A Busi­ness Guardian Spe­cial Re­port

Dar­ren Ba­haw

dar­ren.ba­haw@guardian.co.tt

Diesel fu­el pow­ers the bulk of this coun­try’s com­mer­cial trans­porta­tion in­dus­try, both on land and at sea, but the high sul­phur con­tent is said to be de­stroy­ing the en­gines of mod­ern ve­hi­cles.

A Busi­ness Guardian in­ves­ti­ga­tion has linked the high sul­phur con­tent in the fu­el to the cat­a­stroph­ic fail­ure of en­gines and high main­te­nance costs. This as the T&T Bu­reau of Stan­dards (TTBS) re­ports that it is de­vel­op­ing new stan­dards for diesel and gaso­line fu­els.

One ma­jor lo­cal car deal­er ad­mit­ted his com­pa­ny had been hit with mul­ti-mil­lion dol­lar los­es as it had to change hun­dreds of en­gines, fu­el pumps, in­jec­tors and tur­bocharg­ers all de­stroyed by low-qual­i­ty diesel fu­el.

The domi­no ef­fect left new ve­hi­cle deal­er­ships over­whelmed as cus­tomers with diesel ve­hi­cles crowd­ed their ser­vice bays push­ing out oth­er cus­tomers.

Some cus­tomers had to fork out con­sid­er­able sums to re­pair their ve­hi­cles while oth­ers were cov­ered by the man­u­fac­tur­er’s war­ran­ty.

Many peo­ple chose to pur­chase diesel fu­el-pow­ered ve­hi­cles be­cause it is cheap­er fu­el and cov­ers more mileage than gaso­line.

Now, the re­sale val­ue of their in­vest­ments have de­clined dras­ti­cal­ly and some deal­er­ships are even re­fus­ing to ac­cept those ve­hi­cles as part of trade-ins for oth­er ve­hi­cles.

Own­ers of high-end lux­u­ry ve­hi­cles are among those af­fect­ed.

One new car deal­er, who spoke on the con­di­tion of anonymi­ty, said his com­pa­ny had to bring in for­eign ex­perts to as­sist and point­ed to a pile of dis­card­ed en­gines in the garage

Guardian Me­dia reached out to the ma­jor new car deal­ers seek­ing com­ment and they chose to re­spond through the Au­to­mo­tive Deal­ers As­so­ci­a­tion of T&T.

Pres­i­dent of the as­so­ci­a­tion Jerome Bor­de in a state­ment con­firmed that the high sul­phur con­tent in diesel fu­el was dam­ag­ing the en­gines of ve­hi­cles.

(See box)

Apart from ir­repara­ble dam­age to ve­hi­cle en­gines, the rep­u­ta­tion of pre­mi­um ve­hi­cle brands are al­so be­ing com­pro­mised.

Me­chan­ics from sev­er­al lead­ing au­to­mo­bile deal­er­ships, who spoke off the record, as they were not au­tho­rised to speak on be­half of their com­pa­nies, ad­mit the sul­phur in the fu­el grad­u­al­ly eats away at the en­gine’s com­po­nents.

The so­lu­tion, me­chan­ics say, is to use ul­tra-low sul­phur diesel (ULSD) which would like­ly cost sig­nif­i­cant­ly high­er than pre­mi­um gaso­line—which now fetch­es $5.75 a litre at the pump.

Al­ter­na­tive­ly, fu­el im­porters can in­crease the vol­ume of bio-fu­el mixed with high sul­phur diesel, which would low­er the sul­phur con­tent and al­so pro­duce clean­er emis­sions.

An­oth­er me­chan­ic de­scribed the ef­fects of lo­cal diesel on mod­ern en­gines as “breath­ing in sand.”

An al­most $3 bil­lion ULSD plant that was be­ing con­struct­ed by the now-de­funct Petrotrin to pro­duce ULSD re­mains in­op­er­a­ble be­cause of struc­tur­al de­fects and even if the re­fin­ery re­opens will need sig­nif­i­cant in­vest­ments to bring it up to scratch.

The new op­er­a­tors of the re­fin­ery, Pa­tri­ot­ic En­er­gies and Tech­nolo­gies Com­pa­ny Ltd—a com­pa­ny whol­ly-owned by the Oil­fields Work­ers’ Trade Union— would have to kick-start the plant to pro­duce and sell diesel and oth­er fu­els on in­ter­na­tion­al and re­gion­al mar­kets.

In re­sponse to ques­tions from Guardian Me­dia, Paria Fu­el Trad­ing Com­pa­ny, the coun­try’s au­tho­rised fu­el im­porter, said the fu­els it im­ports, in­clud­ing diesel, are in keep­ing with the TTBS spec­i­fi­ca­tion for mo­tor ve­hi­cles.

But car man­u­fac­tur­ers have long rec­om­mend­ed ul­tra-low sul­phur diesel fu­el for mod­ern en­gines.

Ve­hi­cle own­ers who spoke to Guardian Me­dia ques­tioned why they were nev­er told the lo­cal diesel sup­ply was not com­pat­i­ble with their ve­hi­cles and whether the com­pa­nies kept it a se­cret.

One such own­er, Dr Rollin Bertrand, who pur­chased a high-end ve­hi­cle from the lo­cal deal­er­ship South­ern Sales re­count­ed his ex­pe­ri­ence af­ter his en­gine failed.

The for­mer Trinidad Ce­ment Ltd CEO said his me­chan­ic told him there was a “mis­match be­tween the fu­el and the en­gine” of his ve­hi­cle.

He said he be­gan to ex­pe­ri­ence prob­lems start­ing his ve­hi­cle and a di­ag­no­sis re­vealed the com­pres­sion of the en­gine had “fall­en away” be­cause of the ef­fects of the high sul­phur con­tent of the fu­el.

Bertrand said he even­tu­al­ly had to make con­tact with the ve­hi­cle’s for­eign man­u­fac­tur­er af­ter ne­go­ti­at­ing with the lo­cal deal­er­ship and was able to get a “sig­nif­i­cant dis­count” on a com­plete­ly new en­gine which could han­dle the high sul­phur con­tent.

Bertrand sur­mised that the lo­cal car deal­ers be­gan im­port­ing ve­hi­cles which re­quired low sul­phur diesel as the new Ul­tra Low Diesel Plant was about to be com­mis­sioned by Petrotrin in 2009.

“It is a re­al scan­dal. These ve­hi­cles are shut­ting down all over the place. I had to re­sort to spray­ing Bay­gon in­to the in­take of the en­gine for it to start.

“Imag­ine a mil­lion-dol­lar ve­hi­cle start­ing like an old truck,” he said.

Bertrand said he was told by the lo­cal deal­er­ship that be­fore the diesel ve­hi­cles were sold on the lo­cal mar­ket, agents for the for­eign com­pa­ny took a lo­cal sam­ple of the fu­el for test­ing and ap­proved it.

Ri­ad Ali, a man­ag­er at Lifestyle Mo­tors, ad­mit­ted that the lo­cal diesel had af­fect­ed the per­for­mance of some of the ve­hi­cles.

He sug­gest­ed short­er pe­ri­ods for ser­vic­ing as a counter-mea­sure.

An­oth­er ex­ec­u­tive at a Port-of-Spain-based car deal­er­ship sug­gest­ed that Paria im­port ul­tra-low diesel fu­el and give cus­tomers the choice, just as in Pre­mi­um and Su­per gaso­line.

He too said the lo­cal diesel fu­el had been test­ed be­fore a de­ci­sion was tak­en to im­port the high-end ve­hi­cles but claimed that it de­grad­ed over time.

Paria Fu­el says it has re­ceived re­quests to bring in ul­tra-low sul­phur diesel fu­el from cus­tomers who own lux­u­ry Eu­ro­pean ve­hi­cles but de­clined be­cause the de­mand was too low.

The com­pa­ny said it was aware that Clax­ton Bay com­pa­ny, AM Mar­ket­ing, was im­port­ing ul­tra-low sul­phur diesel and re­tail­ing it at $2,812 a bar­rel (200 litres). That works out to $14 a litre com­pared to $3.41 a litre for diesel sold at the pump.

AM Mar­ket­ing did not re­spond to a re­quest for an in­ter­view but Guardian Me­dia con­firmed their sale of ul­tra-low sul­phur diesel fu­el.

Paria Fu­el says it in­tends to im­port ul­tra-low sul­phur diesel dur­ing the sec­ond half of 2020 and the trad­ing price will be de­ter­mined by the mar­ket price at that time.

Be­fore No­vem­ber 2018, State-owned Petrotrin pro­duced all fu­el for the lo­cal mar­ket.

In the last few months be­fore its clo­sure, the diesel fu­el it pro­duced fell way be­low the ac­cept­able lim­its of sul­phur set by the TTBS.

Con­fi­den­tial da­ta for that pe­ri­od from Na­tion­al Pe­tro­le­um showed the sul­phur con­tent in­creased by al­most 200 per cent.

Da­ta seen by Guardian Me­dia showed the sul­phur con­tent in diesel fu­el sky-rock­et­ing to over 2,800 parts per mil­lion (ppm) in some in­stances.

Since Paria Fu­el came on stream there has been an im­prove­ment in the qual­i­ty of diesel fu­el im­port­ed. Da­ta from Na­tion­al Pe­tro­le­um show the im­port­ed diesel fu­el has close to 900 ppm.

The TTBS says the com­pul­so­ry stan­dard for diesel fu­el is 1,000 ppm. The stan­dard for gaso­line is 500 ppm.

Lo­cal car deal­ers told Guardian Me­dia that the rec­om­mend­ed diesel sul­phur con­tent for mod­ern ve­hi­cles was be­tween 10 to 500 ppm.

The TTBS says its cur­rent stan­dard is­sued in 2011 was “now out­dat­ed” and the or­gan­i­sa­tion “ini­ti­at­ed the re­vi­sion process in June 2019 to align the chem­i­cal re­quire­ments for diesel fu­el to in­ter­na­tion­al re­quire­ments aimed at:-

1) en­sur­ing ac­cept­able prod­uct qual­i­ty and

2) pro­tect­ing the en­vi­ron­ment in ac­cor­dance with TTBS’ le­gal man­date (Chap­ter 82:03)”

The TTBS stat­ed that as part of its en­force­ment regime for this com­pul­so­ry stan­dard, it would have con­duct­ed analy­ses of Cer­tifi­cates of Qual­i­ty (CoQ) pro­duced by the now-de­funct Petrotrin and for diesel im­port­ed by Paria Fu­el.

“From the analy­ses of the Co­Qs, it is ev­i­dent that there has been an im­prove­ment in the qual­i­ty of diesel im­port­ed in­to the coun­try. Some ar­eas of im­prove­ment in­clude re­duced sul­phur con­tent and to­tal aro­mat­ic hy­dro­car­bons,” the or­gan­i­sa­tion said.

“In ad­di­tion, we are cur­rent­ly de­vel­op­ing a more rig­or­ous en­force­ment pro­ce­dure which will in­clude test­ing by in­de­pen­dent test lab­o­ra­to­ries to en­sure that all fu­el (whether im­port­ed or lo­cal­ly man­u­fac­tured) con­form to the re­quire­ments of the rel­e­vant na­tion­al com­pul­so­ry stan­dard.”

Asked specif­i­cal­ly whether there have been any com­plaints from lo­cal car deal­er­ships re­gard­ing the qual­i­ty of diesel fu­el used by high-end ve­hi­cles such as Porsche, Au­di, Volk­swa­gen BMW, Mer­cedes Benz, Land Rover, the TTBS said it has re­ceived re­quests from key stake­hold­ers in the lo­cal car in­dus­try to re­vise the na­tion­al fu­el stan­dards, as re­cent as De­cem­ber 2018.

“TTBS has made a de­ci­sion to pro­ceed with this re­quest to com­mence the re­vi­sion of the na­tion­al com­pul­so­ry stan­dard for diesel, as well as gaso­line, in col­lab­o­ra­tion with oth­er key stake­hold­ers with reg­u­la­to­ry over­sight for the en­er­gy sec­tor. The re­vi­sion process for the diesel and gaso­line stan­dards of­fi­cial­ly com­menced in June 2019.”

But me­chan­ics say the shift to more suit­able diesel fu­el needs to be done much soon­er to pre­vent fur­ther degra­da­tion of en­gines.

Many of the ve­hi­cles man­u­fac­tured in Eu­rope, UK and now Japan must meet in­ter­na­tion­al stan­dards re­gard­ing low emis­sions to pro­tect the en­vi­ron­ment and man­u­fac­tur­ers rec­om­mend fu­el with low sul­phur con­tent.

Asked whether there has been any re­quest to im­prove the stan­dards of diesel fu­el to meet the re­quire­ments of Eu­ro-spec fu­el in keep­ing with the man­u­fac­tur­ers’ rec­om­men­da­tion for the type of fu­el to be used in high-end lux­u­ry ve­hi­cles, the Ma­coya-based reg­u­la­to­ry body said it will use in­ter­na­tion­al bench­marks to in­form the re­vi­sion of the na­tion­al stan­dard for diesel fu­el.

“We have looked at the Eu­ro-6 spec­i­fi­ca­tion which is 10 ppm for sul­phur and ASTM (Amer­i­can So­ci­ety for Test­ing and Ma­te­ri­als) In­ter­na­tion­al Stan­dard which spec­i­fies 500 ppm for Low Sul­phur Diesel and 15 ppm for Ul­tra-Low Sul­phur Diesel.

“The stan­dard­i­s­a­tion process re­quires con­sul­ta­tion with in­dus­try stake­hold­ers to en­sure feed­back is re­ceived on all pro­posed com­pul­so­ry re­quire­ments,” the TTBS said.

State­ment for Au­to­mo­tive Deal­ers As­so­ci­a­tion of Trinidad and To­ba­go

“ADATT has for many years raised con­cerns with the high sul­phur con­tent in the diesel sup­plied to the lo­cal mar­ket.

All the lo­cal agen­cies in the sup­ply chain are aware of the po­ten­tial dam­age high sul­phur can cause to the en­gines run­ning on diesel.

In most cas­es the con­tent is twice the max­i­mum tol­er­ance lev­el.

The re­sult has been an enor­mous cost to deal­ers who out of good­will have un­der­tak­en to re­pair at no cost to the con­sumer.

We look for­ward to the day our sup­ply meets the ul­tra low sul­phur re­quire­ments of most mar­kets.”