Bulk Liquid Stock Control at Retail Outlets

API RECOMMENDED PRACTICE 1621 FIFTH EDITION, MAY 1993

REAFFIRMED, MAY 2020

Bulk Liquid Stock Control at Retail Outlets

Downstream Segment

API RECOMMENDED PRACTICE 1621 FIFTH EDITION, MAY 1993

REAFFIRMED, MAY 2020

SPECIAL NOTES

1. API PUBLICATIONS NECESSARILY ADDRESS PROBLEMS OF A GENERAL NATURE. WITH RESPECT TO PARTICULAR CIRCUMSTANCES, LOCAL, STATE, AND FEDERAL LAWS AND REGULATIONS SHOULD BE REVIEWED.

2. API IS NOT UNDERTAKING TO MEET THE DUTIES OF EMPLOYERS, MANU- FACTURERS, OR SUPPLIERS TO WARN AND PROPERLY TRAIN AND EQUIP THEIR EMPLOYEES, AND OTHERS EXPOSED, CONCERNING HEALTH AND SAFETY RISKS AND PRECAUTIONS, NOR UNDERTAKING THEIR OBLIGATIONS UNDER LOCAL, STATE, OR FEDERAL LAWS.

3. INFORMATION CONCERNING SAFETY AND HEALTH RISKS AND PROPER PRECAUTIONS WITH RESPECT TO PARTICULAR MATERIALS AND CONDI- TIONS SHOULD BE OBTAINED FROM THE EMPLOYER, THE MANUFACTURER OR SUPPLIER OF THAT MATERIAL, OR THE MATERIAL SAFETY DATA SHEET.

4. NOTHING CONTAINED IN ANY API PUBLICATION IS TO BE CONSTRUED AS GRANTING ANY RIGHT, BY IMPLICATION OR OTHERWISE, FOR THE MANU- FACTURE, SALE, OR USE OF ANY METHOD, APPARATUS, OR PRODUCT COV- ERED BY LETTERS PATENT. NEITHER SHOULD ANYTHING CONTAINED IN THE PUBLICATION BE CONSTRUED AS INSURING ANYONE AGAINST LIABIL- ITY FOR INFRINGEMENT OF LETTERS PATENT.

5. GENERALLY, API STANDARDS ARE REVIEWED AND REVISED, REAF- FIRMED, OR WITHDRAWN AT LEAST EVERY FIVE YEARS. SOMETIMES A ONE- TIME EXTENSION OF UP TO TWO YEARS WILL BE ADDED TO THIS REVIEW CYCLE. THIS PUBLICATION WILL NO LONGER BE IN EFFECT FIVE YEARS AF- TER ITS PUBLICATION DATE AS AN OPERATIVE API STANDARD OR, WHERE AN EXTENSION HAS BEEN GRANTED, UPON REPUBLICATION. STATUS OF THE PUBLICATION CAN BE ASCERTAINED FROM THE API AUTHORING DEPART- MENT [TELEPHONE (202) 682-8000]. A CATALOG OF API PUBLICATIONS AND MATERIALS IS PUBLISHED ANNUALLY AND UPDATED QUARTERLY BY API, 1220 L STREET, N.W., WASHINGTON, D.C. 20005.

Copyright ? 1993 American Petroleum Institute

FOREWORD

This recommended practice contains procedures and methods designed to control and identify product losses through use of a suitable inventory control accounting system. Em- ployees should be trained in the procedures in this recommended practice and be required to follow them. Use of these procedures will enable the operator to identify trends and sig- nificant changes in inventory variations that may indicate the presence of controllable losses. Suitable corrective actions may then be taken to reduce product losses.

On September 23, 1988, the U.S. Environmental Protection Agency (EPA) issued its Technical Standards and Corrective Action Requirements for Owners and Operators of Un- derground Storage Tanks (UST). These standards, which will be found in 40 Code of Fed- eral Regulations Part 280, were published in Volume 53 of the Federal Register at pages 37194?37212. Furthermore, legislation and regulations on all aspects of UST management are under active development at state and local levels. These levels may have requirements other than those specified in the EPA Technical Standards, and the appropriate government agencies should be consulted about regulations that apply in the geographic area of interest before any action suggested by this recommended practice is taken. When used in this doc- ument, the term implementing agency means EPA or the designated state or local agency re- sponsible for carrying out an approved UST program.

This recommended practice is based upon the experience of knowledgeable members of the petroleum industry. In some respects it may be more stringent than the requirements im- posed by the EPA Technical Standards. However, the recommended practice does not at- tempt to cover all of the subjects covered by the EPA Technical Standards. Furthermore, while substantial effort has been made to ensure that none of the recommendations contra- vene the requirements of the EPA Technical Standards, API is not undertaking to interpret the EPA Technical Standards and cannot guarantee that its recommendations are com- pletely in accord with them, nor is any representation made that these recommendations conform with any requirements imposed by state and local agencies.

This recommended practice supersedes and replaces API Recommended Practice 1621, fourth edition, December 1987. The EPA Technical Standards provide that Recommended Practice 1621 can be used as a guide to comply with EPA?s standards for inventory control. According to EPA, an owner or operator conforms with this provision of the EPA Technical Standards if he or she uses the 1987 edition, which was in force when the EPA Technical Standards became final. However, an owner or operator who uses this new edition will also be meeting the requirements of the 1987 edition and EPA encourages the use of the most recent version.

API publications may be used by anyone desiring to do so. Every effort has been made by the Institute to assure the accuracy and reliability of the data contained in them; however, the Institute makes no representation, warranty, or guarantee in connection with this pub- lication and hereby expressly disclaims any liability or responsibility for loss or damage re- sulting from its use or for the violation of any federal, state, or municipal regulation with which this publication may conflict.

Suggested revisions are invited and should be submitted to the director of the Manufac- turing, Distribution and Marketing Department, American Petroleum Institute, 1220 L Street, N.W., Washington, D.C. 20005.

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CONTENTS

Page

SECTION 1?GENERAL 1

1. Introduction 1

2. Purpose 1

3. Federal Requirements 1

4. Referenced Publications 1

SECTION 2?ACCOUNTING SYSTEMS 2

1. Requirements 2

2. Implementation 2

SECTION 3?PRODUCT LOSSES 2

1. Sources of Losses 2

2. Unavoidable Losses 2

   1. Description of Normal Losses 2

   2. Magnitude of Normal Losses 3

3. Controllable Losses 3

   1. Description of Normal Losses 3

   2. Leakage 3

   3. Spillage 4

   4. Theft 4

   5. Product Used on Premises 4

SECTION 4?PROCEDURES FOR REDUCTION OF

SECTION 5?MANUAL TANK GAUGING 6

1. Description 6

2. Federal Requirements 6

3. Conditions for Use 6

4. Form and Procedure 6

   APPENDIX A?SAMPLE RECONCILIATION FORMS 7

   APPENDIX B?PROCEDURE FOR TESTING ACCURACY OF

   GASOLINE-DISPENSING METERS 13

   APPENDIX C?GAUGING PROCEDURE FOR UNDERGROUND

   HORIZONTAL TANKS 15

   APPENDIX D?WATER-GAUGING PROCEDURE 19

   APPENDIX E?MANUAL TANK GAUGING RECORD AND

   RECONCILIATION FORM 23

   
   

   Figures

   1. 1?Balance System Schematic 17

   2. 1?Water Removal Procedure Using an Oil Skimmer 21

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Bulk Liquid Stock Control At Retail Outlets

SECTION 1—GENERAL

1. Introduction

   1. The primary application of this recommended prac- tice is in connection with the underground storage of motor fuels and used oil at retail and commercial facilities. This recommended practice does not apply to inground (that is, where a part of the tank is aboveground) or aboveground bulk storage systems. Hereafter, the use of the term tank refers to an underground petroleum storage tank. Any mer- chandising operation in which a commodity is handled in bulk is susceptible to stock or inventory losses. This problem becomes even more critical at retail outlets selling motor fu- els since the principal bulk commodity handled is volatile. Thus, special care must be exercised to control product losses to (a) provide a safe environment for the operator, em- ployees, customers, and neighbors; (b) minimize air and wa- ter pollution; and (c) maximize profits.

   2. The negative effect of product losses on profits needs no explanation. However, the operator should under- stand that he or she, as well as the owner of the underground storage and dispensing equipment, may be subject to finan- cial penalties imposed by government agencies if product leakage causes contamination. He or she may also be liable for personal injuries and property damage resulting from hazardous conditions caused by product leakage as a result of his or her negligence. Most states have regulations that contain penalties for noncompliance.

1. Purpose

   The purpose of this recommended practice is to assist the operator in controlling bulk stock losses, thereby achieving a high level of safety and pollution control while maximizing profits. This recommended practice describes and explains practices and procedures needed to achieve good bulk stock control. This control is achieved through the daily prepara- tion and review of inventory control records. Achieving good control of bulk stock allows the operator to quantify product losses and quickly recognize the presence of leaks or equipment problems.

   
   

2. Federal Requirements

   The U.S. Environmental Protection Agency (EPA) ac- cepts inventory control in conjunction with tank tightness testing as an approved method of release detection until De-

   cember 22, 1998, or 10 years after a new tank has been in- stalled or an existing tank has been upgraded, whichever comes later. The EPA requires that any suspected release be reported within 24 hours to the authority having jurisdiction. Authority having jurisdiction refers to one or more federal, state, or local government agencies or individuals responsi- ble for approving equipment, installations, and procedures associated with underground storage tank systems. When us- ing inventory control as a method of release detection, vari- ances exceeding 1 percent of product throughput plus 130 gallons for two consecutive months must be reported to the authority having jurisdiction. In addition, the tank tightness test must be capable of detecting a 0.1 gallon per hour leak rate with a 95 percent probability of detection and a 5 per- cent probability of false alarm.

   An alternate method of release detection accepted by the EPA is the use of an automatic tank gauging (ATG) system. The ATG must be capable of detecting a release equivalent to 0.2 gallons per hour with a 95 percent probability of de- tection and a 5 percent probability of false alarm during a monthly test. In addition to providing a tank testing feature, some ATG systems may be able to perform automatic inven- tory control. The scope of this recommended practice does not include additional discussion of ATG systems.

   The EPA also allows manual tank gauging (MTG) as an alternate method of leak detection for tanks of 2000 gallons capacity or less (refer to 5.2). MTG can be used for tanks containing motor fuels, used oil, and petroleum distillates. However the EPA exempts certain tanks from the UST reg- ulations, including heating oil tanks used for consumptive use on the premises where stored. Some state regulations, however, do not exempt such tanks.

   State and local agencies may have more stringent stan-

   dards and should be consulted.

   
   

3. Referenced Publications

The most recent editions of the following standards, codes, and specifications are cited in this recommended practice.

API

RP 1615 Installation of Underground Petroleum Stor- age Systems

RP 1628 A Guide to the Assessment and Remediation of Underground Petroleum Releases

RP 1631 Interior Lining of Underground Storage Tanks RP 1637 Using the API Color-Symbol System to Mark Equipment and Vehicles for Product Identifi-

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