In the oil and gas industry, where every tonne of cargo, every quality parameter and every operational decision can have significant commercial, financial and reputational implications, trust is the foundation of every transaction. For Daniel Nedelcu-Damiciuc, OGC Manager at SGS Romania, the role of Oil, Gas & Chemicals services goes far beyond carrying out inspections or laboratory analyses. The OGC team’s mission is to provide all parties involved with an independent and credible assessment of the quantity, quality and compliance of traded products. In essence, uncertainty is turned into verifiable, reliable information, enabling SGS clients to make decisions based on facts rather than assumptions.
If petrol, diesel or crude oil are produced to very clear standards, where does the technical difficulty arise?
Standards define the limits and characteristics a product must meet, but operational reality is far more complex. Two batches of diesel or petrol may comply with the same product quality specification and still show differences caused by their origin or by transport, storage or handling conditions.
The challenge lies not only in obtaining an accurate analytical result, but also in interpreting it in the appropriate operational and commercial context. Petroleum and chemical products are dynamic, and their characteristics can be influenced by many factors throughout the logistics chain, including transport, handling and storage.
The value SGS brings does not lie solely in the use of accredited methods and high-performance equipment, but also in the expertise required to interpret results in the real context of the operation. Our clients need more than data; they also need confidence that the data accurately reflects the commercial and technical reality of the product.
When we talk about an “inspection”, the first thought is usually of something being wrong, such as defects or non-compliance. What exactly do you inspect in the crude oil, petroleum products and gas sector?
In the oil sector, inspection means first and foremost establishing an independent technical reality.
In most commercial transactions, our main objective is to determine precisely the quantity and quality of the product transferred between the parties, through rigorous application of international standards for measurement, sampling and testing.
Of course, there are also situations where the purpose is to identify non-conformities, for example during checks in distribution networks or technical investigations. In our day-to-day work, SGS’s role is not to decide who is right, but to ensure an independent assessment and a shared understanding of the facts, based on verifiable data and internationally recognised standards.
The approach provides the market with an essential element: trust. Whether we are talking about crude oil, petroleum products, LPG, biofuels or chemicals, all parties need to know exactly what they are buying, what they are selling and what they are paying for.
Who decides where the quantity determination that matters commercially is made: at the refinery, in the terminal or on board the vessel?
The commercial contract.
It establishes the point at which responsibility for the cargo transfers from one party to another and, consequently, the location where quantity and quality determinations have commercial effect.
The transfer point may be at the refinery gate, in a terminal, in a storage facility, on board a vessel or at any other location agreed contractually. The importance of this moment is fundamental, because the transaction is settled on the basis of the results obtained there.
For that reason, an inspection does not begin with measuring the stock in a tank or taking a sample. It begins with understanding the contractual framework and each party’s responsibilities.
Quantity is probably the simpler part: you weigh or measure it and get the result. Why is an inspector needed?
In reality, determining quantity is far more complex than it may seem.
Crude oil is a relevant example, because the commercial quantity cannot be entirely separated from certain quality characteristics. Elements such as water and sediment directly affect the net quantity and therefore have a financial impact.
There are also differences between measurements taken in tanks and those carried out on board vessels, checks on the condition of transfer systems, the degree to which pipelines are filled, temperature and density corrections, and contractually permitted tolerances.
At volumes of tens or hundreds of thousands of tonnes, seemingly minor differences of a few tenths of a percentage point can have a considerable economic impact. The inspector’s role is to ensure that all determinations are carried out in accordance with international standards and that the final result reflects the physical reality of the transfer as accurately as possible.
Once the samples have been taken, they go to the laboratory. Can we say that the equipment and its quality are decisive at that stage?
High-performance equipment and accredited methods are indispensable, but they cannot compensate for an unrepresentative sample.
The quality of a result begins in the field.
Depending on the product and operational conditions, spot samples, composite samples or complex sampling procedures may be required. Choosing the correct method requires experience with the applicable international standards and a good understanding of the product’s behaviour.
A laboratory can accurately characterise the sample it receives. It cannot, however, determine whether that sample properly represents the entire batch.
That is why we often say that the value of an analysis begins when the sample is taken. A perfectly performed analysis on an unrepresentative sample can lead to incorrect conclusions. For this reason, inspectors’ expertise and compliance with sampling procedures are just as important as the performance of the laboratory itself.
The war in Ukraine and disruptions in the Middle East have changed supply routes and sources. Has anything changed in terms of the cargoes reaching Romania today and the inspector’s work?
Yes, the changes are significant.
In recent years, we have seen supply sources diversify and logistics flows that were previously considered stable and predictable being reconfigured. Products now come from a wider range of geographical regions, while logistics chains have become more complex and dynamic.
For the inspector, this means that every shipment must be assessed on the basis of its actual characteristics rather than assumptions drawn from previous experience. The standards remain the same, but the operational context is different.
In an environment characterised by volatility and rapid change, the need for independent verification services becomes even more important. An apparently small difference of 0.1%, 0.3% or 0.5% can have a significant economic impact when dealing with cargoes of tens or hundreds of thousands of tonnes.
SGS’s role is to provide the same technical rigour, impartiality and credibility regardless of the cargo’s origin, the complexity of the logistics chain or the geopolitical context in which the transaction takes place.
In an industry undergoing continuous transformation, trust remains the most valuable resource, and our mission is to support it through verifiable data, expertise and independence.
