Australian Convenience Store News

Service station operators selling adulterated fuel in Sydney have been treated by the popular press as people in the same class as bag snatchers and child molesters - the public doesn't like them. Politicians whose departments are successful in prosecuting those running and profiting from fuel substitution rackets in NSW and other states are likely to see strong public support.

Initially, it would probably be the vehicle operator that would be identified, but if that operator were not aware that they had purchased adulterated fuel the EPA action would flow on to the fuel retailer. Once again, more big fines. If schonk operators are banking on government inaction, as they have in the past, then they should think again.

Engine Damage
Finally there is the question of engine damage to vehicles running on tax-dodging fuel cocktails. Most popular locally built vehicles seem to be fairly tolerant, providing toluene levels aren't too high for too long.

Ford stated that a Falcon run consistently on high toluene content fuel could suffer cylinder head damage which, being uncharacteristic in this engine, would lead service engineers to identify fuel adulteration as a problem.

Toyota mentioned damage to seals and non-metallic components in the fuel injection system, and in extreme cases possible breakdown of lubricating oils leading to major engine damage.
Modern diesel engines however, are proving far more sensitive to adulterated fuel. Injection systems in expensive 4WD power units have failed after a single tank filling of adulterated fuel and the manufacturer has passed the warranty claim on to the fuel provider. One case currently under scrutiny involves a cost of over $8000 to repair the fuel injection system of a two-litre turbo diesel engine.

Modern heavy vehicle power units can be just as sensitive and rebuilding the fuel injection system of a new Euro 3 compatible MAN power unit is going to cost a lot more than $8000, with possible claims for down time of the vehicle.

Eventually Australia will be forced to accept specific standards for both petrol and diesel fuel formulation and this will help regulatory authorities prosecuting those who sell adulterated product.
In the US, fuel retailers who sell anything other than the precisely defined product can find themselves in gaol. The implementation of similarly stringent sanctions against fuel cheats in Australia is bound to meet with strong public approval.

But possibly the ultimate sanction, particularly for the small family run servo in a quiet city suburban area or country town, would be the loss of customers and the collapse of the business. Short memory syndrome would assist the big turnover main road site with a large casual passing trade survive, but not the little guy who is possibly most tempted to resort to fuel adulteration to stay in the game.

One paragraph from the court reporter in the local paper could mean the end for a small site offender. In March of this year, the long running petrol substitution racket finally came under public scrutiny, and the howls of protest didn't die down until the government excise and rebate scheme appeared to remove the incentive for adding large quantities of toluene to automotive fuel.

Mark Kevin, Managing Director of Liberty Petroleum, was a prime mover in the campaign to expose the toluene scam. He is pleased that the Federal Government finally placed excise on this particular substance, but warns that there are still a few unscrupulous operators who like to mix their own fuel cocktails using other lower tax level substitutes in petrol and diesel fuel.

Rogue Operators
Though it had been common knowledge in the industry that large volumes of tax free toluene was being pumped into Australian motorists' fuel tanks, authorities did little to stop it. Until recently it was under Federal responsibility, specifically, Australian Customs and Excise, and it is they who should have been testing service station fuel stock. It would appear that Customs was too busy in other areas to offer much of a threat to rogue operators.

Now that the job of fuel supply inspection has been turned over to individual state fair trading and consumer protection agencies, things may well get tougher for those involved in fuel adulteration. There is now significant pressure on politicians to fix what consumers view as a total rip off. At a time when fuel prices have risen dramatically, the motoring public is only too aware that the high levels of tax they pay and resent, is in some cases going to line the pockets of racketeers, which they resent even more.

New South Wales, with the current labour administration, is more than happy to make political capital out of the coalition Federal Government's previous lack of action.

The Victorian Government Department of Fair Trading has decreed that the limit for toluene levels in petrol is 15%, and diesel must have a flashpoint above 61 degrees Celsius. Anything below that is defined as a Class 3 Flammable. Fines in Victoria for individuals prosecuted under the Fair Trading Act are $24,000 for an individual and $60,000 for a company.

No Standards
In Queensland, penalties at this time are limited to naming those outlets that sell petrol with more than 10% toluene content.

One of the difficulties in prosecuting those selling toluene as petrol has been the absence of an Australian Standard for 'petrol'. New South Wales Minister for Fair Trading, John Watkins, stated in parliament on April 4, that " because of the continuing possibility of adulteration occurring and the likelihood that the Federal Government will continue to shirk its duty, I have sought further advice to ascertain how we in NSW can take prosecution action against those who continue to flout the law. This follows my concerns that stronger enforcement action than naming be taken if the problem continues.

"I am pleased to advise the House that the Crown Solicitor has now provided legal advice to guide the Department's continuing investigations.

"The Crown Solicitor has advised that action can be taken under the Fair Trading Act against operators found to be supplying petrol with high levels of toluene."

Mr Watkins gave details of increased levels of random inspection and specific examples of service stations identified as sellers of adulterated petrol. From now on service station owners who sell adulterated fuel in NSW face a fine of up to $110,000, and once identified and convicted, could face further prosecution from the NSW Environmental Protection Agency (EPA), as adulterated fuel may produce emission levels that contravene clean air regulations.