Streamlining Tank Farm Operations with One Day TSR Requirements

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Fuel supply management involves complex processes that require transparency, trust, and strict adherence to procedures. One critical aspect in this field is the role of Tank Storage Receipts (TSR) and their active status. This post explores how tank farm transactions work, why an active TSR is essential, and what buyers and sellers must know to ensure smooth fuel supply operations.

Fuel tank farm showing multiple storage tanks with clear labeling

What Is a Tank Storage Receipt (TSR) and Why It Matters

A Tank Storage Receipt (TSR) is an official document issued by a tank farm operator confirming that a specific quantity of fuel or petroleum product is stored in a designated tank. The TSR includes details such as the product type, volume, storage location, barcode, and GPS coordinates. It serves as proof of product availability and ownership.

An active TSR means the storage agreement is valid and the product is currently held in the tank, ready for transfer or sale. This status is crucial because:

• It guarantees the buyer that the product exists and is reserved for them.

• It protects sellers by confirming the buyer’s storage capacity and commitment.

• It enables smooth transaction flow by providing verifiable proof of product custody.

  
  

Without a valid, active TSR, buyers risk purchasing fuel that may not be available or properly stored, leading to delays, disputes, or financial losses.

Key Products and Pricing in Tank Farm Transactions

In Kazakhstan, where many tank farms operate, common products include:

• JET A-1 aviation fuel priced at $92 (sell-side closed) and $90 (buy-side opened), with a $1 commission on both sides.

• EN590 10PPM diesel fuel priced at $590 (sell-side closed) and $580 (buy-side opened), with a $5 commission.

• D6 fuel priced at $1.02 (sell-side closed) and $1.00 (buy-side opened), with a $0.01 commission.

  
  

These prices reflect market conditions and commissions agreed upon by buyers and sellers. Buyers can request trial lifts and specify minimum or maximum monthly requirements, but brokers should note that buyers unwilling to provide a one-day TSR should not be engaged.

Step-by-Step Transaction Procedures for FOB Tank to Tank Sales

Fuel transactions from tank to tank follow a strict procedure to ensure transparency and legal compliance. The process includes:

1. Valid LOI/TSR Requirement

   The buyer must provide a Letter of Intent (LOI) and a valid one-day TSR from their tank farm. This confirms the buyer’s ability to receive and store the product.

   
   

2. Issuance of ICPO

   The buyer issues an Irrevocable Corporate Purchase Order (ICPO) that includes the seller’s procedures, banking details, a scanned copy of the buyer’s passport, and the Tank Storage Agreement (TSA) from the buyer’s logistics company.

   
   

3. Commercial Invoice and Verification

   The seller issues a Commercial Invoice (CI) for the available products at the port. The buyer reviews and endorses this invoice, which the seller then legalizes at their expense. The seller verifies the TSA to confirm the authenticity and availability of the storage facility.

   
   

   • Commitment to Supply

   • Injection Report

   • Fresh SGS report (not older than 48 hours)

   • Authorization to Sell & Collect (ATS)

   • Authorization to Verify (ATV)

   • Dip Test Authorization (DTA)

   • Commitment Letter to Supply

   • Export License

   • Statement of Product Availability

   • Tank Storage Receipt (TSR) with barcode and GPS coordinates

   • NCNDA/IMFPA agreements

4. Release of Proof of Product (POP) Documents

   Once the TSA is verified, the seller sends POP documents to the buyer’s secure email. These include:

   
   

5. Dip Test by Buyer

   The buyer conducts a dip test on the product in the seller’s reservoir to verify quality and quantity.

   
   

6. Authority to Inject (ATI)

   The buyer provides an ATI from their logistics company, allowing the seller to inject the product into the buyer’s tank within the agreed timeframe.

   
   

This procedure ensures both parties have verified the product and storage, reducing risks and building trust.

Close-up of dip test equipment measuring fuel level in a storage tank

Why Buyers Must Provide a One-Day Active TSR

Buyers who cannot provide a one-day active TSR create uncertainty in the transaction. Without this document:

• Sellers cannot confirm the buyer’s storage capacity.

• The risk of product misallocation increases.

• Transactions may stall or fail due to lack of proof of storage.

  
  

Buyers should ensure their TSR is current and valid before engaging sellers. Brokers are advised not to respond to buyers unwilling to provide this critical document.

Practical Tips for Buyers and Sellers in Tank Farm Transactions

• Buyers should maintain an active TSR and TSA with their logistics company to facilitate smooth transactions.

• Sellers must verify all buyer documents carefully before releasing POP to avoid fraud.

• Both parties should agree on trial lifts and monthly volume requirements upfront.

• Use secure communication channels for exchanging sensitive documents.

• Confirm product pricing and commissions clearly before signing agreements.

  
  

The Role of Transparency and Verification in Fuel Supply

Transparency in tank farm transactions protects all parties. Verification steps such as SGS reports, dip tests, and active TSR checks ensure the product is genuine and available. These measures prevent disputes and build confidence in long-term business relationships.