Mobil Press Release Thursday January 13, 2000 MOBIL AVGAS

THE ISSUE

In late December 1999, Mobil received reports from light aircraft users of problems with their fuel systems. An investigation by Mobil determined the likely presence of a contaminant in avgas produced at the Altona refinery since mid November 1999. The contaminant was of minute concentrations that were not detectable by normal industry standard specification testing.

The contamination is believed to be related to an increase in the dosage of a chemical used in the control of corrosion in the refining process.

Problems reported by users of the contaminated fuel mainly involved formation of a sticky black material in aircraft fuel systems that could block filters and carburetors. The deposits appeared to form mainly on brass components on those systems. Investigations are not yet complete that would conclude whether the problems reported by users of the fuel were caused by the presence of the contaminant in the fuel. However, the safety of our customers is paramount and therefore Mobil proceeded to take a number of precautionary actions.

Mobil assembled a team of local and international experts which has worked relentlessly to understand the problem, devise a testing technique to identify the presence of the contaminant in the avgas and develop a procedure to remove it from the affected product.

On December 23, following discussions with Mobil, CASA issued a directive requiring aircraft operators who had purchased the affected avgas to drain it from their aircraft and conduct specified tests on their engine fuel systems.

However, in early January, aircraft operators who appear to have complied with the previous CASA Airworthiness Directive have reported the presence of deposits in their fuel systems which appear similar to those found previously.

Mobil's team of experts is working with CASA to determine if the deposits are related to the previous contamination and operating problems and to develop a solution, with the aim of getting aircraft safely back into operation as soon as possible.

The problem with avgas relates to piston-engined light aircraft only. Aircraft using jet fuel are not affected.

CHRONOLOGICAL OVERVIEW

December 17   Mobil becomes aware of a fuel system problem affecting light aircraft at Moorabbin Airport. Mobil's re-testing of its avgas re-confirmed that the product met all standard industry specifications.

December 21   A light aircraft loses power on take-off at Moorabbin. Subsequent investigations find a possible link between problems being experienced and the presence of a contaminant in avgas supplied from Altona refinery.

December 22   A team of local and international experts is drawn together to investigate the situation, devise a testing technique to measure the contaminant, and develop a procedure to remove it from the affected product. In the meantime, to ensure the safety of its customers, Mobil immediately quarantines Mobil avgas in Victoria, Tasmania, NSW, ACT and southern Queensland where Altona product had been delivered.

December 23   Following discussions with Mobil, CASA issues an Airworthiness Directive requiring aircraft operators with affected fuel to drain it and conduct specified tests on their engine fuel systems.

December 27   A team is put in place to develop a plan for the recall/replenishment of affected avgas, and customers are advised that Mobil will reimburse them for the cost of inspection of aircraft fuel systems in line with CASA AD/General/77 and for removing and replacing their fuel.

December 27   Mobil's team of experts successfully devises a testing technique to measure levels of the contaminant in avgas and develop a procedure to remove it from affected product.

December 29   Call centre (customer hotline) established to assist in processing claims for reimbursement or other queries about the issue.

December 30   Mobil lifts quarantine on avgas in Tasmania after completion of testing to confirm it is free of contaminant.

January 6     Mobil technical team meets with CASA.

January 6     Mobil becomes aware of reports of further fuel system problems in four aircraft based at Moorabbin and Essendon airports. While these aircraft operators appear to have complied with the previous CASA Airworthiness Directive, they report the presence of deposits in their fuel systems that appear similar to those found previously.

January 7     Tests are conducted overnight on the residue found in the fuel filter of one of the aircraft. The results are not conclusive, but show signs that contaminants may still reside in fuel systems.

January 7     Consistent with its commitment to customer safety, Mobil urges all customers whose aircraft were fueled in Victoria, NSW or southern Queensland with Mobil avgas 100/130 supplied between 24 November 1999 and 23 December 1999 to not fly their aircraft until they receive further advice. Also included in this recommendation are aircraft that were refuelled with the same product on November 21, 22 and 23 at Bankstown, Essendon, Albury, Hay, Griffith and Moorabbin.

January 7     CASA is also advised about Mobil's concerns and it issues an advice requiring mandatory inspection before each flight of all affected aircraft which had previously shown evidence of fuel system contamination.

January 10    CASA issues a new Airworthiness Directive grounding all aircraft affected by the avgas contamination until further notice.

THE CONTAMINATION

The contamination has been traced to a chemical called Ethylene Di-amine, which is an anti-corrosion agent used in the refining process to manufacture avgas. It is added during a process called alkylation to neutralise acid.

The contamination is believed to be related to an increase in the dosage of this chemical in November at the Altona Refinery, which produced an unexpected reaction in the aviation gasoline.

We believe this contamination is unique and Mobil is not aware of previous experience in dealing with a similar situation elsewhere around the world.

However, based on our test results to date, it appears that the contaminant may affect the fuel systems of light aircraft in two ways. Firstly, there appears to be a reaction with carbon dioxide in the air which may cause white or clear deposits to form inside fuel tanks. Secondly, when the contaminant makes contact with copper and brass in the fuel system, a black sticky substance appears to be formed which can block filters and carburetors.

Developing a Testing Procedure

The potential residue of the contaminant in already inspected and re-fueled aircraft remains an issue.

Mobil is working with CASA to develop tests to detect the presence of contaminant deposits which may be trapped in aircraft fuel systems. These tests are based on research that has been undertaken into the properties of substances that appear to be formed by the contaminant. Any test proposed needs to be as simple as possible, able to be used by aircraft mechanics in the field, while still providing technically reliable results.

CURRENT POSITION - WHAT IS MOBIL DOING?

Although the presence of the contaminant has not yet been conclusively linked to the engine problems reported, Mobil is continuing to take a number of prudent actions:

· Working with our agents and distributors to ensure that those aircraft that have not had contact with the affected fuel are not unnecessarily grounded.

For example, Goulburn airport (NSW) has been confirmed free of any contaminated product in locations covered by CASA's AD/General/78.

· Continuing to work closely with CASA to get planes flying safely as soon as possible.

· Developing a draft test to detect the presence of contaminant deposits that may be trapped in aircraft fuel systems. The draft testing procedure is currently with CASA for review and discussion with aircraft manufacturers and pilots.

· In parallel with the draft testing procedure, seeking to develop an effective means of cleaning any residual contamination from affected aircraft fuel systems.

· Bringing in additional aviation/engineering resources from the US and Europe.

· Preparing to put more resources on the ground, including people at airports to help implement the clean-out of affected aircraft once the appropriate testing procedure is in place.

· In contact with emergency services to understand their needs/issues and how we can help. We are supplying uncontaminated drummed product to re-fuel any planes that have not been affected by the grounding. It is a priority to get emergency services aircraft flying safely as soon as possible.

· Technical personnel are going to spend time at airports Thursday/Friday to help address concerns.

· Planned discussions with AOPA to work out the best way to progress the testing and recovery program.

· Working with agents and customers to ensure that the recall of affected fuel is handled in a safe and environmentally responsible manner. Affected product is being returned to Mobil terminals where it is being stored and treated to remove the contaminant, pending a decision on its future disposition.

· Re-supply of non-contaminated fuel to all agents and customers is well under way. To ensure timely supply, drums of non-contaminated product have, in many instances, been delivered to agents and customers who normally receive bulk supplies.

Mobil is working closely with the key stakeholders to ensure they are kept informed of the status of the issue, including progress of developing the testing procedures and the availability of drummed, non-contaminated avgas to customers who have not used affected product.

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