Pipeline Shipments

Tariffs and shipper status

The tariff is the contract. It sets the rate per barrel between origin and destination, minimum batch size, product specifications, line fill obligations, loss allowance, credit terms and how capacity is shared when the line is full. FERC adjusts ceiling rates for most oil pipelines each year under an index, and carriers can also offer committed rates to shippers who sign long-term transportation agreements.

Batching, interfaces and transmix

Product pipelines move several grades one after another in the same line: gasoline grades, diesel and jet fuel. Where two batches meet, they mix into an interface. At the destination, the operator cuts the interface into the tank of the more tolerant grade or into transmix, a mixed stream that has to be reprocessed before it can be sold as a finished product.

Cut points matter to quality. Jet fuel is sensitive: a small amount of gasoline can pull its flash point off specification. Carriers sequence batches so that neighbors are similar, and jet is normally placed next to distillates rather than gasoline. We sample each batch at receipt and test it against specification before it is released to a customer.

Nominations and prorationing

Space is requested through nominations. Most lines take nominations monthly by a published deadline, with changes allowed up to a later cut-off. When nominations exceed capacity, the carrier prorates space under the tariff, often protecting regular shippers with shipping history while reserving a share for new shippers.

• Nomination: origin, destination, grade, volume and requested cycle
• Confirmation: the carrier's schedule, which may be prorated
• Supply and receipt: product ready to enter the line and ullage ready to receive it
• Tickets: meter tickets for each batch in and out
• Monthly balancing: volumes nominated against volumes shipped

Metered custody transfer

Pipeline custody transfer is usually by meter. Turbine, positive displacement, Coriolis or ultrasonic meters record each batch, and each meter is proved against a prover of known volume to establish its meter factor, under API MPMS Chapter 4. Volumes are corrected to 60°F and standard pressure using the API MPMS Chapter 11.1 tables.

At the terminal, we check every pipeline receipt against the shore tank gauge, opening and closing. A difference outside the agreed tolerance triggers a reconciliation before the receipt is credited to a customer's stock. That reconciliation sits behind every stock figure we report, including the quantities a verified buyer sees in the portal.