August 11, 2008

Dear Sprague Customer:

As you may know, the industry is facing security changes later this year for all workers entering Marine Transportation Safety Act (MTSA) terminals.  You are receiving this letter if you or one of your employees visits a Sprague MTSA-regulated terminal, which is impacted by the changing security regulations.  Last year, Congress established Transportation Worker Identification Credential (TWIC) requirements which will be administered by the Transportation Security Administration (TSA) and the US Coast Guard, in order to track all workers at these facilities.

The TSA is now accepting applications for TWIC cards (or Smart Cards), which allow workers access to secure MTSA facilities on an un-escorted basis.  Please refer to the TSA website for more information regarding the registration and other requirements of the TWIC system (http://www.tsa.gov/twic).  These requirements go into effect October 15, 2008 for Sprague’s Northern New England terminals; October 31, 2008 for Oswego, NY; December 1, 2008 for Oceanside, NY and Stamford, CT terminals; on or before April 15, 2009 for Mt. Vernon, NY and Albany, NY.

We encourage you to obtain TWIC cards for all your employees entering Sprague-operated facilities.  Without this specific identification, each of your employees will need to present other government-issued IDs for each visit, and will then be monitored/escorted while on site by Sprague personnel as required by the regulations.  While Sprague will accommodate customers who do not have TWIC cards, please note that these monitoring/escort requirements for non-TWIC holders may lead to congestion and delays during busy periods.  Please be aware that for other throughput locations, the TWIC guidelines will be determined by the terminal operator. 

Prior to the enforcement date, Sprague will request that each driver initially present his/her TWIC card so that ID information can be linked to each driver’s pin.  Because of the systems link at Sprague facilities, it will be mandatory that each driver uses one unique pin and does not exchange numbers with other drivers in your organization.  After the initial TWIC verification, each driver may be subject to random checks throughout the year as required by the TSA.

Your assistance is appreciated as we implement these new security regulations.  Sprague will provide additional updates as we approach the enforcement dates.  If you have any questions, please contact Sprague Customer Care toll-free at 866-477-7248.

Frequently Asked Questions regarding TWIC can be found at http://www.spragueenergy.com/pages/content.aspx?p=twicfaqs .