Colonial Pipeline announced a system origin specification
of maximum 8 parts per million for shipment of ultra low sulfur diesel. This
announcement followed the approval by Colonial's Board of Directors of extensive
pipeline and system modifications necessary to limit the increases in sulfur
content during pipeline transportation of the product. Colonial will begin
transporting ULSD in June 2006.
Ultra low sulfur diesel was mandated by the U.S.
Environmental Protection Agency for use in on-road diesel engines (light and
heavy duty) beginning with the model year 2007. This requirement is a part of
the ongoing effort to reduce pollution and improve the air quality across the
country. The EPA has established a 15 ppm limit, with a testing tolerance of 2
ppm, for ultra-low sulfur diesel at the retail market.
Pipelines such as Colonial, which are large, fungible
systems and also carry such high-sulfur products as home heating oil and jet
fuel, face significant challenges in ULSD delivery.
"Reaching this decision for the 8 ppm origin
specification into Colonial has required the cooperation and collaboration of
refiners, our customers, marketers and distributors of diesel fuels and
government regulators," said David Lemmon, President and Chief Executive Officer
of Colonial Pipeline. "We respect and support President Bush's commitment to
clean air and clear skies. Colonial's ability to deliver this cleaner-burning
diesel fuel will contribute significantly to achieving the President's goal. We
will meet this EPA regulation and continue to meet our own Colonial standards
for delivery of fuels that meet the quality and sulfur content specifications
for all products that we deliver," Lemmon said. "We will also meet our
responsibility to transport the products that consumers along the Colonial
system rely on for much of their energy needs."
Actual shipments of ULSD are not expected to begin until
June 2006. Initially, Colonial plans to deliver ULSD to markets as far north as
As initial system modifications are tested and verified
as successful, Colonial will expand ULSD delivery into additional Virginia
markets, including Richmond, by December of 2006. As demand for ULSD grows and
as Colonial gains experience in delivering the fuel, Colonial will expand
service to the Northeast. Modifications planned to Colonial's system include the
construction of new tanks to store ULSD, changes in pipeline manifold systems to
aid in the handling of ULSD between pipeline and storage tanks, the replacement
of valves and upgrading of other pipeline equipment, and changes in procedures
for handling product.
"Thanks to the combined efforts of our industry, our
regulators and our customers, we are confident these system modifications will
allow us to deliver ULSD," Lemmon said. "Colonial is committed to quality and to
delivering on our customers' needs." Several decisions are pending on the ULSD
issue, including establishment of a product code. Colonial anticipates these
decisions to be announced during the coming months.
Colonial and other pipeline common carriers have determined
that the additives used to increase the lubricity in fuels are considered
contaminants in Jet fuels. As a result they have decided not to allow these
additives to be used in fuels that will travel through their pipelines.
This means that the lubricity additives will need to be
added at the terminating point or delivery rack.
There is further concern because the levels of additization
required to meet the American Society for Testing of Materials (ASTM)
requirement of High Frequency Reciprocating Rig (HFRR) 520 is significantly less
than the Engine Manufacturers Association (EMA) and European Union (EU)
specification of HFRR 460.
It is commonly agreed by engine and component manufacturers
that this reduced level of lubricity will result in accelerated fuel system
component wear and possible premature failure of fuel lubricated parts.
It is strongly suggested that customers using Ultra-Low
Sulfur Diesel fuels supplement these fuels with additives containing additional
lubricity such as Complete Fuel Treatment or EnerFuel with Lubricity.
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