10/30/97 THE STATE OF ARIZONA COMMENCED AN INVESTIGATION IN THIS MATTER BASED ON CONSUMER COMPLAINTS. THEIR INVESTIGATION DISCLOSED THAT THE PREMIUM GRADE OF GASOLINE DISTRIBUTED THROUGH AT LEAST 109 MOBIL OUTLETS CONTAINED EXCESSIVE EHTANOL (13% TO OVER 40% ETHANOL). THE PRODUCT WAS BLENDED (IN-LINE) AT THE SANTA FE PACIFIC PIPELINE TERMINAL IN PHOENIX, AZ. SANTA FE PACIFIC PIPELINE SETTLED THIS MATTER BY PERFORMING EXTENSIVE REMEDIAL EFFORTS AND PAYMENT OF A CIVIL PENALTY OF $300,000.