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WELCOME TO OUR 2012 CUSTOMER CONFERENCE WHERE WE VALUE OUR CUSTOMERS!

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Presentation on theme: "WELCOME TO OUR 2012 CUSTOMER CONFERENCE WHERE WE VALUE OUR CUSTOMERS!"— Presentation transcript:

1 WELCOME TO OUR 2012 CUSTOMER CONFERENCE WHERE WE VALUE OUR CUSTOMERS!

2 OPENING REMARKS MIKE SCHMIDT MANAGER, PRODUCT MOVEMENT

3 SXL LEGAL DISCLAIMER Statements we make that are not historical facts are forward-looking statements. These forward-looking statements are not guarantees of future performance. Although we believe the assumptions underlying these statements are reasonable, investors are cautioned that such forward-looking statements involve risks and uncertainties that may affect our business and cause actual results to differ materially from those discussed in this presentation. Such risks and uncertainties include economic, business, competitive and/or regulatory factors affecting our business, as well as uncertainties related to the outcomes of pending or future litigation. Sunoco Logistics Partners L.P. has included in its Annual Report on Form 10-K for the year ended December 31, 2011 cautionary language identifying important factors (though not necessarily all such factors) that could cause future outcomes to differ materially from those set forth in the forward-looking statements. For more information about these factors, see our SEC filings, available on our website at www.sunocologistics.com. We expressly disclaim any obligation to update or alter these forward-looking Statements whether as a result of new information, future events or otherwise. This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non- GAAP financial measures to GAAP financial measures are provided in the appendix to this presentation. You should consider carefully the comparable GAAP measures and the reconciliations to those measures provided in this presentation.

4 OVERVIEW OF SUNOCO LOGISTICS SYSTEMS Pipeline – George Dikeman Nederland – Brian Hudgins Butane – Laura Olah Energy Transfer – Luke Fletcher

5 ASSET OVERVIEW

6 CRUDE OIL PIPELINE SYSTEM  Approximately 4,900 miles of crude oil trunk lines located in the Southwest and Midwest U.S.  Approximately 500 miles of gathering lines  60.3% interest in West Texas Gulf Pipeline, a 580-mile crude oil pipeline  91.0% interest in Mid-Valley Pipeline, a 990-mile crude oil pipeline  37.0% undivided interest in Mesa Pipeline

7 REFINED PRODUCTS PIPELINE SYSTEM  Refined products pipeline system (approximately 2,500 miles), located in the Northeast, Midwest and Southwest U.S.  Equity interest in four product pipelines  Explorer (9.4%)  West Shore (17.1%)  Wolverine (31.5%)  Yellowstone (14.0%)  83.8% interest in Inland Pipeline, a 350-mile refined products pipeline system

8 MAJOR ORGANIC PROJECTS IN 2012  Successful Open Seasons  West Texas Crude expansion (crude oil)  Permian Express Phase I (crude oil)  Allegheny Access (refined products)  Mariner West (natural gas liquids)  Mariner East (natural gas liquids)  Actively developing Permian Express Phase II (crude oil)  Continued development and expansion at Eagle Point Terminal

9 NEDERLAND OVERVIEW BRIAN HUDGINS TERMINAL SUPERVISOR

10 NEDERLAND MARINE TERMINAL  68 Crude Storage Tanks  70 Lube Storage Tanks  Provide Bunker Service  Railcar offload Facility  5 Ship Docks  3 Barge Docks

11 CRUDE STORAGE CAPACITY 68 Crude Oil Storage Tanks  Total Shell Capacity ~21.6Mbbls.  Max Fill Capacity ~18.1Mbbls.

12 RAILCAR FACILITY  Able to receive a 112 railcar unit train  Able to offload unit train in ~ 4 days

13 RAILCAR CAPABILITIES  30 Crude unloading spots.  6 positive displacement pumps rated at 1,050 bbl/hr each.  4.5 hr pump time for 30 cars.  Daily switches via KCS.

14 Keystone Pipeline

15 FIVE SHIP DOCKS & THREE BARGE DOCKS

16 BUTANE OVERVIEW LAURA OLAH BUSINESS DEVELOPMENT

17 Butane Blending Program SXL owns and operates the only U.S. patented Automated Butane Blending System

18 WHY BLEND? Distribution System Many products Complex refining Long-haul pipelines Gasoline Volatility Specifications Geographically diverse Multiple seasonal changes Pipeline vs Retail Specifications Butane Blend Opportunity Direct to rack or pipeline Maximizing Profitability

19 Standard & Customized Design Financial Options Butane Supply Regulatory Compliance Proprietary Blending Systems Customer Service Full, Turn - Key Program

20 Tailored Design Complex design and permitting

21 Designed for Performance Commitment to safety & reliability

22 Commitment to Readiness Training and Commencement

23 Butane Supply Certification & Compliance

24 Operational Excellence Focus on optimization

25 Communication & Reporting Dynamic Analysis, Trending Daily Report

26 ENERGY TRANSFER OVERVIEW ENERGY TRANSFER OVERVIEW LUKE FLETCHER VP, COMMERCIAL OPERATIONS

27 THE CHANGING ENVIRONMENT OF PIPELINE SAFETY REGULATION LARRY SHELTON MANAGER, ASSET INTEGRITY

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29 BACKGROUND  High Profile Events  NTSB/Congress Criticism of PHMSA  Secretary LaHood’s Call to Action  Pipeline Safety, Regulatory Certainty, and Jobs Creation Act of 2011  Performance-Based Regulations  Mixed Results in 10 Years of IMP Rule

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31 SO, WHAT’S COMING? ……

32 ASSET INTEGRITY  Low Stress Phase II Implementation  Gathering  New Repair Requirements  Expand Requirements beyond HCAs  More ILI Tools  Non-Pipeline Facilities  “Fitness for Service”

33 DESIGN & CONSTRUCTION  Mill QC  Construction Inspections  Advance Notice  Cost Recovery  Operator Qualification

34 DATA REQUIREMENTS  Records Verification  ILI as an As-Built Verification Tool  Sophisticated Data Integration  More Data Layers for Risk Modeling  Risk Quantification (vs. Qualification)

35 DAMAGE PREVENTION  Evaluate State One Call Programs  Face-to-Face with Emergency Responders  Train & Drill with Emergency Responders  NTSB Putting Onus on Agencies to Seek Out Training from Operators  Closer Liaison with 911

36 REGULATORS  More PHMSA Inspectors  More State Inspectors  More Inspections  Broader Interpretations  Stricter Enforcement  Higher Penaltie $

37 BOTTOM LINE  Improved Technology  More Repairs & MOP Restrictions  Higher Expectations  Greater Scrutiny  Tougher Penalties  Smoother Sailing

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