LETTER FROM THE PRESIDENT

Welcome to the first

edition of the ValvTect

Waves newsletter. It

is designed to provide

Cert i f ied ValvTect

Marinas, ValvTect

Marine Fuel Distribu-

tors and non-ValvTect

marina operator ’s

information about marketing gasoline and

diesel fuel at marinas.

As we all know, purchasing 50, 100 or 500

gallons of gasoline or diesel fuel at a marina’s

fuel dock has never been a pleasant experi-

ence. However, the introduction of ethanol,

ultra low sulfur diesel and biodiesel,

combined with record high fuel prices, have

made purchasing fuel at the marina’s fuel

dock a virtual nightmare for both boaters and

marina operators.

As a boater for over 35 years, and a fuel

supplier to marinas for more than 40 years

(first developing the Texaco Star Port pro-

gram and then as a fuel distributor in the

Great Lakes), I was always aware of

complaints boaters made about fuel related

problems. However, the biggest complaint

has always been the higher price boaters

pay at the marina’s fuel dock for the same

brand and quality of fuel they buy from a

land based gas station. It just dosen’t seem

right to most boaters.

Since founding ValvTect Petroleum 22 years

ago, I have been committed to provide

marina operators and boaters a brand of

gasoline and diesel fuel that is specially

formulated for marine engines and marine

operating conditions. A brand of fuel

that differentiates in quality and value than

fuel purchased at gas stations.

I am extremely proud that so many of the

nation’s best marina operators (large and

small) have chosen to market ValvTect

Marine Fuels, the value the ValvTect brand

brings to their business and the benefits to

their customers. All of us at ValvTect thank

each ValvTect Distributor and Certified

ValvTect Marina for their support.

We hope you find the information contained

in The ValvTect Wave informative and

beneficial to your business and to your

customers. Please feel free to contact us

with questions or topics you would like

us to address in the next issue of the

ValvTect Wave.

Gerald (Jerry) H. NessensonPresident, ValvTect Petroleum Products

STATE OF THE INDUSTRY

Summer 2008 saw fuel prices escalate to

levels never experienced or anticipated.

High consumption vehicles, increased

energy demand from emerging economies

such as China, India, etc., and pricing pres-

sure caused by investors and speculators

drove prices up and reduced consumer

discretionary income.

There was near panic about the dwindling

supply of crude oil and limited refining

capacity. Government passed incentives to

increase domestic crude oil production,

expand refineries and incentatize alternative

energy. Consumers drastically altered their

driving habits, got rid of powerful (but com-

fortable) “gas guzzlers” and bought smaller,

lighter fuel efficient vehicles.

Nowhere was the impact felt more than in

the marina industry where pump prices at

fuel docks often exceeded $5 per gallon.

Consequently, boaters virtually stopped

boating and marine fuel sales dropped as

much as 30% at some marinas. By mid-year

the perfect storm hit when the real estate

and stock markets crashed leaving the

expense of boating at the bottom of many

boaters’ list of expensive things to do.

As I write this column in early January, crude

oil refined fuel prices dropped like a free

falling anchor from record highs down to

prices not seen in many years. The good

news is that this has reduced the burden on

consumers. The bad news is that crude oil

producers (mainly OPEC) have cut produc-

tion, refinery projects are being cut back,

consumers are going back to old habits

resulting in increased demand for gasoline

and there is another conflict in the mid-East.

Yes, then when we thought we were safe,

crude oil prices increased almost 40%, then

dropped agiain to the mid 30 dollar range.

I have watched this ying/yang cycle for years

starting from the energy crisis (with shortages

and allocations) in the early 70’s to the out of

orbit prices of 2008. I have heard every US

president from Nixon to Bush (2) talk about

the need for energy independence. I have

seen policies range from incentives to help

oil companies to drill and build refineries to

punitive taxation because they make too

much money. Meanwhile I have watched the

volume of crude oil imports increase every

year as we become more reliant on foreign

oil for our energy. And, still the debate goes

on and on.

Hopefully someday there will be a rational

approach to the energy problem that will

combine incentives to encourage investment

in domestic production and refining, conser-

vation and alternative energy sources. Until

then, I will hopefully be able to afford to get

in my Sea Ray and cruise to interesting

places, and visit happy boaters and ValvTect

Marinas.

AMI REPRESENTS MARINAS’ INTERESTS

The Association of Marina Industries (AMI)

is a merger of the Marina Operators

Association of America (MOAA) and the

International Marina Institute (IMI). It

represents the interests of marinas in the

U.S and around the world. AMI provides

critical legislative and regulatory support on

issues affect ing the marina industry,

education and training such as the Certified

Marina Manager (CMM) certification course.

ValvTect’s president Jerry Nessenson serves

on the board of directors. We encourage

al l marina operators to jo in AMI. For

information visit www.marinaassociation.org

or call 866-367-6222.

Published By ValvTect Petroleum Products Exclusively For The Marina Industry

SPRING - SUMMER 2009

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The Wave

SOLUTIONS FOR ETHANOL, LOW SULFUR

DIESEL, AND BIODIESEL FUELS

Changes to today's gasoline

and diesel fuels, while helpful

in reducing harmful emissions,

can have serious unwanted

effects on marine engines.

Boaters need to be aware of

the potential problems with

ethanol blended gasoline, low

and ultra-low sulfur diesel,

and biodiesel to avoid fuel-related issues. Doing

so will help guide the purchase of the right fuel or

fuel additives to assure the health and optimum

performance of their marine engines.

Ethanol Blended Gasoline: Problems specific

to marine use of ethanol blended gasoline are

linked to ethanol’s absorption of excess moisture

around water and the length of time between fill-

ups. This can cause fuel to degrade in less than

a month, and in rare cases for ethanol to sepa-

rate from the gasoline if a large amount of water

enters the fuel tank. Ethanol blended gasoline

can also develop excessive deposits in hotter-

burning marine engines. This can decrease fuel

economy, reduce power output and potentially

cause powerhead failure.

To help prevent these potential problems, ValvTect

Marine Gasoline contains marine-grade fuel

additives not found in automotive gasoline. They

stabilize the fuel to keep it fresh for up to a year

and to help prevent octane loss. A moisture dis-

persant also assists in preventing phase separation.

Low and Ultra-Low Sulfur Diesel: EPA regula-

tions require many marinas to sell low sulfur

diesel. Low sulfur (500 ppm) or ultra-low sulfur

(15 ppm) diesel contain higher levels of moisture,

destabilize quickly and are more susceptible to

bacterial growth than high sulfur diesel. The

results are sludge and plugged fuel filters that can

completely shut your engine down while at sea.

Because sulfur helped to lubricate the fuel sys-

tem, premature injector and fuel pump wear may

develop. Older diesels may experience leakage

from injector and fuel pump seals that aren't com-

patible with lower sulfur diesel fuels. Boaters

should keep in mind that fuel additives don't prevent

or correct leaky seal problems caused by lower

sulfur diesel fuel. They should contact their engine

manufacturer to determine if replacement of fuel

system seals are necessary.

ValvTect Marine Premium Diesel with BioGuard

biocide, lubricity improver, water dispersant, cor-

rosion inhibitor and fuel stabilizer has been

specifically formulated to prevent problems

caused by the reduced sulfur content. ValvTect

Marine Premium Diesel requires no additional fuel

additives, eliminating the risk of improper additive

use saving boaters both time and money.

Biodiesel: This eco-friendly fuel is becoming pop-

ular, especially in the Midwest where tax incen-

tives make its price very attractive. Although

biodiesel has good lubrication qualities and a

more pleasant smell, it has some of the same

problems for boaters as ultra-low sulfur diesel.

These include very poor stability and susceptibility

to bacteria growth. Biodiesel also contains about

3% less Btu’s (energy content) than diesel fuel,

which causes somewhat reduced power and

increased fuel consumption.

Biodiesel can be made from soy, rapeseed, used

vegetable oil and even animal tallow. A byproduct

of the refining process is glycerin, which, if not

filtered out properly by the producer, causes fuel

filter plugging. Because biodiesel is an emerging

industry, product quality and consistency varies

greatly between producers.

Today's diesel engines can't burn 100% biodiesel

without some adjustment, however, they can burn

5-20% biodiesel blended into diesel fuel. At this

time, most engine manufacturers only approve a

5% maximum biodiesel blend. Because of this

situation, Certified ValvTect Marinas are limited

to selling a biodiesel blend with not more than 5%

biodiesel. The addition of ValvTect Marine Diesel

additive and BioGuard micro-biocide to a 5%

biodiesel blend helps prevent problems that

may be encountered with untreated biodiesel.

ValvTect Marine Fuels are the only fuels “specially

formulated” for marine gasoline and diesel engines.

They are only available at Certified ValvTect

Marinas that conform with ValvTect's certification

process and quality control requirements, such as

fuel storage tank testing to ensure they are free of

bacteria and other contamination.

VALVTECT REDUCES FUEL CONSUMPTION

& IMPROVES ENGINE PERFORMANCE

At current fuel prices,

getting the most mileage

out of a tank of gasoline

or diesel is critically

important to boaters.

Using marine-grade

gasoline or diesel spe-

c ia l ly - formulated to

clean-up fuel-robbing

carbon deposits can significantly reduce fuel

consumption and save a lot of money.

Carbon deposits, commonly called gunk, build up

in engines during the combustion process.

As deposits build in fuel injectors, carburetors,

intake valves and combustion chambers, they

reduce the engine's fuel efficiency, increasing fuel

consumption. Because marine engines can use

up to 10 times more fuel per hour than a car or

truck engine, the amount of detergents in automotive-

grade gasoline and diesel typically are not

sufficient to effectively clean-up deposits.

ValvTect Marine Gasoline and ValvTect Marine

Diesel Fuel are specially-formulated to prevent

and clean-up power-robbing deposits in marine

engines. Compared to automotive-grade gaso-

line and diesel fuel, ValvTect Marine Fuels contain

more, and higher levels of detergents and other

important additives required for marine engine

operation.

VALVTECT FUELS HELP BOATERS GO

GREEN FOR THE ENVIRONMENT

Boaters are becoming

increasingly concerned about

maintaining the environmen-

tal quality of our lakes, rivers

and oceans, both for their

personal enjoyment as

wel l as the i r livelihood.

It’s one of the reasons why

the formulators at ValvTect have spent so much

time perfecting and testing our additive packages.

ValvTect Marine Gasoline and ValvTect Marine

Diesel are formulated to burn cleaner, eliminate

power-robbing deposits that increase pollutants,

and reduce fuel consumption. By doing so, they

significantly reduce engine emissions removing

thousands of pounds of harmful pollution from the

air we breath and our waterways.

Wether you are selling ValvTect fuels at your fuel

dock or using it personally in your boat, you can

take pride in the fact that you are doing something

good for your engine, your wallet, and the

environment.

FUEL TANK CERTIFICATION

IMPROVES CUSTOMER SATISFACTION

Few marina industry programs have been more

successful than the Certified ValvTect Marina

Program. An important feature of the program

is the testing of marinas' gasoline and diesel fuel

storage tanks for excess water, bacteria and

other contaminants. Before a marina can

become a Certified ValvTect Marina, and up to

twice a year thereafter, its fuel storage tanks

must be tested. If contamination is found, it

must be cleaned up in order to become and/or

remain a Certified ValvTect Marina.

Once the marina passes the tank test, it receives

a Certification of Contamination Free Storage

Tanks certificate to be posted on the fuel

dock for customers to view. This innovative

certification program

assures boaters

t h a t Va l v Te c t

Marine Gasol i n e

a n d Va l v Te c t

Marine Diesel Fuel

are free from water,

bacteria and other

contaminants.

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TECH TALK

Before and After ValvTect

MAY C

ON

TAIN

UP T

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VALVTECT IMPROVES FUEL SALES ANDCUSTOMER SATISFACTION

A marina owner's top

priorities are improved

sales, increased margins

and satisfied customers.

As more marinas be-

come Certified ValvTect

Marinas, offering ValvTect

Marine Gasoline and

ValvTect Marine Diesel

Fuel specially formulated

for marine engines, they're seeing the positive

impact on their bottom lines and more satisfied

customers.

With 21 marinas from New York to Maine, BrewerYacht Yards is the largest privately held marinagroup in the U.S. "All 18 of our fuel docks have

been ValvTect Certified for many years," offers

Jack Brewer. "Even with the record high prices,boaters gladly pay the few additional cents per

gallon for ValvTect due to better fuel economy,

longer filter life and the fact they don't need to buy

any other additives or play chemist."

"Before going with ValvTect we had plenty of

customers who encountered fuel problems," said

Brewer. "These have been virtually eliminatedeven though we now have to market ethanol

gasoline and low-sulfur diesel."

"ValvTect's advertising program touts the benefits of

ValvTect Marine Fuels and establishes branding

that gives the marina operator credibility," Brewercontinues. "The most important thing ValvTect

gives us is a feeling of confidence that we're

doing everything possible to provide the boating

public with the most cost-effective, highest quality

and safest fuel."

Competition is keen among the three fuel

docks in Newport Harbor, California and we are

all priced within cents of each other," adds

David Beek, General Manager of IslandMarine Fuel, the exclusive Certified ValvTectMarina in the area. "Our fuel business dramati-

cally picked up as soon as boaters knew we

had ValvTect at our fuel dock. We even have

boaters come to our fuel dock from marinas

over 20 miles away to fill their tanks with ValvTect.

I don't understand why anyone would buy an

automotive brand fuel when ValvTect Marine

Fuel is available. It is a substantially better

product for about the same price."

"We have ethanol gasoline and ultra low-sulfur

fuel here in California," says Beek. "ValvTect MarineGasoline has virtually eliminated ethanol related

problems and ValvTect Marine Diesel contains

BioGuard biocide to prevent bacteria and an

injector lubricant to compensate for the lack of sulfur."

"Customers are constantly mentioning how much

they appreciate the better fuel economy they get

with ValvTect," adds Beek. "Our customers savemoney as they do not have to add any additives

such as a stabilizer or water dispersant. It is a

win-win for us and our customers."

Another ValvTect believer is Bob Christoph ofthe famous Miami Beach Marina. "Boaterscome from competing non-ValvTect marinas

for ValvTect Marine Fuel. Many cruising boaters

go out of their way to specifically stop at MiamiBeach Marina for ValvTect Marine Fuels. That'sgreat for our business as we also get additional

high margin transient dockage, restaurant and

ship store sales."

GRAND CAYMAN’S NEW BACADERE

MARIANA FEATURES VALVTECT FUELS

Grand Caymen’s

new luxury marina

located in George

Town, the capital

o f t h e C a y m e n

Islands, features

ValvTect Marine Gasoline and ValvTect Marine

Diesel at both dockside and landside pumps at its

state-of-the-art fuel dock.

Located at the historic George Town Barcadere

and part of the Scott’s Group of Companies, themarina provides birthing for yachts up to 120’ with

concierge service and a host of other amenities

geared toward the local and transient boating

communities.

We welcome Scott’s Landing at BacadereMarina to the ValvTect Certified Marina family

and are excited about the prospects for broaden-

ing the availability of our fuels to boaters

wherever they roam.

MARINE FUEL ADVERTISING PROGRAM

REACHES MILLIONS OF BOATERS

ValvTect’s comprehensive

national, regional and

local advertising cam-

paign wi l l reach over

1 million boaters a month

d u r i n g t h e b o a t i n g

season.

National publications

where ValvTect ads

regularly appear include Boat U.S., Sea Ray

Living, Soundings, Marine Max Lifestyles and

Marina Life. These ads are complimented by

regular advertising in regional and local publi-

cations like Southern Boating, Lakeland Boating,

Heartland Boating, Northwest Yachting, and the

San Diego Log.

The ad program would not be complete without

additional ads in cruising guides and chart books

like The Florida Cruising Directory, The Lake

Michigan Cruising Guide, and various editions

of the Maptech Embassy Cruising Guides.

“We’re always working hard to drive in new

customers to our certified marinas,” says

Dave Grochocki, ValvTect Advertising Manager.“Suggestions for other publications to advertise in

are always welcome. Please give us a call or let

your distributor know.”

NEW POINT OF SALE MATERIAL CREATES

BOATER BUZZ

Last season, ValvTect updated all of its point of

sale material to better communicate to boaters

the benefits of buying and using ValvTect Marine

Fuel. The new materials use attention grabbing

graphics and straight forward copy to present the

benefits of ValvTect fuels in a positive, quickly

understood fashion.

Please make sure that your fuel dock and pump

signs are in good shape and ready for use next

season. Contact your ValvTect Distributor for new

or replacement signs.

SEA RAY SAYS”PUMP IT UP WITH

VALVTECT FUELS”

The following appeared in the Winter Edition of

Sea Ray Living: All fuels are not created equal.

The same gas you want to use in your car is not

the same you want to use in your Sea Ray.

ValvTect Marine Gasoline contains marine

grade fuel additives not found in any automotive

brands. These add up to a healthy and powerful

engine, greater fuel efficiency and less harmful

exhaust emission. It is only available at Certified

ValvTect Marinas

HOW TO BECOME A CERTIFIED

VALVTECT MARINA

The Certified ValvTect Marina program differentiates

your fuel dock from the local gas station. When

your customers pull-up to a Certified ValvTect

Marina’s fuel dock they know the fuel is “specially

formulated” for their boats’ engine and they can

expect to be free from fuel related problems.

They don’t need to add any other fuel additives,

spend more money and play chemist. Certified

ValvTect Marinas are clean, safe and are

environmentally friendly.

To learn how to join the network of Certified

ValvTect Marinas contact ValvTect Petroleum at

800-728-8258.

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MARKETING TIPS

Marine Gasoline Pump Topper

ValvTect Petroleum Products3400 Dundee RoadNorthbrook, IL 60062

RETURN SERVICE REQUESTED

INDUSTRY ALERT

ABSENCE OF PUMP LABELING

RESULTS IN $27,000 MARINA FINE

A Certified ValvTect Marina operator had their diesel fuel pumps inspected

recently by a local U.S. IRS inspector and was fined over $27,000 for not

having the proper labels (decals) posted on their diesel fuel pumps. The

fine was $10 for each gallon of diesel fuel in the storage tank, however, they

could have been fined $10 for each gallon of diesel fuel SOLD over the

entire period that the pumps were not properly labeled. That fine could

have totaled well over $1,000,000.

Although they had a label on the pump indicating the fuel was dyed and FOR

OFF HIGHWAY USE ONLY, which complies with EPA requirements, the IRS

regulations also require a label that indicates dyed diesel is TAX EXEMPT

AND PENALTY FOR TAXABLE USE (IRS regulation 48.4082-2).

We are concerned that many marinas may not be aware of the EPA and

IRS regulations that require labels with both statements and have

located a company that stocks the labels along with other signage for fuel

pumps use. It is Gasoline Advertising Products. They can be contacted at

866-442-7744, or www.gasolineadvertising.com.

TEMPERATURE COMPENSATION OF FUEL SALES A BIG COST

TO MARINA OPERATORS

Several consumer groups and legislators are attempting to pass legislation

(Retail Fuel Act S1997) to require fuel sold on a temperature compensated

basis; i.e. adjusted to 60 degrees versus on a volumetric basis (231 cubic

inches); which is currently the way retail fuel is sold in the U.S. The issue is

when fuel is more than 60 degrees (most of the year) it expands and the

consumer does not receive a full gallon, thus it should be compensated

(corrected) with temperature compensating meters. The converse occurs

when fuel is less than 60 degrees. The estimated cost to install temperature

compensating meters on fuel pumps at a marina may be as much as $25,000

or more. Most petroleum marketing groups (PMAA, SIGMA, API, etc.) are

opposed, stating the small savings to the consumers (if any) does not justify

the huge investment to fuel retailers who would need to pass on the cost to

consumers. Marina operators should contact their representatives to voice

their opinion.

ETHANOL BLEND MAY BE INCREASED TO 20%

The EPA Is considering increasing the maximum percent of ethanol in gasoline

blends from 10% to 20%. Fortunately many industry groups including NMMA,

SIGMA, the Engine Manufacturers Association, etc. are opposing this increase

and have expressed concerns about the harmful effects of ethanol on certain

types of engines. They have urged the EPA not to take action without fully

addressing these problems. Marina operators should contact their repre-

sentatives to voice their opinion.

All Rights Reserved. 8 2009 ValvTect Petroleum Products . 3400 Dundee Road, Northbrook IL 60062 . (800) 728-8258 . www.valvtect .com

Send comments, questions or suggestions to valvtect@valvtect.com