Sampling, testing of imported petroleum products: Changes in procedure allowed

The Economic Co-ordination Committee (ECC) of the Cabinet has approved changes in the procedure of sampling and testing quality of imported petroleum products, thereby allowing re-sampling by a third party in case of disputes on Hydrocarbon Development Institute of Pakistan (HDIP) results. Sources said the ECC while considering a summary submitted by the Ministry of Petroleum on "import of fuel oil/diesel oil by traders" approved the procedure for sampling/testing of imports of fuel oil and diesel oil.
The approved procedure includes: (i) the product will conform to approved specifications notified by the Petroleum Ministry; (ii) the quality of the product for all importers including oil marketing companies (OMCs) and industrial consumers will be tested by HDIP laboratory, Karachi, prior to unloading. Sampling of product for quality analysis will be done by Oil Company Advisory Council (OCAC) approved surveyors in the presence of HDIP representative as per prescribed procedure; (iii) and in case of quality dispute, second retained sample will be tested by HDIP in the presence of nominated representative of the importer and test results of second sample will be final and binding.
The Ministry of Petroleum & Natural Resources has received representation from Oil Company Advisory Council, a consultative forum of the oil industry, against the third condition. The ECC was reportedly stated that the reasons behind the representation are various occurrences, where the test results of HDIP for 1st sample were declared off-spec but the test results of 2nd sample were found within the approved specifications, though both the samples were drawn at the same time.
The Ministry of Petroleum added that such occurrences lead to delays in discharge of vessels and consequent incidence of unnecessary demurrages. The OCAC has, therefore, suggested that in case the sample testing by HDIP fails, the second retained sample be tested by some other independent laboratory.
The ECC was told that OGRA has also concurred with the proposal and asked for approval of the ECC, as the existing procedure was backed by the ECC decision. The Ministry of Petroleum & Natural Resources has considered the issue in consultation with the concerned stakeholders including OCAC/oil industry, OGRA and HDIP and since the frequency of failure in testing of first sample is around 3-5 cases per year, the consensus, therefore, was for introducing the option of re-sampling exercise in case the sample testing by HDIP fails.
Additionally, under the provisions of the Pakistan Oil (Refining, Blending, Transportation, Storage and Marketing) Rules 2016, sampling and testing of petroleum products now falls in the domain of OGRA. The changes in the existing procedure are proposed in order to introduce more transparency in the process of sampling and testing of imported petroleum products.
The ministry proposed that existing procedure may be revised with that: (i) the product will conform to approved specifications notified by the Ministry of Petroleum; (ii) the quality of the product for all importers will be tested by HDIP laboratory prior to unloading. Sampling of the product for quality analysis will also be done by HDIP in the presence of importer's surveyors; (iii) and in case of quality dispute if the sample testing by HDIP fails, re-sampling will be made by a third-party surveyor in the presence of authorised representatives of concerned stakeholders including HDIP. The fresh sample, so taken, will be tested in the presence of nominated representatives of the importer and HDIP by another independent laboratory, pre-approved by the authority OGRA. Test results of fresh sample shall be final and binding.
The OGRA will also independently carry out a random sampling from vessels carrying imported petroleum products for testing through any of the laboratories approved by the authority for effective monitoring, quality assurance and greater transparency in the process.