Here is news item on Kinder Morgan $25 MM civil suit for selling customers coal. They were exploiting the difference between coal barge weights & scale weights and selling the differences thru its “Red Lightning” company (name seems fit practice given what normally happens in red light district?).
KM is good company that got caught in a bad practice because some wunderkind had a brain-fart on this solution – but it has been my experience that bad applications don’t get limited to one area. KM is also the US & Worlds largest handler of petroleum coke and refiner’s like the TVA aren’t all that swift when it comes to dry bulk logistics.
Think this popped up during a financial audit & the FBI & OIG agents uncovered the details on what was happening.
Given the “sting” nature on this practice & fact KM paid 3X the value of what was sold – no doubt this practiced stopped but……
Think it might be good for anyone refining petcoke area to audit / review previous barge / ship weights (always more reliable and accurate than scales unless your survey agent is bum) against scale shipments from KM terminals??
Petcoke & coal always have a lot to crosscheck given changes in both moisture, Volatiles and handling losses but volumes should always be taken back to dry ton (or fuel coke case 8% moisture) basis for accounting purposes.
Regards
