3. First Amendment to A.00-05-035 and A.00-12-008

Application (A.) 00-12-008, filed December 12, 2000, requested Commission authority for SPBPC to own and operate the Pipeline Assets and Pump Station Assets as a common carrier pipeline corporation, pursuant to §§ 216 and 228.⁴ As of the date of the filing, Tosco Corporation (Tosco) and PG&E had executed a Purchase and Sale Agreement, and Tosco had formed a wholly-owned subsidiary, SPBPC, for the specific purpose of owning and operating the Pipeline Assets and Pump Station Assets as a common carrier pipeline corporation subject to the Commission's jurisdiction over public utilities.⁵ During the pendency of the subject applications, changed circumstances caused PG&E, ConocoPhillips, and other interested parties including SCVHG⁶ and Shell, to enter into various agreements between themselves that modify the transaction initially described in A.00-12-008 and, correspondingly, change the disposition and ultimate use of the Pipeline Assets and Pump Station Assets from that set forth in the original application. As described in the First Amendment to A.00-05-035 and A.00-12-008, filed May 6, 2004, by amendment to the Purchase and Sale Agreement, SPBPC, a newly formed Delaware limited liability company, will be the purchaser of the Pipeline Assets and Pump Station Assets from PG&E.⁷ Pursuant to various other contractual arrangements, PG&E, ConocoPhillips, SCVHG, and Shell, agreed that, conditioned upon Commission approval, the transactions described below will occur in the following sequence:

1. ConocoPhillips, with PG&E's consent, will assign the Richmond Pipeline Agreement to SPBPC;

2. SCVHG will acquire ConocoPhillips' ownership interest in SPBPC;

3. PG&E and SPBPC will execute an amendment to the Purchase and Sale Agreement;

4. SPBPC will purchase the Pipeline Assets and Pump Station Assets from PG&E;

5. The Pump Station Assets, upon their transfer from PG&E to SPBPC, will be removed from public utility service;

6. SCVHG, as owner of SPBPC, will transfer the Pump Station Assets (including all related real property) from SPBPC to SCVHG;

7. Immediately after the Pump Station Assets have been transferred to SCVHG, or an affiliated entity, SCVHG's ownership interest in SPBPC and corresponding ownership and control of the Pipeline Assets will be transferred to Shell; and

8. SPBPC, as controlled by Shell and subject to the Commission's jurisdiction, will own, operate, and maintain the Pipeline Assets for the purpose of providing common carrier, pipeline transportation of crude oil, blackoils, and refined petroleum products. Unless SPBPC seeks and gains approval from the Commission and/or any other relevant agencies, it would not be permitted to use the pipeline to transport products other than crude oil, black oils, and refined petroleum products.

Upon consummation of the transactions described above and receipt of all necessary Commission authorizations, Shell will control SPBPC and provide, through SPBPC, intrastate pipeline transportation services as a public utility subject to the Commission's jurisdiction, pursuant to §§ 216 and 228.