ARCHIVED REPORTS 2nd QUARTER 2011 QUARTERLY REPORT

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Mr. David Johnson -2- 22 December 2010 , Herman and Helen's Marina depth to water ranged from about 3 to 28 feet. Flow gradients were to east-southeast and ranged from 0.22 feet per foot (ft/ft) at the levee to about 0.004 ft/ft in the field area. During the third quarter, the highest concentrations of CDCs were observed monitoring wells MW=2, MW-3, and MW-4 in the center of the Site. MW-2 contained 1 1 ,000micrograms per liter (pg/L) of TPHg, MW-3 contained 7,900 ug/L of TBA, and MW-4 contained 11 pg/L of MTBE. Groundwater at the Site also contains elevated concentrations of benzene, ethyl benzene, and total xylenes. Between September 2007 and February 2008, the highest concentrations of CDCs were generally detected in MW-2, the well that was degraded by the 2007 AGT gasoline release. The third quarter TBA results for MW-3 represent an order of magnitude increase, and a historic high, over the TBA concentrations last observed in this well in February 2009. TPHg and TBA concentrations in MW-2 were also sharply higher. During an 18 May 2010 meeting, Centra! Valley Water Board staff discussed with AGE and H&H the 5 May 2010 ORC Advanced TM Pilot Study Work Plan, which proposed to implement an ORC pilot study in the vicinity of MW-4. At a later date, based on information provided by Regenesis, the contractor who will conduct the pilot study, staff informed AGE that the requirement to perform bench scale testing could be replaced by monitoring for select metals that could be mobilized by the in-situ application of Regenesis' oxidants. We requested that a revised Work Plan include a pre- and post-injection sampling plan to monitor for byproducts and metals that could be mobilized by the oxidants. A Revised Work Plan was submitted on 30 June 2010, and a Revised Work Plan Addendum was submitted by email on 8 July.The Addendum provides for monitoring for bromide, bromate, trivalent and hexavalent chromium (Cr III and Cr VI), total chromium, and vanadium. Baseline concentrations for these parameters will be determined from a one-time, pre-injection sampling event. Depending on the pre-injection monitoring results, post-injection monitoring for the metals may.exclude Cr VI and bromate and will be conducted on a monthly basis in select wells. Central Valley Water Board requested that AGE provide the Pilot Study Report by 3 January 2011, and monthly reports of the pre- and post injection monitoring. The Annual Report states that execution of the Work Plan is awaiting the negotiation of an access agreement with Reclamation District 2029 for permission to inject the oxidants described in the Work Plan. The Annual Report also contains a recommendation to determine whether the City of Stockton's Delta water supply pipeline construction dewatering activity has exerted a hydraulic influence on the hydrocarbon plume at the Site. The Central Valley Water Board's 25 May 2010 Notice of Applicability (NOA) authorizedthe City to perform groundwater extraction and land disposal to dewater the proposed alignment for the pipeline. The Annual Report shows that water levels in monitoring wells screened in a deep water bearing zone beneath H&H were about four feet lower in July than in April. In a 23 September 2010 letter, the City's consultant informed Central Valley Water Board staff that the dewatering operation would be terminated and the dewatering wells and monitoring piezometers properly abandoned by.30 September.