The 2014 OFTEC Awards for Excellence winners The best talent in the oil heating industry was showcased at OFTEC’s 2014 Awards for Excellence event last month. Attended by more than 170 industry guests, this year’s Awards saw David Ewins from Cornwall-based Davanna Heating beat off stiff competition to pick up the title of Boiler Installer of the Year, with Stephen Owen of SC Owen in Reading receiving the award for Servicing and Commissioning Technician of the Year.

Domestic oil theft is on the rise according to the FPS. The trade association has warned consumers to be extra vigilant when it comes to safeguarding their supply during the summer holiday period and issued the following advice: ·         If your tank has a lid, fit locks. This may be a legal requirement for some tanks. Your tank installation engineer or fuel delivery company will be able to advise you. ·         Consumers with the ‘vent and fill’ design should fit the lockable cap designed to secure this type of container. Of course, locking your tank may prevent your supplier from filling your tank if you’re not at home, so make sure your supplier has a key or code for access. ·         Monitor your oil tank on a regular basis.  Remote electronic oil level gauges are available which will set off an audible alarm if the oil level in the tank suddenly drops or falls below a quarter full. These gauges can be located in the kitchen or perhaps a utility room to warn of any potential problem. ·         If you belong to a neighbourhood watch scheme you can discuss this issue of oil theft with your group coordinator so that everyone of the scheme can be vigilant. ·         If the need arises to replace your tank, consider where you position the tank and make more secure. But remember to leave clear access for the delivery man at the fill point and the gauge can be seen. ·         You MUST never lock or block the tank vent/ breather, as this will cause the tank to split and cause further damage. ·         Consider fitting CCTV to monitor the tank ·         Security lights can have a very positive effect and make any property a much harder target for the thief. It’s not always necessary to floodlight the area with high power beams, as a more subtle level of lighting may be all that is needed. Low energy “dusk till’ dawn lights positioned close to the tank should, in most cases, provide sufficient light to illuminate any suspicious activity. This type of light can be both effective and inexpensive. High powered lights can be used but care should be taken not to cause any nuisance to neighbours or road users. Chief executive, Mark Askew warned that consumers in rural areas may be at greater risk: “Consumers in isolated locations, especially with tanks sited near the road should be especially vigilant. Rural areas are quieter and less frequently patrolled by police than their towns and cities, so homeowners need to look out for each other. Lookout for suspicious-looking individuals and vehicles, particularly vans, on both yours and your neighbours’ properties. If you’re particularly concerned, consider relocating your tank to an area that is more secure, remembering to leave it accessible for deliveries. Fitting CCTV and/or security lights to monitor your tank can also go some way to deterring potential thieves.” www.oilsave.org.uk https://blog.boilerjuice.com/3-ways-to-prevent-heating-oil-theft-in-your-area/  

In April 2004 a small team of passionate individuals formed MechTronic with the aim of providing ‘class leading products and services’ to the  fuel oil market  Initially working from a spare room, the company moved into an industrial unit at Kirkstall Forge in Leeds, an area first occupied by the Cistercian monks of Kirkstall Abbey 800 years ago. “At this stage the team would not have believed that within 5 years the company would be the UK market leader in its field,” said sales & marketing director, Andy Spencer. “But MechTronic’s three years at the forge saw the development of the first mechanical metering solution, the new VisiFlow manifold and the revolutionary SPGI (Smart Product Grade Indication System).  It also delivered the MaxFlow electronic metering system with its simplified one cabinet approach that the industry now considers the bench mark.” In 2007 when the River Aire burst its banks flooding the MechTronic building, the company moved to newer city centre premises which had the added benefit of parking for Leeds United matches!   Listening to customers, doing the simple things well and innovating Further investment in cutting edge IT enabled the development of a facility in which rapid proto typing could be carried out.  Coupled with the team’s flexibility and drive, these new resources allowed the company to take ideas from the field and bring them to market as products they could sell very quickly. “MechTronic’s philosophy has always been to listen to customers, do the simple things well and to innovate,” said Andy.  “This philosophy resonated with fuel oil distributors giving us a unique approach that would eventually deliver a fresh new look to the industry.” In addition to first-class products, the company quickly realised that after sales support was just as important and MechTronic Technical Support was born.  Known as MTS, this service team has rapidly increased in size in response to demand for planned/unplanned maintenance packages, similar to those offered by vehicle manufacturers. “The UK-wide team now has 12 people dedicated to providing class leading customer service,” added Andy. Anniversary activities Celebrating its 10th anniversary this year, MechTronic will unveil its new OptiMate metering control system.  “The next major step in the evolution of metering and delivery control, it will reflect big operational savings for distributors and much improved compliance with HMRC requirements on line contamination,” says Andy. In June, 12 employees will cycle almost 80 miles in just one day for charity – some customers are rumoured to be tagging along too.  Later in the year, all employees are invited to a day at York races. “Time flies – that saying has never been truer, especially for those that were present when MechTronic was formed 10 years ago,” said Andy.  “In the time ahead, the team looks forward to working with customers old and new to help ensure our industry is a more cost effective and safer place to be.’’

Given developments in Ukraine and the role that Russia plays in the global oil market, supply availability is a big talking point once again. Below UX Energy Services consultant Dr Craig Lowrey looks at some of the issues that this situation could generate for the UK market. Closer to home, the devastating weather conditions that hit parts of the UK over the last winter have also brought security of supply into renewed focus.     The UK’s ability to control the fate of its heating oil price has diminished; something also seen in the wholesale natural gas market over the last decade. A decline in domestic refining capacity coupled with the decline in crude production from the UK Continental Shelf has meant increased import reliance, making the UK price for heating oil increasingly reflective of international events. As North Sea output declines further, forecasts from the UK government show that this trend is likely to continue well into the next decade for all petroleum products. Reflecting the economics of the refining industry across Europe, the nation’s refining capacity has fallen over the past few years as the industry struggles with falling demand in the wake of recession and the resultant over-capacity.  This has been compounded by growing competition from facilities in the US, Russia and Asia, although these regions themselves have had a few mixed years.  Many sources in the industry are predicting that further European refinery closures can be expected by the latter part of the decade. The refining sector saw the closure of the Petroplus-owned Coryton site in 2012 and in late 2013, an industrial dispute threatened to result in the closure of the INEOS site at Grangemouth.  The start of 2014 has been equally challenging; in February, Essar Energy announced that its Stanlow refinery would see production capacity reduced by a third from October, citing ongoing losses on site. For some years Murphy Oil has been seeking a buyer  for its Murco facilities in the UK which include the Milford Haven refinery.  With the latest efforts regarding a takeover having recently broken down, the future operation of the site is now in further question; particularly given the general ill health of the European refining sector. Increasing imports with ‘mutual interdependency and common interest’ With the UK’s reliance on imports showing no signs of abating, there is the question of the source of those imports and, in particular, the role Russia plays with respect to energy matters in the UK and Continental Europe. Building on a long standing partnership, Russia and the EU signed an agreement in March 2013 aimed at cooperation in the energy sector through to 2050.  In recent years, Europe has sought to diversify away from Russian energy imports, a move that largely commenced in 2006 following the Russia-Ukraine gas supply dispute when Russian gas flows to the EU through Ukraine’s pipelines were compromised. A second dispute in early 2009 accelerated the move away. The EU describes the relationship with Russia as one based upon ‘mutual interdependency and common interest’ with Russia being the largest oil, gas and coal exporter to Europe.  In the oil industry, EU-Russia cooperation has been growing over recent years with European companies active in Russian exploration and production, while Russian companies have made increasing inroads into refining, marketing and retail. According to the latest figures from the UK government, at 40% of total imports Russia may have been the nation’s largest single source of coal and solid fuel imports in 2012 but it was third in terms of crude oil imports with the provision of 11% of the total, behind Norway at 50% and Nigeria on 12%. The Department of Energy and Climate Change did however note that Russia ‘has generally become a more important source of imports’ of crude oil in recent years. The effect of sanctions While the possibility of economic sanctions and a decline or loss of Russian energy flows into Europe is – at the time of writing – a number of steps away, even the possibility of such an event gives rise to continued volatility in financial and energy markets in the short term.  So far, Russia’s comments regarding a possible reduction  in energy flows have focused more upon gas than oil and oil products, a fact reflective of Ukraine’s outstanding multi-billion debt to state-owned Russian company Gazprom. The ability of both the UK and the rest of the EU, notably Germany – the largest single importer of Russian oil and gas – to diversify away from this traditional and long standing source is limited – particularly given that the influence of sanctions will have a global effect. Sanctions against Iran in the summer of 2012 contributed towards a 10%-15% increase in the price of crude oil that was reflected in the markets for petroleum products. As well as impacting energy prices, this in turn fed through to the cost of living through the prevailing inflation rate. Russia’s status as the largest non-OPEC oil producer – as well as the world’s largest largest oil producers in general – means that sanctions would have a noticeable effect, although the extent of this – not to mention the likelihood and form of sanctions – remain speculation at this stage.

Improving the terminal’s capability has seen customer service and efficiency optimised says engineering manager, Phillip McEvoy Since moving to its new terminal at Stanlow in Cheshire, ESL Fuels has gone from strength to strength. ESL has invested in modern, sophisticated facilities and systems to bring the terminal up to date.  The terminal is on the former BP Castrol site which closed in March 2010 with the loss of 60 jobs Deputy editor Liz Boardman visited engineering manager, Phillip McEvoy to find out more about the company’s plans for growth.Innovation and diversification “Innovation powers our long-term growth and is at the heart of what we do,” said Phillip.  “Established in 1999, ESL Fuels pioneered the manufacture of alternative industrial fuels long before anyone was truly aware of the impact caused by greenhouse gases and CO2 emissions. We’ve gone on to diversify, specialising in the design, manufacture and supply of a wide range of innovative fuel products. “The move to Stanlow has opened the doors for further diversification. We’re in a key location with extensive storage and have numerous opportunities to move the business forward.” In addition to a long-standing partnership with Certas Energy, ESL has recently further strengthened its well established collaboration with Essar Oil (UK), by linking the two facilities together. “The infrastructure for growth is in place,” said Phillip. “We have an excellent relationship with Essar – they have a good track record of supporting local companies and are helping us to grow the business.” This is being done by moving away from the traditional customer supplier model and moving towards a solutions driven collaboration between ESL and Essar. “We see Essar as a supportive and innovative business partner.” Colin Dixon, Essar’s head of marketing commented: “Our partnership with ESL is a great example of Essar’s commitment to delivering world class service to our customers in the reseller channel. We’re proud to have supported ESL’s growth since the early days of their business.” ESL operates a pipeline network that runs through the Stanlow refinery to the terminal’s quayside with the Manchester Ship Canal, opening up further opportunities for the company by having the ability to import and export products by ship.A bespoke service ESL can offer a huge range of customer offerings, from standard storage solutions to bespoke discrete toll manufacturing and blending services. “We have 112 tanks offering at total of 50,000 cubic meters of storage, of varying capacity and function. Any tank can be heated, agitated and blended with components from any other tank on site. “We’re committed to working with customers and providing bespoke solutions. We pride ourselves in offering a good service at a reasonable cost.” ESL has recently been awarded a major contract on behalf of a leading biodiesel supplier. This will see ESL blend up to an additional 100 million litres per year. This contract was awarded by working closely with the operator to provide a tailored solution to their requirements. The company, which was founded by Stephen Whittaker and now employs 30 people, is also going through a program of major capital investment. This is focused on improving the terminal’s capability so customer service and efficiency will be optimised. Investment is also being targeted in terminal infrastructure and asset integrity.  “Robust asset management is at the heart of everything we do, this allows us to sustainably provide an excellent service to all customers.” ESL has also recently invested in four new In-Control loading skids to enable a quick turnaround for fuel collection for both customers and its own tanker fleet. Now supplying up to 180 million litres of alternative fuels per year, the company uses in house transport combined with dedicated haulage contractors to deliver a first class service.

Following the recent acquisition of Countrywide’s fuels division, deputy editor Liz Boardman travelled down to Ford Fuel Oils’ Farrington head office to find out more about the family firm   Family values From early roots in milk and coal after the Second World War to scrap metal in the early 1970s, Alan and Jack Ford founded the fuel business in 1972.Following in their footsteps, sons Adrian, Michael and Richard remain in the business whilst the family’s fourth generation – John, Teelah, David and Grayson – has also entered the business in recent years. John Ford, now a director, joined the business at 15, working part time to gain valuable experience. Having worked in every area of the business, including two years as a full time driver, John can turn his hand to pretty much anything. “You can’t ask someone to do something that you wouldn’t do yourself,” he said. “We have got to where we are now through family,” adds John. “Certainly we have increased in size since the Countrywide acquisition and now employ 120 people including 45 drivers, but we are still very hands on. Customers can still talk directly to a member of the Ford family. We often go to visit farmers and regularly speak to domestic customers over the phone. Equally we know all of our employees well and regularly talk to our drivers. That’s what sets us apart and ultimately accounts for our success. We like to think that we do things differently here – and better!”   A good fit  Although the company has tentatively dabbled in the acquisitions market in the past – mostly buying one man bands for access to their customer bases – the decision to acquire Countrywide’s fuels division in October 2013 was not one that the directors took lightly, as John explained: “We agonised over the decision but ultimately it looked right. It was a good opportunity and one which fits well with our business – not least geographically. “We have strong family ethics and in many ways still view ourselves as a small, independent distributor. We’ve not lost touch with our roots and don’t want to be seen as a big corporate machine now we have a sizable acquisition under our belt. We don’t want to introduce high margins or have phones ringing off the hook – it would be a bad reflection on both the business and the acquisition itself.” Now rebranded as Countrywide Oils – part of the family driven solution/part of the Ford Fuels Oils Group (the company’s two strap lines) the new section of the business will eventually come under the Ford banner with a dedicated website in the pipeline. As far as further acquisitions go, Ford Fuel Oils is not currently in the market, as John pointed out. “We’ve already taken on a big acquisition and that’s enough for the foreseeable future. We don’t want to chase growth and put at risk what has taken years to build. We need a solid period of consolidation and we also need to take the time to build Countrywide Oils back up to where it used to be.” Nor is the company up for sale: “There have been a number of big distributor acquisitions recently but we are most definitely not for sale,” added John.   Supply solutions With existing Ford depots in Farrington Gurney, Westerleigh, Stalbridge, Membury, Theale, Bow and North Petherton and newly added Countrywide Oils depots in Defford, Finmere, Presteigne and Weston Super Mare, the company has a good presence across the south of England with a significant stronghold in the south west. Supplying in excess of 150 million litres of fuel each year, mostly to agricultural and domestic customers, the company also has a sizeable commercial customer base and services a number of local quarries. “The domestic and agricultural sectors remain by far our biggest markets. We are an old fashioned distributor – it’s what the business was built on,” John told Fuel Oil News. “However we are fortunate that we aren’t reliant on one sector. We haven’t really had a winter so far but have been able to pick up work in other markets.” The company also supplies four million litres of Total, Petronas and its own brand lubricants – Lubricants Direct – per year. “Lubricants bring opportunities for fuel and vice versa,” said John. “We have our own bottling plant and can label containers with our customers’ logos, which is quite unusual for a distributor. It also gives us a good level of flexibility.” Fuel cards is another albeit small arm to the business. “We supply approximately 15 million litres of fuel this way each year, explained John.” It’s a relatively small part of our business but one that’s convenient for our customers. If customers want to use fuels cards then we can supply them, although we are very wary credit-wise” With a fleet of 43 tankers and another three on order from RTN Lakeland, Ford Fuel Oils moved up six places from 16th to 10th on this year’s Fuel Oil News’ Top 20 UK distributors list which was published in the February issue. “We have a long-standing relationship with RTN Lakeland and buy at least three rigid tankers each year. We are a company that likes to build lasting relationships and stick with them. We consistently use Emco Wheaton’s loading solutions and have long been a customer of Fuelsoft.”

INVER CONTINUES TO GROW ITS UK BUSINESS BY EXPANDING THE SALES OFFERING FROM ITS CARDIFF TERMINAL; THE SIZE AND LOCATION OF WHICH HAS FACILITATED THE COMPANY’S GROWTH AND DIVERSIFICATION Development projects in 2008, 2010 and 2012 have transformed the terminal from a heavy fuel oil terminal to a modern sophisticated facility supplying a full range of fuel products.   The 74,000 m3 terminal now has multi-modal capability for receipt of fuel by ship, road and rail.  The terminal’s automation system, 24/7 operations, and its 6 fast-pumping loading racks offer customers unparallel flexibility and efficiency.   A wider range of products Capitalising on recently vacated storage capacity within the terminal, Inver has expanded its product offering. The company is now selling a wide range of gas oils, kerosene, diesel, heavy fuel oil and marine fuels.  Inver’s ability to purchase and store large economical cargoes, allows it to offer customers competitive pricing for these products.  Sales have exceeded expectations in the first quarter; this is supported by the security of supply afforded through the import and storage of 20,000 tonnes of kerosene and low sulphur gasoil. The company has observed the increasing product segmentation of the gas oil market: 10 ppm gasoil for non-road mobile machinery; 1000 ppm gasoil for industrial and commercial heating; and various grades of marine gasoil.  Inver’s ability to import and store these various grades has allowed it to offer customers the right grade at the right price for the specific requirement. Tony Wilson, commercial director of Inver UK since 2006, says that the expansion of Inver’s sales and product offering has been well received and welcomed by customers. “The exit by other fuel importers in the area has reduced the security of supply and competitiveness in the market.  Inver is committed to using its own terminal to maintain the supply of cost competitive product,” says Tony. “Customers always want supply and pricing alternatives.  Inver’s pricing options include contract and spot live pricing and both are proving popular.  Our ability to supply ex-rack or to deliver using our fleet of dedicated road tankers is also an important optionality and service.”

Pete George – taking every opportunity to get out and meet customers AN HONEST CONVERSATIONHeadquartered in Houston, Phillips 66 has 13,500 employees and, as of 31st December, 2013, had $50 billion worth of assets ‘On the back of a strong supply of quality products both in the wholesale markets and in the retail market as JET’, Phillips 66 continues to grow its market share here.  Fuel Oil News editor, Jane Hughes asked managing director, Pete George about the business, refining and fuels and its relationship with fuel oil distributors.