"Minimization of Petroleum product losses during transportation in Hasc" by Haroon Lazar, Zain Ul Abideen et al.

Degree

Master of Business Administration Executive

Faculty / School

School of Business Studies (SBS)

Year of Award

2024

Advisor/Supervisor

Dr. Muhammad Wasif, Visiting Faculty, Department of Management

Project Type

MBA Executive Research Project

Access Type

Restricted Access

Keywords

Tank lorries, Theft, Shortages, Mixing, Hascol

Executive Summary

Oil and gas industry is the one of the most vital and critical sectors for Global economy. Pakistan’s Oil and Gas industry’s downstream segment is managed by several Oil Marketing Companies (OMCs). Global and local Oil industry downstream segment dynamics and issues are somewhat similar, while some issues are somewhat unique to local socio-economic and law and order environment.

In the downstream segment, two main petroleum products are involved i.e. Premium Motor Gasoline (PMG) and High-Speed Diesel (HSD), these are also termed as White Oil. White Oil product quality and quantity variance during the transportation of petroleum products is prevalent throughout the world and Pakistan is no exception. This issue is being faced when White Oil products are being transported to the up-country through tank lorries.

Hascol Pakistan Limited (HPL), one of the leading OMC has been facing the volumetric loss and gain issues with their White Oil products. The reported loss/gain in quantity and quality are during tank lorries transportation in the downstream segment. The product loss / gain at this stage of the supply chain is certainly an alarming situation for the business which results in financial losses and damage to the brand image due to the operational errors and possible malpractice. The estimated loss reported is approximately a significant 19% of the total standard gross profit.

Hascol is dealing with this product loss, likely due to the mishandling, mixing and theft of the fuel during its transportation through the tank lorries. The issue of product loss / gain of fuel volume due to theft and mixing of inferior quality products which involves real time traceability, reliability and tracking of the tank lorry to be thoroughly ascertained.

This study employed a combination of qualitative and quantitative design. Qualitative data collection was based on interviews taken from Hascol management and industry experts through a questionnaire. Thematic approach was adopted, and the data was assessed through a specialized Qualitative data analysis software - NVIVO. The qualitative data collected through questionnaire focused on the essentials of White Oil logistics, SOPs and their violation, best international practices, transportation of fuel through tank lorries, theft and mixing, suggestions and recommendations to address these issues. Quantitative data collection was based on conducting a survey of the Fuel stations / Petrol pump owners through a quantitative questionnaire analyzed through SPSS. This survey was focused on product quality, quantity and other relevant questions related to the product being sent by the OMC and received by the retailer. International and National literature, pertaining to the problem, its solutions and best practices was also consulted.

The findings from the above corroborated and affirmed the prevalent theft and mixing issue faced by Hascol during the fuel transportation through tank lorries. The prime reasons being violation of SOPs, lax monitoring, traceability and tracking of tank lorries, unfit and sub-standard vehicles, lack of driver training and inadequate driver wages.

The study concludes with several recommendations to reduce and control theft and mixing issues faced by Hascol. These include real-time monitoring of all tank lorries with GPS tracking, strict implementation of OMC SOPs and logistics protocols, stringent action against violating cartage contractors, law enforcement, regular inspection and timely calibration to ensure vehicle fitness, mandatory installation of cameras inside the vehicle cabins and all fuel stations, adopting internationally adopted ADR and Petron vehicle standard and initiation of regular driver trainings.

Adoption of these recommendations will hopefully benefit Hascol Petroleum Limited in reducing the problem of theft and mixing and thus saving a substantial revenue with an improvement its damaging brand image.

Keywords: Tank lorries, Theft, Shortages, Mixing, Pipeline

Pages

iii, 240

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