Technical Bulletin 02-1

International Federation of Inspection Agencies Petroleum and Petrochemical Committee

Position Paper Vessel Experience Factors

IFIA member companies are frequently asked to apply Vessel Experience Factors (VEFs) to ship figures as a compromise solution to quantity problems with volumes determined by shore measurements. The purpose of this Bulletin is to clarify the position of IFIA member companies regarding the usefulness and application of VEFs at the time of inspection of a cargo. Background Information A Vessel Experience Factor [VEF], is a historical compilation of ship-to-shore cargo volume variations and was designed to be used, primarily, as a loss control tool to help assess the validity of quantities derived from shore tank measurements. Vessel experience factors are also frequently used to determine custody transfer quantities when shore-based measurements are not available. Since vessel capacity tables are typically derived from the vessels building plans, and not from (more accurate) tank calibration measurements, there are usually significant differences between the quantity of a cargo measured in a calibrated shore tank and the same cargo measured in vessel tanks. These differences may be as high as 2%. The following are the three most commonly used industry standards that define the procedures for deriving a VEF: ! ! ! API/MPMS Chap. 17.1 - Guidelines for Marine Cargo Inspection IP PMM Part XVI - Procedures for Oil Cargo Measurements by Cargo Inspectors ISO 13740 - Assessment of vessel experience factor of ocean-going tanker vessels

Mathematical procedures are applied to reject quantity data for those voyages that are insufficiently representative for inclusion, after which the sum of the qualifying ship/shore ratios is averaged to arrive at the VEF. Two possible methods for rejection are available in the standards: ! ! Method 1, the most widely used, also known as the field method, uses a 0.3% difference from the mean to reject any voyage. Method 2 employs a more statistically rigorous outlier rejection technique to discard unsatisfactory data.

Current standards always require the rejection of ship-to-ship transfers and all voyages prior to cargo tank structural modification.

VEF Limitations There are a number of limiting factors that affect the overall accuracy of VEF calculations: The voyage data used to compile a VEF must, by necessity, come from information supplied by the vessel and the inspector is rarely able to verify the accuracy of this data. ! Most vessels only have load port data, therefore, most vessel experience factors are load port experience factors [LVEF], even though they are frequently applied to discharge data. Page 1 of 2 - March 15, 2002

Technical Bulletin 02-1

International Federation of Inspection Agencies Petroleum and Petrochemical Committee
Position Paper - V essel Experience Factors Continued: Vessel
! ! Experience factors that are compiled from data from the same shore facility will reflect any bias that may be inherent in that facility. Experience factor calculations specify a minimum number of qualifying voyages but do not specify any upper limit. Factors compiled from a differing number of voyages will result in different factors; however, it is usually not possible to determine the optimum number of voyages for maximum precision. Calculation routines do not specify a required relationship between the number of qualifying voyages and the total number of voyages used in the calculation. For example, Method 1 requires a minimum of five qualifying voyages for a valid VEF; however, there can be any number of non-qualifying voyages, as long as there are five that qualify. A VEF that is compiled from 5 qualifying voyages out of a total of 25 voyages is unlikely to be very accurate. The standards do not consider how full each tank should be. This has resulted in considerable debate about the usefulness of VEFs with part-cargoes. The calculation routine for developing a VEF, as specified in the current commonly used standards, is not as rigorous as the calculation routines typically used for custody transfer.

! !

Application Current VEF standards provide guidance only on calculating VEFs, and do not contain any recommendation on their application. Therefore, whether to use a VEF as a factor when quantifying any particular loading or discharge is a commercial decision. Therefore, unless instructed to the contrary by their principals, IFIA member companies will apply vessel experience factors under the following conditions: ! ! ! Experience factors will be applied to custody transfer quantities only with specific instructions from all principals; Method 1 (above) will be used to determine whether voyages qualify; Vessel experience factors will be calculated from the 20 most recent voyages, not including voyages excluded for non-mathematical reasons such as ship to ship transfers. If 20 voyages are not available, the maximum number available should be used, assuming that they yield a minimum of 5 qualifying voyages. If the 20 most recent voyages do not yield 5 qualifying voyages, IFIA Member Companies do not recommend using the VEF for custody transfer. Page 2 of 2 - March 15, 2002

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