantial compliance with the emission limits reported in Exhibit 1;

i. Paid the civil penalty with respect to all Covered Refineries and the stipulated penalties with respect to the Trainer Refinery; and

j. Completed the Supplemental/Beneficial Environmen tal Projects in
Section VIII that relate to the Trainer Refinery.10 04. The permitted limits and standards set forth in Exhibit 1 to this Order shall

survive the termination of the Consent Decree as to the Trainer Refinery. Monroe Energy shall

operate in accordance with these permitted limits.

05. With respect to the Trainer Refinery, Paragraph 143 of the Consent Decree is

hereby amended as follows: Monroe Energy shall have until eight (8) months after the restart of

the Trainer Refinery (following an ant icipated turnaround in 2012) to certify compliance with

one or more of the compliance methods found in Paragraph 139 of the Consent Decree and

accept NSPS applicability at the Main Yard and SWS Flares at the Trainer Refinery.

06. With respect to the Traine r Refinery, Paragraph 95 of the Consent Decree is

hereby amended to require Monroe Energy to secure part of Phillips 66’s NOx reductions as

follows: Monroe Energy shall secure and demonstrate 278 TPY of NOx reductions from heaters

and boilers at the Train er Refinery (which shall be in addition to the 917.2 tons of NOx

reductions previously realized by Phillips 66 at the Trainer Refinery). Monroe Energy shall have

until twelve (12) months after the restart of the Trainer Refinery (following an anticipated 2012

turnaround) to install Qualifying Controls on the heaters and boilers at the Trainer Refinery to

fulfill Monroe Energy’s obligation to achieve a reduction of 278 TPY of NOx emissions.

07. Paragraph 95 of the Consent Decree is hereby amended to require Phillips 66 to

demonstrate and certify, in accordance with the requirements of Paragraph 95, a total of 3,755.8

TPY of NOx reductions from the heaters and boilers at all Covered Refineries except for the

Trainer Refinery.

08. Monroe Energy shall send a no tification to the United States and Pennsylvania

that identifies the date that it restarts the Trainer Refinery (after the turnaround, which is

anticipated in 2012).11 09. Monroe Energy shall not be responsible for payment of any portion of the civil

penalty provided for in Part X of the Consent Decree, which civil penalty already has been paid

in full. Further, Monroe Energy shall not be responsible for payment of any portion of the

stipulated penalty required pursuant to Paragraph 288B of the Third Amendme nt of the Consent

Decree, which also has been paid in full.

010. Monroe Energy shall be responsible for the payment of stipulated penalties, if

any, that may accrue during its ownership or operation of the Trainer Refinery.

011. All Section V obligations r elating to the Trainer Refinery have been satisfied

except for those set forth in Paragraphs 01, 05, and 06.

012. Other than the limitations set forth in Paragraphs 01, 03

, and 09 (with respect to

Sections V and X of the Consent Decree and Paragraph 288B o f the Third Amendment), Monroe

Energy shall be substituted for Phillips 66 as the Defendant, with respect to the Trainer Refinery

only, for all other provisions of the Consent Decree, including all rights, liabilities, and

obligations.

013. For purposes o f Notification under Paragraph 433 of the Consent Decree, the

Trainer Refinery and Monroe Energy shall be notified as follows:

Mr. Jeffrey Warmann Manager Trainer Refinery
4101 Post Road Trainer, PA 19061

Ms. Christine Boucher
Shared Servic es Counsel Delta Air Lines, Inc.
P.O. Box 20574 Atlanta, Georgia 30320

- 2574
Phone: 404 715

- 9921
Fax: 404 715

- 2233
Email: Christine.Boucher@Delta.com12 014. As to the Trainer Refinery only, the Consent Decree is terminated as to

Phillips 66 and Phillips 66 no longer is liable to the United States and/or Pennsylvania for any

obligations that apply to the Trainer Refinery.

Dated this _______ day of ___________, 2012.

_______________________________ UNITED STATES DISTRICT JUDGE13 Fourth Amendment to Consent Decree in the matter of United States

, et al. v. Phillips 66 Company , Civil Action No. H

- 05

- 0258 (Southern District of Texas).

FOR THE UNITED STATES OF AMERICA

IGNACIA S. MORENO /s/ Ig nacia S. Moreno

Assistant Attorney General

Environment and Natural Resources

Division U.S. Department of Justice Washington, D.C. 20530

ANNETTE M. LANG /s/ Annette M. Lang

Trial Attorney

Environmental Enforcement Section

E nvironment and Natural Resources

Division U.S. Department of Justice

P.O. Box 7611

Ben Franklin Station Washington, D.C. 20044

- 7611 Telephone: (202) 514

- 4213 Facsimile: (202) 616

- 6584 annette.lang@usdoj. gov14 Fourth Amendment to Consent Decree in the matter of United States

, et al. v. Phillips 66 Company , Civil Action No. H

- 05

- 0258 (Southern District of Texas).

KENNETH MAGIDSON

UNITED STATES ATTORNEY

SOUTHERN DISTRICT OF TEXAS

By: /s/ Keit h Edward Wyatt

KEITH EDWARD WYATT Assistant United States Attorney

Texas Bar No. 22092900

Fed. Bar No. 3480

P.O. Box 61129 Houston, TX 77208 Telephone: (713) 567

- 9713 Facsimile: (713) 718

- 3 303 keith.wyatt@usd oj.govFourth Amendment to Consent Decree in the matter of United States

, et al. v. Phillips 66 Company , Civil Action No. H

- 05

- 0258 (Southern District of Texas).

FOR THE ENVIRONMENTAL PROTECTION AGENCY

/s/ Pamela J. Mazakas ***

PAMELA J. MAZAKAS Acting Director
Office of Civil Enforcement Office of Enforcement and Compliance Assurance United States Environmental Protection Agency Ariel Rios Building 1200 Pennsylvania Ave., Mail Code 2201A Washington, DC 20460

/s/ John Fogarty ***

JOHN FOGARTY
Office of Civil Enforcement Office of Enforcement and Compliance Assurance United States Environmental Protection Agency Ariel Rios Building 1200 Pennsylvania Ave., Mail Code 2201A Washington, DC 20460

*** Signed with permission.Fourth Ame ndment to Consent Decree in the matter of United States

, et al. v. Phillips 66 Company , Civil Action No. H

- 05

- 0258 (Southern District of Texas).

FOR CO

- PLAINTIFF
COMMONWEALTH OF PENNSYLVANIA

/s/ James Rebarchak ***

JAMES REBARCHAK Regiona l Manager, Air Quality Pennsylvania Department of Environmental
Protection
2 East Main Street Norristown, PA 19401 (484) 250

- 5920

*** Signed with permission.Fourth Amendment to Consent Decree in the matter of United States

, et al. v. Phillips 66

Co mpany , Civil Action No. H

- 05

- 0258 (Southern District of Texas).

FOR DEFENDANT
PHILLIPS 66 COMPANY

/s/ Donna H. Carvalho ***

DONNA H. CARVALHO Regulatory Senior Counsel, Legal Refining, Projects and Procurement Phillips 6 6 Company
McLean 2110 600 N. Dairy Ashford Houston, Texas 77079 (281) 293

- 4281

*** Signed with permission.Fourth Amendment to Consent Decree in the matter of United States

, et al. v. ConocoPhillips Company , Civil Action No. H

- 05

- 0258 (Southern District of Texas).

FOR TRANSFERREE MONROE ENERGY, LLC

/s/ Eva Fromm O’Brien ***

EVA FROMM O’BRIEN Fulbright & Jaworski, LLP 1301 McKinney Houston, TX 77010
Phone: 713 651

- 5321
Facsimile: 713 651

- 5246 eobrien@fulbright.com

Counsel for Monroe Energy, LLC

*** Signed with permission.EXHIBIT 1

Trainer Consent Decree Based Permit Limits

The following permit limits are in the Trai ner Refinery’s combined New Source and Title V Operating Permit # 23

- 00003 (last revised on 10

- 28

- 11).

FCCU:

FCC NOx

- 365

- Day Rolling Average NOx Emission = 121.1 ppmvd @ 0% O2

FCC NOx

- 7

- Day Rolling Average NOx Emission = 155.3 ppmvd @ 0% O2

FCC SO2

- 365

- Day Rolling Average SO2 Emission = 25 ppmvd @ 0% O2

FCC SO2

- 7

- Day Rolling Average SO2 Emission = 50 ppmvd @ 0% O2

FCC PM

- 3

- hour Rolling Average PM Emission = 0.5 lb/1000 Pounds of Coke Burned

FCC PM

- NSPS J for PM (Opacity)

FCC CO

- 1

- Hour Averag e CO Emission = 500 ppmvd @ 0% O2

Heaters and Boilers:

All Heater & Boilers SO2

- NSPS J for combustion device
All Heaters & Boilers Fuel Oil Prohibition

- CD requirement included in permits

Operating Permits for the following units were surrendered to create 917.2 tons of NOx reductions for the NOx control plan: Boiler 6, Boiler 7, and Old FCC Feed Heater

Sulfur Plant:

Sulfur Plant SO2

- NSPS J

Flares:

Back

- up (Old Yard) Flare

- NSPS A
Back

- up (Old Yard) Flare SO2

- NSPS J for combustion device

Acid Gas Flare

- NSPS A
Acid Gas Flare SO2

- NSPS J for combustion device