Published since 1951...
May 11, 2007 | Vol. 57, No. 9

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Dear PEI Member:

Approximately 75 federal and state air quality control regulators, PEI members and petroleum marketers met May 1 in Manchester, New Hampshire, to continue the dialogue started years ago about the future of Stage II vapor recovery. The meeting was sponsored by Northeast States for Coordinated Air Use Management (NESCAUM), an association of air regulators from the Northeastern states. Although we still can’t tell you anything definitive, we are beginning to see some light at the end of the tunnel and feel more confident speculating when Stage II will begin to disappear in most states.

First, some background. About 275 counties in 20 states require Stage II vapor recovery at this time. Section 202(a)(6) of the Clean Air Act (CAA) says the EPA administrator may waive Stage II gasoline vapor recovery requirements in moderate ozone nonattainment areas upon standards promulgation. The CAA also provides that EPA may waive Stage II by rule in more severe ozone nonattainment areas after the administrator determines that onboard refueling vapor recovery systems (ORVR) are in widespread use throughout the motor vehicle fleet.

States that make up the Ozone Transport Region (OTR) have additional requirements to comply with the CAA. States in the OTR are required to have either Stage II or comparable measures even when widespread use is declared. Regulators in attendance from OTR states (Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New York, New Jersey, Pennsylvania, Rhode Island, Vermont and northern Virginia) expressed hope that ORVR will be declared a comparable measure by the federal EPA and that OTR states won’t have to jump through additional hoops in the move away from Stage II.  

Stage II VR Update

Board Meeting Summary


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The federal EPA still hasn’t defined when it would consider ORVR in widespread use. What criterion (percent of fleet with ORVR, vehicle miles traveled with ORVR, gasoline sold to ORVR vehicles, etc.) EPA will use has yet to be determined. Similarly, the percent penetration of ORVR into the vehicle fleet required (somewhere between 80 and 95 percent) to transition from Stage II to ORVR also has not been decided by EPA. Despite these uncertainties, we can make these predictions about Stage II and ORVR systems with some confidence:

  • EPA will supply the criterion for what is widespread use.
  • Widespread use determinations will likely be made state by state or region by region.
  • States will determine when the criterion for widespread use applies in their state. Once that is determined, states will then submit a state implementation plan (SIP) revision removing Stage II.
  • Stage II will begin to disappear from the states between 2011 and 2013.
  • California expects to keep Stage II systems until 2020 or longer to maintain emissions reductions. California air officials are considering developing certification standards for a “Stage III” vapor recovery system that could include requirements for “dripless” nozzles, underground storage tank pressure limits and in-station diagnostics.
  • When the Stage II requirement is removed, the states or EPA will develop some guidance regarding appropriate procedures for removing Stage II equipment. PEI is likely to become involved in that process, perhaps by adding a removal section to PEI/RP300, Recommended Practices for Installation and Testing of Vapor Recovery Systems at Vehicle-Fueling Sites.

The PEI Board of Directors met last month in Austin, Texas, and made a number of policy decisions related to membership services and association operations. Here is a summary.

Changes to the PEI Constitution and Bylaws. PEI’s Constitution and Bylaws have not been thoroughly reviewed since 1966. The board will recommend numerous changes to the membership at PEI’s annual membership meeting and lunch (see below) November 8 in Atlanta. Most of the changes are of a general housekeeping or editorial nature, although a few are strategic. Members will be mailed all recommended changes in September for review prior to the meeting.

New Service and Construction Division. A new membership division specifically for service and construction firms will be proposed to the general membership at the November 8 meeting. We expect 350 current affiliate division members will transfer to the new service and construction division, allowing us to serve both groups better. For PEI Directory purposes, distributor division members that provide installation and/or service to their customers can elect to have their company listed under the Service and Construction Division as well as the Distributor Division.

Membership Meeting AND Lunch. The board approved a slight change in timing for the Annual PEI Membership Meeting that is held at convention each year. The membership meeting, where the changes to the Constitution and Bylaws will be considered, will be combined with lunch and held on Thursday, November 8. The meeting will begin at 11:30 a.m. and finish at 12:30 p.m., permitting membership meeting attendees to conduct PEI business, hear some brief remarks and enjoy a good lunch before arriving on the trade show floor.

Should we be the Petroleum Equipment Institute or PEI? Directors discussed whether it made sense at this time to be officially known as PEI instead of the Petroleum Equipment Institute. The negative connotation given to the word “petroleum” was a big factor in the discussion but in the end, directors felt that “petroleum” was the one word that tied PEI members together. The issue will be revisited next year. 

Committee Recommendations Approved. Reports from PEI’s Education, Strategic Long Range Planning, Safety, Exhibitor & Convention Advisory, Investment, and Young Executives Committees were reviewed and approved. Some of the committee’s recommendations of general interest to PEI members that were approved by the directors include:

  • A $2,217,050 budget for the fiscal year that began April 1. No dues increase for 2007-2008.
  • The incorporation of the Manage Safe publication into the new PEI Journal.
  • The Safety Committee’s Dos and Don’ts provided free of charge on the PEI website.
  • An Inventory and Purchasing Managers Conference in 2008.
  • A new survey on business software used by distributor members.
  • Strengthen 10-Groups.
  • Investigate additional topics that could serve as subjects for future recommended practices. Members’ comments are solicited.

PEI President Calvin Bishop, El Paso, Texas, presided at the midyear meeting. Other officers and directors attending the meeting included:
Bruce Larson, Clarkston, MI (vice president)
Blair Shwedo, Charlotte, NC (treasurer)
Steve Hieber, New Oxford, PA (immediate past president)
Bob Renkes, Tulsa, OK (executive vice president)
Mark Babcock, Falmouth, ME (District 1)
Scott Hafer, Reading, PA (District 2)
Joey Cheek, Tampa, FL (District 3)
Andy Mercer, Jackson, MI (District 4)
Kevin McKinney, Mobile, AL (District 5)
Terry Cooper, Marion, IA (District 6)
Richard Dixon, Wichita, KS (District 8)
Dennis Rethmeier, San Diego, CA (District 9)
Randy Dixon, Billings, MT (District 10)
Ian Burton, Shakopee, MN (District 11)
Martin Pettesch, Elizabeth, NJ (District 12)
John Radu, Vienna, OH (District 13)
Gene Pope, Tampa, FL (Affiliate Division)
Bob Dendy, Houston, TX (Affiliate Division)
Connie Dooley, Tulsa, OK (director of administration)

Bob Renkes
, PEI’s executive vice president, will speak at the Building Biofuels Infrastructure Conference in Washington, D.C., sponsored by the U.S. Department of Commerce on June 19. His presentation will be on fueling station and dispensing equipment compatibility. The conference flyer lists all of the presentations at the conference. There are a limited number of seats available for PEI members at this conference. If you wish to attend, call or email Shannon Fraser at (202) 482-3609 or

Calvin Bishop, 2007 PEI president, will address delegates to the China Petroleum Wholesale and Retail Summit in Beijing, China, June 28-29. The title of his speech is “More Profit for Petroleum Marketing Companies.”

Jones & Frank Corp.
, headquartered in Norfolk, Virginia, has acquired JCV, Inc., with offices in Salisbury and Hughesville, Maryland. The company says that the acquisition of JCV will add to the existing remote service capabilities established by Jones & Frank in Baltimore, and will broaden its reach into all areas of Maryland, Washington, D.C., and portions of Delaware.
Murphy Oil Corp., El Dorado, Arkansas, announced that it has entered into an agreement with Wal-Mart Stores and subsidiaries to purchase parcels of property which the company currently leases from Wal-Mart for its retail gasoline stations. Under the terms of the agreement, Murphy will take control of the stations in several phases over the course of the year. Expansion of the program will continue with additional opportunities to purchase new site locations in the future. In conjunction with the agreement, the company said it plans to close as many as 47 locations. Murphy’s retail presence currently covers 21 states, primarily in the Southeast and upper Midwest. Murphy operates more than 1,000 stations in Wal-Mart parking lots.
ConocoPhillips has sold its 147 gasoline stations in Thailand to PTT, Thailand’s largest energy company. PTT’s market share in Thailand will increase by 4 percent from the current 30 percent after the acquisition, expected to be completed in June. ConocoPhillips also agreed to sell 44 gasoline stations in Malaysia to Royal Dutch Shell.

Gasoline combined with ethyl tertiary butyl ether (ETBE) is now being sold at 55 gasoline stations in Japan on a trial basis. The fuel, marketed as “biogasoline,” contains 3 percent ETBE, although the government is considering raising that to 10 percent. The plans are to increase the number of biogasoline outlets to 100 within fiscal 2008, and 1,000 in fiscal 2009. In fiscal 2010, biogasoline is projected to constitute 20 percent of all gasoline sold.—Daily Yomiuri Online, April 23, 2007.
Sheet steel prices have moved upward from $508/ton in February and probably will be around $600 in June, according to Reed Business Information.
In order to provide convenient and reliable refueling, hydrogen-powered fuel-cell drivers want station operators to drop liability agreements, integrate hydrogen with other products at the pump, adopt common standards, remove or standardize the need for protective equipment, and introduce more information on the status and capacity of stations, according to Adam Gromis, program manager at the California Fuel Cell Partnership. Around 100 hydrogen-powered fuel-cell vehicles operate in California, supported by 24 operational filling stations concentrated in the San Francisco-Sacramento and Los Angeles-San Diego corridors. Another 16 filling stations are planned.

Laura Stewart
, director of regulatory policy for the Petroleum Marketers Association of America since 2001, died April 30. Survivors include her husband, Brian, and twin one-year-old daughters, Lindsey and Olivia. A trust fund has been established for the daughters: The Olivia and Lindsey Stewart Trust Fund, c/o Marion Center Bank, Willow Springs Office, 162 Route 119 Highway N, Indiana, PA 15701.

Mexico software company
. Alvic Mexico, Calle Rio Nito, 90 Piso 7 Oficina 701, Colonia Cuauhtemoc, Delegación Cuauhtemoc, Mexico, D.F., Mexico 06500, has applied for manufacturer division membership. Cesar Juarez Fernandez is director general adjunto for the firm, which was established in 2005. Alvic Mexico provides software for service stations which is sold through distributors. Nominated for PEI membership by Wilhelm Schmidt Richter, Meridian, Mexico, D.F., Mexico.
Mexico tank manufacturer. Torco de la Laguna S.A., Calle Carmen Salinas #256 Sur Int. 4, Col. Centro, Torreon, Coah., Mexico 03100, has applied for manufacturer division membership. Luis Fernando Ramirez is the official representative for the firm, which was established in 2002. The company manufactures underground storage tanks. Nominated for PEI membership by Wilhelm Schmidt Richter, Meridian, Mexico, D.F., Mexico.
Florida installation and service company. J.E.B. Petroleum Contractors Inc., P. O. Box 173786, Hialeah, Florida 33017, has applied for affiliate division membership. Jose Archila is president of the firm, which was established in 2004. The company provides complete planning and construction services for service stations. Nominated for PEI membership by Pete Delderfield, DeltaPtrFL, West Palm Beach, FL.
Maryland environmental consulting firm. Advantage Environmental Consultants, LLC, 8610 Washington Boulevard, Suite 217, Jessup, Maryland 20794, has applied for affiliate division membership. Jeff Stein is a principal with the firm, which was established in 2002. Nominated for PEI membership by Dwayne Stambaugh, StaMtnceMD, New Windsor, MD.
Virginia installation and service firm. Diversified Industries, 307 Byrnes Street, Goodview, Virginia 24095, has applied for affiliate division membership. Robby Weaver is the owner of the firm, which was established in 2005. The company installs, upgrades, removes and services aboveground and underground petroleum storage tanks and equipment. Nominated for PEI membership by David Bass, ShannonAsc, Southern Pines, NC.

Arkansas Testing Services Inc.
, P. O. Box 191, Austin, Arkansas 72007, has requested its membership in PEI be transferred from the affiliate division to the distributor division. The company represents AmFab, Bagby, Flex-Ing, Franklin, HallTank, Morrison, PetroClear, Richards, Smithpipe, Tuthill and Universal. The transfer is sponsored by Richard D. Dixon, Hoidale, Wichita, Kansas, and Lyndell Thomas, HootenEqp, Springdale, Arkansas. 


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Petroleum Equipment Institute
P. O. Box 2380
Tulsa, OK 74101-2380

The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Robert N. Renkes, Executive Vice President, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.