Bids to open for government fuel depot

The contract to provide fuel and new equipment to the government fuel depot on North Sound Road will go out to tender soon. – PHOTO: CHRIS COURT

Both the Rubis and Sol petroleum companies will bid to operate the government’s North Sound Road fuel depot, installing new equipment and supplying as much as 400,000 gallons of fuel each year.

The depot, mired in controversy in 2010 and 2011 after the auditor general revealed repeated compromises of its “Gasboy” dispensing system, has been supplied by Rubis since 2011, and the company’s predecessor, ChevronTexaco, since 1995.

Richard Simms, director of the Department of Vehicle and Equipment Services, said the contract would go out to public tender “in another couple of weeks.”

“We are working with the ministry [of Planning, Lands, Agriculture, Housing and Infrastructure], and this won’t be a long-term contract,” he said, “but will be for five years.” Mr. Simms hopes to make an award in September.

“There are two tenders really. The new contractor will have to do fuel supply and the second will be for equipment. If one company can do both, that’s fine,” Mr. Simms said.

Rubis Managing Director Joel Maes said the company intended to bid on the project, but offered few details: “Rubis has been serving DVES over the past years,” he said, calling it an honor and a privilege to serve government “with our quality products.”

“It goes without saying that Rubis will continue to do our very best to submit a proposal that would meet all the requirements. We value the business we have with the DVES and trust that we can continue to receive their vote of confidence to continue serving them in the future,” Mr. Maes said.

While the company has not had a contract since it took over from ChevronTexaco in 2011, operating on a month-to-month basis, it will now face competition for the first time – from Sol Petroleum, which took over from ExxonMobil in 2014.

Asked if Sol would challenge Rubis, Sol General Manager Alan Neesome said “I would think so.”

The government fleet comprises “just over 900 vehicles and equipment,” Mr. Simms said, and last year consumed roughly 250,000 gallons of gasoline and another 230,000 gallons of diesel fuel, although “that is a little more than usual. We usually consume about 400,000 gallons in total.”

In the June 9 session of the Legislative Assembly, Minster for Planning, Lands, Agriculture, Housing and Infrastructure Kurt Tibbetts said “the initial [ChevronTexaco] contract was a 15-year contract. I’ve taken the position – and my colleagues agree with me – that it is not in the best interest of the government, at any time, to do a contract that lasts that long.”

He also called for replacement of the fuel-storage tanks and other equipment used at the depot, particularly in the wake of the late-April discovery of oil and gas pools beneath Rubis’s Shedden Road station, which is being redeveloped.

The Petroleum Inspectorate, responsible for the clean-up, has suggested the contamination may be from discarded liquids from the autobody shops once located behind the station. Rubis has denied its fuel tanks contributed to the problem.

The North Sound Road tanks “need to be replaced because they’re getting to the point where it’s going to be dangerous, and we don’t want any underground spills or anything like that,” Mr. Tibbetts told the Legislative Assembly.

Mr. Simms said the installations would form part of the tender. He pegged the value of the project roughly between $300,000 and $400,000, although final costs would be contingent on the bidders.

The Gasboy dispensing system will remain, however. Originally installed in 1996 and upgraded in July 2015 to “Gasboy Islander Plus,” it is an Internet-based fleet-management system that Mr. Tibbetts described to the House as “almost foolproof.”

In spring 2010, Auditor General Dan Duguay reported that one-third of $500,000 in fuel purchases between January 2008 and March 2009 at the depot were likely to have been the result of “abuse and fraud.” The problems continued, he said, between July 2009 and June 2010.

Employees of as many as 15 government departments or statutory authorities had used fuel cards without proper monitoring, Mr. Duguay said, indicating that 43 percent of the 378 active Gasboy cards were used by motorists no longer employed by the unit designated on the card or “had no business need” for it.

Mr. Duguay’s successor Alastair Swarbrick found similar, ongoing abuses in 2012.

On April 30 last year, bids closed for a new system, updating software with tracking and monitoring functions, enabling more precise control and allowing time restrictions and a maximum volume for each card. Gasboy Islander Plus also employs a “ring system,” a microchip that ensures fuel is pumped into a government vehicle.

“The pilferage and other things that used to occur can’t happen anymore,” Mr. Tibbetts told Thursday’s LA session. “The system itself also can allow additional features which, as resources become available, can increase the features of the system that are there now and can create an instrument that can be placed on each gas tank.”

Mr. Tibbetts also announced a new vehicle-procurement program, limiting to seven years the operation of any equipment while standardizing the fleet and streamlining use of replacement parts.

“We realized that government maintenance” of an aging fleet had become a costly burden, Mr. Simms said, and that limiting ownership to seven years was likely to prove more efficient and require less inventory.

Seven years, Mr. Tibbetts said, was “the length of time, the period, when vehicles should be kept, after which they should be sold off and replaced. After that it becomes uneconomical.

“Already it is showing that there is significant savings … it’s showing the volume of fuel that is being used, it is less.”