Policy Change Could Mean Headaches for Sunoco Marketers

Invoice corrections no longer automatic

Carole Donoghue, Petroleum Editor

PHILADELPHIA -- Sunoco’s merger with Energy Transfer Partners is now completed, but it’s not quite business as usual for the company’s fuel marketers, CSP Daily News has learned.

Sunoco has told its wholesalers that it will no longer correct errors on a jobber or carrier ship-to invoice when fuel is sent out-of-state. The move means marketers could be liable for hefty fines and penalties if a driver inadvertently enters the wrong destination code at the terminal, sources said.

“It’s a pain in the you-know-what,” said one Sunoco jobber who delivers several loads a day to dealers in a number of states. “We have a zillion ship-to numbers we have to deal with all the time.”

Until now, Sunoco automatically fixed the error if the wrong state’s name appears on a bill of lading, crediting or debiting the marketer’s account for any difference in state taxes due to the diversion.

“They used to charge us $250 every time it happened, but it was a nice service, nevertheless,” said the marketer, noting that other majors still make such corrections for marketers.

Delivery drivers have different PIN codes for invoices, depending on the state where the product is to be delivered, and it is easy for the wrong one to be entered when the driver is loading fuel, he said.

“Now it’s just another liability on our shoulders,” the marketer said. “We’ll have to apply to a state for refunds or make sure we pay them the extra tax under this new system.”

The policy change is effective immediately, said Jeff Byard, an official with Sunoco’s branded wholesaler department, in a message to marketers.

When a product diversion occurs, the carrier is required by law to register the diversion within 24 hours. “State laws are very strict regarding the reporting of diversions, which may result in significant tax, penalty and interest implications for Sunoco and its customers,” Byard said. “For example, Virginia’s motor fuel law imposes a $10,000 penalty per diversion not registered within 24 hours.”

Sunoco said that most states allow reporting of diversions through a website run by a company called FuelTrac (www.fueltrac.us).

Sunoco did not respond to an e-mail seeking comment for this story by deadline.