The Case for Implementing National Fuel Integrity Programs

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Reducing Illicit Fuel Fraud and Recovering Revenue for National Governments around the World

By Andrée Bourgeois, Senior Marketing Manager, Authentix

The impact on national governments from adulterated, diluted, and illegally trafficked fuel within a country’s borders results in lost tax revenue, poor quality product, environmental issues, and ultimately reduced community services and benefits for citizens. After 25 years of working with dozens of government ministries and leaders to implement fuel integrity programs across the globe, Authentix has helped many countries expand revenue collections by reducing or eliminating the proliferation of tax avoidance and illegal profiting through illicit fuel sales. Many countries that implement an Authentix fuel integrity program quickly see reductions of this illegal activity by more than 30 percent annually with corresponding increases in taxation revenue.

Our experience and years of data has proven that implementing fuel integrity programs has substantial benefits to many national governments and its citizens alike, providing very high returns on investments made. Many governments have published data showing the positive impact of securing and monitoring their fuel supply including Ghana, Serbia, Zambia, South Africa, and most recently, Kenya published an article further confirming the effectiveness of its fuel integrity program. As stated in the publication businessdailyafrica.com, Kenya’s Energy and Petroleum Regulatory Authority (EPRA), which is mandated under Section 92 of the 2019 Petroleum Act, is charged with monitoring petroleum products offered for sale in the local market and has continued to enhance its fuel integrity program with tremendous outcomes. As a result, Kenya continues to reduce fuel adulteration and is well on the way to achieving near 100 percent reduction of fuel fraud.

READ THE FULL ARTICLE HERE.

To mitigate adulteration challenges, many governments such as Kenya have taken action to implement national fuel integrity programs curbing fuel fraud, recovering missing tax collections, and restoring confidence in the national fuel supply. These programs are continuing to grow in number and scope as technology advancements result in more sophisticated enforcement techniques as well as building a history of data retention, correlation, and actionable insights over time. As programs remain implemented, product and supply chain data are collected over multiple points in the supply chain — providing organizations complete visibility of trends, reconciliation issues, and machine learning capabilities to help prevent, correct, enforce, and ensure ultimate compliance.

Most fuel integrity programs in place today involve chemically marking fuel at refineries and/or terminal distribution points to ensure that all fuel in the downstream supply chain can be authenticated all the way to retail points of sale. The fuel is typically marked by dosing with an inert, organic chemical marker at levels so low (parts per billion), the presence of the marker cannot be detected without proprietary and highly sophisticated devices. As fuel is sampled and tested in supply vehicles, retail stations, and even consumer vehicles, it is possible to determine if the fuel has been diluted with substandard or non-taxed products such as waste oil, off-road tax-free fuel, or via other illicit means. The detection technique enables accurate quantification using portable analyzers in the field or more enhanced, forensically defendable methods in a laboratory.

Authentix is the market leader throughout the world delivering these solutions and has become a trusted and effective partner for national governments to validate fuel quality and supply authenticity, and provide the tools to enforce and prosecute those whom are trafficking illicit fuel products. Authentix continues to build its large library of unique covert markers, resulting in the highest level of authentication security and effectiveness available today. Authentix has spent decades building its suite of custom markers which take many different forms and vary in application and use based upon the country’s unique set of requirements.

The return on investment of successfully deployed fuel integrity programs by Authentix is substantial, helping governments recover millions in lost tax revenue each year, while positively impacting the society through expanded services and infrastructure and resulting in a cleaner environment for all.

Learn more about Authentix National Fuel Integrity Programs.

Andrée Bourgeois is Senior Marketing Manager for Authentix. As the authority in authentication solutions, Authentix thrives in supply chain complexity. We provide advanced authentication solutions for governments, central banks and commercial companies, ensuring local economies grow, banknote security remains intact, and commercial products have robust market opportunities. Our partnership approach and proven sector expertise inspires proactive innovation, helping customers mitigate risks to promote revenue growth and gain competitive advantage.

Fuel Authentication & Traceability through the Supply Chain: Advancing Quality & Sustainability

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By Yanos Michopoulos, Managing Director, Oil & Gas, Authentix

The Oil and Gas industry is facing increasing pressure to take urgent actions toward a low-carbon future. Some have responded already by setting bold Net Zero and other ambitious Sustainability targets by 2050. With the current geopolitical landscape, the industry continues to be challenged to innovate in navigating climate and environmental issues driven by constantly changing policy and regulations.

To emphasize the seriousness of the industry’s need to address climate issues, the Energy Institute recently focused on the energy transition as the key theme at IP Week 2020, held in London this February. As a key conference speaker on behalf of Authentix, I had the opportunity to share unique insights on how physical and digital fuel authentication technologies can help reduce emissions, protect the environment, and enable a more sustainable future, while also removing manipulation throughout the supply chain.

Fuel Adulteration’s Impact on the Environment

Fuel adulteration has proven to increase emissions of harmful pollutants from vehicles and worsen urban air pollution that lead to adverse impacts on human health. For example, kerosene, which when illegally added to a nation’s fuel supply, increases levels of carbon monoxide (CO) by as much as 50%. CO is one of the most common adverse by-products caused by adulterants often added to gasoline and diesel supplies to dilute taxable fuels with non-taxed or extremely low-cost materials.

To assess the level of impact of fuel adulteration on emissions, a study was conducted by the Journal of Civil Engineering and Environmental Technology in India, a country where this continues to be a significant and ongoing problem. The study concluded that gasoline adulterated with five percent kerosene was found to have a CO value of 16.4%, while gasoline with a 55% adulteration factor increased the CO value to 51.6%, an alarming increase.

In many countries, fuel adulteration using harmful by-products, waste oils, etc. can make up to 30% of the total volume of gasoline or diesel sold. It’s no secret that petroleum products present a lucrative opportunity for those who wish to deliberately manipulate fuel supplies for illicit monetary gain. Such activity is a huge environmental and financial problem for oil companies and governments alike. In fact, the annual worth of illicit fuel trade is estimated to be $133 billion and growing.

How Fuel Integrity Can be Compromised

Fuel manipulation can occur in multiple ways. If you consider the complex downstream supply chain, there are intentional or accidental vulnerabilities at many points that provide opportunities for fuel adulteration. These include:

  • Diversion
  • Dilution or substitution
  • Theft
  • Human error
  • Equipment malfunctions

When any of these factors occur, it can result in the wrong product used in the wrong application.  Without a traceability solution of some kind, it then becomes difficult to determine where and when the wrong product entered the supply chain.

Finding the Right Solution: Balancing Performance and Cost

To mitigate these challenges, oil companies and government agencies must be able to track and validate the quality and authenticity of their fuel at all points in the supply chain. This requires advanced technologies that can not only authenticate the fuel, but also identify and record meaningful data for product insights to be gained from terminal to retail station.

Marking fuel by inserting an extremely low dose (parts per billion) chemical marker into a petroleum product has become one of the most trusted solutions for enabling the detection of adulterants and to understand where this problem is happening. To provide the highest level of security and effectiveness, Authentix currently provides dozens of governments and branded fuel companies with proprietary and unique covert marker systems that vary in complexity and scope. Detection and measurement can occur in the field, in a laboratory, or both depending on the needs of the organization.

While fuel integrity programs are an effective way to combat adulteration, questions may remain about the quality and legitimacy of the fuel being refined or imported. To address this uncertainty, organizations and governments typically perform fuel quality assurance testing using ASTM standards via third-party laboratories. While ASTM testing is a longstanding and accepted method, it can be very expensive, and results are delayed as organizations struggle to find the balance between performance and cost.

For organizations looking for a more affordable and faster alternative to traditional lab-based ASTM testing, Authentix provides solutions for field use leveraging portable devices using sophisticated chemometric models, which can identify fuel composition and predict the overall quality and chemical properties. Applying this method, field enabled inspectors can simultaneously measure the density and the spectrum of fuel samples modeled to ASTM properties without the expensive and slower lab-based methods. These portable measurement devices can be used for a wide variety of fuels, including gasoline, diesel, jet, and other specialized fuels. In addition, IOT sensors can be installed in downstream locations for monitoring fuel volumes, which aid inspectors to audit consumption, shortages, and assist in demand forecasting.

In many cases, quality, volumetric, and usage data can complement a fuel integrity program with variable-time monitoring and actionable intelligence – enabling testing and visibility at any and all points in the supply chain.

Using Data Intelligence to Bring it Together

The magic bullet is not just the chemical marker itself nor the fuel quality testing method if used independently. But imagine the ability to collect, correlate, and analyse multiple data points from different sources that feed into a single data platform, providing a unique and actionable dashboard view into all elements of the fuel supply chain. As digital transformation continues to permeate the oil and gas industry, Authentix is accelerating its digital technology to provide this platform. The Authentix Information System, or AXIS®, is a cloud-based, integrated set of software applications designed to provide comprehensive and insightful data for our customers to make remediation and enforcement decisions, thereby giving them the ability to rapidly take preventative or corrective action.​

AXIS® report showing month-over-month view of failure results

 

 

AXIS® report showing geographical view of location of stations tested and pass/fail rates

Looking Ahead

The move to a more sustainable future, decarbonization, and lowering adverse impacts of climate change will no doubt take an incredible allocation of time, technology, and resources. By having full visibility and control over the fuel supply chain, our customers are able to deter illicit activity and reduce unauthorized fuels in the market. Therefore, implementing a fuel integrity program has shown to directly improve emissions, reduce pollutants, and improve overall consumer health and safety. In our view, this becomes an important piece of the solution and should become a key component of any Net Zero or Sustainability Plan going forward.

About Authentix

As the authority in authentication solutions, Authentix thrives in supply chain complexity. We provide advanced authentication solutions for governments, central banks and commercial companies, ensuring local economies grow, banknote security remains intact, and commercial products have robust market opportunities. Our partnership approach and proven sector expertise inspires proactive innovation, helping customers mitigate risks to promote revenue growth and gain competitive advantage.

To learn more, email info@authentix.com.

Fuel Authentication Case Study: Ghana

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Authentix uses its advanced and innovative fuel authentication solution to help the nation of Ghana combat adulteration of its petroleum products and recover lost revenue.

THE CHALLENGE

With a population of almost 28 million, Ghana is one of the fastest growing nations in Africa. It has moderate fuel taxes compared to its neighbors and limited fuel subsidies. The government of Ghana discovered that the adulteration of petroleum products offered for sale at retail outlets was degrading the quality of the available supply, while depriving the nation of significant tax revenue. In fact, baseline testing demonstrated that 32% of fuel stations had at least one tank showing dilution. Government officials estimated that the tax losses incurred because of this adulteration was more than USD 10 M annually. Ghana was in urgent need of a solution to combat adulteration of its petroleum products and recover fiscal tax revenue that was sorely needed for economic development.

THE SOLUTION

Since 2013, Authentix has been providing the Ghana National Petroleum Authority (NPA) with a fuel authentication solution. The program’s objectives are reducing deterioration in the quality of petroleum products due to dilution and adulteration whilst ensuring the appropriate recovery of fiscal tax revenues from the sale of petroleum and diesel for passenger vehicles.

Full-taxed domestic fuels are marked with a field quantitative marker for screening and dilution detection, and a forensic marker for lab confirmation. Subsidized products are marked to detect adulteration in domestic fuel. The Authentix solution is comprised the following core components:

MARKERS & DEVICES

Authentix LSX field analyzer detects dilution of taxed road fuels at fuel stations. Authentix MSX analyzer provides quantitative, forensic results in a laboratory environment. MSX analyzers are also used to measure the concentration of the MSX fuel marker that is added to fuel at the depot with the LSX marker. MSX analyzers were placed in regional labs in the largest cities in five regions of Ghana.

SERVICES & SUPPORT

  • Marking operations (marker storage & reconciliation, logistics, hand-marking trucks, warehouse management, etc.)
  • Field testing/sampling implementation, training, auditing and maintenance
  • Laboratory implementation and maintenance
  • Program management and reporting

THE OUTCOME

With the adoption of the Authentix fuel authentication program in Ghana, there has been a marked improvement in the quality of the fuel supply of the country. Additional benefits include:

    • A 78% reduction in adulteration of sampled products
    • An increase of excise tax collection estimated to be almost USD 9 M annually
    • Improved environmental and public health benefits: In most cases, the adulterant used to dilute either gasoline or diesel affects the quality of the product resulting in vehicle engine failures and harmful environmental emissions
    • The program was originally planned to mark two billion liters. Today, over three billion liters of fuel is marked, with continued
      reduction in contraband and the preservation of authentic, marked fuel on the market.

    The program designed and implemented by Authentix has established an international reputation as a best-in-class fuel authentication program because of its continuous improvement over time, consistent increases in recovered volumes and taxes of excisable and subsidized fuels, and the reduction in the number of samples and retail outlets showing signs of dilution or adulteration.

    Download Case Study PDF Here

    Case Study: Serbia

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    Authentix deploys a fuel authentication program to help Serbia recover millions in lost excise taxes

    • Government fuel excise revenues for 2014 were almost USD $161M higher than in 2013
    • Fuel excise tax collections increased by more than USD $23M in just one year

    Challenge

    The Republic of Serbia, a country of over seven million people, is located at the crossroads of central and southern Europe and is a transit point for many important commodities traveling from Europe to a wide variety of destinations. In 2009, Serbia’s economy was struggling and a decrease in fuel excise taxes was exacerbating the problem. Serbia’s government noticed that, while the number of fuel stations and the number of vehicle registrations were both increasing, the taxable sale of fuels used in cars was, at the same time, declining. This alerted officials that fuel fraud, intended to facilitate evasion of excise taxes, was an issue that needed to be addressed.

    By 2013, 1,434,000 tons of diesel had been consumed in Serbia, while only 902,000 tons had been sold by oil companies through wholesale channels. This left a staggering 37 percent of volume unaccounted for— equating to a tax value of about USD 246,749,850.

    The government of Serbia determined that this disparity could be explained by the practice of two illicit trade patterns:

    • Direct revenue losses: In this case, fuel to be transported is purposely under-measured by manipulation of measurement equipment and falsification of transport documentation. The unaccounted-for fuel is then diverted to the black market.
    • Indirect revenue losses caused by fuel being adulterated and sold at lower costs. This practice was harmful beyond the excise tax losses, as the introduction of adulterants degraded fuel quality—resulting in lower fuel efficiency, harm to the environment, and damage to vehicles and equipment

    Solution

    PILOT PROGRAM

    Prior to the Serbian government  implementation of a national fuel authentication solution, a pilot program was initiated to test the suitability of the fuel marker provided by Authentix. The pilot program proved that the marker did not have any adverse effect on fuel properties, homogenized well with the fuel, and the detection technology was easy to use. Most importantly, it demonstrated that the marker made it possible to detect unmarked (i.e., illegal) fuel, and the marked fuel was effectively quantified in the field.

    PROGRAM ROLLOUT

    As the actual program rolled out, regular sampling and testing begun. This included both field testing at petrol stations, internal stations, depots, and refineries, to indicate the presence of illicit fuel; and laboratory testing to confirm the field results.

    MARKERS & DEVICES

    The Authentix marker chosen for the program is constructed of the same molecular components as the fuel—making it virtually impossible to separate from the fuel once it has been marked and enabling a level of testing that supports successful criminal prosecution. The marking of both petrol and diesel is done manually at the bulk tank level at eight locations, at the auto truck level at four locations, and at the rail truck level at four locations.

    The marking of LPG is done manually at 15 locations. Rapid fuel testing at retail outlets and other bulk storage locations uses Authentix’s LSX and LPX technology, which allows inspectors to quickly screen all retail fuel stations and immediately determine whether the retail fuel has been diluted.

    Government officials may then choose to act based on the results from Authentix LSX 2000 and LPX1000 devices (specifically in cases of repeated failed tests over a period), and/or send samples for laboratory testing with our MSX1000 and HPLC devices.

    Outcome

    In just the first five months of the fuel authentication program, nearly 1 billion liters of fuel were marked, and the Serbian government began to see significant evidence that the program was working— even before enforcement started. Sales volume increased 18% for diesel, 14% for gasoline. And excise revenues increased by over USD $39M when compared to the same period the year before.

    • Fuel excise tax collections in February-March 2014 increased by more than USD $23M over the same period in 2013
    • It was reported on national television that government fuel excise revenues for 2014 were almost USD $161M higher than the year before
    • The number of failed samples at retail outlets has decreased steadily and is now 75% lower than at the start of the fuel marking program.
    • Volumes of marked fuel have increased by about seven percent, resulting in significantly increased inflows from paid excises to Serbian government coffer
    • From 2013 to 2018, the inflow of funds from the collection of excise taxes on petrol and diesel into the Serbian budget increased by about USD $232M
    • From 2013 to 2016, consumption of diesel fuels increased by 30%

    Download Case Study PDF Here

    Fuel Authentication Case Study: Middle East

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    Authentix uses its fuel authentication solution to uncover pervasive product smuggling and reduce smuggling losses by 80%.

    THE CHALLENGE

    The sole provider of petroleum products in its country, this Middle Eastern national oil company, one of the largest in the world, also manages the distribution of these products to major and remote bulk plants via pipeline networks, trucks, and marine shipments.

    Through their internal monitoring process, the company suspected that some domestic use subsidized products transported to and from the company’s refineries and bulk storage plants by third-party-operated trucks were being diverted and sold to unauthorized entities to be used as feedstock or was being smuggled. In addition, it was alleged that:

    • Product was being tampered or mixed with other products to alter and degrade specification for exporting purposes at higher profit margins
    • Product that was sold to customers for their own use was being diverted and resold to unauthorized dealers
    • Different products were illegally blended (low price low quality fuel/products) and sold for higher product prices
    • Products were being stolen during delivery process in the supply-chain
    • The average yearly revenue losses to smuggling and product diversion was in the hundreds of millions of U.S. dollars.

    THE SOLUTION

    Since 2014, Authentix has been providing an advanced fuel authentication program to the national oil company. The program marks subsidized diesel fuel at multiple locations, in order to detect the smuggling and product diversion as industrial feedstock of the refined product, or its distilled extracts smuggled out of the country through border crossings. The major components of the program consisted of the following:

    MARKERS & DEVICES
    The amount of fuel to be marked requires large-volume production of the markers. This was readily achieved early into the program and the marker concentrate is now securely blended in country. The fuel marker is added to the diesel fuel at seven locations (refineries and a bulk tank farm). Auto-injectors are used to simplify the process.

    Authentix MSX 2000 analyzer utilizes gas chromatography-mass spectrometry (GC-MS), which Authentix considers to be the ideal analytical technique for the unambiguous identification and quantification of markers in unknown petroleum samples. All diesel samples are analyzed directly via GC-MS. Four large independent labs are equipped by Authentix to conduct tests. Fuel specification testing is conducted using proprietary Authentix methods and established ASTM methodology are used.

    SUPPORT & SERVICES
    Fully-integrated lab testing system with over 15 MSX 2000 analyzers, a laboratory information management system (LIMS) to manage the lab workflow and web based management reporting dashboards were built and installed providing near real-time reports. Samples are taken at all borders, ports and suspected industrial sites and sent for testing and analysis at the 4- independent labs. Additionally, quality control tests are conducted on marked diesel at all marking sites to maintain correct marker dosing rates.

    THE OUTCOME

    Once deployed in the field, the Authentix solution proved to be highly effective in detecting and measuring marked diesel. The authentication program revealed the losses to be far greater than originally conceived. Through limited enforcement efforts and ongoing monitoring, the oil company was able to significantly curb smuggling at the country’s border, with the estimated savings of over $1 million per day. This represents a program return on investment of over 10X. Additional positive results include:

    • A substantial reduction in smuggling in the border area, due to 14 smuggling-implicated plants being closed by the nation’s government
    • Several hundred million U.S. dollars in subsidies are saved every year
    • A reduction in diesel demand with the reduction in smuggling and product diversion
    • Revocation of the export permits of the companies involved in illicit activity

    The sampling component of the program has also demonstrated great success. Over the course of the program, the number of samples that fail testing has decreased, as well as the volume of suspect samples. In fact, at this point, less than five percent of samples fail. The losses, measured in U.S. dollars, are now less than 20 percent of what they were before the fuel marking program was originally put in place. Based on the demonstrated success of the Authentix fuel authentication program, the oil company extended the program beyond the initial contract period and it is now a nationwide program which is extended every year due to the benefits realized.

    Download Case Study PDF Here

    Fuel Authentication Case Study: West Africa

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    Authentix solution uses authentication technology and transfer of knowledge to build a reliable, best-in-class program for a developing country.

    THE CHALLENGE

    A West African country was experiencing a significant deterioration in the quality of its petroleum products due to adulteration. Consumer confidence in the fuel supply was rapidly diminishing as adulterated fuel damaged vehicle engines resulting in a flood of consumer complaints. In most cases, the adulterant used to dilute the fuel can result in the release of harmful emissions to the detriment of the environment and public health. Before the implementation of a fuel authentication program, the recorded level of fuel adulteration was 32%. Illicit trade also impacted the appropriate recovery of fiscal tax revenues and government subsidies from the sale of petroleum and diesel for passenger vehicles. A country’s excise tax on petroleum products is diminished when fuels are diluted with products subject to a lower tax rate. National subsidies are negatively impacted when subsidized fuels are smuggled to countries where prices are higher.

    In 2012, in response to this crisis, a government agency was created to ensure the efficiency and profitability of the local petroleum industry, ultimately working to safeguard the quality of petroleum products placed on the local market. The agency’s goal was to halt the adulteration of petroleum products and ensure that subsidized products were reaching the intended consumers. An official fuel authentication scheme was enacted by the government agency to achieve these goals. The scheme was introduced in 2013 and awarded to Authentix as prime contractor, a leading global authentication program and information services company.

    THE SOLUTION

    Authentix works with governments to ensure authentic products are sold in-country to benefit law abiding citizens – not criminals. Fuel marking solutions enable governments to collect more excise taxes without raising taxes for the benefit of citizens and legitimate industries. By delivering technology and partnership strategies, the Authentix fuel authentication program is financed and operated by Authentix with a program of knowledge and skill transfer so governments can independently operate their own fuel authentication initiatives. The Authentix end-to-end solution uses chemical markers built to withstand adulteration and illicit filtering methods, the AXIS Information System, an integrated set of software applications, and in-house services and support (advisory, design, implementation and operational) to customize security solutions for its customers. Authentix, as prime contractor, designed, financed, built, and managed the operations together with the customer of the entire program before transferring it to a local partner after several years.

    As this program was the first in the country, Authentix designed the program based on the national mid and downstream fuel distribution networks and implemented the infrastructure and operations to maximize the efficiency and minimize interference with the local operators. Initially, fuel marking was rolled out to ten fuel depots. The program was expanded to all 13 national depots with additional sites coming online as they become operational. Authentix trained the government customer for field testing which was initially conducted to set the baseline for fuel adulteration occurring and subsequent subsidy and revenue recovery calculations.

    Markers and Devices – A machine-readable marker was added to the fuel supply at test retail stations (and later to the national supply at fuel depots) where unannounced checks could be conducted. A layered testing approach used the LSX 2000 field portable analyzer to screen samples. Failures were retested and, if failed a second time, were sent to a local lab for forensic testing. This layered solution provides scalability at a low total cost with enforceable results for legal prosecution.

    AXIS Information System – Expansion of the program required more efficient ways to operate the program daily. Authentix deployed the Marking Operations Management System (MOMS)  module of the AXIS Information System when it was determined that manual completion of truck marking orders and certificates wouldn’t meet the needs of fuel depot personnel. The digital database eliminates the need to manually input data from forms, a tedious process subject to error. Legible printed orders and certificates resulted in a higher professional standard of  documentation. Data from the depots is compiled and sent to the government agency for analysis and official record keeping.

    Services and Support – Under the guidance of the government agency, the fuel authentication program has followed a process of continual improvement and stakeholder engagement, including changing elements of the program, adapting to the actual conditions of the fuel supply chain and the agency’s desire for a greater role in daily operations. Authentix supported this process
    by providing training and guidance to transition to government agency-led management and implementing significant improvements to the analyzers, chemometric testing methods and depot operations.

    THE OUTCOME

    The Authentix fuel authentication program successfully identified product adulteration, earning back consumer confidence, recouping lost tax revenue and creating a significant number of highly skilled jobs for local people. The increase in tax revenue assisted government investment in critical infrastructure projects including roads, health posts, and schools. Over time, the Authentix build-operate-transfer fuel authentication model moved the operational workload of the program to the government agency. This approach supported the agency’s goal of independently operating its own fuel authentication program. Authentix as prime contractor delivered the following measurable successes from 2013 to 2017 have included:

    • A steady decrease in adulterated samples from 15-19% in 2013 leveling off to 3-5% in 2017.
    • A year-over-year reduction (196 million liters in 2013 to 95 million liters in 2017) of legitimate taxed product forcing out non-taxed product from the supply chain.
    • An increase in consumer confidence as evidenced by a reduction in consumer complaints in an annual customer satisfaction survey.
    • Generation of more than USD 200 M in additional excise revenue retention and subsidy recovery.
    • A 50% increase in the number of retail outlets tested and year-on-year increases in testing frequency. This in combination with actively sanctioning those found with adulterated fuels, has resulted in a strong deterrent effect.
    • Increase in the programs reach by deploying higher numbers of analyzers in the field and labs. This has driven the creation of local maintenance and auditor jobs.

    Download Case Study PDF Here

    Major US Fuel Marketer Protects its Brand Promise and Revenue Stream

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    Fuel authentication solution by Authentix used to combat commingling achieves a seven percent decrease in failure rate for a major US fuel marketer. 

    THE CHALLENGE

    In the early 2000s, our customer, a major Fortune 20 fuel marketer, acquired the retail operations of another large fuel marketer. This purchase increased our customer’s retail operations footprint substantially. The acquisition added new complexities to the fuel marketer’s supply chain, including:

    • Adding over 10,000 stations to the retail network
    • Consolidating two branded additives to one third-party additive package
    • Using more than 100 unmonitored, third-party fuel terminals
    • Continued divestiture of company-owned stations to franchise ownership

    THE NEED

    Consequently, the company became concerned about the integrity of their combined gasoline supply chain, the possibility of commingling, and of fuel terminals running out of gasoline.

    The fuel marketer required that any fuel marker selected to combat commingling meet all U.S. E.P.A. standards, as well as more rigorous California E.P.A. Air Resource Board (CARB) standards. This required a marker chemistry that would not harm the environment or cause adverse health effects through combustion and evaporative emissions.

    Able to meet all requirements, Authentix has been the fuel authentication solutions partner since 2002 for this company, which today involves nearly 15,000 branded sites in the United States.

    THE SOLUTION

    The Authentix fuel authentication solution developed for this large fuel marketer is an advanced solution that includes a fuel marking system consisting of physical markers added to fuel; information systems including proprietary software, data collection, and reporting; and services including:

    • Lab testing and sample analysis
    • Program management and sampling oversight
    • Results analysis and reporting
    • Sample collection in the field

    The Authentix solution uses a mass differentiated molecular marker with gas chromatography-mass spectrometry (GC-MS) analyzers, considered to be the gold standard for forensic analysis. At the additive facility, the marker is added to the customer’s additive package. It is then shipped to over 100 terminal facilities across the country, where it is injected into the base fuel according to prescribed treat rates.

    Samples from approximately 400 retail stations are delivered to the Authentix Analytical Laboratory for analysis. Using three Agilent GC-MS analyzers, a sample analysis is conducted for the customer’s fuel and additive.

    THE OUTCOME

    Since developing and implementing the fuel authentication program in 2002, Authentix has marked more than 200 billion gallons of gasoline to all 50 states with outstanding results:

    • Decrease of seven percent in failure rate directly attributed to a reduction in the commingling of non-branded gasoline with branded product
    • Greater integrity within the complex fuel supply chain
    • Increase in consumer brand confidence and competitive advantage across the U.S.

    Download Case Study PDF Here