Thieves Target Used Oil Tanks


When crude oil prices are riding high – as has been their habit this year – many quick-lube operators have a built-in means of reducing the impact on their business. They sell their used oil and get better returns from the fuel oil market.

But the industrys biggest trade organization is warning operators that a problem accompanies that opportunity: The threat of thieves stealing that used oil. According to the Automotive Oil Change Association, the danger far surpasses the revenue that might be lost. Quick lubes that have their oil stolen can become liable for clean-up if it becomes part of an environmental hazard.

A lot of people dont even know this is an issue, said the associations policy advisor, Joanna Johnson. Weve found out its much bigger then we ever realized, and were trying to alert members so they can protect themselves.

Most of the used oil collected in the United States and Canada ends up being sold as industrial fuel oil. Dallas, Texas-based AOCA says the oil from its members is highly valued by that market because of the low risk of contamination and because it requires little or no processing.

Years ago, most quick lubes paid to have their used oil collected and disposed, regardless of crude prices. Today many can reverse the direction of payments, although their ability to do so dependson ever-changing crude prices, as well as geography.

That oil is a commodity with a value, and the value is higher when crude and products like virgin fuel oil are higher, Johnson said. A lot of centers are able to sell it, but it depends on the regulatory costs of disposal, which vary a lot from state to state. If youre in states like California, Washington or Florida, where the environmental controls are real strict, youll probably have to pay for collection.

Those who are able to sell their oil dont make a lot of money from it.

It ranges from a nickel per gallon up to about 20 cents, said K.C. Bruch, vice president of franchising for Valvoline Instant Oil Change. The company follows a standard practice of signing haulers to agreements that value the used oil according to an index of oil products. The quick lubes pay – or are paid – on a quarterly basis depending on the level of that index.

It really doesnt amount to much, but it does make an incremental contribution to the bottom line, Bruch said.

But then theres the threat of theft. AOCA says it has no statistics on the problem but that it seems to be biggest in the Northeast. Scotty Lee, who owns Oil Change Express in New Castle, Del., said hes never been victimized but knows others who have.

Weve got these midnight bandits who come out whenever crude is up the chart, he said. They know theyve got a chance to make some money, and they get pretty aggressive. Usually the oil is easy to get to, and they can make off with 900 gallons in 15 to 25 minutes.

Johnson said a growing number of oil thieves even operate during the day, posing as haulers contracted to collect.

Weve heard of more and more cases in recent years of these people driving up with a truck and someone in uniform, she said. Theyre pretty clever, and if the person they deal with doesnt know what to look for, its easy to be fooled.

Often the quick-lube operator doesnt even know theyve been robbed until the next time the legitimate hauler comes by and finds collection tanks a few hundred gallons light. Of course, this may amount to a loss of less than $100. The real problem, Johnson says, is that the stolen oil may end up as part of a spill that comes back to haunt the quick-lube operator.

The thing is that even people who steal used oil have to file paperwork when they sell it, she said. There are several steps between the collection of the oil and the point where its used as fuel, and theres tankage at every stop along the way. We know that most of the spills that require remediation have to do with storage, and its possible for oil thats been stolen to be traced back to the operator. If that happens, you have a big problem.

The association is trying to learn more about the problem and to advise members about protection measures. Johnson said the most effective steps are to teach employees how to identify legitimate haulers and to install some type of lock on storage tanks.

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