Hi all!
Here is an expanded answer from my sister at Amoco. I think it's more
than I wanted to know! ;)
Keep Triumphing,
Susan Hensley :)
Subject: Another one!
Author: susan (susan@bearcom.com) at unix,mime
Date: 1/28/99 2:01 PM
Hi!
Here's something you might want to answer, if you have time (from the
Spitfire list)...
"Riddle me this!
Is it true that Amoco buys it's gasoline from Chevron, and then adds
more Techron? My buddy at Chevron, down near Pascagoula, Ms., told me
that one.
My two favorite brands - Amoco, and Chevron, in that order!
Chip"
Susan :)
Yes and no re this being true. Amoco, and all other sellers, buy
fungible regular. Fungible means interchangable. This is the
largest
general gasoline type, because it 1)decreases transportation costs
for
the sellers, and 2) allows everyone to blend away some junk,
because
if everybody buys from anybody, and price is the only
differentiation,
then there is no incentive for "extra" quality...so, if anything
above
the very minimum quality means lost value, so everyone runs to the
very minimum.
Amoco does buy fungible regular for Mississippi through Florida
(although we also ship some Amoco regular from our Texas City
refinery
via barge to Florida, for net logistics cost savings for
transporting
the Ultimate to these markets -- it's cheaper per pound if the
barge
is full, but you can put only so much Ultimate into storage tanks
at
each terminal). Quite a number of companies in the Pascagoula
region
probably buy fungible grades from Chevron.
Amoco RARELY buys Ultimate, because we have specifications on it
that
very few refiners can meet (we do an extra processing step that
removes a particular heavy component that can otherwise lead to
increased engine deposits (both intake valve and combustion
chamber)
and gum. If you buy quality gasoline, you'd only see the
difference
after 30k - 40k miles or more...also, a good additives package can
provide 90% of the same effect. I'm not sure if Chevron is one of
the
few that can make Ultimate, but I don't think so (I know there is a
refinery that can make it on the East coast, but we pay a heck of a
lot of $$ to transportation companies to get Ultimate spread along
the
gulf coast from Texas City).
Mid-grade can be shipped as mid-grade, or blended as premium plus
regular at the terminal (could be fungible premium, which is
cheaper
than Amoco Ultimate, and would have to come from anywhere except
for
an Amoco refinery, since we don't make this, so mid-grade could be
from Chevron).
The additives are always added at the terminal. Amoco, Chevron,
and
Exon have been the 3 "top tier" additive package users, in the last
couple years, with Texaco as a close follower (actually Texaco has
great additive components, but dose below ideal rates, which is why
they are a little behind "top tier" in quality, from what I hear).
Amoco buys a PEA-based additive package from Oronite (a subsidiary
of
Chevron). Oronite may be making a lower quality additive for
Chevron
gasoline now (based on a product that I make, polybutene, and that
a
lot of folks in my work area would like for Amoco to switch to
using
since it would boost our sales -- but while it would cut their
costs,
it isn't anywhere near as good, and would require reformulation of
the
entire additive package). Mobil used to be "top tier" but has
elected
to go for a cheaper additive, about a year or 2 ago. For
fungibles,
the additive packages and treat rates are the only standard
differences between different sellers' gasolines.
I believe "Techron" is the trade name for the additive package that
Chevron uses, not Amoco. I get more involved in components than in
trade names (although I should probably know all those as well, but
I
don't, I've only been the Manager of the Additives Market for Amoco
Chemicals for a couple months!). Amoco and Chevron use some of the
same components, but have slightly different additive packages, so
could not use the same trade name, so it's not quite true that
Amoco
"just adds more Techron".
BP (like most of the other oil companies) buys only all fungible
grades (and uses a cheaper additive package), and the current
estimate
is that there will be enough data generated and analysed by late
fall
of 1999 to be able to compare the short term $$ savings to the
longer
term costs of not maintaining our high quality position, and to
decide
whether to stick with Amoco's quality approach (and upgrade all BP
stations) or to go for the $$ and downgrade Amoco quality. The
inital
guess is we'll stay with quality, but that's very, very foggy at
the
moment. If not, we'll probably start buying more from not only
Chevron, but from overseas, Clark, Tosco, etc, like most of the
other
sellers do.
|