San Joaquin Valley am AIR POLLUTION CONTROL DISTRICT

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San Joaquin Valley am AIR POLLUTION CONTROL DISTRICT HEALTHY i E LIVING AUG 15 2014 Mr. Ken Bork Freeport McMoran Oil & Gas 1200 Discovery Drive, Suite 500 Bakersfield, CA 93309 Re: Final - Authority to Construct / COC (Significant Mod) District Facility # S-1372 Project # 1141425 Dear Mr. Bork: The Air Pollution Control Officer has issued Authorities to Construct (S-1372-226- 3 and '-416-0) with Certificates of Conformity to Freeport McMoran Oil & Gas in western Kern County, California. The project authorized installation of a tank and resulted in an increase in VOC emissions of 2,243 lb/yr. Enclosed are the Authorities to Construct and a copy of the notice of final action to be published approximately three days from the date of this letter. Notice of the District's preliminary decision to issue the Authority to Construct permit was published on June 2, 2014. The District's analysis of the proposal was also sent to CARB and US EPA Region IX on May 28, 2014. No comments were received following the District's preliminary decision on this project. Prior to operating with modifications authorized by the Authority to Construct, you must submit an application to modify the Title V permit as an administrative amendment in accordance with District Rule 2520, Section 11.5. Thank you for your cooperation in this matter. If you have any questions, please contact Mr. Leonard Scandura, Permit Services Manager, at (661) 392-5500. SincKely, Artiaud Marjollet Director of Permit Services Enclosures cc: cc: Mike Tollstrup, GARB (w/enclosure) via email Gerardo C. Rios, EPA (w/enclosure) via email Seyed Sadredin Executive Director/Air Pollution Control Officer Northern Region 4800 Enterprise Way Modesto, CA 95356-8718 Tel: (2091557-6400 FAX: (2091557-6475 Central Region (Main Office) 1990 E. Gettysburg Avenue Fresno, CA 93726-0244 Tel: (559)230-6000 FAX: (559)230-6061 Southern Region 34946 Flyover Court Bakersfield, CA 93308-9725 Tel: 661 392-5500 FAX: 661-392-5585 www.valleyair.org www.healthyairliving.com Printed en recycled paper. Ca

rem San Joaquin Valley AIR POLLUTION CONTROL DISTRICT HEALTHY IR LIVING - PERMIT NO: S-1372-226-3 LEGAL OWNER OR OPERATOR: MAILING ADDRESS: LOCATION: AUTHORITY TO CONSTRUCT SECTION: 36 TOWNSHIP: 29S RANGE: 21E FREEPORT-MC MORAN OIL & GAS 1200 DISCOVERY DR - STE 500 BAKERSFIELD, CA 93309 HEAVY OIL WESTERN STATIONARY SOURCE CA ISSUANCE DATE: 08/12/2014 EQUIPMENT DESCRIPTION: MODIFICATION OF 5,000 BBL FIXED ROOF CRUDE OIL STORAGE/ CLARIFIER TANK: ADD FWKOS LISTED ON S- 1326-223 CONDITIONS 1. This Authority to Construct serves as a written certificate of conformity with the procedural requirements of 40 CFR 70.7 and 70.8 and with the compliance requirements of 40 CFR 70.6(c). [District Rule 2201] Federally Enforceable 2. Prior to operating with modifications authorized by this Authority to Construct, the facility shall submit an application to modify the Title V permit with an administrative amendment in accordance with District Rule 2520 Section 5.3.4. [District Rule 2520, 5.3.4] Federally Enforceable 3. True vapor pressure of any organic liquid introduced to the tank shall not exceed 0.5 psia at liquid temperature. [District Rule 4623, 5.1] Federally Enforceable 4. This tank shall be equipped with a pressure-vacuum (PV) relief valve set to within 10% of the maximum allowable working pressure of the tank, permanently labeled with the operating pressure settings, properly maintained in good operating order in accordance with the manufacturer's instructions, and shall remain in leak -free condition except when the operating pressure exceeds the valve's set pressure. [District Rule 4623, 5.2] Federally Enforceable Through Title V Permit CONDITIONS CONTINUE ON NEXT PAGE YOU MUST NOTIFY THE DISTRICT COMPLIANCE DIVISION AT (661) 392-5500 WHEN CONSTRUCTION IS COMPLETED AND PRIOR TO OPERATING THE EQUIPMENT OR MODIFICATIONS AUTHORIZED BY THIS AUTHORITY TO CONSTRUCT. This is NOT a PERMIT TO OPERATE. Approval or denial of a PERMIT TO OPERATE will be made after an inspection to verify that the equipment has been constructed in accordance with the approved plans, specifications and conditions of this Authority to Construct, and to determine if the equipment can be operated in compliance with all Rules and Regulations of the San Joaquin Valley Unified Air Pollution Control District. Unless construction has commenced pursuant to Rule 2050, this Authority to Construct shall expire and application shall be cancelled two years from the date of issuance. The applicant is responsible for complying with all laws, ordinances and regulations of all other governmental agencies which may pertain to the above equipment. Seyed Sadredin, Executive Director / APCO daud Marjollet, Director of Permit Services Re-1372.2264 Aug 122074 9.20AM EDGEHILA Joint Impaction NOT Requlf ad Southern Regional Office 34946 Flyover Court Bakersfield, CA 93308 (661) 392-5500 Fax (661) 392-5585 Piinled an ',eyelid NO., 11)

Conditions for S-1372-226-3 (continued) Page 2 of 2 5. The operator shall conduct a TVP testing of each uncontrolled fixed roof tank at least once every 24 months during summer (July - September), and/or whenever there is a change in the source or type of organic liquid stored in each tank. In lieu of testing each uncontrolled fixed roof tank, an operator may conduct a TVP testing of a representative tank provided the requirements of Sections 6.2.1.1.1 through 6.2.1.1.5 are met. The operator shall also comply with Section 6.2.1.2. The operator shall submit the records of TVP and/or API gravity testing to the APCO as specified in Section 6.3.6. [District Rule 4623, 6.2.2] Federally Enforceable 6. The operator shall submit the records of TVP and API gravity testing conducted in accordance with the requirements of Section 6.2 to the APCO within 45 days after the date of testing. The record shall include the tank identification number, PTO number, type of stored organic liquid, TVP and API gravity of the stored organic liquid, test methods used, and a copy of the test results. [District Rule 4623, 6.3.6] Federally Enforceable 7. For crude oil with an API gravity of 26 degrees or less, the TVP shall be determined using the latest version of the Lawrence Berkeley National Laboratory "test Method for Vapor pressure of Reactive Organic Compounds in Heavy Crude Oil Using Gas Chromatograph", as approved by ARB and EPA. [District Rule 4623, 6.4.4] Federally Enforceable 8. The operator shall keep an accurate record of each organic liquid stored in each tank, including its storage temperature, TVP, and API gravity. Such records shall be retained for at least five years and made available to the District upon request. [District Rule 4623, 6.3.1] Federally Enforceable 9. PTO S-1372-223-2 shall be cancelled upon implementation of this ATC. [District Rule 2201] Federally Enforceable S-1372-228-3 Aug 12 2014 9:20AM EDGEHILR

San Joaquin Valley si. AIR POLLUTION CONTROL DISTRICT 71 HEALTHY Al LIVING' AUTHORITY TO CONSTRUCT PERMIT NO: S-1372-416-0 ISSUANCE DATE: 08/12/2014 LEGAL OWNER OR OPERATOR: FREEPORT-MC MORAN OIL & GAS MAILING ADDRESS: 1200 DISCOVERY DR - STE 500 BAKERSFIELD, CA 93309 LOCATION: HEAVY OIL WESTERN STATIONARY SOURCE CA SECTION: 6 TOWNSHIP: 30S RANGE: 22E EQUIPMENT DESCRIPTION: 2000 BBL FIXED-ROOF CRUDE OIL STORAGE TANK WITH PN VALVE (STAR FEE) CONDITIONS 1. This Authority to Construct serves as a written certificate of conformity with the procedural requirements of 40 CFR 70.7 and 70.8 and with the compliance requirements of 40 CFR 70.6(c). [District Rule 2201] Federally Enforceable 2. Prior to operating with modifications authorized by this Authority to Construct, the facility shall submit an application to modify the Title V permit with an administrative amendment in accordance with District Rule 2520 Section 5.3.4. [District Rule 2520, 5.3.4] Federally Enforceable 3. Tank shall be operated at constant level. [District Rule 2201] Federally Enforceable 4. This tank shall only store, place, or hold organic liquid with a true vapor pressure (TVP) not exceeding 0.5 psia under all storage conditions. [District Rules 2201 and 4623] Federally Enforceable 5. The tank shall be equipped with a fixed roof with no holes or openings. [District Rule 2201] Federally Enforceable 6. This tank shall be equipped with a pressure-vacuum (PV) relief valve set to within 10% of the maximum allowable working pressure of the tank, permanently labeled with the operating pressure settings, properly maintained in good operating order in accordance with the manufacturer's instructions. [District Rule 2201] Federally Enforceable CONDITIONS CONTINUE ON NEXT PAGE YOU MUST NOTIFY THE DISTRICT COMPLIANCE DIVISION AT (661) 392-5500 WHEN CONSTRUCTION IS COMPLETED AND PRIOR TO OPERATING THE EQUIPMENT OR MODIFICATIONS AUTHORIZED BY THIS AUTHORITY TO CONSTRUCT. This is NOT a PERMIT TO OPERATE. Approval or denial of a PERMIT TO OPERATE will be made after an inspection to verify that the equipment has been constructed in accordance with the approved plans, specifications and conditions of this Authority to Construct, and to determine If the equipment can be operated in compliance with all Rules and Regulations of the San Joaquin Valley Unified Air Pollution Control District. Unless construction has commenced pursuant to Rule 2050, this Authority to Construct shall expire and application shall be cancelled two years from the date of issuance. The applicant is responsible for complying with all laws, ordinances and regulations of all other governmental agencies which may pertain to the above equipment. Seyed Sadredin, Executive Director / APCO AYWaud Marjollet, Director of Permit Services 1372-410-0. Aug 12 2014 023AM EDGEHILR JIM Inspection NOT Require0 Southern Regional Office 34946 Flyover Court Bakersfield, CA 93308 (661) 392-5500 Fax (661) 392-5585 Ptintel on monied ppm 0

Conditions for S-1372-416-0 (continued) Page 2 of 2 7. Permittee shall conduct true vapor pressure (TVP) testing of the organic liquid stored in this tank upon initial start-up, at least once every 24 months during summer (July - September), and/or whenever there is a change in the source or type of organic liquid stored in this tank in order to maintain exemption from the rule. [District Rule 2201 and 4623] Federally Enforceable 8. The TVP testing shall be conducted at actual storage temperature of the organic liquid in the tank. [District Rule 4623] Federally Enforceable 9. For crude oil with an API gravity of 26 degrees or less, the TVP shall be determined using the latest version of the Lawrence Berkeley National Laboratory "Test Method for Vapor pressure of Reactive Organic Compounds in Heavy Crude Oil Using Gas Chromatograph", as approved by ARB and EPA. [District Rule 2201 and 4623] Federally Enforceable 10. The API gravity of crude oil or petroleum distillate shall be determined by using ASTM Method D 287 el "Standard Test Method for API Gravity of Crude Petroleum and Petroleum Products (Hydrometer Method). Sampling for API gravity shall be performed in accordance with ASTM Method D 4057 "Standard Practices for Manual Sampling of Petroleum and Petroleum Products". [District Rule 2201 and 4623] Federally Enforceable 11. Permittee shall maintain monthly records of average daily crude oil throughput and shall keep accurate records of each organic liquid stored in the tank, including its storage temperature, TVP, and API gravity. [District Rules 2201 and 4623] Federally Enforceable 12. All records required to be maintained by this permit shall be maintained for a period of at least five years and shall be made readily available for District inspection upon request. [District Rules 1070 and 4623] Federally Enforceable 13. PTO S-1372-223-2 shall be cancelled upon implementation of this ATC. [District Rule 2201] Federally Enforceable S-1372-416-0. Aug 122014 0.26AM - EDOEHILR