Petroleum Measurement Manual

Petroleum Measurement Manual
HCOTEG170000 – Measurement: Table of

contents
This section contains the following:
HCOTEG170250 Scope of guidance

HCOTEG170500 Background
HCOTEG171000 Law
HCOTEG171250 Public Notice 179 Section 4
HCOTEG171500 Energy Institute (Institute of Petroleum) measurement papers
HCOTEG171750 Measurement Instruments Directive (MID)
HCOTEG172500 What are the responsibilities of the trader/warehousekeeper?
HCOTEG173000 Health and safety
HCOTEG173250 The importance of location and the environment surrounding meters
HCOTEG173500 Security of equipment and contingencies for loss of power
HCOTEG173750 Standard temperature accounting
HCOTEG174000 Flow meters – technical background
HCOTEG174250 Flow meters – other information
HCOTEG174500 Meter proving
HCOTEG174750 Proving meters – technical background
HCOTEG175000 Measuring the contents of tanks
HCOTEG175250 Preferred measuring methods
HCOTEG175500 Automatic Level Gauges (ALGs) – technical background
HCOTEG175750 Automatic temperature measurement
HCOTEG176000 Hydrostatic gauges including manometers
HCOTEG176250 Densitometers
HCOTEG176500 Telemetering
HCOTEG176750 Automatic Tank Level Gauges – other factors to consider
HCOTEG177250 Ullaging
HCOTEG177500 Road tank wagon measurement
HCOTEG177700 Tank dipping
HCOTEG177750 Weighbridges
HCOTEG178000 Vapour recovery
http://www.hmrc.gov.uk Page 1 of 97 February 19, 2011

HCOTEG170250 - Measurement: Scope of

guidance
This section deals with the means of measuring oil (together with their accuracy) used to account
for duty on oil or to control it for revenue purposes.
This distinction is important, since at times we are not interested just in measuring a quantity or
volume of oil in order to determine an actual amount of duty, but because we want instead to
control the oil as it may later be delivered at a reduced or nil rate of duty, having been either
fully or partially ‘rebated’ or relieved of duty.
Please note, that whilst this section is focused on mineral oils, the principles and guidance on
measurement it contains, may be applied equally to fuel oil substitutes, fuel additives and to
biofuels.
The Energy Institute’s Petroleum Measurement Papers (See HCOTEG171500) apply equally to
these products.
Training
 A Guided Learning Unit on ‘Measurements’: Reference 003200 is now available in
Online Learning
 A Guided Learning Unit on ‘Health and safety’: Reference 003199 is now available in
Online Learning.
Other guidance
 X-99 Oils Duty Assurance
 X-99 Biofuels Assurance
HCOTEG170500 - Measurement:
Background
Introduction
It is important to remember that essentially no measurement method can be 100% accurate, and
that the environment in which they are operating can affect the accuracy of all means of
measurement.
Duty is charged on the volume of oil.

However, oil changes density with temperature, so as its temperature increases, the same amount
of oil will take up more space or volume.
To measure oil consistently for duty purposes, the volume must therefore be calculated at a
single temperature.
Accounting for oil

Oil is accounted for by what is known as standard temperature accounting (STA) - the
volume the oil would take up at 15ºC whether or not the oil is actually at 15ºC at the time it is
measured. Only metric units (litres) can be used. (See paragraph 16.15.1.).
The volume expressed in litres at 15ºC is known as standard litres.
The volume of the oil to be accounted for at its actual temperature, at the time of measurement, is
known as bulk litres (or as ‘observed’ or ‘measured’ litres).
Principles of measurement
The principle of measuring, laid down in Public Notice 179, is that the trader uses the most
accurate method available to them. If this fails, we may allow a less reliable method to be used;
however the trader cannot then just pick and choose a method to suit themselves, and there must
be safeguards in place to protect the duty and to prevent any revenue loss where the trader
chooses to use an alternative method.
Metering for large oil companies is increasingly linked to computer systems and has a high
degree of automation, removing many of the physical checks that used to be carried out.
However as there are a growing number of bio-diesel and other fuel substitute producers
registering premises for small scale production, the use of physical checks may become
increasingly important.
HCOTEG171000 - Measurement: Law and

regulations
Hydrocarbon Oil Regulations 1973 SI 1973/1311

Section 14 and Sections 46 to 51 which covers:
Section Section title Summary

14 Method of measurement gives officers the power to require a particular
means of measurement or calibration of oils

46 Means of measurement Says what the trader will provide in equipment and
assistance – also covers what the trader will supply
for sampling.
47 Authorized person’s rights of This is our officer’s rights to inspect, measure,
access sample and require documents for any vehicle and
premises other than residential.
48 Production of records Right to be given records on demand ‘at reasonable
times’.
49 Retention of record Records have to be kept (and unaltered) unless we
give permission.
50 Where records to be kept …at the premises oil moves in and out of.
51 Measurement of volume Establishes that volume means ‘standard litres’ and
these are litres where oil is at 15ºC. Volume in
‘standard litres’ to be calculated using recognised
conversion tables. These are calculated following
measures of volume, temperature and density. (See
Public Notice 179, paragraph 4.10.6)
Note that Section 51 was added by the Hydrocarbon Oil (Amendment) Regulations 1993 SI
1993/2267
Finance Act 1993 section 12 and the Hydrocarbon Oil

(Amendment) regulations 1993
 covers standard temperature accounting.
HCOTEG171250 - Measurement: Public

Notice 179 section 4
This guidance should be read in conjunction with Public Notice 179 Section 4.
The key aspects of Section 4 of Public Notice 179 are:
 Meter accuracy has to checked against a reference meter that meets National Standards
(Public Notice 179, 4.1)
 How to deal with ‘standard temperature accounting’ ( Public Notice 179, 4.4)
 When measurement to our standards is required ( Public Notice 179, 4.7)
 Accuracy standards (Public Notice 179, 4.10)
 Errors in equipment (Public Notice 179, 4.12)

HCOTEG171500 - Measurement: Energy

Institute (Institute of Petroleum)
measurement papers
The Energy Institute, which is the new name for the Institute of Petroleum following its merger
with the Institute of Energy, is a professional body which sets standards and confers professional
status on its members. It issues papers and guidance to the petroleum industry covering all
aspects of handling petroleum products from Health and Safety issues to the equipment which is
used in the industry.
The two papers of most interest are –
 HM39 Petroleum Measurement Manual or a Guide to Recommend Measurement Practice

for Compliance with the Requirements of HMC&E Notice 179, (previously referred to as
PMP7) and
 Petroleum Measurement Paper ‘Code of Practice for the Proving of Loading Gantry
Meters’, (previously referred to as PMP 4)
An electronic copy of HM39 is held for reference purposes by the Oils UoE Immingham, and a
hardcopy version by the Oils Team (Policy) in Manchester.
Measurement Instruments Directive (MID)
Introduction
Known as the MID, details of this and the legislation to bring this EU directive into UK law can
be found on the National Weights and Measures Laboratory site at www.nwml.gov.uk.
The MID sets standards for the operation of most measuring devices sold, putting them into
classes of accuracy and laying down the marking and documentation that must accompany any
device, so that the user or anyone else checking knows how it should perform and the
environment it needs in order to be able to operate properly.
MID and oils assurance

The part of the MID that affects oils assurance directly is in Appendix MI-005 – ‘Measuring
Systems for the Continuous and Dynamic Measurement of Quantities of Liquids Other Than
Water’. This was put into UK law by Statutory Instrument No 1266; The Measuring
Instruments (Liquid Fuel and Lubricants) Regulations 2006 which came into force on 30
May 2006.

The MID specifies accuracy classes, which for simplicity, are named after each class of
measuring system’s maximum permissible error (MPE). So, a class 0.3 accuracy has an MPE of
0.3%. The classes are 0.3, 0.5, 1.0, 1.5 and 2.5. The only class that meets our standard is 0.3 - the
standard specified in Public Notice 179.
Please note however that any meter is part of an overall measuring system – for example, a
positive displacement meter’s revolutions will be within 0.2% of the volume passed through it,
but after an adjustment for temperature affecting density, the reading will be still within 0.3%.
(Please also note, that whilst Public Notice 179 states that all meters will need to perform within
an accuracy MPE of +/- 0.15%, which is what we would expect to see evidenced on any
calibration/proving reports for the meter under test, MID has set new standards to replace these
current values, for all equipment installed after October 2006).
The MID requires that (a) any measuring system is robust in the conditions within which it is
expected to operate ( that is it must be fit for the purposes it is being used for ) and (b) that the
conditions under which a meter is designed to operate are easily verifiable.
Not all of the MID is being put into UK Law, for instance Automatic (tank) Level Gauges,
(ALGs) are not covered, and whilst measures of length are covered, it is unlikely that this will
apply to dipping/ullaging rods and tapes
N.B. We no longer approve meters or ALGs before they are put into service. Instead we now
require that all meters or ALGs meet pre-determined levels of accuracy.
HCOTEG172500 - Measurement: What are

the responsibilities of the trader/warehouse-
keeper?
 To dip tanks where we ask for this; we may witness dips/ullages but do not do these
ourselves.
 To provide H&S to our standards.
 To maintain the accuracy of meters – The warehousekeeper is responsible for the
accuracy of all meters even though they may have subcontracted out the process of meter
proving, or they may have alternatively subcontracted out the loading gantries and the
meters that go with this.
 To ensure measurement equipment is secure and cannot be tampered with (Public Notice
179, 4.1).
 Any automatic (tank) level gauges (ALGs) must be installed, tested and adjusted as
recommended by the Energy Institute (Public Notice 179, 4.7.3).
 To provide tank calibration tables for every tank used for storing oils before the duty
point or marked rebated oils. Calibration tables must take into account floating roofs
(Public Notice 179, 4.9.2)
 To provide facilities for independent checks by us of all quantities in containers, tanks,
wagons, or craft loaded or unloaded at the premises. (Public Notice 179 4.16)

 To comply with Public Notice 179.
 To use the most accurate measurement system available.
 To use the recommended practises of the Energy Institute in their ‘Petroleum
Measurement Papers’, particularly HM39 which deals with complying with Public Notice
179.
 To comply with the directions of ‘our officer’ as to the method of measurement,
calibration or conversion tables to be used (Public Notice 179 4.1).
 To advise HMRC of measurement methods and equipment used for revenue accounting
at each approved warehouse or refinery (Public Notice 179, 4.8).
HCOTEG173000 - Measurement: Health and

safety
On-line H&S guidance

This is not an exhaustive list, and HS-2, Health and Safety Management which covers the risk
assessments that should be in place and available for inspection by all Staff involved in oils duty
assurance, should be consulted in order to identify the risks and potential hazards involved in
visiting trader’s premises, offices, freight, dock and other areas.
 HS-7 Safe clothing and equipment

 HS-10 Hazardous substances
 HS-12 Safe working in docks and freight areas
 HS-15 Safe working on vessels
Personal protective equipment

Meters and measuring systems are usually in places where there are special health and safety
needs. Accordingly Personal Protective Equipment (PPE) should be worn including safety boots
with antistatic (and oil-proof) soles (as other soles may melt), fire-retardant overalls, high-
visibility jacket, goggles, over-spectacles, gloves and a protective safety helmet as necessary.
Main hazards
 Oil has obvious hazardous properties, such as its ‘slippiness’ and other less obvious ones,
such as the lead additives which are still added to some fuels and which are carcinogenic.
 Crude oil gives off flammable vapours which in certain circumstances can be highly
explosive. This is especially the case with ‘petrol’ or gasoline vapours which are highly
volatile.
 Ladders up tanks for our inspection should go round the tank and have railings as
opposed to going vertically up the side.
 Floating roofs on tanks should NEVER be stepped on.

 Officers can be called upon to board ships and most loading/discharge places are busy
with freight vehicles. Docks and Freight areas are particularly dangerous. (Please note
that Officers cannot board vessels without having first completed Dock and Ship Board
Awareness and other Health and Safety training).
 Mobile phones should be switched off when entering oil storage premises and anywhere
else where any form of loading or discharge of oil is in progress.
 Vapour builds up in any oil tank that has a space in it.
Vapour recovery hazards

Vapour recovery units convert the vapour, which behaves like a gas, back into liquid oil. Vapour
recovery is required by EU Directive 94/63/EC, which was enacted in the UK under section 7(2)
of the Environmental Protection Act (1990). For loading/unloading areas, be it road, rail or sea,
vapour recovery requires equipment that has to be attached and detached on each occasion.
The Energy Institute have issued the Vapour Recovery Hazards Bulletin in 2002, which made
specific recommendations relating to road tanker loading and which should have been fully
adopted by now following a series of incidents. At some point in the vapour recovery process,
the vapour is under pressure and potentially explosive. Vapour pressure can also build up in
pipes that are attached and detached.
(For further information on Vapour Recovery and its measurement please see HCOTEG178000)
Will the traders have risk assessments and H&S training?

Officers should comply with a trader’s own H&S training and requirements. All traders should
have in place risk assessments to cover all their staff and any visitors. Officers must be made
aware of these before going on site.
For further information on Health and Safety, see HCOTEG11000 in the ‘Introduction and
overview of oils activity’ section of this guidance.
HCOTEG173250 - Measurement: The

importance of the location and the
environmental conditions surrounding
meters
Introduction
Meters and their readings can be affected by many factors. The right type of meter has to be used
for any specific type of product mix and for the right type of operation. The misuse of a meter is
unlikely to occur by chance, since meter manufacturers clearly specify the uses for which their

products are suitable. Positioning a meter in the wrong place, or changes to the environment
around a meter can cause it to become inaccurate in use, even where the meter has previously
been proved and shown to be accurate in tests.
Other aspects of positioning

Other aspects of positioning which should be considered are, how close the meter is to the point
of delivery or from the point of unloading. All meters need to be positioned in such a way that
they remain full of fluid at all times i.e. that fluid does not drain out of them and the meter does
not have to fill up at the start of any measurement.
Given that a large number of meters either record or transmit (or both) their readings, placing
meters or their transmission wires near electrical equipment or high voltages can give false
results by introducing induced currents and false pulses. Meters with pulse transmitters should
have adequate protection for data transmission to levels A or B security as defined in the
Petroleum Measurement Manual Part XIII, Section 1 (IP 252/76).
HCOTEG173500 - Measurement: Security of

equipment and contingencies for loss of
power
Security of equipment and contingencies for loss of power

All measuring equipment must be secure from tampering, to the extent that:
 Any bolts and screws giving access to the workings of a meter should be sealed with wire
passed through holes in bolts and sealed with a crimped on lead seal (a trader’s own seal).
There may be alternatively a system which automatically detects interference with the
meter, such that any attempts of unauthorised access to the meter will cause a system
alarm and stop any product flow.
 Any tools to open and or to adjust meters should be kept under controlled access by the
trader.
 Wires, computers and computer terminals and printers contributing to readings taken for
revenue accounting purposes must be free from either deliberate or inadvertent
interference.
 For powered equipment, there must be adequate warning of power failure and back-up
systems in place to take readings, where a power failure occurs.
 Where there is a power failure the system must retain the reading that last passed through
it for later recovery.
 Computer or powered equipment must not be capable of being switched off
independently.

Whilst traders have the same interest as HMRC in ensuring that the full amount of dutiable
product sold is measured, this does not rule out internal fraud or lack of vigilance on the part of
the trader, especially where the product is controlled but there is either no duty or a nil rate of
duty.
HCOTEG173750 - Measurement: Standard

temperature accounting (STA)
Standard temperature accounting (STA)
To convert ‘bulk’ litres – the volume of the oil as you measure it - to standard litres, the
temperature and density also need to be known. (See Public Notice 179, Section 4.10.6).
In practice:
 You can agree with the trader if you think it impractical or unreasonable to use STA for
a. Road fuels and aviation gasoline for amounts of less than 4,000 litres
b. Other oil not for use as road fuel for amounts less than 80,000 litres
This is likely to be for one-off amounts or very small quantities.
 You would need to measure the temperature of oil in the tank (this is not easy or
straightforward manually as oil can form different layers of temperatures). Dips would
need to be taken at intervals over the height of the product in the tank and then averaged.
The guidance to the trade provided in HM39 should be followed. The trader needs to
have this and the equipment specified.
 Density will be the density for the product to be accounted for. Conversion tables should
be used to look up the temperature corrections required (the trader should have these).
Standard temperature accounting (STA) calculations

The information needed to convert bulk litres to standard litres comprises the bulk litre figure,
the temperature of the product and the density of the product. By using the conversion tables
specified in Public Notice 179 at paragraph 4 of Section 1H it is possible to convert bulk litres to
standard.
For further information on the Standard temperature accounting calculations, please refer to
Public Notice 179, paragraphs 4.4 and 4.6, and to HM38 ‘User Guidelines for Standard
Temperature Accounting’ which is published by the Energy Institute.
See Public Notice 179, Section 1H for further information on Standard Temperature Accounting
for excise duty purposes.

HCOTEG174020 - Flow meters - technical

background: Positive displacement (PD)
meters
Introduction
This Section is intended as an introduction to the types of volumetric meters and their methods of
operation. We do not approve particular types of meter but do state the standards they must meet
in Public Notice 179.
Positive Displacement meters (PD) are the meters commonly used in the oil industry and are
incorporated in the product line. The interior of the meter bowl is divided into calibrated
measuring chambers by a number of blades. As product flows and enters the inlet section it
occupies each chamber and causes the blades to rotate. As each chamber passes the outlet section
of the meter bowl it is emptied into the delivery line. Either the rotating central spindle or the
rotor is linked to a drive shaft which is connected at the other end through gearing to the meter
register.
The drive shaft may be very short, with the register bolted directly to the meter bowl, or it may
be several feet in length if the register is situated on the platform of the loading gantry.
A PD meter uses energy derived from the moving oil it is measuring, not only to drive its own
mechanism but also those of any ancillary equipment fitted to it. The moving parts are subject to
friction, so any addition, removal or replacement of ancillary equipment may affect meter
accuracy. It is normal for the meter manufacturer to specify a range of rates of flow within which
compensation for the effects of friction and inertia has been made in the design of a meter.
Reliable measurements are only possible if there are no sudden fluctuations. A flow regulator is
often included in the pipeline upstream of the meter to prevent surges or excessive variations of
flow rates.
The rate of product flow governs the frequency of rotation of the blades and drive shaft, and this
is transmitted to the register by means of a variable gear mechanism, known as the calibrator.
The calibrator should never be altered other than during meter proving. Since the viscosity of the
oil being measured influences the inertia effect of the mechanism of a meter, a meter is
calibrated to measure oil of a limited viscosity range. The meter would be inaccurate for products
outside that range without re-calibration.
For further information on the most common types of meters and what affect them see
HCOTEG174280
For information on other types of flow meters see HCOTEG174290

HCOTEG174030 - Flow meters - technical

background: Inferential meters
Inferential meters
Inferential meters are designed to deduce the volume of oil passing through a pipeline by
measuring some physical characteristic such as speed of flow. There are several basic types of
inferential meters, including turbine meters, orifice plates, vortex-velocity and vortex- shedding
meters.
Turbine meters
Turbine meters are commonly used for raising revenue accounts. They are used mainly in long
distance pipelines (including receipts of crude oil from North Sea platforms) and the loading of
ships.
Turbine meters measure the rate of flow of oil in a pipeline and relate it to the pipeline diameter
to give a read out in terms of the desired units of volume.
They are virtually unaffected by friction and inertia, having no mechanical parts other than a
free-moving turbine with magnetic-tipped vanes. The meter should, in theory, be accurate over a
wide range of flow rates. The turbine is rotated by the oil as it passes through a metering
chamber made of non-magnetic material inserted in the pipeline and is mounted on special
bearings so that its axis of rotation is coincident with the axis of the pipeline. It is constructed so
that the pressure of the oil against it counteracts the thrust on its bearings, thus reducing friction
and inertia to negligible proportions.
Rotation of the turbine is detected by one or more sensing heads fitted to the metering chamber.
Meters may also be encountered on which sensing is by means of a photo-electric cell mounted
over a window in the metering chamber and activated by light reflected from a tiny mirror
incorporated in the turbine. In either case the sensing head generates and sends pulse to an
electronic computer which counts them and applies a pre-set factor (determined during proving
of the meter). A digital display registers the volume of oil which has passed through the metering
chamber.
Orifice plate meters
An orifice plate meter measures the pressure differential caused by the presence in a pipeline of
a plate with a hole in it which restricts the diameter of the pipeline. It is sufficiently accurate for
revenue accounting.

Vortex-velocity meters
In the vortex-velocity meter, a vortex develops in a cylindrical chamber off set in the side of the
meter tube carrying the main flow stream. There is a direct relationship between the number of
revolutions of the vortex and the volume of the main flow. The volume flowing through the
meter is recorded by counting the revolutions of a rotor mounted within the vortex chamber.
Connection between the rotor and the revolution counter is by magnetic or electronic means.
Vortex-shedding meters
A vortex-shedding meter measures the number of vortices created and shed per second around
a specially designed obstruction in the pipeline. Pulse signals are generated at a frequency
proportional to the flow rate.
For further information on the most common types of meters and what affect them see
HCOTEG174280
For information on other types of flow meters see HCOTEG174290
HCOTEG174260 - Flow meters - other

information: Terms relating to meters
 Linearity – if a meter’s results are linear, it means the meter would produce a straight
line on a graph that plots volume against flow. In other words, the meter would give the
same degree of accuracy at both low medium and high flow rates. (In theory only a
positive displacement meter will achieve this – as many types of meter will not register
much at low flow and will underestimate at high flows). To maintain accuracy, with non-
linear meters adjustments have to be made to the readings according to flow rates.
 Inferential – a meter that gives a volumetric reading but is actually measuring a different
factor, from which it is able to infer or to produce an equivalent volume, e.g. an
inferential meter may make an assumption that because a turbine has done 10 revolutions
this must mean 3 litres of gas oil has flowed through it.
 Meter proving – testing the accuracy of a meter by comparing the flow through the
meter to be used, against a reference meter that is both known to be and has been proved
as accurate. Some sites have their own reference meters but ‘meter proving’ is often done
by contractors. Meters for ‘revenue accounting’ have to ‘proved’ when installed, then
again at 3 months and 6 months. If these results are satisfactory routine proving may then
be carried out at six-monthly intervals.
 MPE – Maximum Permitted Error, the maximum error a measuring system deviates from
the proving meter and can still be used. (MPE is not an allowable tolerance: it does not
allow a trader to understate by the amount of the MPE).
 Flow computers – this a term for a particular device, often the size of a pocket
calculator, mounted on or near the flow meter which can make calculations that adjust the
meter reading for factors that can alter readings in meters such as pressure, temperature,
density, time over which readings take place, low flow rates, high flow rates.

(These are particularly important for turbine meters). Not all these factors occur or upset all
meters (See the Note* below).
 Automatic temperature compensating (ATC) meters – as previously mentioned, we

account for oil by volume, but volume varies with temperature. Any measurement system
has to adjust for what the oil temperature is at the time the oil is measured, and calculate
what the volume would be if the oil temperature would have been 15ºC. We prefer meters
that do this automatically.
 Meter creep – this describes the tendency for some meters to move slightly forward
between consecutive loadings. It is more noticeable when the smallest amount the meter
can read is greater than one litre, i.e. the meter cannot accurately account for small
amounts or fractions, which then have to be read or recorded as a higher amount.
 Repeatability – this is measured during meter proving and indicates the range of results
between successive proving tests under the same conditions.
 Meter factor – this is established during meter proving tests and is the volume actually
passed through the flow meter divided by the meters indicated volume.
Note* The trade recommends that flow computers should only be used where you cannot depend
upon the accuracy of the meter alone.
This is because of the extra complexity flow computers add to the calculations involved in
measurements, and their potential for unintended and undetected errors which can affect the
accuracy of the measurement.

information: What can make flow meters
inaccurate?
The type of flow meter used is a function not just of the accuracy of the meter itself, but also of
its suitability to cope in the conditions in which it is used.
The factors that affect meters are:
 Turbulence caused by bends in pipe work before the meter – this can affect all types of
meter – indeed, some types of meter work by measuring turbulence caused by a fixed
obstruction – so that any additional turbulence will make the meter inaccurate.
 Bubbles – anything that allows air or gas into the pipe could again cause most meters to
be inaccurate, by changing the volume.
 Viscosity of the fluid – may be illustrated by the difference in viscosities between
lubricating oil and white spirit. Thicker lubricating oil has to be heated to thin it and then
pumped and stored in heated or insulated pipes and tanks. Thinner white spirit has 2
adverse effects: it has no lubricating properties to protect the meter through which it is
flowing, and its ‘thinness’ means that the meter has to maintain a very tight seal where
there are moving parts – accordingly they tend to wear out quickly.

 Temperature – the density of the oil reduces the hotter it becomes – plus some flow
meters work by measuring temperature variation.
 Vibration – ‘Coriolis’ meters in particular are affected by vibration because they use
vibration in order to produce a measurement, so mounting them on a vibrating jetty as has
happened, will render the meter inaccurate.
 Small amounts – a meter should be able to measure less than 2 litres for revenue
accounting but some find it difficult to measure flows that stop and start – (also see
‘linearity)
 Changing flow rates – flow meters used for loading have to be accurate from a standing
start, and initially the loading of tankers is at a low flow rate. If the loading were done at
a high flow rate, the fuel sloshing round an empty tank could generate enough static
electricity to cause a spark. After sufficient fuel is in the tank, the flow rate is turned up to
finish the load as quickly as is practical and safe.
 Electromagnetic interference – (possibly generated by electrical equipment,
transformers, microwave aerials such as mobile phone masts) can affect meters that work
by measuring magnetic interference and might affect computers and transmission
equipment built into the meter. They could cause extra current to be induced into a wire
or flaws/pulses to be generated. They may also interfere with microwave transmission,
where meter readings are wireless, and are transmitted instead to a control room.
 Non oil products – Meter systems should include suitable filters upstream so that any
particles or solids do not enter the meter and cause interference with the measurement
device.
 HCOTEG174280 - Flow meters - other

information: What are the common types
of meter and what affects them?

All meters need to be full of oil at all times, and sited in such a way that there is no
turbulence in the flow ahead of the meter (this usually means there has to be a straight
pipe into the meter) and there is nothing in the immediate vicinity of the meter that could
interfere with the way the meter works – such as vibration.
Type of flow meter and What the meter Main usage and Weaknesses
description measures strengths
Positive displacement – Volume – this is in Accurate at low flow Needs clean fluids. If
there are various types fact the only meter rates – used for fluid (such as white spirit)
involving gears, ovals that is purely tanker loading has no lubricating
and screws – effectively volumetric – its gantries. properties the meter will
they are like a pump action is solely wear out quickly.
working in reverse – a dependent upon the Viscous fluids will find it
fixed volume is trapped volume of liquid that difficult to push through
in a chamber of the passes through the the meter.
meter whilst it rotates. meter. Compensations for
temperature have to be
made.

Turbine – the faster the Speed of flow – Little resistance toReal time compensations
flow the faster it spins. rotations of the flow and can be fitted
have to be made for
turbine are counted – in large diameter density, pressure and
usually by electronic pipes – used in temperature. These
sensor. pipelines. calculations are made by a
flow computer. Turbine
meters often have a pipe
running in parallel with
them, in which a ‘proving
meter’ can be run.
Coriolis – usually a U Mass – which is They can be very Since vibration is a factor
tube which is made to commonly accurate and are not in their operation, external
vibrate. There is nothing understood as weight affected by density vibration can make them
in the tube. Passing fluid – the more the tube changes in the fluid. inaccurate. They are not
through the tube causes bends the greater the They offer little accurate at low flow rates.
it to bend. mass flowing resistance to flow. They are not accurate for
through it. (Mass has They may become high viscosity fluids.
to be converted to common for revenue
volume ). accounting.

information: Other types of flow meter
Type of flowmeter What the meter Main usage and Weaknesses
and description measures strengths
Ultrasonic – use The ‘doppler’ meter Both meters infer Not all fluids conduct
sound waves – there measures the velocity of the flowultrasonic waves and
are two types, the frequency of the and can give readings
opaque fluids degrade
cheaper doppler and reflected wave and the from a static start. The
the signal, as do fluids
the more accurate ‘transit time’ meters meter does not obstruct
that coat the pipe wall.
transit time. the time difference flow. Dirt coating the
between a wave going transducers in the meter
upstream and one sent will also degrade
downstream. accuracy, as will any
turbulence.
Vortex shedding The vortices caused by Can be used in pipes Inaccurate at low flow
and fluidic (Coanda an obstruction in a from .025 inch to over rates, affected by
effect) vortex meter or the 12 inches diameter. vibration and can be
oscillations in a fluidic (Sold for use in affected by compressed
meter, all of which petrochemical pipe work.
increase with flow. industries).
Thermal – heat is The faster the flow the Commonly applied to Fluids that coat the
applied to a sensor, less heat is picked up gases: the meter does sensor or fluids that may
and a second heat by the second sensor. not have to be vary in their thermal
probe measures how compensated for gas properties.

much heat is left. density.
Variable area – a The faster the flow the Used in petrochemical Dirty, and opaque fluids,
vane or a float allows more the movement industries. Used to give and fluids that coat
more fluid to pass it local indication of surfaces can all affect
the faster the flow. small flows. measurement.
Magnetic resonance The faster the flow the Does not obstruct Should not be used near
– fluids that conduct more the voltage. pipes. Commonly used its limit. Needs a
electricity move for water- containing conductive liquid.
through a magnetic products and can be
field in the pipe that used for corrosive
generates a voltage. products, and in
chemical processes.

information: Where revenue accounting
standard flow meters are used
Where revenue accounting standard flow meters are used
 On loading gantries for road tankers that deliver to the customer - filling stations etc.
 On jetties for coastal tankers
 On pipe-lines direct to customers from refineries such as airports
 On cross country pipe-lines
 On rail loading gantries

information: MID Requirements
The problem is not only that the meters have to be located where they can work, but once that is
done, changes to the plant around the meters can also make them inaccurate.
The MID will put into law the following:
 A meter will operate within the maximum permitted errors of its designed class of
accuracy or it will be withdrawn.
 ‘Every measurement system shall be so positioned as to facilitate testing.’
 If it needs it, a measurement system will be marked with the temperature range it must
work within, and similarly with a flow rate range.
 Where a measuring system is marked for use for a particular purpose or manner of use, it
must be used in that way.

HCOTEG174510 - Meter Proving: Typical

methods
Typical methods of meter proving are:
 Static proving tanks – a very finely calibrated tank that is connected to meters where the
discharge from the tank is compared to the meter reading; or where the meter reading is
compared instead to receipt into the tank.
 Mobile proving tanks – as above but of lesser capacity such as 1,500 litres. It needs to
be jacked up and levelled before use. However, the tanks used must be ones which have
been specifically designed for this purpose.
 Reference meters – are high grade meters that are connected in line with the meter to be
tested and the results compared. The reference meters themselves need to be proved.
Corrections need to be made where the pressure goes over 1.5 bars (27 p.s.i.) against an
authenticated correction graph produced at the proving of the reference meter. The
reference meter must not be used to prove meters at flow rates that the reference meter
itself has not been tested at.
 Prover loops – a loop in the pipe work that allows the flow to be diverted through a
proving meter or device rather than the working meter.
 Pipe provers – often work in specially designed prover loops that accommodate a sphere
that is started and sensed at a stop point electronically and travels with the flow so that a
precisely known amount of oil travelling through the pipe travels through the meter and
results are compared. Instead of a sphere, sometimes a piston is used and this process can
be run backwards so that the same precisely known amount of fluid can be pushed
through in the same direction twice.
HCOTEG174520 - Meter Proving: Guidance

Guidance to the trade on meter proving is contained in section 8 of HM39. See HCOTEG171500
Certificates of calibration of proving systems given by independent experts or authorities such as

the DTI are acceptable to us.
It is recommended that meters are tested or ‘proved’ on installation and then at 3 months and 6
months. If these results are satisfactory routine proving may be carried out at six-monthly
intervals.
Proving is often carried out by subcontractors who will provide the trader with a certificate, but it
is the trader who remains responsible for the accuracy of their meters. This is also true, even
where the trader sub-contracts out the metering as well, as can be the case for loading gantries.
Failing meters should be taken out of use immediately. If a replacement meter is not

available, alternative means of measurement will need to be put in place and agreed with HMRC
. Any replacement meter will need to be proved prior to being used for revenue accounting .
HCOTEG174750 – Measurement: Proving

methods - technical background:
Static proving tanks

A static proving tank is usually fixed on firm foundations and consists of a main chamber
calibrated to as fine a degree of accuracy as possible. It narrows at the top to a sight glass or a
subsidiary compartment of small cross-section, enabling extremely accurate measurements to be
made of the over-delivery or under-delivery quantity of oil shown by the meter under test.
The tank may be sited near the meters to be tested and connected with the pipeline system to
enable tests to be carried out without the meter. At large installations, however the excessive
length of pipeline connections to the tank might necessitate removal of meters to a separate
proving station. This would not reproduce the normal operating conditions of the meter and
would not therefore be acceptable for proving meters to be used for raising revenue accounts.
Mobile proving tank

A mobile proving tank is similar in principle to a static proving tank, but is usually of a small
capacity, such as 1,500 litres. The tank is mounted on a wheeled bogey and before it can be used,
it must be jacked up to raise the wheels and then levelled. Meters fitted at road and rail tank
wagon loading bays can then be tested on site under operational conditions.
Reference meters
A reference meter, sometimes called a “master” meter, is normally a high-grade instrument of a
type similar to the meters which it is to test. It is installed ‘in series’ (as opposed to “in parallel”)
with the meter to be tested and the readings of the two meters are compared. It may be mounted
on a wheeled bogey and equipped with controls to form a mobile test rig.
When a meter is proved using a product, temperature and/or flow rate different from those used
to calibrate the reference meter, the appropriate corrections obtained from the reference meter
correction graph are to be applied to the reference readings. A correction is also necessary when
the difference between the pressures exceeds 1.5 bars(27 p.s.i.). The correction graph must have
been dated and authenticated at the time of the last proving of the reference meter.
A reference meter must not be used to prove meters which operate at a higher rate of flow than
that at which it has been tested.

Reference meters must be proved and calibrated against a recognised National Standard and a
certificate to that effect issued by the testing authority must be available for examination.
Being a mechanical device, the reference meter may develop faults which are not immediately
apparent and it may be damaged during handling or transit. Proving by reference meter is,
however widely practised and is probably the most convenient method for most oils installations.
Pipe provers and prover loops

In-line proving by a permanently installed prover loop is the most satisfactory method from the
revenue aspect, as a test can be carried out without delay whenever required. The content of the
prover pipe or loop between two detectors is determined as accurately as possible.
Unidirectional provers
“ Unidirectional” provers have the calibrated section of pipe in the form of a loop to facilitate
the installation of a device for the launching and recovery of a rubber or plastic liquid-filled
sphere. Solid spheres are sometimes used with the smaller provers.
The launcher is operated by electrical means from a control near the meter read-out indicator.
When a test is conducted, a sphere which completely fills the cross-section of the pipe is
launched into it and is carried along at the same speed as the oil. The sphere is detected as it
enters the calibrated section or “loop” and this starts a counting device incorporated in a
computer or similar ancillary equipment. As the sphere leaves the calibrated section it is detected
again, causing the count to cease. The sphere is recovered mechanically and returned to the
launching position.
The reading of the counting device showing the pulses generated by the meter during the passage
of the sphere through the calibrated section can then be related to the known content of that
section, corrected if necessary for temperature and pressure. The number of pulses generated for
the corrected volume is then used to determine the pulse/unit volume factor, which is applied to
produce the unit of measurement for the quantity register.
Bi-directional provers
“ Bi-directional” provers may have a straight calibrated section of pipe or they may be in the
form of a loop. They incorporate either a sphere or a piston which, after passing through the
calibrated section is reversed by the operation of valves to pass back through the calibrated
section to its original starting position. The proving run consists of the ‘round trip’ of the two
movements through the calibrated section.
Pipe provers test meters under working conditions without interference with the operation in
progress. They are particularly suitable for testing meters controlling cross-country pipelines or
long jetty lines.

Increasingly, use is being made of the “ small volume” or “ compact” prover. Such provers
utilise a system of pulse interpolation which enables pulses from a meter to be identified to a
fraction of a pulse thus reducing the rounding-off errors which arise when pulses are counted to
the nearest whole number. They also perform best with meters, such as turbine meters, whose
pulses are emitted at regular intervals. Their advantage is their greatly reduced size compared
with conventional provers and the fact that the proving operation can be carried out much more
quickly. Such provers may be mobile or in-line, and uni-directional or bi- directional.
HCOTEG175010 - Measuring the Content of

Tanks: Introduction
Some companies are switching from trying to accurately measure the volume in tanks to the
standards we require for duty accounting, to more rough and ready methods sufficient for them
to monitor stock levels.
Duty accounting measurement is now more often done instead by flow meters at the point of
loading to leave the premises.

Tanks: Terms relating to tank measurement
 MPE – Maximum permitted error - the maximum error a measuring system can vary
from the proving meter and still be used. (MPE usually refers to Meter rather than to
Tank measurement). Note that ‘MPE’ is not an allowable tolerance: it does not allow a
trader to understate by the amount of the MPE because that’s the amount we allow.
 Dipping and ullaging – dipping measures the depth of liquid in a tank (the top of the
liquid to the bottom of the tank) whereas ullaging measures the height from the top of the
liquid to the roof of a tank. Dipping has to be from a known point to the bottom of the
tank, whereas ullaging is from a fixed point on the tank roof. Note: in order to work out
the volume of liquid in a tank using either method, you have to know how much the tank
holds at any given height/level. You can’t just assume the tank construction of the tank is
regular. Accordingly, each tank should have a tank calibration table.
 Tank calibration table – a table that tells you what the volume in a tank is for any
particular height of liquid (measured by either dipping or ullaging). If the tank is
measured for revenue accounting purposes, this can be affected by:-
a. Deadwood – anything that protrudes into a tank (a brace or reinforcing strut) which
takes up volume that would otherwise be measured as oil.
b. Water bottom – is the water in a tank on top of which oil floats. As water falls to
the bottom of the tank, a measurement made by ‘ullaging’, might not detect the
water bottom, which could then be assumed to be oil.
c. Floating roofs – the roof on top of large refinery tanks can literally be floating and
move up and down with the level of oil in the tank. They usually have bottom stops

or stays that stop them falling to the very bottom of a tank. Floating roofs can affect
volume measures in the tank (by displacement) and should never be walked on.
 Automatic Level Gauges (ALGs) – are commonplace and alternatives to manual

‘dipping’ and ‘ullaging’ found on the fixed roof of large depot tanks. They measure the
height and also usually the temperature (see below) of oil within the tank. The
measurement given by the ALG is usually transmitted electronically to the refinery or
depots’ stock control room/system.
 Automatic Temperature Compensating (ATC) – as previously mentioned, HMRC
account for oil by volume, but volume varies with temperature. Any measurement system
has to adjust for what the oil temperature is at the time the oil is measured, and to
calculate what the volume would be if the oil temperature was 150C. (We prefer ALGs
that can do this automatically).
 Vapour Recovery – because of EU emission regulations (EU Directive 94/63/EC
implementation beginning in 1998), and to save money, tanks’ breathing pipes that were
once open to the air, now have to be connected to a small plant that returns the vapour
given off back into the tank as liquid fuel. This is especially important for the more
volatile fuels such as petrol, which vaporises easily, but it also applies to crude oil.
Vapour recovery can be hazardous (see HCOTEG173000 ‘Vapour Recovery Hazards’).
 Weighbridge – the compact Oxford Dictionary says ‘a machine for weighing vehicles,
set into the ground to be driven on to’. All that is usually visible is a metal plate that is
large enough for a truck to drive on (or it could be set into rails for rail tank wagons).
 Tank Reference Height – this is the height of the point from where all manual dipping
takes place.

Tanks: Factors affecting measurement in
tanks
Water – from condensation forms a layer (known as a “water bottom”) underneath the oil which
then floats above. Only the oil is to be measured, so the presence of water needs to be detected,
measured and deducted from the dipping or ullaging measurement. This can be done with a
dipping tape and special water detecting paste.
Deadwood – the term for anything that sticks out into the inside of a tank, such as bracing, that
changes the volume of the tank – this is hidden from view and might only occur at a particular
height. This should be accounted for by having a tank calibration table that converts the height of
any measurement of liquid into the volume left in the tank.
Floating roofs – the weight of the roof displaces the oil on which it floats, but below a certain
level there will be stops to stop the roof sinking further. Consequently, at a certain point the
floating roof stops displacing the oil on which it is floating and affecting the volume calculation.

Irregular construction - and the fact that tank floors can sink in use. Whilst a tank calibration
table will account for irregular construction, sinking tank floors may easily be missed and will
affect both the measurement and accuracy of Automatic (tank) Level Gauges (ALGs).
Temperature – because density decreases with temperature and the same amount of oil will take
up less space (volume) the colder it is, then the temperature of the oil needs to be known. ALGs
usually measure temperature as well as the height of any liquid in a tank.
HCOTEG175250 - Measurement: Preferred

measuring methods
Introduction
In all cases the trader should use the most accurate method available to them. They are not
allowed to pick and choose the method they use. If the trader wishes to use a less preferred
measure for any reason such as a temporary failure, they must ask our permission.
Storage tanks (site fixtures)

The preferred measuring methods are:
a. Automatic (tank) Level Gauges (ALGs).

b. Dipping/ullaging.
For small storage tanks properly calibrated sight glasses (a clear tube up the side of the tank that
looks like a large thermometer) are acceptable.
Road or rail tank wagons

The preferred measuring methods are:
a. Loading by volumetric meter (the use of meters is mandatory for road tankers loading all
light oils, derv, kerosene and gas oil from duty suspended installations).
b. Automatic loading gauges (a probe that ‘dips’ into the tank).
c. ‘Dipping’ and ‘ullaging’ (are no longer possible and not considered safe on most road
tankers).
d. Weighbridge.
Ship transport
The preferred measuring method is a volumetric meter. (Short sea shipping is the most cost
efficient method for large amounts outside of a pipeline). It is possible to dip (and ullage where
the tank is constructed to allow this) ships’ tanks but they present special problems that render
them generally inaccurate:

 Ship not level – they list (to the side) or pitch (front to rear) and thus the ships attitude in
the water will change all the time that product is being pumped on or off the ship. As
product is loaded, the ships’ displacement that is the height at which it sits in the
waterline will also change, affecting its attitude. The ship may also be deliberately
‘trimmed’ for sailing – its angle in the water altered by flooding ballast tanks, to
compensate for the loads contained in its oil compartments.
 Heavy oils require heating (ships will have their own heating devices) and crude oil coats
the internal faces and bracing of the tanks in such a way that ‘remnants’ of the oil are left
behind. (This remnant is so significant that operators go to the trouble of ‘washing’ the
product out of the tank with lighter oil, in order to recover it).
Accordingly, although a ship’s tanks will have appropriate calibration tables, using ‘dips’ or
‘ullages’ requires extreme care and their routine use as an alternative to metering (except in an
emergency) should be questioned and invite audit.
Vessel experience factors

Vessel experience factors (VEF) may be used to adjust ships tank dip figures to obtain a more
accurate reading. This is an ‘adjustment factor’ calculated for a particular ship that compares the
ships’ own readings historically against alternative shore measurements.
HCOTEG175500 – Measurement: Automatic

Level Gauges (ALGs) - technical background
Introduction
ALGs are more commonly known as Automatic Tank Gauges (ATGs). Automatic Tank
Gauges will not be covered by the Statutory Instruments implementing MID into UK law.
However, Public Notice 179 at 4.7 says Automatic (Tank) Level Gauges (ALGs) must be
installed, tested and adjusted as recommended by the Energy Institute (formerly the Petroleum
Institute).
Whilst we prefer Automatic Tank Gauges to dipping and ullaging, ALGs are often relegated to
stock control rather being used for revenue accounting, where meters are now more commonly
used. We prefer ALGs to automatically measure and compensate for temperature.
Mechanical ALGs have a float attached to a wire that runs over a pulley and is kept taught by a
counter weight. ALGs can not only measure and compensate for the temperature of the oil, but
also the affects of oil temperature on the gauge itself. However, there are a range of other ALG
technologies that involve probes with non-moving parts. They can be connected up to software
that continuously monitors the ALG at the same time it monitors pumps and flow- meters, so
detecting leaks or other problems.
ALGs can be fitted to all types of tanks including floating roof tanks and fixed in the tank top,
bottom or indeed side.

Types of Automatic Tank Gauge in general use

The earliest tank level gauges consisted of a float on the surface of the liquid in the tank,
connected by a wire or tape passing over a pulley to a counterweight or spring-loaded drum. The
indicator at the side of the tank showed the distance of the float from the tank bottom.
Most tank gauges now in use in the UK are based on the same principle but progress in their
design and in the techniques of installation has brought about a continuing improvement in
accuracy and reliability. Some of the features which have brought about this improvement are as
follows:
 Compensatory systems are incorporated to maintain the measuring tape under constant
tension and to correct its length for ambient temperature changes.
 The apparatus is mounted so as to avoid deflections arising from distortion of the tank
sides or bottom caused by the weight of oil or bending of the roof due to vapour pressure
or persons moving on it. The gauge may be rigidly fixed to the bottom or to the top of the
tank.
 Friction is as far as possible eliminated. Servo systems may be employed to provide
power to the liquid level detector, and may cause the detector to “hunt” up and down for
short distances around the surface level. In gauges which do not hunt, a device may be
incorporated which allows an operator to raise or lower the detector to check that it
returns to the same level.
 The liquid detector may either:
 displace a constant volume, irrespective of the temperature and density of the oil; or
 ride in a vertical perforated tube and settle by electrostatic equilibrium at a pre-
determined height above (usually 1mm) or depth below (usually 2mm) the liquid
surface. The principle used to detect the oil-air interface can be used to detect an oil
water interface and so provide a dip of water bottoms in tanks. (This is rarely used in
practice).
 “Damping” arrangements are sometimes used to smooth out ripples on the liquid surface
and give a steady reading at the mean level. Such arrangements can deal effectively with
ripples up to about 25mm in amplitude but are only partially effective with surface waves
having periods of oscillation exceeding 2 or 3 seconds.
ALGs fitted to ships tanks are in general similar to those installed in shore tanks. They have to
withstand more mechanical stress and higher corrosion and usually achieve lower accuracies.
Other types of automatic tank level gauge

The following Automatic Level Gauges are based on different principles:
 Electronic gauges. The liquid level in wholly electrical gauges is determined by its effect
on the resistance or capacity of electrical circuits.
 Ultrasonic devices. The depth is determined from the time taken by high frequency
sound waves to pass through the liquid.

Although these gauges have the advantage of requiring no moving parts, they are affected by the
density of the oil and in some cases by its composition.
HCOTEG175750 – Measurement: Automatic

temperature measurement
Introduction
ALGs usually include a device for measuring the average temperature of the liquid within the
tank. There are also separate devices for measuring the liquid temperature of tank contents as a
whole or at fixed or adjustable “spot” points within the tank. Except for a few spot measuring
devices, which use thermistors or thermo-couples, all automatic temperature measuring devices
in general use, depend on the effect of the temperature of the liquid upon the electrical resistance
of a length of sensitive wire immersed in the liquid. Apparatus connected to the sensitive wire
measures its resistance and deduces the temperature of the liquid.
The main types of temperature measuring equipment are:

 The averaging “bulb” type. Five or more sensitive wires of varying lengths, electrically
insulated from one another, extend vertically upwards from the tank bottom. The longest
wire which is totally immersed in the liquid is selected manually or automatically.
 The averaging spiral type. A single length of sensitive wire is enclosed in a spiral nylon
tube connected to a plate near the tank bottom and a float on the surface. It is maintained
in position by vertical cables. The tube is loaded so as to be virtually weightless and is
extended as the product level rises to form an even spiral throughout the depth of liquid.
 The averaging beam type. A single length of sensitive wire is laid along the length of a
beam. The beam is pivoted at the bottom of the tank and supported by a float on the
liquid surface. The sensitive wire is thus wholly immersed in the liquid and lies
diagonally in the tank between the beam pivot and the float.
 The spot type. A length of sensitive wire is supported horizontally within the tank at a
fixed or adjustable depth below the tank roof or below a float on the liquid surface.
 The portable battery-operated type. A sensitive bulb is attached to a cable about 30
metres in length. This terminates in a small easily carried instrument with a digital or
moving coil temperature indicator. The cable is marked at intervals to indicate the depth
at which the temperature is being recorded.
Temperature measurement instruments and accuracy

The Energy Institute standard for temperature measurement instruments in storage tanks requires
that they should be accurate to within 0.5ºC. Different types and makes of apparatus require
different times to respond accurately from the time the electric circuit is switched on. Spiral and
beam types can give an accurate indication within 15 seconds. All averaging devices are subject
to errors caused by temperature variations which are not in uniform horizontal layers. In tanks

whose diameter is greater than their height, averaging beams can sometimes be laid across the
line of vertical layering and are more accurate than bulb or spiral types.
HCOTEG176000 – Measurement:
Hydrostatic gauges including manometers
Hydrostatic gauges including manometers
The pressure at any given point in a liquid is proportional to the density and height of the liquid
above that point. The reading given by a pressure gauge showing the pressure at a fixed point
near the bottom of the tank may therefore be used to determine:
 The depth of liquid in the tank if the density is known: and

 The weight of the liquid above the fixed point if the horizontal area of the tank is also
known.
By assuming average densities or areas, gauges can be calibrated to read in dips or units or
weight. These devices are seldom sufficiently accurate for revenue accounting, but may be used
for spot checks on quantities.
Examples: Types of pressure gauges.
 “Contract” manometer. The liquid being measured communicates its pressure to an

indicating liquid (usually mercury) and balances the weight of the indicator in a vertical
glass tube. The height of the indicator reflects the pressure and the tube can be graduated
to read the liquid weight or depth. Because of the weight of the indicator this type can
only be used at about the level of the tank bottom.
 “Air-purge” manometer. A supply of air is used to transfer the pressure in the tank to
the indicating liquid in a vertical glass tube. Since the density of air is low, the glass tube
is able to be located at levels other than the tank bottom. The air pressure must be
maintained by an air pump or a compressed-air reservoir. When the air pressure exceeds
the tank liquid pressure, air is allowed to blow off through the tank.
 “Mechanical hydrostatic gauge”. A pressure-sensitive capsule is exposed to the liquid
pressure in the tank and indicates the pressure on a dial or by tracing pen. These
mechanical gauges can be connected to electronic equipment for remote indication.
Densitometers
Densitometers are most commonly required to indicate a change in density of the oil passing
through a pipeline, for example at an interface. Normally they are not used to measure density to
a high degree of precision.

There are a variety of densitometers in use.
 “Balanced flow” type. A sample of the liquid flows through a fixed volume chamber
where it is weighed or compared with a predetermined weight.
 “Displacer” type. A float or plummet is immersed in the liquid and the density of the
liquid determined from the effect on its buoyancy.
 “Gamma-ray” type. A source of gamma radiation and a radiation detector are mounted
to measure the degree to which the radiation is absorbed by the liquid. Absorption
depends upon the density of the liquid.
 “Vibrating” type. Mechanical energy, usually produced by electromagnetic apparatus is
used to set up vibrations in the liquid. The density, or change in the density, of a liquid
can be determined from the amplitude or frequency of the vibrations which vary with the
density of the liquid.
Telemetering
Electrical systems are normally used for transmitting the readings of automatic tank level gauges
and related equipment to remote points. Since the voltage and the current can be affected by
external disturbances, direct current measurement is used only if adequate safeguards can be
applied. (IP 252/76 provides for appropriate standards at different levels of specified security).
Most telemetering systems depend on the number of (or the time interval between) electrical
pulses generated mechanically or electrically. Spurious pulses may be produced by external
electrical interference, caused for example by the close proximity of the transmission lines to
power cables or telephone lines. Safeguards are required to prevent the transmission of spurious
pulses and to ensure that the amplitude of pulses arriving at the remote point is adequate for
accurate reading.
HCOTEG176750 - Measurement: Automatic

Tank Level Gauges- other factors to consider
Factors which may affect measurement by Automatic Level
Gauges
 Lack of use – mechanical ones can seize up.
 Low levels in the tank – some gauges can stop working below a certain level and do not
take account of liquid being received into, or discharged from the tank, whilst
measurement is in progress.
 Rust – unlikely in an oil environment - but this can happen to mechanisms where their
parts or components are regularly exposed.

 Turbulence – although many ALGs are designed to dampen down turbulence and to find
the true level even though the top surface could be rippling.
 Temperature – oil can form layers at different temperatures. Some meters compensate for
this by having an averaging beam that takes and averages temperature measurements at a
range of different depths across layers.
 Tank Dips - see HCOTEG177700, because an ALG is effectively an automatic dipping
machine, the same provisions apply.
Automatic Level Gauges - other considerations

ALGs have to be fitted and adjusted to each tank, and their measurements must be converted by
a calibration table which has been compiled and tested uniquely for each tank (this is most likely
to be done electronically).
The fixings of the meter and all equipment that is used to adjust and maintain the meter and the
read-out system also need to be controlled effectively by the trader in order to stop fraudulent
interference.
Warehouse-keepers should have a control system in place that regularly (usually monthly)
compares the ALG to a manual dip/ullage. Any differences outside of the agreed tolerance
(currently +/- 8 mm) should be investigated and corrective action taken.
Please note that all new equipment installed after October 2006 should meet the new accuracy
tolerance of +/- 5mm when compared to the results of manual dipping.
HCOTEG177250 - Measurement: Ullaging

Factors that affect the accuracy of ullage measurements?
Basically, exactly the same things that affect dips, although no ullage could ever take place on a
floating roof.
Requirements for Ullaging

The needs of tank dipping (See HCOTEG177700) mostly apply here. Ullaging could be used in
Rail Tank Wagons where there is no automatic loading meter. This is rare.
The difference in our requirements for ‘ullaging’ are:
1. The tank must be constructed so that the height from the top of the liquid to the ullaging
point (marked at the top of the tank) can be converted to the volume of liquid within the
tank, by using a calibration table compiled specifically for each tank, i.e. the tank must be
designed and built specifically in order to allow ullaging.
2. The ullaging rod should be graduated in 2mm gradations.

3. The must be an absence of water where it is the total volume of oil which matters (as
opposed to measuring the ‘opening’ and ‘closing’ volumes).
HCOTEG177500 - Measurement: Road tank

wagon measurement
Introduction
Road Tank Wagons (RTW) are now both loaded and unloaded from beneath the tank and there is
no longer any provision for opening the top of the RTW ‘pot’ and dipping it, as this method is
now considered an unacceptable health and safety risk. There are though, still some road tankers
used for heavy fuel oil, which are top-loaded and could be dipped, where access is permissible
only where a railed gantry is provided for access to the top of these tankers. Consequently we
now tend to rely on readings taken from flow meters on loading or unloading.
They could however, be checked by a weighbridge if flow meters failed and traders have asked
our permission. The wagon should be weighed both before and after loading with attention paid
to ensuring nothing is added or taken away that could affect the weight ( like the delivery driver
or a passenger ). It is also necessary to ensure that the road tanker is fully on the weighbridge. It
is possible for the weighbridge to be fitted with sensors that alarm if the wagon is not correctly
positioned
HCOTEG177700 – Measurement: Tank

dipping:
Factor affecting the accuracy of tank dips
 Sinking tank floors and or barrelling (stretching in the middle) which requires a new calibration
table to be made.
 Sludge – at the bottom of the tank (may not be important for differential readings – see below)
 Water bottoms – where the total amount in the tank is what matters (such as when a quantity
of oil is returned to duty suspension) – the presence and size of the water bottom is detected
with a water paste smeared onto the tape, which needs to be left in place for up to minute for
fuel oil but perhaps only 5 seconds for motor spirit.
 Floating roofs with snow - that adds weight causing the roof to sink lower resulting in the
weight of snow being measured as oil (due to increased displacement ) – the trader has to
remove the snow before any dipping.
 Listing ship – or pitching – ships are rarely level.
 Entry and exit valves – must be closed before dipping.
 Entry lines (pipes) - should be empty and drain into the tank – if they are not they need to be
made to do so, or the measurement will be less than it should be.
 Exit lines (pipes) – should be full or the reading will be exaggerated.

These last two factors are especially important when a reading is taken at the start of receipt of
oil into a tank, or the start of loading a delivery, and a second reading is taken later in order to
see how much has been received or loaded. They are also important where the pipelines are long
– such as to a ship and where the ship could be well below the level of the jetty.
Dip carried out by trader or his representative

The trader does the dip but you must witness it.
The trader, or his representative, who does the dipping must keep the tape or rod steady and it
must not swing or the reading will be affected. If water paste is used the tape, which will have a
weight attached to the bottom of it, must be held in place long enough to react – a minute in fuel
oil. The weighted tape must of course be held steadily against the dipping point marked on the
tank.
Requirements for dipping

Calibration tables
These need to be available for every tank used for holding oil on which potential revenue is to be
assessed whilst the oil is in the tank. They must use metric measures and show the volume in
litres for each height in no less than 2mm intervals. If the calibration was done at greater
intervals than 2mm, a supplementary table should be provided saying what the volume is
calculated to be at the 2mm intervals between the readings.
Dip rods and tapes with selection of weights
Like the tank calibration table, the dip tape or rod should also be marked in no less than 2mm
gradations. A dip tape must not vary over its length by 8mm (this is to be reduced to the new
standard of 5mm).
Weights are attached to the bottom of dip tapes (due to viscosity); the heavier the oil to be
measured then the heavier the weight to be used.
Water pastes
When applied to the bottom of the tape or rod, it changes colour. The tape or rod needs to be left
in place for up to 2 minutes in order for the colour change to take place. The volume of water
(water bottom) by reference to the tank calibration table needs to be deducted from the overall
dip volume calculation in order to accurately determine the remaining volume of oil in the tank.
A fixed dipping point
This will normally be a fixed plate at the top of the tank (at the dipping point) which provides a
reference height.
Health and safety requirements

If our safety standards are not met then the measurement should not take place until either this is
put right or an alternative form of measurement is introduced that is acceptable.
Large cylindrical tanks should have a diagonally ascending railed in stairway around the side as
opposed to a vertical ladder if it is to be used for revenue accounting purposes and thus available
for inspection by our officers. Vertical ladders up the side of smaller and squared construction
tanks should have caged-in ladders. There should be a suitable guard rail around the top of the
tank.
Weighbridges
Introduction
The MID has a section dedicated to Rail Weighbridges: The Measuring Instruments (Automatic
Rail-weighbridges) Regulations 2006. However, there is no such section for road weighbridges.
Requirements for weighbridges

Public road vehicle weighbridges
There are legal requirements for public weighbridges that do not apply to private ones. After
checking on installation, the Trading Standards Officer (TSO) will check (reprove) the
weighbridge every six months and give it a stamp. This stamp will be obliterated by the TSO if it
fails a test, but will be reinstated if it passes. Any weighbridge certified by the TSO is acceptable
to us.
Private road vehicle weighbridges
As above, the TSO will stamp the weighbridge on installation. However, from then on it is up to
the trade to have the weighbridge re-proved – the TSO will not test the weighbridge as a matter
of course and obliterate the stamp if it is found inaccurate. The weighbridge is only acceptable
therefore if it has been reproved at least annually.
Rail weighbridges
Accuracy classes of weighbridges

As with flow meters, there will be accuracy classes of weighbridge, and these are:
Accuracy Class Maximum permissible error expressed as a percentage of mass of a

single wagon or total train as appropriate
0.2 + or - 0.2%
0.5 + or – 0.5%

1 + or – 1%
2 + or – 2%
Measurement of rail wagons

Rail tank wagons are loaded from the top, often by remote control apparatus that can include a
tank-measuring probe (a type of ALG) as well as by measurement by flow meter. The loading
system will also include vapour recovery pipes.
Like road tankers, the initial loading is at low flow rates to stop foaming and turbulence that
might cause either static or an electrical spark. Loading is then completed at a higher rate. Where
a printout is given for the Rail tank wagon it must give the weight of the wagon and its load.
Rail tanks, where checked manually are usually ullaged rather than dipped. However, if
automatic equipment fails we may give permission for a rail weighbridge to be used. If this is the
case wagons need to be weighed on a certified weighbridge separately, by being uncoupled, both
before and after loading.
HCOTEG178010 - Vapour Recovery: Vapour

recovery on loading from duty- suspended
installations
Vapour recovery on loading from duty-suspended
installations
Vapour recovery is required by EC directive 94/63/EC for anti-pollution reasons. Gasoline or
petrol vapour adds to ozone depletion and contains carcinogens such as benzene. It is also very
dangerous – a 1 to 7% mixture with air can be explosive. Vapour recovery plants may be found
dotted around any refinery or storage and distribution depot. Vapour recovery takes place for
more products than gasoline, but gasoline yields are the most substantial returns – a cubic metre
of vapour at 25ºC can be converted to 2 litres of liquid. This recovered liquid is not the same as
gasoline. It is the most volatile parts of the gasoline or other mineral oil that evaporate.
Consequently, the recovered liquid is usually ‘flooded’ or re-mixed into a tank of ordinary
gasoline or oil, but not in too great a proportion. Because the vapour is of a different
specification to the fuel it is derived from, it being effectively a fraction or distillate, some plants
burn the recovered vapour as heating fuel.
Extra statutory concession on recovered motor spirit vapour

There is an extra statutory concession allowing relief from duty for recovered motor spirit
vapour. This only applies to vapour that has been recovered from fuel after having passed the
duty point and the recovered vapour is returned to the duty suspended (i.e. not duty paid) storage.

Submission of claims
Reclaim of duty should be made monthly as a credit against the total duty shown on Form HO10.
HCOTEG178030 - Vapour Recovery: How is

recovered vapour measured?
Manufacturers make various claims for the efficiency of their systems but the huge throughput of
a refinery can make the systems a cost-effective investment despite the fact that they have to be
present by law.
A rough estimate of the amount of motor spirit expected to be recovered is one litre per 1,000
litres loaded, and for a 1,000 litres of distillates the recovery of liquid is about a quarter to a third
of a litre.
Because the amounts recovered are small and many units work by adding the vapour back into a
stream of product, it is often not considered possible or practicable to measure the recovered fuel
with meters. Accordingly we have a complex formula to work out the amount of duty that can be
reclaimed. Vapour recovery claims and this formula are under review by the Oils Team (Policy).
The current formula is said by one oil firm to result in errors costing it £580,000 a year – but this
is for all its operations and before vapour recovery, vapour was merely lost to the air. Claims
only began in 1999.
HCOTEG178040 - Vapour Recovery: Vapour

recovery formula approved by the Energy
Institute
Introduction
The formula (below) as approved by The Petroleum Institute (now known as The Energy
Institute) is shown below in full, although it is currently under review and contains some now
obsolete terms.
(Any amendment to this Formula will be publicised and reflected in amendments to this section
of the guidance in due course).
Vapour recovery Formula

Duty reclaim = P*S*H*M*0.0000422*VT [(Ful*Dux) + (Fsul*Dsul) + (Fl*Dl]/D

Where
P = The VRU performance factor

S = The VRU service of availability factor
H = Average TOC (total organic compound) concentration of vapour collected.
M = Mean Molecular Weight of recovered liquids.
VT = For VRUs with a single sample point. Volume of all products loaded through bays
connected to each sample point.
VT = For VRUs with multiple sample points. Volume of products loaded through bays
connected to each sample point. (Where the sampled H value differs, a separate formula
will be required.)
Ful = Fraction of VT comprising unleaded motor spirit.
/ = Divide
* = Multiply
See HCOTEG178050
HCOTEG178050 - Vapour Recovery: How

the constituent factors of the formula are
obtained
How the constituent factors of the formula are obtained

P – The VRU performance factor
The percentage of efficiency is the difference between the vapour returned to the VRU less the
vapour emitted by the VRU; the formulae for calculating these factors are given in the EI
guidelines (Section 4.4). The performance factor has to meet exacting standards. UK legislation
requires a tri-annual compliance test which is monitored by the appropriate environmental
agency. The EI trade guidance requires the copy of the testing agency’s report to be made
available to Customs.
S- The VRU Service availability factor
The VRU may not be always available due to breakdown or servicing. For the effect on the
operation of the formula see the EI Guidance Section 3.3.

H – Average of hydrocarbons in collected vapour
To establish the percentage of hydrocarbons in the recovered vapour the warehousekeeper will
need to analyse samples drawn quarterly from the vapour line during the loading of RTW’s.
The percentage of oxygen is determined by an oxygen meter with a paramagnetic cell. As air
normally contains 20.9% of oxygen, readings of less than that are caused by the presence of total
organic compounds (TOCs).
Readings are taken manually every 30 seconds during the loading of the RTW and an average
reading for the vapour recorded.
If the final average for the RTW is 15.9% of oxygen, a value for the percentage of hydrocarbons
recovered can be determined, using the following:
20.9 – 15.9 = 5 x 100/20.9 = 23.9% hydrocarbons.
Testing RTWs over 2 x 8-hour periods, i.e. an AM and PM, should give a mean value for the
percentage of vapour returned.
The test is repeated for the distillate (DERV) loading racks if the installation’s practise is to use
the same RTW’s for both motor spirit and distillate. Although distillates give off little in the way
of Volatile Organic Compounds (VOCs) an RTW may load DERV into a compartment
previously carrying motor spirit.
A rough estimate of the amount of motor spirit expected to be recovered is one litre per 1,000
litres loaded, and for a 1,000 litres of distillates the recovery of liquid is about a quarter to a third
of a litre.
A millimetre on a small tank will be equal to 30 to 40 RTWs of motor spirit vapour. Additionally
the loading tank may also be the tank used for deliveries and receipts from the absorber column.
Considering that the automatic tank gauge (ATG) or the automatic level gauge (ALG) accuracy
requirement is 8 mm this is a fair number of RTWs. Taking all the above into consideration, bulk
storage tank measurements are not accurate. The EI guidance gives detailed advice to the
operator in Section 4.
M and D - Mean molecular weight and density of recovered liquids
The EI guidance (see Section 4.3.5 and Annex 3) also gives methods of drawing and testing
samples of vapour for molecular weight and density which are performed in a laboratory by gas
chromatography. The test will also establish the components that make up the sample (typically
the various butanes, propanes and pentanes make up 70% or more of the vapour).
VT - Total volume of product loaded through bays connected to the VRU
This will include distillate where the installation’s practice is to use the same compartments.

Ful/Fl/Fsul - Fraction of the volume of motor spirit at the different grades
Only the motor spirit grades are included with the purpose of apportioning the different rates of
duty charged.
Dul/Dl/Dsul - Duty rates on motor spirits
Duty rates for motor spirit grades only.
See HCOTEG178040
HCOTEG180500 - Computer Systems:

Introduction
What types of computer system are encountered in the oil

industry
The oil industry uses computer systems for stock, revenue and financial accounting. These
systems are often integrated with commercial systems to include sales ordering, order fulfilment,
delivery gantry management and meter control.
The fundamental principals of stock and revenue accounting are no different to computer
systems in other duty suspension regimes in that the systems hold details of products, stocks,
storage locations and movement transactions.
By retaining receipt and delivery transactions the systems can report stock balances and
summarise movements by type, by product etc. However “oil” systems have added complexity in
that:
 revenue accounting is in standard litres;

 products are moved in bulk and the quantities ordered, despatched and received will
rarely balance;
 duty paid, duty suspended and rebated product can be commingled; and
 production processes are continuous, and product movements consistently span
accounting periods.
From HMRC’s view, a unique feature of the oil industry is the use of on-line computer systems
to establish transaction volumes.
These systems with little or no operator intervention continuously monitor volume, temperature,
pressure and density measurement devices, control the positions of valves and the speeds of
pumps.

Fulfilling HMRC’s requirements

To fulfil HMRC’s requirements a stock and / or revenue accounting system used in the oil
industry would be expected to:
 recognise products and their attributes such as heavy / light oil, tax code, regime status
 maintain an accurate date & time to establish the applicable duty rate and accounting
date;
 record details of physical stock locations, a record of transactions for that location and the
duty status of those movements; (as below)
Duty-status Duty-status
From: Un-taxed to: Un- taxed
From: Un-taxed to: Tax Paid
From: Tax Paid to: Tax Paid
From: Tax Paid to: Un-taxed
 where appropriate perform Standard Temperature Accounting (STA) conversions;

 contain audit trails to prove the complete and accurate accounting of the system; and
 provide resources to the taxpayer to advise on revenue accounting procedures.
Communication with other computer systems

Flow computers can be integrated into computer systems controlling loading and production of
meter tickets and maintained remotely.
The information which can be requested from the flow computer will include:-
1. totaliser readings;
2. current values of temperature, density, pressure, volume correction factor, gross &
natural flow rate;
3. alarms;
4. constants used in calculations; and
5. standard operating range parameters, e.g. minimum & maximum temperatures, minimum
& maximum flow rates.
The flow computer can also be passed the information at 4 & 5 above.
Obtaining Audit Service assistance with existing computers

systems
In order to obtain the assistance of Audit Service when investigating oils trader’s computer
systems, Audit Service should be approached through the appropriate Senior Tax Specialist or
Sector Specialist.

Obtaining Audit Service assistance with new computer

systems
Audit Service should be involved at an early stage on any proposals made by oil companies or
oil warehouse-keepers to install new accounting or control systems that have a revenue
significance.
Scope of guidance
The following is not intended as a definitive guide to all flow computers but instead as a general
guidance on their technical functions and possible controls.
HCOTEG180750 – Computer Systems:

Standard temperature accounting
Introduction
It is now the norm for volumetric conversions to be performed by a computer. Volume X of the
Petroleum Measurement Tables is dedicated to the computer procedures involved in the
conversion of volumes to volumes at 15ºC.
The volume correction factor to be applied to a volume of product at a known temperature is:
the density of the product at the observed temperature

the density of the product at 15ºC
If the observed product density is supplied by an in-line densitometer and the product density at
15ºC is supplied by analysis then the STA volume correction is a simple matter.
When, as is normal with refinery production, the product density at 15ºC varies the calculation of
volumes at 15ºC becomes a complex mathematical equation.
Where there is a significant number of transactions then the use of a computer system to perform
the calculations can be expected.
The complexity of the calculations is brought about because the only available equation to
calculate the density of a product at a specified temperature requires the density of the product at
15ºC and it cannot be mathematically “reversed” to give a density at 15ºC if the density at the
observed temperature is provided.

To resolve this problem a mathematical process known as iteration is employed.
Iteration
A “guess” is made as to the density at 15ºC (normally the measured density) and the equation
calculates a density at the observed temperature which is then compared to the known density.
The difference in the calculated and the known densities enables an improved estimate of density
at 15ºC to be made and the calculation repeated. The process is repeated until an acceptable
difference between the known and calculated densities is achieved and the last estimated density
is accepted as the density at 15ºC.
Calculation of volume correction factors

Calculation of volume correction factors can be made for all products represented in the Energy
Institute’s Petroleum Measurement Tables.
For calculation purposes there are 5 types of product:
Product Group Density Range

(kg/m3)
From To
Crudes 610.5 1075.0
Fuel Oil 839.0 1075.0
Jet group 788.0 838.5
Jet/Gasoline Transition 770.5 787.5
Gasolines 653.0 770.0
(N.B. Lubricating oils have been excluded)
The conversion equations are referenced in Volumes IX and X of the Petroleum Measurement
Tables. Products which fall in the Jet / Gasoline Transition block are exceptional in that they use
a different equation in the conversion calculation.
Standard Temperature Accounting may be performed by programs held within flow

computers or by other systems. The verification of the correctness of these programs can be
validated using test data with the expected results calculated from the Energy Institute tables
(formerly the Institute of Petroleum). Test data should address the specific requirements of the
system.
Requirements for standard temperature accounting systems

It is expected that within any system performing Standard Temperature Accounting (STA)
calculations the relevant program will have the following:

 a density range check to ensure that only valid values are accepted. The IP equations are
only valid within specific density ranges;
 arithmetic accuracy sufficient to handle the expected values generated during the
calculation process;
 the capability to calculate values to the required number of decimal places and to
correctly round up or down as appropriate; and
 a Temperature range check to ensure only valid temperatures are accepted. The
temperature ranges are specific to density ranges.
HCOTEG181250 - Computer Systems: Meter

proving
Flow computers assist in meter proving by monitoring:
 pressure & temperature up and downstream of the proving loop;

 the proving loop 4 way valve position (also controls the valve);
 switches actuated by the proving sphere; and
 meter pulses from the meter under test.
The flow computer can be expected to perform the following calculations on the raw data to
achieve accurate results:
 correction for the effects of pressure and temperature on the liquid at the prover and at the
meter under test;
 correction for the effects of pressure and temperature on the prover and of the meter
under test; and
 the flow computer will repeat prover runs until consistent data is achieved or the number
of runs exceeds a defined limit.
The flow computer calculates and reports the flowrate (m3/h) to ensure that the meter under test
is calibrated to the correct flowrate. For each run the flow computer will report the calculated K
factor and the percentage deviation of the factor from the average of the proving so far.
The calculation is:
( Average K Factor – Run

x 100
K Factor )
Average K Factor
The K Factor is the relationship between the rotation of the turbine in the meter (measured in
pulses generated by the meter rotor) and the known volume of product flowing through it.
For Example: To ensure correct results, the flow computer would continuously monitor the inlet

and outlet pressures, temperatures and meter flow rate. An alarm would be generated if one or
more of these values or the rate of change of a value is outside defined limits.
Each proving operation should produce a report detailing each prover run reporting the constants
used, the recommended K factor, the product density, the stream pressure, temperature & flow
rate, the calculated K factor and the K factor deviation percentage.
www.flowmeterdirectory.com/flowmeter_for_beginner.html

Supervisory, control and data acquisition
systems (SCADA)
Introduction
SCADA is not the name of a computer software package but a term applied to a system which
collects data and uses it for monitoring, simple control and trend analysis. Acquired data can be
passed to other systems. SCADA systems are employed throughout the oil industry but in
relation to departmental interests they are principally encountered controlling loading gantries
and cross country pipelines.
Features that can be expected in a SCADA pipeline system

The features that can be expected in a SCADA pipeline system are:
 computer monitors displaying schematic diagrams of the pipeline and the position of valves and
the readings from pipeline sensors;
 the ability of operators to operate valves & pumps remotely;
 software modelling the pipeline to predict the arrival of interfaces, tracking the parcels in the
pipeline and detecting leaks & estimating the location;
 automatic control of valves and pumps for operational and safety purposes; and
 controlling and monitoring gas oil marker injection.
Control considerations - technical

The departmental interest in a SCADA system is confined to obtaining assurance that volumes of
product moving are correctly identified at the correct time and correct volumes and that controls
are in place to ensure all product movements are passed to revenue reporting systems.
The revenue concerns of a SCADA system will be several of the following:

Identification of a movement having taken place.
A SCADA system may have no completeness controls and retain no record of a completed
movement. The point at which meter tickets are produced and the controls over sequential
numbering must be established. The primary control over completeness is the daily
reconciliation of stock balances to reported movements.
Identification of the product being monitored.
The system may be configured so that a feeder valve is linked to a product and as such the
opening of the specified valve causes the system to assume, for example, unmarked gas oil is
being moved. The contents of source tanks may not be under the control or ownership of
SCADA system operator and the potential exists for changes of product storage tanks not to be
notified to the operator.
Correct measurement of volume.
Meters may be remote from the operator site and the risks of interference and fallback
procedures in the event of meter or meter transmission failure should be evaluated.
Correct STA conversions.
The STA conversions can be expected to be performed within the system. The sources of the
required data (detailed in the section on flow computers above) should be established and the
accuracy evaluated.
Identification of source & destination of the product.
Correct date & time of movement events.
Actions taken in response to alarms.
HCOTEG181750 - Computer Systems: Road

and rail loading systems - gantry
Introduction
Road and rail loading systems are SCADA systems whose function is to manage product
deliveries. The revenue risks are considered to be:
 the loading of the wrong product;

 unauthorised product loading;
 failure to report a product loading;
 incorrectly calculating dutiable quantities; and

 failure to mark gas oil.
Controls should be identified to control these risks and it may be found that the key controls do
not exist within the SCADA system but within systems providing and receiving information
from the SCADA system.
The loading system may have no integration with other systems with all information being
transferred on paper. This can be expected with rail loading systems where the number of
transactions is small.

Refinery mass balance systems
A Mass Balance is a means of accounting for the operations/activities of a refinery over a period
of time in units of mass. It provides assurance that a balance exists between stock levels, receipts
and deliveries. At its highest level the balance is reported for the whole of a refinery but it is
prepared from balances obtained at process and storage item level. The Mass Balance is not
concerned with duty liabilities or duty accounting.
Data concerning processes, storage plant and the connections between processes and plants is
defined.
The balance is produced by a computer system which models a refinery’s plant and production
processes. Each item of refinery plant which stores, receives and delivers product is defined. The
system is provided with details of every movement in the specified period and by reference to the
definitions a balance for each process and storage location can be established.
No refinery will produce a mass balance which has no losses or gains. The principal
discrepancies will arise through the tolerances in measurement devices. With the measurement
tolerances of each storage tank and meter defined the system, having identified a discrepancy,
will attempt to remove the discrepancy by attributing the loss to measurement tolerances and
correct the amounts moved.
HCOTEG182250 - Computer Systems: Duty

calculation and reporting systems
Introduction
The fundamental feature of any duty calculation and reporting system will be the use of master
files to ensure the correct duty accounting. The master files will hold information concerning:

 consignors & consignees;
 product;
 types of movement;
 storage vessels;
 excise duty rates and effective dates; and
 accounting periods.
Transactions and the use of master files

It can be expected that the system will use master files when a transaction is created, filled and
reported. The files can be expected to be used to:
 identify the product as having an excise duty liability;

 use consignee /consignor and product information to establish that the movement is
allowable;
 establish the dutiable quantity - density, temperature, Std./Nat. litres;
 establish the duty liability; and
 establish the entity responsible for duty payment
The validity of elements of transactions

The decisions made by systems should be established, documented and evaluated. The prime
objective being that for any transaction the validity of the following elements is known:
 date and time of movement;

 the type of movement;
 the duty status of the movement;
 the dutiable quantity moved;
 the rate of duty applied; and
 the entity paying any excise duty
Master Files - other considerations

Remember that any calculations performed by duty calculation and reporting systems will only
be as good as the quality of the information they use or capture, and hence the accuracy of any
transactions performed by these systems are dependent on the quality of the data being held in
the master files or captured from other sources.
It is therefore essential that the contents of the master files are correct and that any changes to
these files can be identified and checked.
You should consider:
 who has access to the master files

 who has the ability to change the data contained in the master files

 where the information contained in the master files or used in the transaction has come
from, and
 the accuracy of the information contained in the master files or transactions
HCOTEG190250 - Sampling: Introduction

RFTU’s now have a budget for the use of the Laboratory of the Government Chemist (LGC) or
other authorised analyst. To ensure that regions have unfettered discretion in the use of such
budget some former advisory provisions of our guidance have been modified.
For example: the requirement for official sampling in duty-suspended premises and at RMPs was
previously withdrawn. Oils assurance officers should now seek similar assurance from the
warehousekeeper/operator owned on-site laboratory, either by an officer witnessing a test in
such a laboratory or from scrutiny of any quality assurance testing record maintained by the
trader.
Note: Nothing in this table constrains the need for taking oil samples as evidence to support
possible offence cases. Oils assurance officers should comply with Schedule 5 of HODA when
taking samples and any analyst used in lieu of the LGC must be “authorised” as defined in
paragraph 5 of that Schedule.
Warning
Attention is drawn to guidance in the HS series and particularly to volume HS-10 Hazardous
Substances, which requires that prior authority of HQ be sought before certain Category “A”
goods are sampled.
HCOTEG190500 - Sampling: Drawing and

retention of samples
Drawing of samples
The officer is to draw the sample in the presence of the trader or a responsible employee who
may also take a sample from the same bulk as the official sample. If practical, the oil is to be
thoroughly mixed before sampling. If the oil cannot be mixed, 3 equal portions from different
parts of the oil are to be drawn and mixed before the sample is taken from the mixture.
Samples are normally to be taken in duplicate and put into 250 ml tins. One sample is to be
forwarded to the LGC.
Samples of composite goods

An unopened original container is, whenever practical, to be forwarded to the LGC, if the goods
are in small or medium sized packages.
Sampling when an offence is suspected

Samples taken when an offence is suspected (e.g. incorrect marking) must be drawn strictly
in accordance with Schedule 5 of HODA. Unless these provisions are strictly complied with
the evidence afforded by the expert examination of the sample may be inadmissible in
proceedings.
The owner or person in charge of the vehicle, or the occupier of the premises, as the case may be,
must be present or have been given the opportunity to be present when the sample is drawn.
Instruments and containers used in taking the samples must be clean. The officer is to draw a
quantity sufficient to fill three 250 ml sampling tins. These must be labelled and secured by wire
and plomb immediately.
A choice of one of the labelled tins is to be offered to the owner or person in charge of the
vehicle or the occupier of the premises for retention. If not present a written notification is to be
sent stating that a sample is available for collection if required.
One of the remaining samples is to be forwarded to the LGC. The test note is to be clearly
marked in red “Suspect” together with a reference to the appropriate part and paragraph of the
instructions and the plumbing iron number. On receipt of the samples the LGC will examine the
wire and plomb and certify their condition on the test note.
Sampling in Road Fuel Offence Cases by RFTOs

The procedure above is not to be applied to samples drawn in road fuel offence cases by Road
Fuel Testing Officers (RFTOs), who are to follow the directions on sampling given in X-32 and
are to use the special sample cans, test notes and labels provided for RFTU purposes.
Duplicate samples
The duplicates of samples forwarded to the LGC are to be kept under lock in official custody. If
the samples are of light petroleum oil and likely to exceed 10 litres at any one time they must be
stored on premises for which a petroleum spirit licence has been granted under the Petroleum
(Consolidation) Act 1928 or the Petroleum (Consolidation) Act (Northern Ireland) 1929.
Period of retention
Routine duplicate samples are to be retained only until the result of the test is received. Samples
taken when an offence is suspected are to be retained until directions for their disposal are
received.

Disposal
In the absence of any other instructions, duplicate samples due for disposal are to be returned to
the trader. If the trader refuses to accept them, the Officer is to ensure that the samples are
destroyed in accordance with the Control of Pollution Act 1974. Disposal by pouring down the
common sewer is strictly prohibited. If an Officer has any doubts with or difficulties about a
proposed method of disposal, contact is to be made with the local waste disposal authority to
make appropriate arrangements.
HCOTEG190750 - Sampling: Packaging and

labelling
Sampling tins, etc.

Tins, caps and internal seals and wooden cases for sending samples may be requisitioned from
Stores Branch.
Packaging and labelling

Samples are to be taken in the expendable tins specially provided. These tins are to be used only
once. Bottles must never be used for mineral (hydrocarbon) oil samples.
After filling, each tin must be wired and plumbed through the lugs on the body and the top of the
tin. Sealing wax must not be used for sealing such tins.
All tins must be labelled with the special reinforced labels Form HO69 which are to be attached
by the wire securing the tin.
The tins are to be packed in sawdust in wooden cases.
Samples of all light oils suspected to be such are to be conspicuously labelled on the external
package “Petroleum Spirit”, Highly Flammable, H.M. Revenue & Customs.
HCOTEG191000 - Sampling: Forwarding

Method of despatch - outside of London
Samples of petrol, benzole, kerosene and other “dangerous goods” (defined as products with a
flashpoint below 66ºc) must not be sent through the post. Such goods must have affixed to the
external package a label stating the contents and conspicuously bearing the word “Flammable”.
Samples of these products are to be forwarded by train.

The official packaging is designed to comply with the railway regulations for the conveyance of
flammable liquids. If satisfied that the samples have been properly packed to conform with the
regulations, the Officer may sign the consignment note.
Samples of oil other than “dangerous goods” may be forwarded by the cheapest means. They
should not be marked “Flammable”.
Method of despatch in London

In London, samples (packed in wooden boxes) are to be conveyed by messenger or carrier. If the
boxes are numerous, they are to be enclosed in unsealed wooden cases. “Dangerous goods” are
to be labelled “Flammable”.
Letter of advice (test note)

A test note is to be sent separately to the Laboratory of the Government Chemist (LGC) on the
day the sample is despatched. Form C&E 140 is to be used for all samples, except those taken by
RFTU’s for which form C&E 140RF is to be used.
For samples of Gas Oil or Kerosene to check for colour marker, commercial dye or other
additive, the test note is to be in duplicate and must relate only to one sample. The duplicate copy
will enable the LGC to advise the despatching Officer of the result of the test, as the LGC retains
the original test note.
Samples requiring priority test by the LGC

Only samples for which priority treatment is essential are to be marked “URGENT”. Both the
sample and test note are to be marked accordingly, and a special note is to be made in station
records of all such samples.
On receipt of a test note or sample marked “URGENT” the LGC will contact the Officer if the
associated sample or test note has not been received within 2 or 3 days.
HCOTEG191250 - Sampling: Records

Record of Samples
A record of all samples taken is to be kept in a suitable book or the trader’s folder and is to
include:
 Description of the sample;

 Where drawn;
 Reason for priority test endorsement;
 Date of sampling and despatch to the LGC;
 Date test result received and the result;

 Subsequent action (if any); and
 Disposal of duplicate sample
 HCOTEG200250 - Other sources of

information: Guidance
 Guidance
Old Reference New Reference Contents
C2-38 Mineral Oil Importation
C7-6 Pipelines
R3-18 Inward Processing Relief
R5-1 End-use Relief
X-28 Fuel Substitutes
X-29 Gas for Road Fuel
X-32 Road Fuel Testing
X-51 Excise Assessments
X-51B Civil Penalties
X-99 Oils Duty Assurance
X-99 Oils Strategy
X-99 HCOBIG Biofuels Assurance
X-99 Waste Oils : Assurance ( currently being written )
X-99 HCOTEG ( Mineral) Oils : Technical
X-99 Holding and Movements : Warehousing
X-99 Holding and Movements : Financial Securities
X-99 Holding and Movements : REDS and Occasional Importers
X-99 Holding and Movements : REDS
V-18 VAT : Imports
V1-19A VWRHS VAT : Supplies in warehouse and Fiscal Warehousing
V1-20 VAT : Exports and removal of goods from the UK
HCOTEG200500 – Other sources of

information: Public Notices
Public Notices
Customs Series
 Public Notice 101 – Deferring Duty and other charges

 Public Notice 171 - Hydrocarbon Oils: Customs Duty
 Public Notice 221 – Inward Processing Relief
 Public Notice 232 – Customs Warehousing
 Public Notice 770 – Imported Goods: End-use Relief
Excise Series
 Public Notice 75 – Fuel for Road Vehicles

 Public Notice 76 – Excise duty on gas for use as fuel in road vehicles
 Public Notice 172 – Excise Duty: Drawback – Ships and aircraft stores
 Public Notice 175 – Motor & Heating Fuels: Relief from Excise Duty: Oils used to generate
electricity
 Public Notice 179 – Motor and Heating Fuels: General Information and accounting for Excise
Duty and VAT
 Public Notice 179A – Mineral (Hydrocarbon) oils – AVTUR
 Public Notice 179B – Mineral (Hydrocarbon) oils - List of premises
 Public Notice 179E – Biodiesel and other Fuel substitutes
 Public Notice 183 – Repayment of Excise Duty on Heavy Oil used by growers of Horticultural
produce
 Public Notice 184A – Mineral (Hydrocarbon) Oil put to certain use : Excise Duty relief
 Public Notice 184B – Rebate of Duty on Light Oil used as furnace fuel
 Public Notice 192 – Registered Dealers in Controlled Oil
 Public Notice 197 – Excise Goods: Holding and Movements
 Public Notice 201 – Warehoused Goods: Registered Owners and Duty Representatives
 Public Notice 203 – REDS
 Public Notice 204 – Occasional Importers EU trade in Excise Goods
 Public Notice 206 – Revenue Traders Records
 Public Notice 207 – Excise Duty Drawback
 Public Notice 208 – Excise Assessments
 Public Notice 209 – Civil Penalties, Fixed, Geared and Daily
 Public Notice 263 – Marine Voyages Excise Duty Relief for Mineral (Hydrocarbon) Oil
 Public Notice 431 – Visiting Forces
 CCL1 – General guide to Climate Change Levy
VAT Series
 Public Notice 701/19 - Fuel and Power

 Public Notice 702 - Imports
 Public Notice 702/8 - Fiscal Warehousing
 Public Notice 702/9 - Imports Customs procedures with economic impact, End-use Relief and
Free Zones
 Public Notice 703 - Exports
General
 Public Notice 989 – Visits by Customs & Excise Officers

 Public Notice 990 – Excise and Customs Appeals
 Public Notice 999 – Catalogue of Publications
 Public Notice 1000 – Complaints & Putting Things Right, our code of practice

HCOTEG200750 - Other sources of

information: Guided Learning Units
Guided Learning Units

Whilst there are Guided Learning Units (GLUs) on many aspects of dealing with oils, the
‘Introduction’ GLU provides an overview.
The following GLUs on Oils are either available now, or will be made available shortly in
Online Learning
Available now on Online Learning

 Reference 003088: ‘Introduction’
 Reference 003199: ‘Health and safety’
 Reference 003200: ‘Measurements’
 Reference 003203: ‘Duty Accounting’
 Reference 003202: ‘RDCO Scheme’
 Reference 003209: ‘Cross Country Pipelines’
 Reference 003201: ‘Deliveries’
 Reference 002377: ‘Tied Oils’
 Reference 003207: ‘Gas as a Road Fuel’
Available shortly in Online Learning

 Reference 000232: ‘Marking’
 Reference 003204: ‘Receipts’
 Reference 003205: ‘Approvals’
 Reference 003206: ‘Operations’
 Reference 003208: ‘Biofuels/Fuel Additives/Fuel Substitutes’
 Reference 003210: ‘Stock Accounting’
 Reference 002034: ‘Mineral Oil Reliefs’
HCOTEG210500 - Tables: Table B -

Procedures for the removal of oil sludge or
contaminated oil from ships and aircraft
from foreign
1. General

Notice of any removal must be given to the officer in accordance with agreed local procedure.
2. Means of disposal
Oil may be disposed of in the following ways:
Destruction, provided that the oil is not burnt to produce useful heat. In any case where there is
a duty liability (i.e. other than TTC 551 and 570) duty is to be charged before removal to the
furnace operator.
Warehousing, at a duty-suspended approval warehouse or in refinery (producers premises) for

blending or re-processing.
Removal to oil recoverers and launderers. In this case an import declaration (C88) is required
so that the appropriate duty can be secured.
Re-export. Normal Export procedures apply.
3. Water content
The importer is responsible for establishing and declaring the actual water content, and in the
absence of suspicion, official samples are not to be drawn.
4. Regular removals
At places where there are regular removals of large quantities of waste oils, e.g. Cross channel
ports, managers may agree a procedure, suitably adapted to take account of local circumstances,
involving:
 Prior approval of the importers who can use the scheme

 Form of prior notice before oil is removed
 Security for duty accruing in the calendar month, if deemed necessary; and
 Lodgement of an omnibus import declaration monthly in arrears of importation, and
payment of duty and VAT.
HCOTEG210750 - Tables: Table C -

Procedures to be followed when considering
an application to authorise mineral oil and
gases to be brought ashore by pipeline
1. Initial consideration of approval application
The application should provide the essential details needed for full consideration of the impact
on official resources, and be accompanied by a line drawing (or map) of the whole length of the

pipeline.
The intended dates for laying the pipeline, pressure-testing it and initially flushing it should be
indicated as soon as known, together with the date that oil (or gas) is expected to flow.
As the Commissioners’ formal approval will be issued to the operator of the finished pipeline,
that operator should be named in the application.
(Note: the operator may be one legal person in a consortium of persons with a financial interest
in the pipeline).
Other details to be provided are:
 The name by which the pipeline will be known;

 The length of the pipeline and its diameter
 The longitude and latitude at which the pipeline enters UK territorial waters;
 The point of the coast at which the pipeline will come ashore; and
 The name (if in different ownership than the pipeline operator) and address of the on-
shore site marking the end of the pipeline, and the designation of the boundary valve.
The application should be made locally direct to the CRM when LBS traders are involved.
For further information on Pipeline Authorisation and Approvals see C7-6 ‘Pipelines’.
2. Acknowledgement of receipt
Receipt of the application must be acknowledged by letter; if the application is incomplete that
letter should ask for the further detail to be supplied as soon as it is known.
3. Issue of approval
Formal approval of an import pipeline should not be issued until the testing phase of construction
has been completed. Subject to HMRC being satisfied that the pipeline-operation presents no
unnecessary risks to official staff, nor to revenue-protection, and statistical reporting
requirements will be met, a letter of approval should be issued to take effect just prior to the
commissioning of the pipeline.
4. Content of approval letter
No letter of approval for pipelines format exists, but guidance is given in C7-6 ‘Pipelines’.
5. Conditions relating to the import declaration
(a) On the first day of each month an import declaration is to be made in triplicate and in a
form agreed with the local officer of HM Revenue and Customs, of the Tariff description and
quantity of natural gas/oil expected to be imported through and delivered from the approved
pipeline during the month.

This import declaration will be for a period commencing from an agreed hour on the first day of
the month and finishing at the same time on the first day of the following month.
The import declaration shall include:
(1) information giving the sea areas from which natural gas/oil will originate;
(2) contain a declaration for VAT purposes.
(b) At the end of each month a declaration of the actual quantity of natural gas/oil imported
through and delivered from the approved pipeline during the month from each field.
(c) The import declaration at (a) above, supported by the monthly declaration at (b) above, when
signed and dated by the importer or a person duly authorised by the importer, shall be deemed
for the purposes of Section 37 of the Customs and Excise Management Act 1979, to constitute a
Customs import declaration of the gas/oil for home use.
HCOTEG211000 - Tables: Table D -

Accidental mixing and/or contamination of
mineral oils: possible options
(This text has been (This text has been withheld because of exemptions in the Freedom of
withheld because of Information Act 2000)
exemptions in the
Freedom of
Information Act
2000)
(This text has been (This text has been withheld (This text has been withheld because
withheld because of because of exemptions in the of exemptions in the Freedom of
exemptions in the Freedom of Information Act Information Act 2000)
Freedom of 2000)
Information Act (This text has been withheld
2000) because of exemptions in the
Freedom of Information Act
2000)
Freedom of 2000)
Information Act
2000) (This text has been withheld
because of exemptions in the

2000)
Freedom of 2000)
Information Act
2000)
Freedom of 2000)
Information Act
2000)
Freedom of 2000)
Information Act
2000)
Freedom of 2000)
Information Act
2000)
Freedom of 2000)
Information Act (This text has been withheld because
2000) (This text has been withheld of exemptions in the Freedom of
because of exemptions in the Information Act 2000)
2000)

Freedom of 2000)
Information Act
2000)
Freedom of 2000)
Information Act (This text has been withheld because
2000) (This text has been withheld of exemptions in the Freedom of
because of exemptions in the Information Act 2000)
2000)
(This text has been withheld because of exemptions in the Freedom of Information Act
2000)
HCOTEG211250 - Tables: Table E - Tax Type

Codes - Mineral oil descriptions
Tax Type Code Excise description of goods
LIGHT OILS 511 Aviation Gasoline (AVGAS) including light oil
aviation turbine fuel)
515 Leaded Petrol
520 Other un-rebated light oil
521 Furnace fuel (marked/un-marked under marking
waiver)
522 Unleaded petrol (other than ULSP)
525 Ultra low sulphur petrol (ULSP)
594 Sulphur free petrol (SFP)
HEAVY OILS 541 Un-rebated heavy oil (inc. DERV or road fuel
extender and un-marked kerosene or un-marked gas
oil for which no marking waiver has been granted)
other than ULSD
542 Kerosene to be used as motor fuel off road or in an
excepted vehicle
545 Ultra low sulphur diesel (ULSD)
551 Kerosene (marked/un-marked under marking

waiver, including heavy oil aviation turbine fuel
(AVTUR)) to be used other than as a motor fuel
off-road or in an excepted vehicle
556 Gas oil (marked/un-marked under marking waiver)
other than ULSG
560 Ultra low sulphur gas oil (ULSG) (marked/un-
marked under marking waiver)
561 Fuel oil (un-marked)
570 Other rebated heavy fuel oil
593 Sulphur-free diesel (SFD)
N.B. See the Tariff
Volume 1 Part 12
paragraph 12
HCOTEG211500 - Tables: Table F - Un-

rebated/rebated Tax Type Codes (TTC)
Un-rebated Tax Type Codes Rebated Tax Type Codes
511 Aviation Gasoline (AVGAS) 521 Furnace fuel (marked/un-marked under
including light oil aviation turbine marking waiver)
fuel)
515 Leaded Petrol 522 Unleaded petrol (other than ULSP)
520 Other un-rebated light oil 542 Kerosene to be used as motor fuel off road or in
an excepted vehicle
525 Ultra low sulphur petrol (ULSP) 551 Kerosene (marked/un-marked under marking
waiver, including heavy aviation oil turbine
fuel (AVTUR) to be used other than as motor
fuel off-road or in an excepted vehicle
541 Un-rebated heavy oil (inc DERV or 556 Gas oil (marked/un-marked under marking
road fuel extender abd un-marked waiver) other than ULSG
kerosene or un-marked gas oil for
which no marking waiver has bee
granted) other than ULSD
545 Ultra low sulphur diesel (ULSD) 561 Fuel oil (un-marked)
593 Sulphur-free diesel (SFD) 570 Other rebated heavy fuel oil
594 Sulphur-free petrol (SFP)
HCOTEG211750 - Tables: Table G - Removal

of dual consignments

2000)
(This text has been withheld because of exemptions in the

Freedom of Information Act 2000)
(This text has been withheld because of exemptions in the Freedom of Information Act 2000)

 (This text has been withheld because of exemptions in the Freedom of Information Act 2000)



HCOTEG212000 - Tables: Table H -

Deliveries to United States Forces
(See also X-44 Visiting Forces, Section 4 - Hydrocarbon Oils)
A: United States Forces

The owner of the oil in warehouse:
 Has a contract with the US visiting force for supply of oil

 Holds a signed requisition (C185) from a responsible officer for each consignment
delivered under the contract
 Retains the signed requisitions for production to the Local Officer under locally agreed
arrangements
The warehousekeeper:
 Checks that the owner of the oil in the warehouse has a valid contract with US visiting
forces and that they hold a signed requisition (C185) from a responsible officer of the US
Forces for each consignment delivered under the contract. As part of the nomination
process, the warehousekeeper should obtain a copy of the C185 for retention.
 May deliver aviation fuel, motor spirit and heavy oil free of customs duty, excise duty
and VAT for use exclusively for official purposes by US Forces.
 Is to obtain a valid certificate of receipt for each delivery and retain it for an officer’s
inspection.
 Is only to accept as valid those certificates of receipt that are signed by (1) a responsible
officer or non-commissioned officer of the US Forces or (2) an authorised civilian
employee of the US Forces.
 Is to produce the relevant certificate of receipt to the warehouse officer under locally
agreed procedures. Where such deliveries are numerous, a schedule of the receipts is to
be produced together with the supporting certificates.
 Retain all written notifications of named civilian employees of US Forces authorised to
sign certificates of receipt.
The warehouse officer * is to:
 Ensure that the warehousekeeper and/or owner of the oil in warehouse complies with
these requirements
 Examine as part of a risk based programme the written notification of authorised
signatories and the certificates of receipt for satisfactory agreement and completion

 Occasionally select certificates of receipt for verification by the local officer for the base.
Details from such certificates are to be sent to the local officer at the place of receipt,
which is to include the following information:
a. delivery ticket number and date delivery made;
b. receiving service unit and name of signatory on the certificate;
c. grade and quantity delivered.
 Ask the local officer whether the consignment was received in full
 Inform the warehouse-keeper by issue of a request for explanation (see paragraph 14.9.4,
‘Losses of oil removed under duty-suspension in the ‘Deficiencies in warehouse section
of this guidance) if the receipt of any consignment is not confirmed.
 Institute normal transit loss procedure in respect of any quantity of oil not accounted for
satisfactorily.
 Maintain a station record of verifications made and any enquiries and duty demands
resulting
B: United States AAFES/Navy Exchanges

The warehouse-keeper:
 May deliver motor spirit, kerosene and heavy oil for road fuel free of customs duty,
excise duty and VAT to the AAFES and USNX.
 Is to follow the same procedure as applies to duty free deliveries to US Forces
The officer for the warehouse is to follow the guidance in the paragraph above *.
C: Use of duty paid oil in the course of fulfilling contracts for

the carriage of personnel and other US government
contracts.
When a claim for repayment of excise duty on oil, supplied to US Forces is allowed, repayment
of any customs duty charged may also be allowed if evidence of customs duty payment is
produced. The first document from each supplier providing evidence of customs duty payment is
to be verified, with verification thereafter reduced to one document in twenty. In the absence of
evidence of customs duty payment the claimant is to be instructed to delete that part of the claim.
Such oil is not regarded as exported: accordingly no claim for export relief can be made.
D: Deliveries from duty paid stock (netting arrangements).

Persons supplying the US forces who are approved for oils ex-warehouse under duty deferment
must use the netting procedure when making deliveries from duty-paid stock.
This enables approved suppliers to make supplies at duty exclusive prices from duty paid stock

held at nominated locations. Repayment of the duty is achieved by credit adjustment to the net
duty liability as shown on the HO10 duty deferment warrant.
Claims made by this method are subject to separate procedures and are controlled at the Central
Accounting point. Full details of the procedures for approval and accounting can be found in
Notice 179, Section 12.
HMRC Central Accounting Point Officers will exercise control of all adjustments made under
this procedure and initiate any verification action required to ensure the eligibility, accuracy and
completeness of any HO65 claims received.
HCOTEG212250 - Tables: Table I – Mineral

oil products and their markers
2000)
Oil Product Marked at … Used for … Markers added
( MGO) also Straight from the refinery Agricultural vehicles C1 Solvent Red 24
known as ‘Red (duty suspended warehouse),
Diesel’ or at a Remote Marking Point Vehicles used off- plus Quinazerin
(RMP) road
plus Euro-marker
Generators
Excepted vehicles
listed in schedule 1
of HODA
Heating Fuel
Marine Engines
Kerosene Straight from the refinery Waste AVTUR for Euro-marker plus
(duty suspended warehouse) use as light furnace
or because it is unmarked fuel. Coumerin
AVTUR that has become
contaminated or ‘Off- Primarily this is ( No Dye is added to
specification’. This is either Domestic Heating MKO)
marked at the RMP or on Oil (Paraffin)
collection by a remote marker.

Marine Diesel Straight from the refinery or Ships and boats, Whilst there is no legal
because it was previously inboard and outboard requirement for Marine
unmarked fuel that is being re- engines, hovercraft. Diesel to be marked, it
landed or at either a RMP is our policy to
encourage marking.
HCOTEG212500 - Tables: Table J - Marking

approvals and what they cover
Approval is needed Why Applied for by Under law/notice
for …
Marking Oil in Marked under duty Approval to mark oil The Hydrocarbon Oil
Warehouse suspension at a refinery or may be included as regulations, 1973
in an excise warehouse, part of an Excise
following import, receipt Warehouse Customs and Excise
from another EC state or Application. Management Act 1979
production in the UK s92
The Hydrocarbon Oil

(Marking Regulations)
2002
Remote Marking Oil unable to be marked Writing to MORC The Hydrocarbon Oil
Premises under duty suspension at (Registered Remote
refinery or in an excise Markers) Regulations
warehouse or 2005
Marking oils other than

your own
Emergency The local officer can see By contacting the local The Hydrocarbon Oil
Marking no alternative to covering officer (Registered Remote
duty by guarantee until the Markers) Regulations
oil is removed to a remote 2005
marking premises
Marking other than e.g. waste AVTUR Writing to local officer The Hydrocarbon Oil
at Remote Marking flushed out of aircraft (Registered Remote
premises tanks Markers) Regulations
2005

HCOTEG212750 - Tables: Table K - Items

covered by marking approvals
HMRC requirement Notice Law
The warehouse (duty suspended) The Hydrocarbon Oil (Marking
Regulations) 2002
Or other place (remote marking The Hydrocarbon Oil (Registered
premises) the trader is allowed to Remote Markers) Regulations 2005
mark
Oils the trader is allowed to mark Para 8.19 of Notice The Hydrocarbon Oil (Marking
179 Regulations) 2002, Regulation 3
The timeliness of the marking The Hydrocarbon Oil (Marking
Regulations) 2002, Regulation 8
The equipment used to do the Para 8.11.2 of
marking Notice 179
The storage and records of marker(s) Para 8.12 of Notice The Hydrocarbon Oil (Marking
179 Regulations) 2002, Regulation 10
The requirement for separate storage Para 8.12 of Notice The Hydrocarbon Oil (Marking
of marked and unmarked oils 179 Regulations) 2002, Regulation 11
The labelling of marked oils and the The Hydrocarbon Oil (Marking
endorsing of the delivery notes that Regulations) 2002, Regulation 12
accompany marked oils (saying for
example ‘not to be used as road fuel’)
Records to be kept and information The Hydrocarbon Oil (Registered
sent to us Remote Markers) Regulations 2005,
Regulation 9 and the Revenue
Traders (Accounts and Records)
Regulations 1992
HCOTEG213000 - Tables: Table L- Oils we

control because they are not marked
Note. This is an indicative list and does not cover every possibility.
The possibility that marking might be an appropriate control can also be considered.
Typical Product Used for Has no marker Covered by Our controls are
because legislation covered in:
AVTUR (aviation Aviation To maintain purity Hydrocarbon Oil AVTUR and its
turbine fuel) or JET turbine fuel for of the fuel for Marking variants will run
A1 or any military jet engines technical and for Regulations, 2002 diesel engines.

jet fuel and their safety reasons Section 6 See Public Notice
variations for 179A (Traders
helicopters who supply
(AVCAT, amongst AVTUR are
others) required to
register under the
RDCO scheme).
Marine Gas Oil Sea going It is accepted that Some is marked.
vessels the fuel is Fuel that is re-
effectively going landed should be
for export by marked, see
leaving the UK – Public Notice
we encourage 263. (The control
marking but there is of Marine Fuels
no requirement to is under review).
do so
Solvents, hydraulic Tied Oils or It is accepted that is Hydrocarbon Oil Tied OIL traders
fluids, trans-former oils ‘put to the oil is being Duties Act 1979, have to be
oils, and oils for certain use’ incorporated into Section 9 approved – see
other industrial being purposes other products, and Notice 184A. The
purposes, where other than for markers may have a disposal of waste
they are road fuel or detrimental effect Tied oil is also
incorporated into heating fuel on the end product controlled.
‘other’ goods such use.
as paints.
Fuel oil or furnace Dark Oil used Dark oil is often Prohibited for sale
fuel to be used to old or impure oil as vehicle fuel by
fuel marine oil- that should not be the Hydrocarbon
fired boilers, used as ‘rebated’ Oil Marking
but this fuel is oil because its Regulations 2002,
now rarely colour impedes the Section 17
burnt for identification of
emission fiscal dyes
reasons.
HCOTEG213250 – Tables: Table M – The

flow of accounting documents to the Central
Accounting Point (CAP) (Text Version)
A: Receipt of Documents at the Trader’s Central Accounting
Point (CAP)

Document From To
Removal Schedules Refinery Warehouse
Direct Import Warehouse
Removal Schedules Trader’s Central Accounting
Premises
Point
Duty/Rebate Claims Remote Marking & Shippers
Pipeline Adjustment Schedules Pipeline Operators & Shippers
Removal Schedules from Refinery Warehouses and Direct Import Warehouse Premises,
Duty/Rebate Claims from Remote Marking & Shippers, and Pipeline Adjustment Schedules
from Pipeline Operators and Shippers are all received at the Trader’s Central Accounting Point.
B: Processing at the Central Accounting Point (CAP)

The Trader’s Central Accounting Point uses the information contained on the Duty/Rebate
Claims and Removal and Pipeline Adjustment Schedules to complete their HO10 Warrant in
triplicate.
C: The Flow of Documents from the Trader’s Central

Accounting Point (CAP)
Document From To
HO10
Removal Schedules Trader’s Central Accounting Central Deferment Office,
Duty/Rebate Claims Point (Oils Team) Southend
Pipeline Adjustment Schedules
On completion the HO10’s, together with the Duty/Rebate Claims and Removal and Pipeline
Schedules are sent to the Central Deferment Office (Oils Team), Southend.
See HCOTEG213275 for a Diagram which illustrates the flow of accounting documents to the
Central Accounting Point
HCOTEG213275 - Tables: Table M – The

flow of accounting documents to the Central
Accounting Point (CAP) (Diagram)
Diagram

HCOTEG213500 - Tables: Table N:

Specimen - Authority to receive and use
unmarked rebated kerosene
(Public Notice 179, paragraph 8.23.3)
In pursuance of their powers under Section 6 of the Hydrocarbon Oil Marking Regulations 2002,
the Commissioners of HM Revenue and Customs authorise:
[Name of Company, and address of premises at which the oil is to be received, stored and used];
to receive unmarked kerosene, [trade name(s) of product(s)] subject to the following conditions:
(a) that it is received duty-paid at the appropriate rebated rate and that it is used only for [full
purpose justifying marking waiver];
(b) that each supplier be provided with a letter signed by a responsible person confirming that the
Commissioners have authorised the above Company to receive [trade name(s) of product(s)] as
unmarked rebated kerosene for [purpose - may be less detailed than shown under (a)]
under HM Revenue and Customs authority number [ MWK/Serial No./numbered according to

local practice];
(c) that each order for such unmarked rebated kerosene be supported by a certificate signed by a
manager or other employee of the above company in the following form:
“Please deliver, under our HM Revenue and Customs authority number [ MWK/Serial
No./numbered according to local practice]; [quantity and description of oil] unmarked and at the
appropriate rebated rate of duty to [name and address of consignee]”;
(d) that evidence of receipts and disposal of unmarked rebated kerosene and of any waste oil
recovered from process be held for at least one year after actual use of the oil or disposal of the
waste;
(e) that up-to-date monthly balanced stock amounts of unmarked rebated kerosene and of any
waste oil recovered from process, showing suppliers of unmarked oil and full details of the
disposal or recycling of waste oil, be maintained and held for at least one year after the date of
the last entries in them;
(f) that the stock accounts be compared and reconciled with physical stocks or unmarked oil and
of waste oil on hand at the close of each calendar month, any apparent gains or losses being
included in the balanced accounts;
(g) that the records referred to in (d) and (e) above be made available at all reasonable times for
inspection and extraction of details by any officer of this Department on request;

(h) that stocks of unmarked rebated kerosene and of waste oil be effectively segregated from all
other stocks of oil by means of marked vessels set aside for their purposes;
(j) that facilities and access be provided at all reasonable times for any officer of this Department
for the purpose of inspecting premises and stocks of all oils, waste oils and finished products
held and processes conducted;
(k) that the above company be liable for repayment of rebate on any stock deficiencies of
unmarked rebated kerosene or waste oils recovered from process which, in the opinion of the
Commissioners, cannot be attributed to natural wastage or other legitimate causes, and on any
unmarked rebated kerosene or waste oil delivered to third parties or used for a purpose other than
in accordance with condition (a) above except as individually authorised by the Commissioners.
The Commissioners reserve the right at any time to impose additional conditions or, if necessary,
to withdraw this authority.
Date
Senior Officer of HM Revenue and Customs
Certified copy to be returned to…
I acknowledge receipt of an authority in the terms set out above, and agree to comply with the
conditions listed at (a) to (k). I understand and accept that the conditions may be varied, or the
authority withdrawn at any time.
(Signed)
(Proprietor, Director, Secretary) on behalf of [name of company]
(dated)
*Delete as appropriate
HCOTEG213750 - Tables: Table O -

Specimen: Authority to receive and use
unmarked rebated gas oil
(Public Notice 179, paragraph 8.23.3)
In pursuance of their powers under Section 6 of the Hydrocarbon Oil Marking Regulations 2002,
the Commissioners of HM Revenue and Customs authorise:
[Name of Company, and address of premises at which the oil is to be received, stored and used];

to receive unmarked gas oil, [trade name(s) of product(s)] subject to the following conditions:
(a) that it is received duty-paid at the appropriate rebated rate and that it is used only for [full
purpose justifying marking waiver];
(b) that each supplier be provided with a letter signed by a responsible person confirming that the
Commissioners have authorised the above Company to receive [trade name(s) of product(s)] as
unmarked rebated kerosene for [purpose - may be less detailed than shown under (a)]
under HM Revenue and Customs authority number [ MWG/Serial No./numbered according to

local practice];
(c) that each order for such unmarked rebated kerosene be supported by a certificate signed by a
manager or other employee of the above company in the following form:
“Please deliver, under our HM Revenue and Customs authority number [ MWK/Serial
No./numbered according to local practice]; [quantity and description of oil] unmarked and at the
appropriate rebated rate of duty to [name and address of consignee]”;
(d) that evidence of receipts and disposal of unmarked rebated gas oil and of any waste oil
recovered from process be held for at least one year after actual use of the oil or disposal of the
waste;
(e) that up-to-date monthly balanced stock amounts of unmarked rebated gas oil and of any
waste oil recovered from process, showing suppliers of unmarked oil and full details of the
disposal or recycling of waste oil, be maintained and held for at least one year after the date of
the last entries in them;
(f) that the stock accounts be compared and reconciled with physical stocks or unmarked oil and
of waste oil on hand at the close of each calendar month, any apparent gains or losses being
included in the balanced accounts;
(g) that the records referred to in (d) and (e) above be made available at all reasonable times for
inspection and extraction of details by any officer of this Department on request;
(h) that stocks of unmarked rebated gas oil and of waste oil be effectively segregated from all
other stocks of oil by means of marked vessels set aside for their purposes;
(j) that facilities and access be provided at all reasonable times for any officer of this Department
for the purpose of inspecting premises and stocks of all oils, waste oils and finished products
held and processes conducted;
(k) that the above company be liable for repayment of rebate on any stock deficiencies of
unmarked rebated kerosene or waste oils recovered from process which, in the opinion of the
Commissioners, cannot be attributed to natural wastage or other legitimate causes, and on any
unmarked rebated gas oil or waste oil delivered to third parties or used for a purpose other than
in accordance with condition (a) above except as individually authorised by the Commissioners.

The Commissioners reserve the right at any time to impose additional conditions or, if necessary,
to withdraw this authority.
Date
Senior Officer of HM Revenue and Customs
Certified copy to be returned to…
I acknowledge receipt of an authority in the terms set out above, and agree to comply with the
conditions listed at (a) to (k). I understand and accept that the conditions may be varied, or the
authority withdrawn at any time.
(Signed)
(Proprietor, Director, Secretary) on behalf of [name of company]
(dated)
*Delete as appropriate
HCOTEG213755 – Table P: Payment of

rebate – action to be taken by LBS, Local
Compliance and MORC
On receipt of the original application
Action by MORC
If you receive a letter asking for a licence to use rebated heavy oil as fuel, containing details set
out in Public Notice 75 paragraph 6.3, from a large business refer the matter to the Large
Business Service Oil and Gas Sector team which covers the address where the rebated oil is to
be stored.
If you receive a letter asking for a licence to use rebated heavy oil as fuel, from a SME, refer the
matter via the appropriate Regional Risk Team to the Local Compliance Oils Assurance team
which covers the address where the rebated oil is to be stored.
On receipt of a referred application

Action by LBS/Local Compliance Assurance Officers
On receipt of the referred application, you should decide whether a visit to the applicant is

necessary. Do not delay consideration of the application and reply pending such a visit.
As well as the items listed in HCOTEG122550 consider the following before making a decision
or arriving at a recommendation.
The issue of a licence allows the licensee to use marked/rebated heavy oil as fuel on the public
road.
A ready willingness to issues a licence could undermine the enforcement effort of the Road Fuel
Testing Unit (RFTU) and each application should be examined critically.
 The application must demonstrate that ULSD or SFD cannot be used and why. It does not suffice
for the applicant to claim that ULSD or SFD is difficult to obtain.
 Applications to pay the rebate (instead of using either ULSD or SFD) on heavy oil for use as fuel
in Fire Brigade appliances, Local Authority Ambulances and liveried Police vehicles are not to be
refused, but the licence must relate to specific “exceptional circumstances”. You should
withdraw the licence as soon as these circumstances change.
Taking a decision or making a recommendation whether or

not to grant a licence
Action by LBS/Local Compliance
Make a recommendation to MORC on the basis of any knowledge of the applicant which you
already have or can obtain via HMRC databases.
Grant or refusal of a Licence

Action by MORC
MORC - When you have received a recommendation from either LBS or LC, you should issue
the licence (or not) based on the recommendation given.
If it has been recommended that a licence should be issued
You should use the specimen licence given at HCOTEG213850 as a template.
The initial accounting period should begin on the day of issue of the licence and end on 31
March, 30 June, 30 September or 31 December.
You should determine whether subsequent accounting periods should be quarterly or annually
dependant on frequency of journeys and amount of payment.
Send copies to:

 Tax Accounting Centre, H.M. Revenue & Customs, Two Broadway, Five Ways, Birmingham, B15
1BG. Telephone: (This text has been withheld because of exemptions in the Freedom of
Information Act 2000)
 The Road Fuel Control Officer (for the storage of the oil).
If it has been recommended that a licence should not be issued
You should use the specimen letter refusing authorisation given at HCOTEG213800 as a
template.
Post Authorisation
Action by LBS/Local Compliance Assurance Officers
If you recommend that the applicant be approved, you will subsequently receive copies of all
estimates, supplementary estimates, additional payments and returns that a licensee in your area
sends to the Tax Accounting Centre in Birmingham.
Those copies should allow you to establish the extent of legitimate use of rebated heavy oil as
fuel in the event of a detection by the RFTU.
Each vehicle legitimately using marked heavy oil as fuel in accordance with these Regulations
should have on board some indication that a valid licence is in force
If you decide/recommend that the applicant be approved, you may later be expected to conduct
an audit of the standard of compliance with the regulations by each licensee in their area.
Pay particular attention to record keeping and stock control of the oil.
Serious or aggravated breach of the regulations or repeated instances of under payment of rebate,
are grounds for withdrawal of the licence.
HCOTEG213756 - Table Q: Payment of

rebate – action to be taken by the Tax
Accounting Centre
Action by the Tax Accounting Centre on receipt of a copy
licence from MORC
On receipt of a copy licence from MORC, the Tax Accounting Centre (TAC) is to set up a
database record of the licensee and note the start/end times of the initial accounting period and
the following accounting periods.
TAC should send the licensee 2 sets of Forms HO72 and HO73 to allow them to make their

estimate of the volume of rebated heavy oil likely to be used in the initial accounting period and
the following accounting period (either quarterly or annual).
Remind the licensee to complete the initial form and return this TAC with their remittance
before any rebated oil is used as fuel, and set up the records required by the regulations.
Should the volume of oil declared on Form HO72 (and paid for) prove insufficient in any
accounting period, the licensee is required to cease using rebated heavy oil as fuel until they have
completed Form HO73 and paid the amount of rebate declared on that form to the Accounting
Centre.
TAC should retain a small stock of Forms HO72 and HO73 for issue at any time.
If TAC does not receive Form HO72 within 10 days of their issue of the form, they should speak
to either LBS or Local Compliance.
If staff in either LBS or Local Compliance decide to withdraw the licence, TAC should not
cancel the database entry until MORC advises them of the cancellation of the licence and the end
date of the final accounting period. A declaration must be made by the licensee on Form HO75
for all accounting periods for which the licence is valid.
Standard accounting routine

Account for Form HO72 (and any Form HO73 for that accounting period) and the remittance in
accordance with A5-1 ‘CECAS transaction processing’. TAC are to retain the original forms
for audit purposes. They will send a copy to the RFCO whose area covers the site at which the
rebated oil is stored.
After placing the remittance accompanying Form HO72 (and any Form HO73 subsequently
furnished in an accounting period) on miscellaneous cash deposit (MCD), no further action need
be taken by the TAC until shortly before the end of the accounting period shown in the licence.
Then TAC is to despatch Form HO75 to the licensee at the address at which the rebated oil is
stored. That Form HO75 has to be completed and returned to the TAC within 10 days of the end
of the period. Form HO72 (and remittance), for the next period, may accompany it if the licensee
anticipates continued need to use rebated heavy oil as fuel.
Additional action required at Budget time

You can expect that on Budget Day either the rate of duty on oil or the rate of rebate allowed on
heavy oil will be varied. The changes make the sums paid against Forms HO72 and HO73
insufficient (called ‘Event B’ in the Regulations) the trader must make a further payment to
ensure that rebated heavy oil used after the charge takes effect (usually 6 pm on Budget day) has
been paid for at current rates.

On the eve of Budget Day the TAC will examine the MCD record and despatch Form HO74 to
each licensee who has presented Form HO72 or Form HO73 in their accounting period. Form
HO74 allows the licensee to declare the volume of heavy oil actually used before the Budget
change, and to declare the expected volume to be used in the remainder of the accounting period
at post-Budget rate(s). The trader must return the completed form (and remittance) to the TAC
within 3 days of the Budget.
On receipt of Form HO74 (and remittance) TAC should follow the procedure above. We have no
objection to all the outstanding sums paid by each licensee in the accounting period being
consolidated, and the total sum being re-deposited to one MCD per licensee.
Action at end of accounting periods

For new licensees there will be an initial accounting period of less than 3 months, to end on the
31 March, 30 June, 30 September, 31 December, followed by a standard accounting period
(either quarterly or annual). The copy Licence for each licensee will show the period length.
Shortly before the end of an accounting period TAC is to despatch Form HO75 to those licensees
who have made a payment. (That form provides for the licensee to declare he actual volume of
heavy oil used in the period as fuel, and to claim refund of the sum overpaid.) At the same time
Form HO72 is to be sent (unless a licence has been withdrawn) so that the licensee can estimate
his likely usage in the next period, and make any payment due. When received at TAC, the
completed Form HO72 is to be dealt with in accordance with the accounting instructions above.
TAC will use the completed Form HO75 (which will not be accompanied by any remittance) to
adjust the MCD raised in the name of that licensee, bring to account the rebate due for the
accounting period and refund the balance overpaid. The Form HO75 provides for the rebate
amount payable for the period to be analysed against tax type codes.
Any sum overpaid in an earlier accounting period can be re-deposited to the credit of that
licensee for he next period provided that the licensee has submitted Form HO72 for that next
period ( and the amount payable shown on that Form HO72 equated to the sum refundable
shown on the Form HO75 for the earlier period). Otherwise it is intended that each accounting
period will end with the HO75 leading to a small refund to the licensee.
 TAC is to make a copy of all Forms HO72 to 75 which are received from licensees,
retain the original forms for audit until they are ready for destruction See IM-2C -
Retention and Disposal: Operational records relating toExcise and Inland
Customs ‘Hydrocarbon Oils’ . Copy forms are to be sent to the RFCO for the
address at which the oil is stored.

HCOTEG213800 – Table R: Specimen letter

refusing approval for payment of rebate
See HCOTEG122550
Dear ( Applicant )
Use of rebated oil as road fuel
I refer to your letter [ date ] applying for permission to use rebated oil as road fuel on repayment
of the excise duty.
I should explain that authorisations to use rebated oil as fuel in road vehicles on pre-payment of
the duty rebate are allowed only in very exceptional circumstances, for example where the nature
of the vehicles concerned and operational requirements are such as to make the occasional use of
rebated oil as road fuel essential.
Your application has been carefully considered, but unfortunately it is not of a type which comes
within the very restricted range of these authorisations. I regret therefore that your application
must be refused.
If you do not agree with the decision in this letter, you can ask for a formal Departmental review.
Your request should be in writing, and set out the reasons why you do not agree with the
decision. It should be sent within 45 days of the date of this letter to [ address of the review team
]
Yours faithfully,
Copy to: RFCO …
HCOTEG213850 - Table S: Specimen

Licence approving repayment of rebate
Repayment of rebate
See HCOTEG122550

Form of Licence
“ Dear ( Applicant ) ,
Hydrocarbon Oil (Payment of Rebates) Regulations: Licence
The Commissioners of Revenue and Customs licence ( name of legal person ) operating at (
address at which stock of heavy oil is stored ) to make payment of the rebate on heavy oil to be
used as fuel in accordance with these Regulations.
The initial accounting period will begin ( show date of issue of licence ) and will end on ( show
31 March, 30 June, 30 September or 31 December ). Thereafter for the purposes of these
Regulations your accounting periods will be ( show quarterly or annual ) ending on ( show
appropriate date ) in each calendar year.
It is a condition of this licence that you comply generally with the requirements of the
Regulations, and in particular that you make and keep records of the use of all rebated heavy oil
in accordance with the Regulations. This Licence remains the property of the Commissioners and
may be withdrawn ( with or without replacement by a further Licence ) by the Commissioners at
any time.”
Yours faithfully,
HCOTEG220025 - Appendices:
Abbreviations
Abbreviation Meaning
A&CG Accountant and Comptroller General
AAD Administrative Accompanying Document. Control document for the movement of
excise goods between approved premises in the EU.
AAFES (United States) Army and Air Force Exchange Service
ALG Automatic Level Gauge/Automatic Tank Gauge. Instrument attached to a tank
that measures the level of product and displays it mechanically at the tank side, or
now electronically in a control room.
AS Audit Service
ASD Accounting Services Division
ASTM American Society for Testing Materials. Recommends standard methods for
testing many substances e.g. hydrocarbons. In association with other bodies it
publishes conversion tables, e.g. for the effects of temperature and pressure on
volumes of oil.

ATG Automatic Tank Gauge – See ALG
AVCAT Aviation Turbine Fuel used by Naval carrier based aircraft. This falls within the
definition of kerosene.
AVGAS Aviation Gasoline. Aviation spirit used in piston engine aircraft.
AVTAG A wide cut fuel for use in turbo-prop aircraft. It is defined for UK Excise Duty
purposes in HODA s6(4)
AVTUR Aviation turbine fuel. Kerosene delivered unmarked and un-dyed at the fully
rebated rate of duty for use as fuel for aircraft engines.
BACS Bankers Automated Clearing System
BPA British Pipeline Agency Ltd
C&E Customs and Excise
CAA Civil Aviation Authority
CAP Central Accounting Point
CAPO Central Accounting point officer. The officer/team responsible for auditing Head
Office records.
CCL Climate Change Levy
CCP Cross Country Pipeline.
CDO Central Deferment Office in Southend.
CEGRA The Customs and Excise Duties (General Reliefs) Act 1979
CEMA Customs and Excise Management Act 1979.
CHP Combined Heat and Power
CHAPS Clearing House Automated Payment System
CMCD Tariff Commodity Code
CNG Compressed Natural Gas
CPC Customs Procedure Code
CRM Customer Relations Manager
CSO Compulsory Stocking Obligation
DAN Deferment Approval Number.
DERV Fuel for a Diesel Engined Road Vehicle.
DfT Department for Transport
DSMEG Duty Suspended Movement of Excise Goods Regulations 2001
DTR Departmental Trader Register
DMB Debt Management and Banking
EC European Community
EGAD Excise Goods (accompanying documents) Regulations 2002
EI Energy Institute (formerly the Institute of Petroleum). A society that keeps under
review the techniques and equipment used for measurement, safety, engineering
etc. in the oil industry.
ELTT Excise Legal and Technical Training Programme
EMCS Excise Movement and Control System

ESC Extra Statutory Concessions
EPD Energy Products Directive
EU European Union
EWER Excise Warehousing (etc) Regulations 1988
FA Finance Act
FSC Financial Securities Centre
GLU Guided Learning Unit
GOMC Gas Oil Marker Concentrate. Commercially available solution that enables
companies to mark oil requirements by addition of 1 litre of solution to 1000 litres
of Gas oil.
GPSS Government Pipeline and Storage System
H&S Health and Safety
HMRC Her Majesty’s Revenue and Customs
HODA Hydrocarbon Oils Duties Act 1979.
HOMR Hydrocarbon Oil (Marking) Regulations 2002.
HOR Hydrocarbon Oil Regulations 1973.
HPLC High Performance Liquid Chromatography
IBC Intermediate Bulk Container. A square plastic container that holds 1000 litres of
oil enclosed in a metal frame.
IOM Isle of Man
KMC Kerosene Marker Concentrate. Commercially available solution that enables
companies to mark oil to requirements by addition of 1 litre of solution 10000
litres of kerosene.
LBS Large Business Service
LC Local Compliance
LE Law Enforcement
LGC Laboratory of the Government Chemist. Used to analyse samples of oil when
there is doubt over its status, e.g. level of marking or excise duty status.
LMS Learning Management System
LNG Liquefied Natural Gas.
LOFF Light Oil Supplied as Furnace Fuel
LPG Liquefied Petroleum Gas. General description of propane, butane or propylene or
mixtures of the three. Liable to excise duty when put to road use.
MDO Marine Diesel Oil, usually a blend of Gas Oil and heavier fractions.
MGO Marked (Rebated) Gas oil. Gas oil that is dyed and chemically marked to attract
the rebated rate of duty. (Not for use as road fuel)
MHFW Motor and Heating Fuel Warehouse
MID Measurement Instruments Directive
MLC Monetary Liability Code
MoD Ministry of Defence
MoD (N) Ministry of Defence (Navy)

MOGAS A common trade term for petrol (Mineral Oil) Gasoline and Aviation Spirit.
MORC Mineral Oil Reliefs Centre at Newcastle. Advise on all Oils Relief schemes,
MPE Maximum Permitted Error
NATO North Atlantic Treaty Organisation
NAS National Advice Service Telephone : 0845 010 9000
NCU National Co-ordination Unit
NG Natural Gas
NOIC National Occasional Importers Centre
NRU National Registration Unit
NVC National Verification Centre
OCCT Oil Central Co-ordination Team. Responsible for co-ordination of the RDCO
scheme.
PD Positive Displacement
RDCO Registered Dealer in Controlled Oils.
REDS Registered Excise Dealers and Shippers. Traders approved to receive excise goods
from the EU under duty suspension. Duty must be accounted for on arrival in the
UK.
REDCENT REDS Control Centre
RFTO Road Fuel Testing Officer.
RFTU Road Fuel Test Unit. A mobile unit responsible for testing the fuel in road
vehicles in order to detect misuse.
RMP Remote Marking Premises. Premises approved by HMRC to mark oil past the
duty point. Duty rebate can be claimed following marking.
RRMR The Hydrocarbon Oil (Registered Remote Markers) Regulations 2004
RTC Rail Tank Car. Several RTC’s usually make up a train for the transport of bulk
deliveries.
RTR The Revenue Traders (Accounts and records) Regulations 1992.
RTW Road Tank Wagon. Road tanker used for distribution of bulk liquids.
SAV Standard Average Value. Value used to account for VAT on Oil when no
transaction value is available. SAV’ are duty inclusive values agreed between the
oil industry and VAT Policy Directorate.
SCADA Supervisory, Control and Data Acquisition Systems
SEED System for the Exchange of Excise Data. EU database containing details of all
traders approved for the movement of excise goods.
SFD Sulphur Free Diesel. Diesel that does not contain more than 10 parts per million
(p.p.m.) of sulphur.
SFP Sulphur Free Petrol. Petrol that does not contain more than 10 p.p.m. of sulphur.
SIVA Simplified Import VAT Accounting Scheme
STA Standard Temperature Accounting. The process of converting bulk or natural
litres at 15ºC (standard litres) which is the unit of quantity for excise duty
purposes.
TTC (Excise) Tax Type Code

UKOP United Kingdom Oil pipeline. A commercial pipeline system operated and
managed by BPA.
ULSD Ultra Low Sulphur Diesel containing less than 50 p.p.m. of sulphur. The current
standard retail diesel.
ULSP Ultra Low Sulphur Petrol containing less than 50 p.p.m. of sulphur. The current
standard retail petrol.
UoE Unit of Expertise
USNX United States Navy Exchange
VEF Vessel Experience Factors
VISION VAT information System Inter-Office Network
VOC Volatile Organic Compounds
WOWGR Warehouse-keepers and owners of Warehoused Goods Regulations 1999
HCOTEG220050 - Appendices: Glossary

Term Definition
Abel-Pensky A method, using specific apparatus, of determining flashpoint.
Method
Additive Any substance added in small proportions to mineral oil to improve or modify
its quality or characteristics as a fuel or lubricant.
Anti-knock Compounds used as additives to motor spirit to improve the ignition quality of
preparations the fuel by delaying premature ignition.
Approved Mixing of oil in accordance with permission under the Hydrocarbon Oil
mixing (Mixing of Oils) Regulations 1985.
Assurance staff Assure the collection and protection of the revenue and facilitate trader
compliance.
Asphalt A solid hydrocarbon found dissolved in natural mineral oil
Audit Service This was created in 2004 to undertake specific audit work at businesses that
have been identified in business’s Risk Assessment (e.g. LBS Core System).
Authorised A person authorised by the Commissioners.
Person
Batch A separate quantity of oil (or other substance) moved at one time or processed at
one time. It contrasts with quantities move continuously or continuous
processing.
Biodiesel A diesel quality liquid fuel derived from biomass or waste cooking oils, the
ester content of which is not less than 96.5% by weight and the sulphur content
of which does not exceed 0.005% by weight or is nil.
Bitumen Extremely heavy semi-solid product of oil refining used for road preparations.
Black oil A description of the heavier, less pure oils such as fuel oil and crude.
Blending Mixing of various components in the preparation of a product of specified
properties.
Bulk litres The volume of oil at ambient temperature.

Bund An area containing a tank or group of tanks surrounded by a wall or earthwork
high enough to contain any tank leaks, bursts or ‘boil-overs’.
Bunkers Any product supplied to fuel a ship’s engines or equipment. The ‘bunkers’ are
the place where fuel is stored on the ship.
Burning oil Alternative name for kerosene.
Butane Normally a gas but can easily be liquefied (see LPG). Component of gasoline.
C88 A Single Administrative Document (SAD) used to make Import/Export Entry of
goods for Customs Purposes, or to accompany third country goods which have
transited via another member state duty-suspended.
C&E1165 Occasional Importers Return.
C&E930A Excise Duty on Gas for use as a Road Fuel.
Calibration A table showing the volume of oil in a storage tank at various levels (see Tank
Table strapping).
Cetane number A means of expressing the energy value of a diesel fuel.
Client Manager Works with NBMs using Audit Agreements to organise work to be carried out
and will decide what Audit Service resources will be required.
Common Duty paid and duty unpaid stocks of oil which are held in common storage: oils
storage of different tax status but the same description mixed together in the same tank.
Coumarin Statutory marker added to kerosene. (1.2 benzopyrone).
Criminal Investigates, prosecutes and dismantles organised and large scale oil frauds such
Investigation as laundering or mixing plants.
Crude oil The basic raw material that undergoes the refining process.
Cycle The sequence in which oils of different types are shipped by pipeline.
Dark Oil A Heavy oil which is darker than ASTM colour 3.0 in the Table of Glass Colour
Standards. For field test purposes oil that is darker than a used copper coin. (Not
for use as a motor or road fuel - as it is too dark to be able to identify the
presence of any fiscal dyes).
Deferment A trader who is approved to defer the payment of excise duty,
Trader
Duty deferment Allows an oil company to defer any excise duty liable on product removed from
guarantee bond during an accounting period, until the last business day of the following
month.
Density The mass of solid or liquid (determined by weighing under controlled
conditions) which is contained in one unit of volume of the solid or liquid at a
specified temperature.
Dip The depth of liquid in a bulk tank measured using a dip tape or dipstick.
Diesel See DERV.
Distillate See Middle Distillate
Distillation Distillation involves heating the oil up, and because different components can
(Refining) be boiled off at different temperatures, each can be drawn off separately and
used to make different types of oil.
Distillation This is where the actual transformation of the crude oil takes place.
columns

Downstream The refining and marketing sectors of oil companies’ activities.
Drawback Repayment of the duty paid on product exported, warehoused for export or
shipped as stores on aircraft or ship.
Dutiable use Dutiable use of oil delivered for home use includes as fuel for any engine, motor
or machinery, or as heating fuel.
Duty See Mineral oil duty.
Duty point The point at which oil becomes legally liable to excise duty ( e.g. when products
are loaded to leave the refinery)
Duty A warehouse, where oils are stored without payment of duty before delivery to
Suspended home use. These are normally attached to the producer’s premises, or are Import
Premises warehouses.
Duty The process that allows oils to be stored without paying Excise Duty, until the
Suspension oils are delivered to home use.
Duty-paid An oils terminal where all the oils in storage have borne excise duty.
terminal
Egress The point at which oil is delivered out of a pipeline.
Electrical oils Oil used as a coolant or insulating fluid in electrical machinery.
Energy Institute Formerly the Institute of Petroleum, a society that keeps under review the
techniques and equipment used for measurement, safety, engineering, etc, in the
oil industry.
Euro-marker A statutory marker added to rebated fuels throughout Europe. Gives fuel a pale
yellow colour. Countries may add their own markers and dyes in addition to
Euro-marker – the UK does. N-ethyl-N{2-(1-isobutoxyethoxy) ethyl}-4-
(phenylazo) aniline.
Ex rack Product collected directly from a refinery or major storage terminal
Excepted Vehicles as defined under Schedule 1 of the Hydrocarbon Oil Duties Act 1979
vehicles as amended, which may use rebated heavy oil. More information is available in
Public Notice 75 ‘Fuel for Road Vehicles’.
Excise Duty The United Kingdom revenue duty chargeable on both imported and home
produced motor and heating fuels. It is charged at a specific rate on the quantity
and description of oil delivered to home use.
Excise Duty The time when the requirement to pay any duty with which the goods become
point chargeable. It is charged at a specific rate on the quantity and description of oil
delivered to home use.
Excise Goods Goods that are liable to Excise duty.
Excise A place of security approved by the Commissioners under the Customs and
Warehouse Excise Management Act 1979, Section 92.
EU The European Union. The member states currently are:
Austria Belgium Bulgaria Cyprus Czech Republic
Denmark Estonia Finland France Germany
Greece Hungary Ireland Italy Latvia
Lithuania Luxembourg Malta Netherlands Poland
Portugal Romania Slovakia Slovenia Spain

Sweden United
Kingdom
Feedstock Material to be processed in a refinery.
Flash point The lowest temperature at which oil ignites momentarily in air, under specified
conditions.
Floating Roof A tank in which the roof floats on the product to prevent the build up of vapour.
Tank Usually found in motor spirit tanks. You should never go on top of a floating
roof tank, even when it is at rest.
Fractional The separation of crude oil into its constituents or ‘fractions’. Separation is
Distillation determined by the different boiling points of the constituents. This is the basic
process that occurs at a refinery.
Fuel oil Heavy oil which contains in solution an amount of asphaltenes and has a closed
flashpoint not exceeding 150ºC. Used for fuelling large steam turbines, e.g. in
power stations or marine engines.
Fuel substitute Any liquid which is not mineral oil but is intended to take the place of a mineral
oil. Fuel substitutes are liable to excise duty at the same rate as the product they
are substituting for. (N.B. This principle also applies to those Biofuels used as a
Fuel substitute, other than Biodiesel or Bioethanol which attract a reduced rate
of duty)
Gantry A static platform that gives personnel access to top-loading road and rail
tankers.
Gas condensate A Light oil that is a naturally occurring by-product of gas production.
Gas oil Heavy oil of which not more than 50% by volume distils at a temperature not
exceeding 240ºC and of which more than 50% by volume distils at a
temperature not exceeding 340ºC.
Gasoline See Motor spirit.
Hard asphalt A form of asphalt which is insoluble in petroleum.
Heavy oil Oil other than light oil, for example, jet fuel, diesel and fuel oil.
High flash Oil where the flash point is more than (>) 32ºC
HO 9 A form used for rebate claims when duty paid gas oil, kerosene and possible
ultra low sulphur diesel (ULSD) has taken place at a remote marking premises
(RMP).
HO10 A warrant for Hydrocarbon Oils for Home use Duty Deferment Account.
HO 11 Pre-repayment credibility query form.
HO 65 Form used to claim for netting rebate.
HO930 A return for Excise Duty on Fuel Substitutes.
Home use Product delivered to the UK home market with all duties accounted for is
referred to as ‘delivered to’ home use.
Hydrocarbon Chemical descriptor of any molecule containing only carbon and hydrocarbon
atoms. Crude oil typically contains more than 97% hydrocarbons.
Inflammable Fumes or atmospheres which can catch fire.
vapour
Ingress The point at which oil enters a pipeline.

Interface The point at which two parcels of oil meet and merge in a pipeline.
Kerosene A heavy oil of which more than 50% by volume distils at a temperature not
exceeding 240ºC. Commonly known as burning oil or paraffin. Not to be used
as road fuel.
Large Business LBS covers ‘Compliance Management’ and ‘Audit Service’.
Service
Laundering Process used to remove the statutory markers from rebated Gas oil (MGO) or
(illegal) from rebated Kerosene (MKO).
Law LE Policy is responsible for the creation, implementation and monitoring of the
Enforcement Oils Strategy.
(LE) Policy
Light oil Oil of which not less than 90% by volume distils at a temperature not exceeding
210ºC or which gives off an inflammable vapour at a temperature of less than
23ºC when tested in the manner prescribed by the Acts relating to petroleum.
Linearity The situation in which actual measurements when set against the true values in a
graph produce an acceptably straight line. In relation to meter accuracy the term
is applied to the range of rates of flow over which the accuracy as a percentage
of the true value is within acceptable limits, i.e. the graph of percentage
accuracy against true value is an acceptably straight horizontal line.
Local Have responsibility for small and medium enterprises (SME)
Compliance
Low flash Oil where the flash point is less than or equal to (=) 32ºC.
Lube cube See IBC.
Lube oil Heavy oil used for lubrication of moving parts. Not liable to excise duty. NB
The specification of some lube oils can be very close to Gas oil, so there is the
possibility of mis-description of gas oil to avoid a liability to excise duty.
Marked oils Those oils that have been marked to claim a rebate of Excise Duty. The oils
affected are Gas Oil, and Kerosene. These oils are also known as controlled oils.
Marking The addition of chemical markers and dyes to oil to differentiate between
product for road use and product for other purposes. Marked oil is delivered at a
rebated rate and should not be used in road vehicles.
Marking Approval to receive rebated oils ‘unmarked’ may be granted for technical or
Waiver health and safety reasons; e.g. AVTUR is a high performance kerosene supplied
for use in Aviation Turbine engines, under such a waiver.
Medium oil Oils which for customs duty purposes lie between spirits and heavy oil. It
includes lighter oil within the excise definition of heavy oil but is not an excise
category of oil.
Metering A means of recording the volume of product supplied. Metering is generally
used for deliveries into road and rail tankers
Meter creep Small quantities recorded on a meter totaliser but not delivered. Usually the
result of an accumulation of fractions of a litre that cause a meter to click over
one digit between deliveries.
Meter proving The process of determining a meter’s accuracy by comparison with another
measuring device whose accuracy is traceable to a national standard.

Middle The products from the mid range of the fractionating column during distillation
distillate of crude oil. Gas oil and kerosene.
Mineral oils Mineral oil is the organic remains (compounds of hydrogen and carbon) of
plant, marine and animal life, which existed between 400 million and 40 million
years ago. Hydrocarbons that are liquid at 15ºC. The terms ‘hydrocarbon oils’
and ‘mineral oils’ mean the same thing.
Mineral oil Mineral oil duty is a UK Excise Duty which is payable on UK-produced and
duty imported oils.
Motor and An excise warehouse where mineral oil may be received and stored and the
Heating Fuels payment of excise duty and VAT is suspended.
Warehouse
Motor spirit Oil used as a fuel for a petrol engine charged at the full rate of duty.
Natural litres See Bulk litres.
Netting A means by which traders approved for duty deferment may off set deliveries
qualifying for duty free status against duty payments.
Octane number A measure of the anti-knock value (i.e. the ignition quality) of motor spirit.
Officer/Officers A person delegated the powers given or the responsibilities laid to the
Commissioners of H.M. Revenue and Customs and empowered to act on their
behalf whilst dealing with members of the trade or public.
Oil products Mineral (hydrocarbon) oil products produced by refineries from crude oil, shale,
and other oil feedstocks. See HCOTEG12650 for a list of oils products
Oil supply The oil supply chain is the physical movement of oil from the manufacturer to
chain the end user.
Paraffin See Kerosene.
Parcel An individual grade of oil delivered as part of a larger consignment. Several
parcels will commonly make up a shipping or pipeline delivery.
Petroleum Motor spirit, petrol.
Pipeline The most common way to get crude oil produced by oil platforms and drilling
rigs at sea to the refinery is by pipeline (although ships may also be used). Also
cross country pipelines used commonly for moving large batches of fuels
between refineries and oil terminals.
Pipeline Gives details of the duty liability or credit generated by pipeline interfaces.
Adjustment
Schedule
Pots Compartments within the body of a road tanker wagon (RTW) each of which
can hold different products.
Producer A company engaged in the production of oil at approved premises.
Propane Normally a gas but can easily be liquefied. It is the principle gas used as road
fuel (see LPG).
Quinizarin Statutory marker added to gas oil. 1,4-dihydroxyantheaquinone.
Rebate The difference between the full rate of Duty and the reduced rate allowed on
certain types of oil when put to specified uses. (It is illegal to use rebated fuels
as fuel in road vehicles).

Rebated fuel Fuel on which a rebate of duty has been allowed.
Red diesel See MGO.
REDS 110 REDS Duty Return
Refinery Premises approved by the Commissioners for the treatment of oil.
Remission A decision not to collect any revenue owed. If revenue has already been paid,
we will repay it.
Refinery Have a responsibility for approvals and issues at refinery sites.
officers
Remote See RMP
Marking
Premises
Retail The oil industry term for sales of motor fuels (petrol and diesel) via filling
stations.
Removal Record deliveries or transactions that have revenue implications.
schedules
Revenue trader A person carrying on a trade or business subject to any of the revenue trade
provisions of Customs & Excise Acts, including importing, exporting,
producing, handling, processing, packaging, transporting or dealing in goods
chargeable with excise duty. (See CEMA, Section 1).
Risk managers Have responsibility to assure the collection and protection of the revenue by
identifying and prioritising assurance activity to the business’s areas that pose
the greatest risk.
SCADA Supervisory, Control and Data Acquisition systems which monitor in ‘real
systems time’, movements of oil and associated tankage, valves and pipeline conditions.
Simplified A scheme to reduce the level of financial security required to guarantee the
Import VAT payment of Import VAT through the Duty Deferment System.
Accounting
(SIVA)
Sulphur Free Gas oil with a sulphur content of less than 0.001 per cent by weight, or nil
Diesel (SFD)
Sulphur Free Petrol that does not contain more than 10 p.p.m. of sulphur.
Petrol (SFP)
Solvent red A red dye used to mark fuel, technically referred to as CI (colour index) Red 24
dye.
Solvent yellow A combined Yellow dye and fiscal marker used to mark fuel, also known as the
Euro-marker or Solvent Yellow 124.
Standard litres Bulk litre volume converted to the volume that would occur if the temperature
was 15ºC (standard litres are also known as litres@15ºC). The standard litre is
the unit of quantity required for excise accounting purposes (see STA).
Standard A value agreed between the Oils Industry and HMRC to be used when the
Average Value original value for VAT is not known.
Statutory Statutory Instruments make the Regulations. They state how things will be done
Instruments in terms of procedure and sometimes amend earlier Regulations.
Sulphur Free Diesel that does not contain more than 10 p.p.m. of sulphur.

Diesel
Sulphur Free Petrol that does not contain more than 10 p.p.m. of sulphur.
petrol
Tank Strapping The means of calibrating a bulk storage tank by taking the dimensions at
successive heights. These measurements are subsequently converted to volumes
and reproduced in a tank calibration table.
Tax Specialists Tax Specialists work to CRMs and deal with the technical tax work at the
businesses.
Tax Warehouse A warehouse where excise goods are produced, held, received or dispatched
under duty suspension arrangements as required by EU Directive.
Technical oils Commercial indication that oil is specially produced other than as a fuel or
lubricant.
Terminal A large storage depot usually owned by an oil company or independent storage
company and supplied by pipeline, rail or sea.
Tied Oil Industrial oil permitted to be delivered duty free when to be put to an eligible
use i.e. not used in an engine or for heating fuel, usually supplied fiscally
unmarked.
Tractor diesel See Red diesel.
Trade Sector TSCs provide an in depth knowledge of a particular trade sector and types of
Consultant businesses involved in the oils industry.
Transformer oil Oil used in electrical transformers as a coolant and as an insulator. See also
electrical oils.
Transport Team Responsible for developing the structure and scope of the tax, implementing,
monitoring and maintaining Oils Policy, on tax liability and procedural issues –
interpretation of law and introduction of legal change. Produce guidance, public
notices and training materials on Mineral Oils, Biofuels and Fuel substitutes.
Ullage The measurement in a bulk tank of the distance between the liquid surface and
an upper reference point i.e. the gap above the product. Alternative method of
gauging a tank’s volume to dipping.
Un-rebated oil Un-dyed and unmarked oil that has borne duty at the full rate.
Upstream The exploration and extraction activity of an oil company prior to refining.
Value Added VAT is chargeable on imported oil, whether or not any duty is chargeable or
Tax (VAT) relieved.
VATA 94 VAT Act 1994.
VAT 908 Hydrocarbon Oils: Deferment Advice for VAT due on removal from
Warehouse.
Vapour The process of recovering the hydrocarbon vapour produced during delivery
Recovery from the Gantry into a Road Tank Wagon (RTW) or on subsequent delivery
from the RTW. Duty can be reclaimed on recovered vapour.
Vapour Used at delivery points to collect mineral oil vapour for recovery in liquid form.
recovery units
Viscosity The resistance of a liquid to flow.
W50 Remittance/Deferment Advice for Additional Payments of Duty and/or VAT

Warehouse Have a responsibility for approvals and issues at excise warehouses.
officers
Weighbridge A means of measuring oil quantities. Weighbridges must be approved by the
National Weights and Measures Laboratory of DTI and must be tested and
stamped by the local Trading Standards Department before using them to raise a
revenue account.
White diesel Another name for unmarked, un-rebated Diesel or Gas Oil. A heavy oil of which
not more than 50% by volume distils at a temperature not exceeding 240ºC and
of which more than 50% by volume distils at a temperature not exceeding 340ºC
White oil White Oils are liquid mineral oils other than fuel oils and heavier residues
White spirit A specialised light oil normally used as a solvent

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Petroleum Measurement Manual

HCOTEG170000 – Measurement: Table of

HCOTEG170250 Scope of guidance

http://www.hmrc.gov.uk Page 1 of 97 February 19, 2011

HCOTEG170250 - Measurement: Scope of

Duty is charged on the volume of oil.

http://www.hmrc.gov.uk Page 2 of 97 February 19, 2011

Accounting for oil

The volume expressed in litres at 15ºC is known as standard litres.

HCOTEG171000 - Measurement: Law and

Hydrocarbon Oil Regulations 1973 SI 1973/1311

Section Section title Summary

http://www.hmrc.gov.uk Page 3 of 97 February 19, 2011

Finance Act 1993 section 12 and the Hydrocarbon Oil

HCOTEG171250 - Measurement: Public

The key aspects of Section 4 of Public Notice 179 are:

http://www.hmrc.gov.uk Page 4 of 97 February 19, 2011

HCOTEG171500 - Measurement: Energy

The two papers of most interest are –

 HM39 Petroleum Measurement Manual or a Guide to Recommend Measurement Practice

MID and oils assurance

http://www.hmrc.gov.uk Page 5 of 97 February 19, 2011

HCOTEG172500 - Measurement: What are

http://www.hmrc.gov.uk Page 6 of 97 February 19, 2011

HCOTEG173000 - Measurement: Health and

On-line H&S guidance

 HS-7 Safe clothing and equipment

Personal protective equipment

http://www.hmrc.gov.uk Page 7 of 97 February 19, 2011

Vapour recovery hazards

Will the traders have risk assessments and H&S training?

HCOTEG173250 - Measurement: The

http://www.hmrc.gov.uk Page 8 of 97 February 19, 2011

Other aspects of positioning

HCOTEG173500 - Measurement: Security of

Security of equipment and contingencies for loss of power

http://www.hmrc.gov.uk Page 9 of 97 February 19, 2011

HCOTEG173750 - Measurement: Standard

This is likely to be for one-off amounts or very small quantities.

Standard temperature accounting (STA) calculations

http://www.hmrc.gov.uk Page 10 of 97 February 19, 2011

HCOTEG174020 - Flow meters - technical

For information on other types of flow meters see HCOTEG174290

http://www.hmrc.gov.uk Page 11 of 97 February 19, 2011

HCOTEG174030 - Flow meters - technical

Orifice plate meters

http://www.hmrc.gov.uk Page 12 of 97 February 19, 2011

For information on other types of flow meters see HCOTEG174290

HCOTEG174260 - Flow meters - other

http://www.hmrc.gov.uk Page 13 of 97 February 19, 2011

 Automatic temperature compensating (ATC) meters – as previously mentioned, we

HCOTEG174270 - Flow meters - other

The factors that affect meters are:

http://www.hmrc.gov.uk Page 14 of 97 February 19, 2011

 HCOTEG174280 - Flow meters - other

http://www.hmrc.gov.uk Page 15 of 97 February 19, 2011

HCOTEG174290 - Flow meters - other

http://www.hmrc.gov.uk Page 16 of 97 February 19, 2011

HCOTEG174300 - Flow meters - other

HCOTEG174310 - Flow meters - other