JAMAICAN authorities complain that the problem of the unregulated sale of petroleum -- with supplies usually sourced by skimming from the deliveries to legitimate dealers -- is on the rise and that more than 100 of these rogue stations exist in Kingston and St Andrew alone.

Dr Jean Dixon, the permanent secretary in the commerce and technology ministry, which has responsibility for the petroleum industry, warned yesterday that these illegal facilities posed major disaster threats and said her agency was seeking to tighten regulations and to work closer with the police to fight the problem.

"Although the problem of illegal filling stations is not a new one, it has escalated to unacceptable levels," Dixon said in a speech to the Jamaica Gasoline Retailers Association (JGRA) at the Alhambra Inn in Kingston. "It is conservatively estimated that there are over 100 illegal filling stations in Kingston and St Andrew alone."

Lloyd Brown, the president of the JGRA, has another reason, beyond safety, why his association is worried about the illegal service stations. They not only provide competition for legitimate service stations but compete with products stolen from legal dealers.

"It is very unfair," Brown lamented. "Our products are skimmed and we lose twice. First, the product is taken from us, and second, we lose due to gas sales to these illegal gas stations."

But it is not only competition from these illegitimate facilities that the JGRA is concerned about. The association has reiterated its seven-year-old campaign to stop the international petroleum marketing companies, such as Shell, Texaco and Esso, from retailing their products.

They are pushing for Commerce and Technology Minister Phillip Paulwell to develop and enforce a code of conduct, which would impose such limits on the petroleum marketers -- an idea that was apparently embraced in the mid-1990s by then energy minister, Robert Pickersgill.

"The JGRA and each of the marketers are yet to sign off on a code of conduct," Brown told reporters after the closed-door session of the association's conference.

"The minister raised the issue in Parliament two weeks ago, so that is really what we are waiting to sign off on," Brown added. "Then we can proceed in a more harmonious manner."

In essence, Brown and the JGRA want the marketing companies to decide "whether they are wholesalers or retailers".

Marketing companies executives were unavailable yesterday for comment on the matter. The international firms own hundreds of service stations across Jamaica, most of which are leased to private operators who then retail the branded products of the particular operator. Esso, Shell, Texaco and the local firms, National and Petcom, also run some stations.

This issue of their proper place, and role, in the market erupted in 1996 when Shell revoked the contracts of seven of its dealers, claiming that they failed to operate at a standard consistent with the company's mandate.

Dealers, however, countered that it was part of a move by Shell to get closer to the retail end of a growing market, given the sharp rise of vehicles on Jamaican roads.

Yesterday, Brown argued that legitimate petroleum retailers, already squeezed by the skimming of their products prior to delivery, also suffered by the presence of the marketing companies' involvement in the retail end of the business.

"(The problem) is that marketers sell at the same price that dealers get the gas," he said. "By the time the dealer puts on his mark-up, it becomes very uncompetitive."

The commerce ministry's Dixon did not address these specific issues of competition but focused primarily on the impact of the illegal trading in petroleum, including on legitimate businesses and safety. There have been several cases of fire and death in communities where these makeshift facilities exist, with petroleum dispensed from drums.

"There is no denying that illegal filling stations pose a major problem to the petroleum industry and country at large," Dixon said. "However, efforts can only be successful if the suppliers, dealers and consumers work together. The fact is that some of the clientele supports this practice."

Her ministry, Dixon said, had beefed up its safety inspectorate division but "the task remains a mammoth one".

Among the proposals put forward by Brown and his association is a revision of the Weights and Measures Act to ensure more accurate measurement systems for petroleum and other tankers.

Currently, rulers are used to measure the volume of the gas received by a tanker. The measurement is valid if it is within a half-a-centilitre of the required volume of the delivery.

But, said Brown: "When it is a huge tanker giving gas, a tolerance level of half-a-centilitre can work out to be hundreds of gallons of missing gas."

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