The preamble to the final rule states that "oxygenate added to a refiner's or importer's gasoline or blendstock downstream of the refinery or import facility may be included in the refiner's or importer's compliance calculations only if the refiner or importer is able to demonstrate with certainty that the oxygenate has been added to that party's gasoline." The preamble further states that "as a result of the complexities inherent in tracking gasoline through the fungible distribution system, EPA believes in most cases it will be impracticable for refiners or importers to effectively monitor downstream oxygenate blending with gasoline that is shipped fungibly, and as a result the refiner or importer normally would be precluded from the oxygenate in compliance calculations".
The scenario in question is:
o a refiner ships conventional gasoline produced by the refiner through a common-carrier pipeline;
o batch shipments allow for tracking of the refiner's gasoline within the pipeline;
o shipments are received into the refiner's storage;
o these receipts might be commingled fungibly with conventional gasoline produced by another refiner;
o oxygenate is added at the rack into all of the fungible gasoline.
a) Can the refiner gain oxygen credits for anti-dumping compliance for a pro rata share of the oxygenate added to all gasoline, on the basis of the proportion of gasoline blended that was produced by the refiner?
b) Is the refiner's ability to gain oxygen credits impacted, in any way, by the configuration of the common-carrier pipeline (e.g. breakout tanks, batch versus open-stock system, etc.)?
c) Is the refiner's ability to gain oxygen credits impacted, in anyway by the configuration of the refiner's storage (e.g., dedicated versus community, etc.)?
d) Could the accounting be done on a monthly basis, or would the refiner have to track the ratio of gasoline produced by the refiner versus that produced by another refiner after each batch?
a) Yes, provided there is sufficient documentation to calculate the proportion of gasoline produced by the refiner, and, all other requirements of §80.101(d)(4)(ii) are met.
b) The configuration would have to be such that the refiner could, indeed, track the proportion of gasoline used in the oxygenate blend that was produced by the refiner.
c) Same as b).
d) The refiner would have to track the ratio of its gasoline to that produced by another refiner for each batch of oxygenate blend produced. (10/17/94)
This question and answer was posted at List of Reformulated Gasoline and Anti-Dumping Questions and Answers: July 1, 1994 through November 10, 1997 (pdf) (18.2 MB, July 2003, EPA420-R-03-009).