EARLY MORNING AND OIL’S WELL

We’re in West Lothian to learn more about hidden link in the oil supply chain with Andrew Salton

CERTAS_FRONT — Certas Energy Headquarters

We are in the hilly outskirts of Edinburgh on what is turning out to be a beautiful spring morning. However, we haven’t come here to admire the scenery. Instead, we’ve come to take a look at a depot belonging to Certas Energy that distributes oil-based products to trade customers.

In case you are not familiar with the name, Certas started in 2001 when DCC acquired a company called Scottish Oils from BP. The firm then acquired the Shell Direct business and Emo Oils as well as many brands for the fuel side of the business. The fuel part of the business boasts 140 ‘wet’ depots, while the mainland lubes division operates from six sites around the UK. However, it is the firm’s most recent branch, opened around 18 months ago, that we are here to see today.

Andrew Salton, General Manager for the North explains that the pre-packs and lubes side of the business has enjoyed a period of growth: “In 2007 when I joined, people were doing 300,000 litres of lube, packed fuel and adBlue per year” he said. “Now we’ve topped 8.5m litres of the same product range, so there has been significant growth, not only through a lot of acquisition, but also through organic growth”.

As most readers will be aware, the lubricant market has become far more complex in recent years with the number of oil types and VM approval codes greatly increasing. Salton made the following observation: “I noticed in CAT a few months ago that someone had written in to ask why lubricants haven’t come down in price in line with oil prices. The simple answer to that is that lubricants today are complex synthetic chemicals and not mineral based. If you tried putting a mineral-based oil in a Euro-VI engine you wouldn’t
get more than 4,000 miles before it starts to deteriorate,
it just can’t deal with the temperature regime”.

TANK FARM
Inside, the large depot is what you might expect: bulk quantities of oil are neatly racked in 1,000-litre pallet tanks known as ‘IBC’s while other shelves are full of barrels of grease and pre- packed fuel. On our visit, the team were in the process of upgrading from a basic barcode- scan stock control system to a more elaborate QR code system which when operational will include useful extra points of reference. Other isles contain smaller quantities of pre-packed items, but central to the whole operation is a ‘tank farm’ designed to quickly and cleanly take bulk quantities of product directly from tanker lorries.

It is an installation of which Salton is clearly proud. “The tank farm has been especially made for our purpose” he explained. “Really, it is not a tank farm but a specialised decanting tool. The trucks come down with 30,000 litre loads, we decant it and measure it into 1,00 litre lots using a special measuring system into IBCs and then we go out and deliver 1000 litres at a time. It’s a good system and it works really well. It cuts down lead-time and customers get what they want”. The company deals with many top-name oil companies, including Castrol, Shell, Valvoline, Total and Gulf Oil.

SERVICE LEVELS
We can’t deny the efficiency of the operation, but we can’t help wondering why trade customers don’t simply buy directly from the oil companies. However, Salton has a simple explanation. “The UK is a mature marketplace. The oil companies understand that they are good at dealing with the VMs, and they make sure that they are developing the right oils for the engines, not just for today but for five or ten years down the line. Where our expertise at Certas comes in, is listening to and dealing with customers. We give [oil companies] an on-the-ground, fast response for the products that the customers need there and then”.

The extra legwork includes understand remote customers, such as those on Scottish islands, stock profiles so the products they need are in stock at the local depot before they have even been ordered. “We’ve won DOFE awards from Shell and Valvoline due to the great effort from all of the branches to make sure the deliveries go on time” said Salton.