Illicit fuel trade is a major, global challenge within the oil and gas industry, the consequences of these unlawful actions being pervasive, from environmental damage to depriving governments of customs and tax revenues and actively supporting illegal activities.
The first Oil & Fuel Theft Summit was held in Geneva in April 2018 which helped to create discourse between high-level stakeholders within the hydrocarbons industry on how we can fight this revenue depriving delinquency. Authentix was a corporate sponsor of the event, where our team provided understandings on the issue, encouraging collaboration and drawing attention to this subject, we sought to deepen awareness.
Authentix insights into combatting fuel trade spans our experience over the last 20 years protecting more than two trillion liters of product in that time.
We believe a system of fair and open commerce is an agent for good in the world, when that system is compromised civil society is weakened. We feel our company’s beliefs and mission help to ultimately combat illicit fuel trade.
Illicit operators go to where the money can be made. The mechanics of fuel fraud allows for this since price arbitrage drives the opportunity for offenders. In Mexico for example, taking stolen product and selling it approximates to USD4B industry per annum. In Ireland, criminals take subsidized diesel remove dye markers and transport it across neighboring borders to be sold as fully taxed diesel and pocket the price difference. Selling unbranded fuel as branded fuel, dilution or adulteration the possibilities are abundant for criminals to profit. The problem is huge, and the typical illicit trade rate which we have seen in serving our customers is usually about 30%.
In the European Union lubricating oils can be moved without being monitored by Excise Movement and Control System because they are not subject to excise tax in the EU and only a few States apply national taxation on these products. Fraudsters manufacture and transport lubricating oil throughout the EU and then introduce it in the mainstream network and sell it as automotive diesel fuel with the consequential evasion of excise duties.
Technology alone is not the solution. Understanding the job to be done, the desired outcomes to be achieved and how we apply technology to realize those outcomes is the way Authentix helps customers be the heroes.
Customers want to understand where their problems are and what they need to do to solve them.
Fuel markers and field analyzers are a part of the solution but translating data into actionable insights to combat illicit trade is key. Our Authentix Information System (AXIS) is an integrated set of software applications that collects data from testing performed on fuel samples, combined with fuel volume and pricing and other information which allows for intelligent analysis to be done which deliver those actionable insights.
Authentix Services and Support is available to our customers throughout the program and includes advisory services, design services, implementation services, and operational support.
Subsidized fuel looks exactly like full priced fuel, branded fuel looks exactly like unbranded fuel. So, marking fuels is important, since it enables the efficient determination of the identity of fuel products. Fuel marking as a tool within a program is cost effective and makes sense. The proper application of this technology lends to the idea of – its less of what you have but more of what you know from it.
Authentix’s roots are as an analytical chemistry company. Our core capability in developing robust molecular markers, purpose built to withstand adulteration and illicit ﬁltering methods, has earned us the reputation as the premier covert marker developer.
Understanding the desired outcome of a program is significant to our goal at Authentix whether it be protection of a subsidized product, ensuring quality throughout the supply chain, trying to increase the collection of excise taxes or trying to stop smuggling, we focus on devising solutions that address our customer’s needs.
It may sound complicated and customers may seem overwhelmed with available technology solutions on the market, various types of programs being offered but our advice at Authentix is – Do Something!
There are simple approaches to begin deterring illicit activity. Making the issue more visible and having offenders understand the consequences involved in being complicit in this behavior is a preventive move and minimizes the problem. This menace is not going away till we do something.
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