Western Regional Gas Conference

1. Western Regional Gas Conference Metal Theft Mitigation Protecting Valuable Operator Assets Southwest Gas Corporation Central Arizona Division Risk Management Ken Baldwin, CFEI

2. Is it a problem? • Do you track metal theft? • How many metal thefts have occurred? • Where are the thefts occurring? • Is metal being stolen but not reported to the police? • What type of metal is being stolen? • What type of properties are thieves targeting?

3. Metal Theft • Natural Gas Industry is not Immune to Metal Theft • No Single Factor Accounts for Rise in Metal Theft • Potential Targets • Meters • Valve Lids • System Components • Piping • Wires and Wiring

4. Metal Theft • Crime of Opportunity • Unprotected & Unsecured Metal • Vacant & Foreclosed Properties • Become Targets when Guardianship is lacking • Easily Identifiable • Utility Meters Often Remain On Property

5. Metal Theft Harm of Metal Theft • Physical Damage • Damaged Gas Lines, Damaged Electric Lines, Damaged Monitoring Devices, Escaping Gas, Other Property Damage • Economic Damage • Repairs, Property Replacement, Lost Revenue to Company & Customers • Occasionally, thefts can result in catastrophic events • Explosions & Fire, Injury & Loss of Life

6. The Columbus Dispatch House explosion blamed on pipe-stealing thieves By  Theodore Decker The Columbus Dispatch Monday March 26, 2012 11:35 AM Thieves stealing pipes to sell for scrap are being blamed for a natural-gas leak that blew up a vacant North Side house last week. Fire crews were called at 1:30 p.m. Wednesday to 2362 Joyce Avenue and found the front and back walls of the house had been blown out. The ensuing fire, fueled by the gas, burned the house to the ground and damaged homes on either side. The destroyed home was a vacant rental property. No one was injured in the blast. Explosions due to stolen pipes have been rare in the city, but firefighters have worried for years that the right combination of gas and an ignition source could prove deadly.

7. SouthCoast Today.com Copper theft caused New Bedford house explosion, police say By Curt Brown cbrown@s-t.com May 29, 2012 1:48 PM Popular Today NEW BEDFORD — Investigators believe a gas explosion that destroyed a vacant Babbitt Street house last week was caused by thieves stealing copper piping in the basement. Detective Greg Sirois, an arson investigator for the Police Department, said someone broke into the single-family home at 40 Babbitt St. on May 22 and stole copper piping. He said the thief or thieves tried to steal a gas pipe, believing it also was copper and caused a gas leak that filled the house with natural gas. “It appears the gas pipe was compromised,” Sirois said today. “It was leaking gas.” The Cape-style house was completely destroyed in the explosion, which also sparked a fire in the kitchen that spread to the attic and the roof. The house was unoccupied and was in the process of being renovated, according to fire officials. There were no injuries in the explosion and fire. District Fire Chief Jim Clark said last week that all four exterior walls buckled from the force of the explosion. Sirois is asking anyone who has seen copper piping with light yellow or light green paint on it or has information about the explosion to contact him at 508-991-6300, ext 137. He said a reward of up to $5,000 is being offered through the state Fire Marshal's office for information leading to a conviction.

8. Detroit Free Press Milford fire chief points to metal thieves in house explosion By Bill Laitner Detroit Free Press Staff Writer 10:17 PM, May 30, 2012 Illegal metal scavenging might have been the cause of an explosion that destroyed an unoccupied house in Milford Township today, fire chief Larry Waligora said. There were no injuries in the blast that occurred at about 12:30 p.m., Waligora said. The secluded house sits about 400 feet back from Duck Lake Road north of Sleeth Road, hidden by a grove of trees in a rural area just north of Proud Lake State Recreation Area. Its owner moved to a retirement center three years ago and since then the house has been unoccupied, Waligora said. “It’s possible there were some copper violators in there and they broke a (gas) line and realized, ‘Uh oh, we just screwed up — we’d better get out of here,’ and they left the gas leaking,” Waligora said tonight, after returning from the scene. The brick ranch house still has its walls standing, but its roof, doors, windows and interior were obliterated, he said. The incident caused a traffic backup in the area most of the afternoon, after authorities closed Duck Lake Road between Sleeth and Commerce, township officials said. “We had MichCon out to shut off the meter, but we’ll be investigating further” at the house on Thursday, Waligora said. He had these words of advice to homeowners: “If you’re going to leave a home unattended for prolonged periods of time, turn off the gas service.” Contact BILL LAITNER: 313-223-4485 or blaitner@freepress.com

9. Our Story • SWG experienced a rash of meter thefts • The thefts occurred in one geographic area over a short period of time • Meters were stolen: regulator, cane and piping left behind • In two instances SWG was made aware of the theft due to escaping gas; thieves damaged the stopcock and riser • Thefts discovered: • During meter reading cycle • Customer calls from active residential and commercial accounts

10. Our Story • Completed Internal Investigation & Review • SWG met with Phoenix PD – Metal Theft Unit • Conducted internal meetings regarding recognition of metal theft • Began tracking and trending thefts • Focus on prevention • Partnering with police • Learn from other utilities • Inform Recycle & Scrap yards

11. Prevention • Mark Metals with Company’s Name or Contact Information • Review Practices and Policies • Ask Employees to Help • Consider removing unused facilities • Create a Master List of Bulk Metal Buyers • Develop Relationship with Law Enforcement

12. Questions