Methodology and specifications guide Argus US Products — Temperature correction factors Contents: Temperature correction factors Publication and data Corrections Correction factors and conversions Net to gross Gross to net Model2 Last Updated: mAY 2020 The most up-to-date Argus US Products — Temperature Correction Factors methodology is available on www.argusmedia.com www.argusmedia.com Methodology and specifications guide Temperature correction factors May 2020 Model Fuels expand and contract with changes in temperature At lower temperatures, they are denser and therefore more valuable on a per-gallon basis At higher temperatures, they are less dense and therefore less valuable on a per-gallon basis Argus Temperature Correction Factors (TCFs) account for these changes, modelling the effect of ambient temperature on the temperature and density of fuel in terminal tanks around the US TCFs can be used to convert between net prices (the price for volumes measured at the industry-standard, 60°F) and gross prices (the price for volumes measured at a real-world temperature) Argus TCFs are calculated as a given amount of fuel at 60°F divided by the volume occupied by that same amount of fuel at a real-world temperature TCFs increase as real-world temperatures drop and fall as real-world temperatures rise Publication and data Argus TCFs follow the same publication schedule as Argus US Products, which is available at www.argusmedia.com Argus publishes six TCFs for each North American terminal listed below TCFs are for finished and blended gasoline and diesel fuel for the day of publication, the day after publication, and two days after publication Argus TCFs are available through all Argus publication channels and are labelled according to the terminal they represent Each Argus TCF is calculated using a proprietary thermodynamic model that accounts for atmospheric heat transfer, radiation heat loss by night, and heat transfer through the base of a tank to the ground Each TCF relies on the nine previous days of ambient temperature data, and makes the following assumptions about the tank in which the fuel is held: • Tank is 14m high, 14m wide, and 60pc full • Tank is turned every five days, on average • Tank paint has a reflectivity of 60pc TCFs are calculated assuming densities for finished gasoline and finished diesel fuel blended with renewable fuels to national average blend proportions In addition, “refinery-fed” TCFs assume that the tank is being refilled direct from a refinery, with fuel that is warmer than ambient temperature Example: In the example below, fuel temperatures in tanks in Wethersfield, Connecticut, tomorrow (day 2) will be below 60°F As a result, gasoline at the location will be 4.103% more dense than a “net”, 60°F gallon of gasoline TCF gasoline [CT \ Wethersfield \ 50 Burbank Rd] day = 1.04103 Weather data are provided by Dark Sky, available at: https://darksky net/poweredby/ Corrections Argus will on occasion publish corrections after the publication date We will correct errors that arise from clerical mistakes, calculation errors, or a misapplication of our stated methodology Correction factors and conversions Correction factors Fuel temperature Argus TCF Below 60° F >1.00000 Above 60° F