Policy_Number_DESC-P-2.pdf

DEFENSE LOGISTICS AGENCY

DEFENSE ENERGY SUPPORT CENTER

8725 John J. Kingman Rd. Suite 4950 Fort Belvoir, Virginia 22060-6222

Policy Number: DESC-P-2 April 27, 2010

Receipt and Shipment of Petroleum Products

1. SCOPE and APPLICABIITY: The Defense Energy Support Center (DESC) is the DOD Integrated Material Manager (IMM) and DOD Executive Agent (EA) for Defense Working Capital Fund (DWCF) owned Class III Bulk Petroleum products. This interim policy provides general guidance related to shipments and receipts of DWCF fuel and bulk fuel additives received into storage at the DESC Defense Fuel Support Point (DFSP). The guidance herein is applicable to DWCF fuel inventories as well as fuel and additive products purchased from bulk contracts, Posts, Camps and Stations (PC&S), and Bunkers contracts to the extent that it does not conflict with contract terms. This policy has been coordinated with and approved by the Service Control Points (SCP) and is issued pending approval and publication of DOD 4140.25-M, Part 2, Chapter 5. Responsible Officers (RO), Terminal Managers (TM) and Property Administrators (PA) are responsible for implementing and ensuring full compliance with this policy.

NOTE to AF DFSP: The DFSP shall route information to the Air Force SCP, the Air Force Petroleum Office (AFPET) through the applicable Air Force Major Command.

1. 1. Supersession: This administrative change supersedes DESC-P-2, dated June 16, 2009.

Paragraph 5.1.1.1., is added to authorize the use of the DESC-Form 702 Petroleum Daily Receipt Summary, to document individual receipts, fuel loaded for shipment, or bulk sales by tank truck. However, receipts, shipments and sales by tank truck may not be recorded on the same form. A bold line in the right margin marks changed information.

2. GENERAL POLICY:

2.1. Accounting transactions relative to shipments and receipts shall be documented and processed in accordance with this guidance and applicable Business Systems Modernization- Energy (BSM-E) application documentation or DESC Interim Policy and Procedural Instructions.

2.2. Document Retention: Signed copies of all shipment and receipt documentation for DWCF managed fuel inventories shall be maintained in the DFSP Daily Document Control File as required by DESC-P-3 “Document and Data Control and Retention Policy”. DESC-P-3 can be located at the following DESC Web Page: http://www.desc.dla.mil/DCM/Files/DESC-P-3.pdf .

Contracted DFSPs are required to maintain documents and data in compliance with DESC Clause I 119.04 Inventory Control Records and Systems of Record and DESC-P-3. Completed documentation for shipments between DFSPs shall be retained by both the shipping and receiving DFSPs in the Daily Document Control File.

DESC-P-2

April 27, 2010

Table 1, Shipment and Receipt Documentation

Transaction Types Forms Used

DWCF Fuel Shipments and Receipts

DD Form 1348-7 (Truck, Tank Wagon, Truck with Trailer, Rail Car, and Pipeline modes)

DWCF Fuel Shipments and Receipts DD Form 250 (Optional use for Tank Truck, Tank Wagon, Truck with Trailer, Rail Car, and Pipeline)

DWCF Fuel Shipments and Receipts DD Form 250-1 (Ocean Barge and Tanker modes)

DWCF Fuel Shipments and Receipts

Meter ticket / Bill-of-Lading (When used for shipments or receipt)

DWCF Fuel Contract Receipts

DD Form 250 (Overland Modes) DD Form 250-1 (Barge and Tanker Modes) Meter ticket / Bill-of-Lading (When used for shipments or receipt)

Contracted Storage Operations (COCO and GOCO DFSPs

All Receipt and Shipment Documents

2.3. Waivers to Policy: Waivers to this policy shall be requested in writing to DESC-T through the applicable SCP, or appropriate DESC Region for DESC intermediate terminal and commercial pipeline operations. Waiver requests shall be addressed to DESC-T. In-turn DESC- T will coordinate approval of waivers with applicable DESC Commodity Business Units (CBU) and/or DESC Regions, and Defense Logistics Agency (DLA)/DESC Offices. Waivers are not required for deviations to specific policy or procedures prescribed herein when an approved DESC Interim Policy or Procedure is published to address the deviation for a specified site or group of sites with common unique circumstances that would justify the deviation. For example, DESC-I-29 provides specific procedures regarding sealing of tank trucks in convoy under armed guard and receipt documentation requirements applicable to DFSPs within Iraq and Kuwait.

2.3.1. NATO and/or Foreign Government managed DFSPs shall report and document transactions in accordance with the specified terms and conditions of the applicable NATO or DESC Agreement.

2.3.2. Occasionally, foreign governments provide “Free Fuel” or Assistance in Kind (AIK) fuel to the DOD. The terms and conditions regarding the receipt of this free fuel is situation specific and will be addressed via DESC Interim Guidance.

2.4. Acronyms and Definitions: Acronyms and abbreviations relative to this interim policy are available on line at http://www.desc.dla.mil/DCM/Files/ACRYMC.pdf. Definitions of terms used in this interim policy are also available on line at http://www.desc.dla.mil/DCM/Files/Definition.pdf.

2.5. Processing Applications: The Business Systems Modernization – Energy (BSM-E), formerly referred to as the Fuels Automated System (FAS), is the overarching system of processing applications used to record and process fuel accounting transactions to include fuel shipments and receipts. BSM-E subsystems include; the Defense Fuels Automated Management System (DFAMS), the DESC legacy system of record, Oil Enterprise Downstream (OED), the new DESC system of record, the Fuels Enterprise Server (FES), Base Level Support Application (BLSA), and Paperless Ordering and Receiving Transaction System (PORTS), etc.

2.6. On-Board Quantity (OBQ) and Remaining on Board (ROB): Identify and measure any on-board quantity (OBQ) at time of loading of a conveyance, or remaining-on-board (ROB) product at termination of receipt of a delivery. The OBQ and/or ROB shall be annotated on the appropriate shipment or receipt document accompanying the delivery. Immediately advise the applicable DESC Region and DESC-B transportation officer if delivery is by ocean tanker, if OBQ/ROB quantities are found on the conveyance. The DESC Region (DESC-B for ocean tanker deliveries) shall advise DFSPs of appropriate additional actions to be taken when QOB/ROB quantities are reported. The transporter shall account for Government owned stocks that are not off-loaded at the intended destination. The DESC Region and/or DESC-B will advise the reporting activity of appropriate actions to be taken.

3. GENERAL MEASUREMENT STANDARDS, QUANTITY DETERMINATION AND

VOLUME CORRECTION PROCEDURES

3.1. Measurement Standards: Refer to the approved American Petroleum Institute (API) measurement standards and applicable Manual of Petroleum Measurement Standards (MPMS) chapters for volume correction procedures. API Volume Correction tables are available for download at the following DESC Web Page:

https://www.desc.dla.mil/DCM/Restricted/DCMRestrictedPage.asp?ReDirect=NO&PageID=773 . Operators at Military Service managed DFSPs shall utilize the API tables referenced above and volume correct product in accordance with Military Service specific guidance. Approved quantity determination procedures for specific modes of transport are contained in sections 4 and 5 below.

3.1.1. Receipt of product from procurement contracts/vendors: The petroleum industry standard for quantity determination is for quantities to be volume corrected to a standard temperature of 60° F or 15/20° C if measured in liters. For the purpose of this policy the term “Net” implies quantities have been converted to 60° F or 15/20° C. For the purpose of this policy the term “Gross” indicates the quantities have not been converted to a standard temperature of 60° F or 15/20° C.

3.1.2. Shipments: DESC defines a shipment as the transfer of product from one DFSP to another or the transfer of product from one Responsible Officer (RO), Terminal Manager (TM), or Property Administrator (PA) responsibility to another RO, TM, or PA responsibility.

Shipments between DFSPs and the subsequent receipt of shipments in quantities equal to or greater than 5,000 gallons (19,000 liters) shall be volume corrected to a standard temperature of 60° F (15/20° C if measured in liters).

3.2. General guidelines for quantity determination for fuel shipments and receipts are as follows:

3.2.1. Weigh Scales: When a weigh scale is used for quantity determination, the shipping conveyance shall be weighed before and after loading for shipments, as well as before and after unloading for receipts. Before and after weights shall be determined under the same conditions, e.g. the driver should remain in the vehicle for both the before and after weighing, etc.

3.2.2. Meters used to Determine Receipt or Shipment Quantities: When using a temperature compensating meter, the meter must be calibrated and the density shall be set on the meter before the meter is used.

3.2.3. Conveyance Gauge: Conveyance gauge reading shall only be used for quantity determination when certified strapping/gauge charts are available for each individual delivery conveyance.

3.2.4. Issue or Receipt Tank Gauge: Issue or receipt tank gauge readings shall only be used when strapping/gauge charts have been certified according to MPMS standards. Automatic Tank Gauge (ATG) readings may be used in lieu of manual gauge readings only if the ATG is fully operational and ATG systems have been calibrated as discussed below. If this quantity determination method is employed, upon request, DFSPs must provide copies of the certified strapping charts and the ATG calibration certificate. Additionally, DFSPs must be able to demonstrate that the entire certified strapping chart has been loaded into the Fuels Manager or applicable ATG Data Base.

3.2.4.1. Certified strapping charts are capacity charts prepared by an independent agent, engineer, or surveyor for each container (tank) in which DWCF product is being measured or stored. Each tank storing DWCF owned fuel shall be equipped with a certified strapping chart and will, at a minimum, be graduated in feet, inch, and 1/8th inch (meters/millimeters are acceptable for overseas locations) increments with the associated quantities represented in whole U.S. Gallons. DFSPs are reminded that manufactures strapping charts for factory prefabricated storage tanks are not certified strapping charts since they do not take into consideration the actual on-site installation of the storage tank (pitch and roll). DFSPs with prefabricated storage tanks shall request and obtain certified strapping charts prior to placing new tanks into service. Storage tanks must be re-strapped if they have undergone major repairs, modifications; if the product stored in floating roof tanks has been changed (to address roof displacement factors), if the tank has been damaged by lightning, winds, earthquakes, etc, or if the current strapping charts are identified as or suspected of being inaccurate.

3.2.4.2. ATG Maintenance and Calibration: The DES/DESC-WI Engineering Office is responsible for managing the ATG calibration and maintenance program. ATG systems used for inventory purposes shall be maintained and calibrated on an annual basis according to API Manual of Petroleum Measurement Standards (MSPS), Chapter 3. DESC-WI will fund for maintenance and calibration of ATG systems installed on tanks storing DWCF owned fuel.

3.2.4.3. ROs and/or GOCO TMs must submit calibration request(s) through the BSM-E Help Desk for maintenance and calibration of any ATG systems not covered under the provisions of an existing maintenance contract. ROs/GOCO TMs are reminded to satisfy service specific coordination requirements e.g. notification to parent Major Commands (MAJCOMs/MACOMs) or SCPs prior to submission of requests to the Business Systems Modernization- Energy (BSM- E) Help Desk.

3.2.4.3.1. Requests for maintenance and/or calibration of ATG systems shall be submitted to the BSM-E Help Desk via electronic mail (e-mail) at bsme.helpdesk@dla.mil , 1-800-446-4950, or DSN: 697-6733. The help desk in-turn, will forward all requests to the DESC-WI Automation Second Tier Help Desk located at SPAWAR Charleston, SC for processing and validation.

Normal maintenance and calibration requests are handled as corrective or preventive maintenance actions by our centralized maintenance team. Work that is determined to be beyond the scope of normal maintenance is handled through the Sustainment, Restoration, and Modernization (SRM) and Environmental Compliance Program (ECP) process in paperless Dimensions Management System managed by SPAWAR. These latter requests are validated by the SCPs within the paperless Dimensions Management System managed by SPAWAR. All service validated requests are then electronically sent to DESC-WI for final approval and funding. Requests must include the following information:

3.2.4.3.1.1. DFSP Name, DODAAC, Facility Identification Number, and Installation Number

3.2.4.3.1.2. Facility Identification Number of the Tank or Tanks Requiring Service

3.2.4.3.1.3. A detailed description of the nature or the problem

3.2.4.3.1.4. DFSP Project Point of Contact Information e.g. Name, Rank, Phone Number, e-mail address…etc.

3.2.4.4. Each storage tank’s ATG maintenance and calibration records, and certified strapping charts shall be maintained in the DFSP document control file in compliance with DESC-P-3 “Document and Data Control and Retention Policy”.

3.2.5. Calibrated ATG systems shall have certified strapping charts and verification shall be made to ensure all certified strapping chart data points are accurately loaded to ATG system. A minimum of 21 certified strapping chart data points shall be loaded to ensure statistical accuracy and correct extrapolation of converted gauge quantities. Additionally, extrapolated gauge quantities computed by the ATG system shall be verified against the certified gauge charts and amended as required. ROs/TMs shall ensure that changes to gauge data reference points as a result of re-strapping/calibration of fuel tanks are accurately re-loaded to the ATG system and that extrapolated gauge quantities computed by the ATG system verified against the new strapping/calibration chart.

3.3. Volume Correction: Volume correcting all shipment and receipt quantities will substantially improve inventory management, especially in areas where ambient temperatures are constantly above or below 60° F (15/20° C). Refer to paragraphs 3.1., 3.1.1., and 3.1.2., for additional information concerning shipment and receipt volume correction requirements.

Tactical DFSPs (T-DFSP) shall follow T-DFSP specific guidance e.g. DESC-I-29, DESC-I- 11…etc.

3.3.1. Volume Correction of Shipments between DFSPs: Shipments between DFSPs and the subsequent receipt of shipments in quantities equal to or greater than 5,000 gallons (19,000 liters) shall be volume corrected to a standard temperature of 60° F (15/20° C if measured in liters). Quantities measured in liters at 15/20° C shall be converted to gallons at 60° F using ASTM D 1250, Volume XII, Table 52. Where calibrated temperature compensating meters are available all shipment and subsequent receipt quantities shall be reported at 60 F (15 C).

3.3.2. Contract Deliveries/Receipts: Volume correction shall be required for all contract deliveries and receipts and shall be accomplished using the approved API method as specified in applicable contract clauses and/or contract narratives. One exception to this policy is where the applicable contract narrative/clause specifies the delivery conveyance equipped with a non-temperature compensating meter be used for quantity determination. In those instances, the delivery and subsequent receipt quantity shall be reported in gross quantity as discussed in paragraph 5.3.3.2.

3.3.3. Approved methods for obtaining net quantities at 60 F (15/20 C) in order of preference are as follows:

3.3.3.1. Calibrated temperature compensating meter (TCM).

3.3.3.2. Automated tank gauge (ATG) “certified” for custody transfer.

3.3.3.3. Calibrated non-temperature compensating meters with manual temperature conversion using the temperature and density (or API gravity) obtained from a calibrated temperature probe installed mid-stream in the piping manifold adjacent to the meter. To ensure the most accurate volume correction, ambient conditions of the meter and piping near the temperature probe shall be the same (i.e. both meter and piping where the probe is installed are exposed to the same climatic conditions). See MPMS Chapters 7 and 9 for approved temperature and density determination methods.

3.3.3.4. Issue/receipt tank gauge: Correct volume using temperature and density (or API gravity) obtained from the issue/receipt tank. See MPMS Chapter 3 for approved gauging methods, and Chapters 7 and 9 for approved temperature and density determination methods.

See Section 3.2.for additional information/requirements concerning issue/receipt tank measurements.

3.3.3.5. Certified weight scale: Correct volume using temperature and density (or API gravity) obtained from fuel in the conveyance being weighed.

3.3.4. DFSPs that do not have the capability to determine or measure receipted quantities utilizing the methods in Section 3.3.3., shall submit a DD Form 1391"Military Construction Project Data" to DESC-WI to establish or obtain the required capabilities. Per DOD 4140.25- M, the DD Form 1391 or other project documentation (any Service-specific form or format that includes Real Property Information (RPI) and Category Codes in accordance with in accordance with UFC-3-701-05 may be suitable, if such documentation provides project scope, justification, and cost estimate as described in DOD 4140.25-M. Part II, Chapter 8.

4. SHIPMENTS BETWEEN DFSPs

4.1. Delivery Hours: Contractors and DFSPs shall make every effort to schedule tank truck deliveries to arrive at receiving locations during normal duty hours. However, when it is not feasible to receive monthly pro-rata quantities of product from contractual sources during normal duty hours, it will be incumbent upon the receiving unit to make all necessary arrangements to receive product during other than normal duty hours. DFSPs shall document receipt restrictions such as off-loading capability limitations and/or local restrictions to tank truck delivery windows/scheduling during the requirements submission phase of contract development.

4.2. Quality Control of Shipment Conveyances: Strict quality control standards apply to all shipping conveyance modes transporting DWCF fuel. Military Standard 3004A provides detailed guidance for conveyance quality control.

4.3. Shipments of DWCF Owned Fuel: This section addresses shipments of DWCF owned fuel between capitalized DFSPs only. Transportation of DWCF fuel shipments may be via government transport or commercial contracted transport. Shipments represent the transfer of product from one DFSP to another and the transfer of responsibility/accountability for the product shipped from one Responsible Officer or Terminal Manager to another.

4.3.1. Documentation and Processing of DWCF Fuel Shipments: Prompt shipment transaction processing to the FES is essential to enable the receipt DFSP to process a receipt transaction.

Thus, DWCF fuel shipments shall be recorded into the BSM-E BLSA and processed to the FES within one business day of the shipment. Procedures for input and processing of shipment transactions are provided in the applicable BSM-E BLSA and FES documentation.

Documentation requirements for all DWCF fuel shipments are as follows:

4.3.1.1. Enter the product grade, NSN, unit of issue, quantity of shipment, quantity determination method to include whether or not the shipment quantity is adjusted to 60° F (15/20° C if measured in liters), date of shipment, shipping activity and receiving activity DoDAACs, addresses, and point of contact information in the applicable data entry fields.

4.3.1.2. Shipment Document Number Assignment: The following construct shall be used for shipment document numbers: Shipper’s DoDAAC [positions 1-6] + Julian Date [positions 7-10] + two digit product code (1st and 3rd digit of the standard 3 digit grade code) [positions 11-12] + a two digit sequence number or two digit alpha character [positions 13-14]. For example, shipment document number FP48775257J801 would be used for the first shipment of JP8 from FP4877 on September 14, 2005.

DFSPs that input shipments directly into the FES using the FES-02 processing screens shall follow the document number construct specified above. Shipment document numbers are systematically assigned for DFSPs that process using current BSM-E base level support applications.

4.3.1.2.1. Separate document numbers are required for individual carriers when multiple carriers are used to transport shipments. Individual document numbers are entered into POWERTRACK used for transportation payment purposes.

4.3.1.3. Batch/Cargo Data Field: Data entry requirements for various modes of transport are as follows:

4.3.1.3.1. If shipment is by ocean tanker or commercial barge; enter the actual cargo number for the shipment.

4.3.1.3.2. If delivery is by local conveyance or government conveyance via tank truck or rail;

leave the Batch/Cargo data field blank.

4.3.1.3.3. If delivery is by commercial pipeline; enter the actual batch number provided by the commercial pipeline company. If a batch number is not used by the commercial pipeline company; enter “PIPELINE” in the Batch/Cargo data field. If delivery is by government pipeline, enter “GPIPELIN” in the Batch/Cargo data field.

4.3.1.3.4. If delivery is by commercial rail tank cars, commercial tank truck, and commercial pipeline paid via POWERTRACK; enter “POWRTRCK” in the Batch/Cargo data field.

Overseas locations that do not participate in the Power Track Program shall ensure copies of completed shipping documents are provided to the applicable DESC Region for processing in accordance with the terms and conditions of their contract with DESC.

4.3.1.3.5. Upload Start/End Dates (DD Form 1348-7) or Load/Commence Start/End Dates (DD Form 250-1): For pipeline shipments enter the upload start date and upload end date on the DD Form 1348-7; or Load Commence Start Date and Load End Date on the DD Form 250-1 for barge and tanker shipments. Not applicable for tank truck or rail tank car shipments.

4.3.1.3.6. Enter all applicable release information in the Shipment Release Information/Additional Data/Remarks block of the DD Form 1348-7 (Remarks or Statement of Quality sections of the DD Form 250-1). Additional data sheets such as quality analysis results may be used as appropriate. When additional data sheets are used, they shall be attached to and retained along with the document control copy of the shipment document. Alternate release authority is required by the QAR when the QAR is not available to verify product shipments. In those instances, an alternate release authority statement must be entered in the Remarks area of the shipment document. Local shipments between DFSPs located on the same installation are exempt from the alternate release statement requirement.

4.3.1.3.7. Prepare the shipment documentation in accordance with the procedures outlined in section 4.3 of this document. The shipping and receiving DFSP shall retain completed shipment documents on file in accordance with Table 1. The shipping DFSP representative will sign and date blocks 17a and 17b of the DD Form 1348-7 or block 30 of the DD 250-1. The receiving DFSP will complete blocks 18 to 22 and acknowledge receipt by signing and dating blocks 23 and 24 of the DD Form 1348-7 or block 29 of the DD 250-1. The receiving DFSP shall return one copy of the countersigned DD Forms 250-1 or DD 1348-7 the shipping DFSP for filing in the Daily Document Control File.

4.3.2. Processing of Returned or Diverted DWCF Fuel Shipments: The DFSP shall make every effort to minimize shipment returns by emphasizing accurate projection of fuel delivery requirements and subsequent scheduling of shipments to meet the requirements. However, unpredictable circumstances may dictate the return of full or partial shipment quantities to the shipping DFSP or diversion of shipments to another DFSP. The following actions shall be completed when shipments cannot be off-loaded at the intended destination, or when diversion of a shipment is necessary to support mission requirements.

4.3.2.1. The DPSP in receipt of a shipment that cannot be off-loaded shall immediately notify their appropriate DESC Region and the shipping DFSP. Whenever practical, the Region may direct the shipment to another DFSP or end use customer. The original shipping activity shall document the return or diversion on the original shipment document and process the appropriate transactions to BSM-E as follows:

4.3.2.1.1. Return of Shipment to Shipping DFSP: If the entire shipment is returned to the shipping DFSP, process a reversal for the shipment transaction. If the “ship to” DFSP off-loads part of a shipment and returns the balance to the shipping DFSP, process a reversal and correction to the shipment transaction to adjust the quantity to the actual off-loaded quantity.

4.3.2.1.2. Diversion of Shipment to a Different DFSP: If an entire quantity of a shipment is diverted to another DFSP, the shipping activity shall process a reversal and correction to the shipment transaction to reflect the new “ship to” DoDAAC of the DFSP receiving the diverted shipment. For partial shipment diversions to another DFSP, process a reversal and correction to the shipment transaction to reflect the actual quantity received at the original “ship to” DFSP;

then process a new shipment transaction to the DFSP receiving the diverted partial shipment.

4.3.2.1.3. Diversion of Shipment to a Non-capitalized End Use Customer: If the entire shipment is diverted to a customer, process a reversal of the shipment transaction. Then process a sale transaction to the end use customer receiving the product. For partial shipment diversions to an end-use customer, process a reversal and quantity correction to the original shipment transaction. Then process a sale transaction to the end-use customer for the quantity of product diverted.

4.3.2.2. Where applicable, the DFSP or DESC Region shall document shipments and product diversions in POWERTRACK according to established procedures.

4.3.3. Shipment Notices: The shipping DFSP shall notify the receiving DFSP and the quality assurance representative upon release of a barge, ocean tanker, or pipeline shipment. The receipt DFSP shall also be notified upon release of shipments by rail car or tank truck. Shipment notification may be made by phone, electronic mail, or by providing the receiving DFSP an advance copy of the shipment document in sufficient time to allow for receipt planning.

Shipment notifications shall include shipment number, grade and quantity of product shipped, cargo/batch numbers (as applicable to ocean tanker/barge or pipeline shipments), rail car and tank truck numbers, and seal numbers, when applicable.

4.3.3.1. Overseas Tanker Shipment Notices: DESC shall notify the respective Sub-Area Petroleum Office (SAPO) and receipt DFSP Responsible Officer (RO) or Property Administrator (PA) for tanker shipments slated overseas through the weekly tanker arrival schedule or by direct message when shipments originate outside the SAPO area of responsibility.

4.3.3.2. Fuels Enterprise Server (FES) Shipments Calendar: The FES Shipments Calendar provides an excellent tool for visibility of shipments between DFSPs and should be used by both shipping and receiving DFSPs to monitor status of DWCF fuel shipments and receipts.

4.3.4. DWCF Fuel Shipments, between DFSPs, via Tank Truck, Tank Wagon, and Truck with Trailer:

4.3.4.1. DWCF fuel shipped via government or contract carrier tank truck, tank wagon, or truck shall be documented using DD Form 1348-7, DOD MILSPETS DFSP Shipment and Receipt Document, according to instructions in Section 4.3. The DD Form 1348-7 is the preferred source document for DWCF fuel overland shipments; however, wholesale DFSPs may use the DD Form 250, Material Inspection and Receiving Report, to document overland shipments. Future base level/DFSP processing applications will provide automated generation and printing capability for the DD Form 1348-7. Meter tickets may also be used for as the accompanying document for individual truck loads; however, the DD Form 1348-7 (or DD Form 250) shall be used to document a consolidated shipment transaction. The DD Form 1348-7 can be downloaded from the following DOD Forms Web Page in a writeable PDF format:

http://www.dtic.mil/whs/directives/infomgt/forms/ddforms1000-1499.htm .

4.3.4.2. Seals: All tank openings and manifolds on shipment transports shall be sealed after loading. Seal numbers for individual loads shall be annotated on the shipping document that accompanies the shipment to destination. Seal numbers are not required to be transposed from individual load documentation to the consolidated shipment document where multiple, individual loads comprise a single shipment transaction.

4.3.4.2.1. Approved Exceptions: Seals are not required for fuel transport or refueling vehicles for DFSP to DFSP shipments that do not depart the military installation. For example, a DFSP that provides fuel to a Reserve or National Guard DFSP on the same installation, must process a shipment to the tenant DFSP; however, the refueling vehicles do not need to be sealed. Seals are optional for transport vehicles in tactical convoys, provided the convoy is under armed escort to the delivery destination.

4.3.4.3. Quantities for DWCF shipments via tank truck, tank wagon, and truck shall be determined by calibrated meter, certified weigh scale, or by gauging the issue tank. The conveyance gauge method is only authorized when the conveyance tank has a certified strapping/gauge chart.

4.3.5. DWCF Fuel Shipments via Rail: DWCF fuel shipments via rail car shall be documented using the DD Form 1348-7 according to instructions in paragraph 4.3.1. The DD Form 1348-7 is the preferred source document for DWCF fuel shipments overland; however, wholesale DFSPs may use the DD Form 250 to document shipments. All hatch and manifold openings on rail cars shall be sealed and seal numbers annotated on the shipping document accompanying the shipment to destination. Quantity determination for rail shipments shall be determined by calibrated meter or by before and after gauge readings of the issue tank(s) using certified strapping charts.

4.3.6. DWCF Fuel Shipments via Intermodal Tank Containers: DWCF fuel shipments via Intermodal Tank Containers shall be documented using the DD Form 1348-7 according to instructions in paragraph 4.3.1. The DD Form 1348-7 is the preferred source document for DWCF fuel shipments overland; however, wholesale DFSPs may use the DD Form 250 to document shipments. Shipment quantities shall be determined by gauging the shipping tank, by a calibrated meter, or by weight using a calibrated weigh scale. All hatch and manifold openings on intermodal containers shall be sealed and seal numbers annotated on the shipping document accompanying the shipment to destination.

4.3.7. DWCF Fuel Shipments via Pipeline: Shipment quantities shall be determined by calibrated meter or by before and after gauge reading of the shipping tank(s). DWCF fuel shipments via Government owned/operated pipelines shall be documented using the DD Form 1348-7 according to instructions in paragraph 4.3.1. The DD Form 1348-7 is the preferred source document for DWCF fuel shipments overland; however, wholesale DFSPs may use the DD Form 250 to document shipments. DWCF fuel shipments via commercial pipeline shall be documented using DD Form 250 and/or Vendor’s meter ticket according to procedures in paragraph 4.3.1.

4.3.8. DWCF Fuel Shipments via Barge: Shipment quantities shall be determined by calibrated meter or by before and after gauge reading of the shore issue tank(s). The shipments via government or commercial contract barge shall be documented using the DD Form 250-1, Material Inspection and Receiving Report, Tanker/Barge according to instructions in paragraph

4.3.1. Additionally, before and after up-load gauge readings shall be taken of the barge. The barge gauge readings shall be used for comparison of variance between meter or shore tank gauge quantity determination and barge gauge quantities. The receiving activity or regional QAR shall witness the gauging of the barge and shore/issue tanks.

4.3.8.1. DWCF fuel shipments via the U.S. Gulf Coast Barge Contract shall be processed using processing DoDAAC UCHOUS as the ship to/customer DoDAAC. DESC Americas will make the appropriate data entry to the OED Carrier Planned Movement module to enable processing of shipments and subsequent receipt at discharge DFSPs.

4.3.9. DWCF Fuel Shipments via Ocean Tanker: Shipment quantities shall be determined by calibrated meter, or by before and after gauge readings of the shore issue tank(s). DWCF fuel shipments via tanker shall be documented using DD Form 250-1 according to instructions in paragraph 4.3.1. Additionally, before and after load gauge readings shall be taken of the tanker.

The tanker gauge readings shall be used for comparison of variance between meter or shore tank gauge quantity determination and tanker gauge quantities. The receiving activity or regional QAR shall witness the gauging of the tanker and shore/issue tanks.

4.3.9.1. DWCF Fuel Shipments via Military Sealift Command (MSC) Tanker: Shipments of DWCF fuel via MSC Ocean Tanker shall be processed using the ocean tanker DoDAAC as the “ship to” DoDAAC. See Table 2 for MSC Ocean Tanker DoDAACs. DESC-BIT will make the appropriate data entry to the OED Carrier Planned Movement module to enable processing of shipments and subsequent receipt at discharge DFSPs.

4.3.9.2. Cargo numbers shall be used to identify DWCF fuel (in-transit inventory) issued to MSC ocean tankers. These issues shall be reported to DESC-BI via MSC Report 4020-4. DESC-BI shall record cargo diversions and receipts by ocean tankers.

Table 2, MSC Ocean Tanker Fleet DoDAACs

DoDAAC MNMC Description N23875 Tpacific Transpacific - Tanker N46373 Gdarnell Gus Darnell - Tanker N46374 Pbuck Paul Buck - Tanker N46375 Scobb Sam Cobb – Tanker N46376 Rmatt Richard Matthieson – Tanker N46377 Lgianella Lawrence Gianella – Tanker UCSPOT Spottankr1 Spot Tankers, MSC Charter Vessels

4.3.10. DWCF Fuel Shipments to Capitalized US Navy Ships (Oilers, Carriers and L-Decks):

Shipment quantities shall be determined by calibrated meter, or by before and after gauge readings of the shore issue tank(s). DWCF fuel shipments from shore terminals into capitalized Navy AFLOAT vessels shall be documented using DD Form 1348-7 according to instructions in paragraph 4.3.1. DD Form 1149, Requisition and Invoice/Shipping Document may be used by DFSPs to document shipments to capitalized US Navy Oilers, Carriers, and L-Deck vessels.

Shipments of DWCF fuel between capitalized US Navy vessels shall be documented using the DD Form 1149 and processed in accordance with NAV SUP 4026.1.

4.4. Procurement Contract Shipments: Procurement contract shipment sources addressed in this interim policy include Bulk Contracts and Posts, Camps, and Stations (PCS) Contracts.

Procurement contract shipments are generally categorized as Freight or Free-on-Board (FOB) Origin or FOB Destination Contracts. Individual contract narratives specify terms of the contract with regard to FOB Origin or FOB Destination.

4.4.1. Paperless Ordering and Receipt Transaction Screens (PORTS) Application: PORTS applications include both Bulk PORTS for bulk contract items and Ground PORTS for ground products provided under PC&S contracts. PORTS use is mandated where contract line items are loaded to the applicable PORTS application. Instructions for using the Bulk PORTS and Ground PORTS applications are available at the following DESC Web Page http://ports2.desc.dla.mil/manuals/REF1111D.htm# .

4.4.2. PORTS Notifications: Both the Bulk PORTS and Ground PORTS applications automatically generate e-mail notices to the appropriate contract vendor and ordering office when an order is created. For bulk contract orders, e-mail notices are automatically generated to the appropriate Quality Assurance Representative (QAR) responsible for release of Bulk contract deliveries. In-turn, approval of the contractor invoice (DD Form 250) in Bulk PORTS by the QAR generates another e-mail notification to ordering office personnel and to the DFSP advising that the shipment has been released. The DFSP/QAR shall electronically (PIN) the discharge DD Form 250 in Bulk PORTS.

4.5. Direct Delivery Fuel Shipments to Non-Capitalized Entities (Direct Sales):

4.5.1. Ground PORTS: Ground PORTS is also used by DESC customers to order ground fuel deliveries off non-capitalized PC&S contract line items. Acceptance of the vendor invoice (DD Form 250) in Ground PORTS by the customer generates a direct sale to the customer DoDAAC and fund cite loaded against the non-capitalized contract line item.

4.5.2. Bulk PORTS: Bulk contract deliveries to non-capitalized entities that are FOB Origin are accepted by the QAR in Bulk PORTS which generates a direct sale to the customer. Bulk contract direct deliveries to non-capitalized entities that are FOB Destination are processed to BSM-E by the applicable DESC Region.

5. RECEIPT OF PRODUCT INTO DWCF FUEL INVENTORY

5.1. General Receipt Practices: Responsible Officers and Property Administrators at DFSPs shall ensure proper quality control, receipt quantity verification procedures, and timely transaction processing procedures are followed for all receipts of product into DWCF fuel inventories.

5.1.1. Receipt In-Check and Out-Check Requirements: All in-bound fuel deliveries shall be checked to ensure product quality standards are met prior to receipt of the product, and that the quantity of product actually received as compared to the shipment quantity reflected on the shipping documentation are within acceptable in-transit gain or loss tolerances. Discrepancies with deliveries shall be immediately reported to the appropriate Quality Assurance Representative (QAR) responsible for release of deliveries and the applicable DESC Region Offices. Immediately notify the DESC-P contracting officer at 1-800-2TOP-OFF, or 1-800-286- 7633 when discrepancies exist with Direct Delivery Contract deliveries. DESC-P contracting officers can also be contacted during normal business hours, 07:30- 16:30 EST Monday through Friday at (703) 767-8500 (DSN Prefix 427). Appendix 1 provides a receipt in-check checklist.

5.1.1.1 Documenting Receipt Shipment and Sales : The DESC Form 702, Petroleum Daily Receipt Summary, may be used to document individual receipts, fuel loaded for shipment, or bulk sales by tank truck. However, receipts, shipments and sales by tank truck may not be recorded on the same form.

5.1.2. Quality Discrepancies: The DFSP shall investigate and report Quality discrepancies through appropriate command channel and SCP to DESC-QA. Submit the details of the quality discrepancy to DESC-QA in accordance with Joint DLAR 4155.24/AR 702-F/SECNAVINST 4855.5/AFR 74-6/ MCO 4855.5F, Product Quality Deficiency Report Program and DESCR 4155.9, Customer Complaints and Quality Deficiency Reports, Standard Form 368, Quality Deficiency Reports (QDR). The DFSP may e-mail a QDR containing all of the required information to: DESC.BQoffice@dla.mil . Additionally, the QDR is available in PDF format for electronic submission via the following DESC Web Page:

http://www.desc.dla.mil/DCM/DCMPage.asp?PageID=100 .

5.1.2.1. If product is found to be nonconforming to contractual quality requirements prior to acceptance, the product will be rejected. For bulk contract deliveries, the receiving DFSP shall immediately notify the QAR at origin, the appropriate SCP and DESC Region responsible for the receipt location, and DESC-QA. DESC-QA, in coordination with the DESC Region will advise the DFSP of action to take. For PC&S contract deliveries, DFSPs shall consult with the SCP prior to rejection of a product for nonconformance to contractual quality requirements.

Additionally, the SCP and/or DFSP shall notify the DESC-P contracting officer and DESC-QA of any rejected delivery. In all cases, annotate quality discrepancies found during the receipt inspection on the shipping documentation.

5.1.2.2. If after receipt, product is found to be off-specification the receiving DFSP shall isolate the off-specification product and promptly notify the QAR at origin and their applicable SCP, DESC Region, DESC-QA, and DESC-N. The receiving DFSP shall ensure an investigation is initiated. DESC-QA in coordination with DESC-N and applicable SCP will inform the DFSP of appropriate actions to be taken.

5.1.2.3. Promptly notify the shipping activity and/or carrier, and the appropriate DESC regional office/QAR, and SCP when tank truck, tank car, and intermodal tank containers are received with apparent seal tampering (e.g. seals missing, broken, bent or when seal numbers on the conveyance do not match the seal numbers on the shipping document), or when there are other reasons to suspect the product may be contaminated. Do not unload the product until cleared to do so by the QAR. For PC&S contract deliveries, notify the appropriate SCP, contracting officer at DESC-P, and the applicable Region Quality Office. Observed discrepancies shall be documented on the source documents e.g. DD Forms 250, 250-1, 1348-7…etc.

5.1.2.4. In instances where the product quality is determined to be unacceptable for receipt, the tank truck/car and intermodal tank container product will normally be returned to the shipping activity at origin if the quality problem cannot be corrected at the delivery destination. Prior to rejection of a receipt, the shipping activity and/or unit that issued the bill-of-lading shall be notified. For DWCF fuel, every effort will be made to transfer the product into isolated storage pending restoration or disposition instructions by DESC-QA.

5.1.3. Quantity Discrepancies: Variances between quantity shipped and quantity determined at destination that exceed the tolerances specified in paragraph 5.2.2 shall be thoroughly investigated to determine root causes and to ensure that appropriate corrective actions have been implemented. The quantity determined at destination, method used to determine quantity, and other defects noted with the delivery shall be annotated on the receipt document.

5.1.4. DOD Regulation 4500.9-R, Part 2, Defense Transportation Regulation provides general guidance on Transportation Discrepancy Reports (TDRs) (available at http://www.transcom.mil/j5/pt/dtr.html). DOD 4500.9-R, Part 2, Chapter 210, Transportation Discrepancy Reports, exempts bulk petroleum shipments via all transportation modes from TDR submission requirements contained in DOD 4500.9-R, Chapter 210, and references DOD 4140.25- M, Volume II for specific guidance regarding submission of TDRs for bulk petroleum shipments via all transportation modes. Pending revision of DOD 4140.25-M, DFSPs shall submit discrepancy reports in writing using DD Form 361, Transportation Discrepancy Report according to instructions in Appendix 3 when one or more of the below conditions exist. The discrepancy report shall be submitted to DESC-BI through appropriate command channels, applicable DESC regional office/QAR, SCP, and Sub Area Petroleum Office if applicable. The DD Form 361 is also available at the DOD Form Page at http://www.dtic.mil/whs/directives/infomgt/forms/formsprogram.htm.

5.1.4.1. Evidence of damage, theft, or tampering exists.

5.1.4.2. Seals are missing, broken, improperly installed, or when seal numbers annotated on the shipping document do not match the seals on the conveyance.

5.1.4.3. Variance between the quantities determined at origin (loading) and at receipt location exceeds allowable tolerances.

5.1.4.4. Shipment documentation is missing or invalid.

5.1.4.5. Other noted discrepancies with delivery conveyance.

5.1.5. The Responsible Officer (RO), Terminal Manager (TM), or Property Administrator (PA) of DFSPs, shall be notified prior to off-loading any deliveries where there is evidence of fraud, theft, or gross negligence. In turn, the RO/TM/PA shall promptly inform the local commanding officer and/or appropriate command level office or contracting officer, and the DESC Fraud Counsel. Such incidents shall be thoroughly investigated and documented results of the investigation provided to the DESC Fraud Counsel. Activities reporting suspected fraud cases may contact the DESC Fraud Counsel via the 24 hour operating center at 1-800-2TOPOFF or 1- 800-286-7633.

5.2. Receipt of DWCF Fuel Shipments from other DFSPs:

5.2.1. Receipt Quantity Determination: The transaction receipt quantity reported to BSM-E for DFSP to DFSP shipments shall reflect the quantity determined at destination using approved quantity determination methods discussed below and section 5.4. Exceptions to this policy may be approved on a case by case basis by DESC-N as necessary, e.g. where a receiving activity in a tactical environment does not have the capability to accurately meter or gauge receipt quantities;

or where receipt facility limitations dictate the simultaneous receipt of product from multiple sources into a single receipt tank or through a common manifold meter. DFSPs with such facility limitations shall submit appropriate facility project upgrade requirements to DESC. In-turn DESC will evaluate facility upgrade submissions and if appropriate fund projects to alleviate system limitations and enhance accountability for receipts, (E.G. appropriate modifications to receipt manifold and receipt meters, etc). In instances where quantity determination at destination is waived by DESC, the receipt transaction quantity will be based on the quantity determined at origin as reflected on the shipment document providing the delivery conveyances are properly sealed and there is no evidence of tampering or theft. The receiving activity shall promptly notify the appropriate DESC Region and SCP any time seals are missing or broken, and/or when there is evidence of theft. The DESC Region in coordination with DESC-N will advise of appropriate actions.

5.2.2. In-Transit Variances: Except for ocean tankers, variations between quantity shipped and quantity received in excess of 0.5% (0.005) shall be researched and appropriate actions shall be taken to correct discrepancies and/or practices that caused the excessive variance. For ocean tankers, shore-to-shore variations (excluding intermediate discharges) in excess of the following shall be investigated: 0.2% (0.002) for cargos not requiring cleaning, gas freeing, drop/strip;

0.3% (0.003) for cargos requiring drop/strip; or 0.5% (0.005) for cargos requiring gas freeing and cleaning (Reference MIL-STD-3004A).

5.2.2.1. The RO/TM/PA or designated representative at the receiving DFSP shall contact the shipping DFSP to advise of excessive variances and to request verification of the quantity shipped. The verification is intended to identify computation/documentation errors that may contribute to an excessive variance, and to make appropriate corrections to shipment/receipt documentation.

5.2.2.2. Excessive variances not attributable to computation/documentation errors shall be investigated and a DD Form 361, Transportation Discrepancy Report, shall be submitted by the receipt DFSP in accordance with Appendix 2. The receipt activity shall further notify the appropriate DESC Region or Service Command channels, which will refer the unresolved discrepancy to DESC-QA/N, as appropriate.

5.2.3. Movements Under Investigation: DESC-N and the applicable DESC Regions shall monitor Movements under Investigation Report for DFSPs that process to Oil Enterprise Downstream (OED) and shall follow up to ensure appropriate actions are initiated to investigate and resolve root causes for excessive in-transit variances. DWCF fuel shipments via truck, rail, pipeline, and barge (except the Gulf Coast Barge Corporation –UCHOUS) are included in the OED Movements under Investigation Report.

5.2.3.1. Voyage Reconciliation Reports: Voyage Reconciliation Reports are available for DFSPs that process to OED for shipments via tanker and the UCHOUS Barge

5.2.4. Ocean Tanker or Barge Shipment Multiple Off-Loads: The following applies when ocean tankers or barge cargoes are discharged at two or more DFSPs.

5.2.4.1. Quantities discharged at intermediate points will be entered in the "discharge" column of the DD Form 250-1. Receipt quantities entered on the DD Form 250-1 shall be adjusted to 60º F (or 15º C when metric is used). No loss or gain will be indicated for the intermediate points.

DFSPs at intermediate discharge points shall promptly advise the final discharge point of the quantity received (in advance of mailing documents in order to expedite loss or gain calculation).

5.2.4.2. Total in-transit gain or loss shall be calculated at the final discharge point. Excessive in-transit gain or loss variances shall be investigated and a Transportation Discrepancy Report (DD Form 361) submitted by the final discharge point DFSP. Investigations shall take place within the week in which the excessive gain or loss is discovered. Findings shall be reported on DD Form 361 and a copy of the completed DD Form 361 submitted to DESC-N via FAX at: (703) 767-9380.

5.2.4.3. Ocean Tanker or Barge Cargo Diversions: A cargo number will be used to identify DWCF fuel (in-transit inventory) issued by MSC tankers to ships at sea. Such issues will be reported to DESC-BI via MSC Report 4020-4. DESC-BI shall record the cargo diversion and receipt.

5.3. Contract Receipts into DWCF Fuel Inventory: Contract receipts may be categorized as “Freight or…