Contract analysis

I. Executive Summary This memorandum analyzes the scope and adequacy of insurance coverage available to Dunmore Energy Holdings Ltd. ("DEH") for environmental remediation liabilities at the legacy Dunmore Wharton Terminal site (the "Site") under the Pollution Legal Liability ("PLL") policy issued by Bridgemont Insurance Company (the "Bridgemont Policy" or the "Policy"), Policy No. ENV-BIC-2024-07821. This memorandum

II. Background A. The Site and Contamination Summary The Dunmore Wharton Terminal (the "Site") is a 48.7-acre former petroleum bulk-storage facility located at 14200 FM 1301, Wharton, Wharton County, Texas 77488. The Site is identified by Tax Parcel ID WC-0241-0034 and is legally described as Lots 3 and 4 of the H.T. & B.R.R. Survey, Abstract No. 241, Wharton County, Texas, as more particularly described in the deed

III. The Bridgemont PLL Policy — Key Terms A. Policy Identification and Period The PLL Policy at issue was issued by Bridgemont Insurance Company, a Delaware corporation with offices at 200 Galleria Parkway, Suite 1800, Atlanta, Georgia 30339. The underwriter contact for the Policy is Paul Neumann, Senior Vice President, Environmental Lines. The Policy is identified as Policy No. ENV-BIC-2024-07821. The Policy has an

IV. Analysis A. Adequacy of the $15M Aggregate Limit The $15 million aggregate limit of the Bridgemont Policy significantly exceeds the total estimated remediation cost of $9.74 million prepared by Pinehill. The Policy limit provides a margin of approximately $5.26 million above the base-case cost estimate, which represents approximately 54% additional capacity beyond the estimated cleanup cost. Even at the high end

I. Historic CGL Policies — Piedmont Mutual Insurance Co. DTS maintained comprehensive general liability ("CGL") insurance policies issued by Piedmont Mutual Insurance Co., a North Carolina corporation, from approximately 1974 through 2000. These policies predate the Bridgemont PLL Policy and could, in theory, provide "occurrence"-based coverage for pollution events during their respective policy periods. Of the five

V. Coverage Gap Analysis Based on the foregoing analysis, the following summary identifies the costs and liabilities that are covered under the Bridgemont PLL Policy, those that are potentially uncovered, and the overall adequacy of the available coverage. Covered Costs. The following categories of costs and liabilities are expected to be covered under the Bridgemont PLL Policy, subject to the $500,000 SIR and the $1