J.E. Sweeney Manager of Loss Control ConocoPhillips Company

A.P.I. SubCommittee on Measurement Accountability (COMA)

API Chapter 17: Marine Measurement and

Accountability Measurement Standards Overview

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Agenda Responsibilities of COMA

Role of Measurement Standards

Custody Transfer

Loss Control & Accountability

Chapter 17 Contents

Application of Ch. 17 & Other API Standards

Questions & Answers (Q&A)

Committee on Measurement Accountability (COMA)

Develops standards for Marine Measurement

Develops loss control tools for measurement accountability and management of quantity & quality loss of petroleum and petroleum products in all modes of transportation

Industry standards serve a commercial requirement because they provide a technical means to determine measurement accuracy (or inaccuracy/uncertainty). Industry standards provide procedural accountability for all participants; inventory custody holders & owners. Industry standards are referred to in regulatory law for which they provide a technical basis for reporting & compliance Industry measurement standards are voluntary

Role of Measurement Standards

Custody Transfer Custody transfer measurement: “Provides quantity and quality (Q&Q) information used for the physical and fiscal documentation of a change in ownership and/or a change in responsibility for commodities.” (API MPMS Chapter 1 Vocabulary)

Q&Q Determination. Change in Ownership and/or Accountability. Each Marine Custody Transfer’s Q&Q Data is determined by or dependent upon over a dozen Measurement Standards.

Loss Control is a risk management process that minimizes & prevents inventory Q&Q losses. Loss Control begins with the commercial contract Terms & Conditions (T&Cs). Loss Control processes custody transfer data to validate “performance” & accountability of operations and to verify measurement data integrity (measurement, sampling & lab). “Performance” and “Compliance” are defined by adherence to accepted custody transfer measurement standards.

Loss Control

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COMA Subcommittee Chapter 17 Standards (*published jointly with Energy Institute)

17.1 – Guidelines for Marine Cargo Inspection

17.2 – Measurement of Cargoes on Board Tank Vessels

17.3 - Guidelines for Identification of the Source of Free Waters Associated with Marine Petroleum Cargo Movements

17.4 – Method for Quantification of Small Volumes on Marine Vessels (OBQ/ROB)

*17.5 – Guidelines for Cargo Analysis and Reconciliation

17.6 - Guidelines for Determining Fullness of Pipelines Between Vessels and Shore Tanks

17.7 – Recommended Practices for Developing Barge Control Factors

17.8 – Marine Measurement – Guidelines for Pre-Loading Inspection of Marine Vessel Cargo Tanks

*17.9 – Vessel Experience Factors (VEF)

17.10 (Parts 1 & 2) – Measurement of Refrigerated and/or Pressurized Cargoes on Board Marine Gas Carriers (Part 1; LNG & *Part 2; LPG/Chemical Gases)

*17.11 – Measurement and Sampling of Cargoes on Board Tank Vessels Using Closed/Restricted Equipment

*17.12 – Procedure for Bulk Liquid Chemical Cargo Measurement by Cargo Inspectors

Commercial Application of COMA Standards Contract Creation; Quantity & Quality (Q&Q) Determination T&Cs Inventory Management; Optimization and Managing Q&Q Risks Custody Transfer, Financial Settlement & Claims Resolution

What Q&Q Determination Language Do You Have in Your Commercial Purchase/Sale & Terminal Agreements ?

“The quantity and quality of the oil delivered under the Agreement shall be determined in accordance with the standard practice in use at the Loading Terminal at the time of loading. “

Or…

What Q&Q Determination Language Do You Have in Your Commercial Purchase/Sale & Terminal Agreements ?

“All measurement & sampling equipment, procedures, calculations, and practices* shall be performed in conformance with the most current API Manual of Petroleum Measurement Standards, ASTM Standards and/or corresponding International measurement, sampling and testing Standards. * Whether performed by accredited

surveyor or terminal personnel.

J.E. Sweeney Manager of Loss Control ConocoPhillips Company

Chair of API Committee on Petroleum Measurement

Q & A