GUIDE TO THE TERMINAL GATE PRICE SYSTEM FOR SUPPLIERS YOUR

							       GUIDE TO THE TERMINAL GATE PRICE SYSTEM FOR SUPPLIERS
        YOUR OBLIGATIONS UNDER THE NEW TERMINAL GATE PRICING SYSTEM

On 19 December 2002, a new Terminal Gate Pricing system will be introduced into Western
Australia. From this date, prescribed1 suppliers will be required to nominate a Terminal Gate
Price for each controlled petroleum product (ULP, PULP, LRP and Diesel) supplied by them
from a Declared Terminal2. Suppliers will also be required to comply with certain transparency
requirements in respect of sales from the terminals.
1
   Suppliers are prescribed under the Petroleum Products Pricing (Maximum Terminal Gate Price) Order 2002. For
details of the prescribed suppliers, see the paragraph below on “Who does the TGP apply to?”
 2
   Terminals are declared under the Petroleum Products Pricing (Declared Terminals) Order 2002. For details of
Declared Terminals, see the paragraph below on “Where does the TGP apply?”

What is the Terminal Gate Price?

The Terminal Gate Price (‘TGP’) is the maximum price which a prescribed supplier can charge
for a sale of motor fuel from a Declared Terminal. The TGP applies to all spot (uncontracted)
sales and to sales made under contracts entered into after 1 November 2000. As this price is
only for the motor fuel, the supplier can charge for services provided in addition to the motor
fuel such as delivery, branding, equipment and credit facilities. These charges must, however,
be disclosed to the purchaser on the invoice for the sale.

The supplier may nominate its TGP for each product at each terminal and the components
making up that price, to the Prices Commissioner by directly uploading this information to the
FuelWatch website. If a supplier does this, this price is fixed by the Prices Commissioner as
the maximum TGP under section 12 of the Petroleum Products Pricing Act 1983 until such
time as the supplier nominates a new TGP.

As the TGP is a maximum price fixed under section 12 of the Act, it imposes certain statutory
obligations on the supplier such as the obligation to supply under section 19 of the Act. It is
also an offence under section 14 of the Act to sell fuel from the terminal at a price greater than
the TGP.

What happens if you do not notify the Prices Commissioner of your TGP and
components?

If you do not notify your TGP and components on the day before the Order comes into effect
(18 December 2002), your maximum TGP will be the spot price which is required to be
displayed under section 22B of the Act, as at 8.30 am on 19 December 2002. This price will
remain the TGP until such time as a TGP notification is made by you to the FuelWatch
website: www.fuelwatch.wa.gov.au
Who does the TGP apply to?

The new provisions will apply to the following suppliers:
          · BP Australia Limited
          · Caltex Australia Petroleum Pty Ltd
          · The Shell Company of Australia Ltd
          · Mobil Oil Australia Pty Ltd
          · Gull Petroleum (WA) Pty Ltd
                                                           2




Where does the TGP apply?

The new requirements will apply to supplies of fuel from all of the following terminals:

Metropolitan

BP Australia Limited, Abernathy Road, Kewdale
BP Australia Limited, Swan Street, North Fremantle
Caltex Australia Petroleum Pty Ltd, Bracks Street, North Fremantle
Gull Petroleum (WA) Pty Ltd, Kwinana Beach Road, Kwinana
Mobil Oil Australia Pty Ltd, Kwinana Beach Road, Kwinana
The Shell Company of Australia Limited, Bracks Street, North Fremantle

Regional

BP Australia Limited, Port Drive, Broome
The Shell Company of Australia Limited, Port Drive, Broome
BP Australia Limited, Gladstone Street, Esperance
Caltex Australia Petroleum Pty Ltd, Gladstone Street, Esperance
The Shell Company of Australia Limited Brazier Street, Esperance
Caltex Australia Petroleum Pty Ltd, Brunswick Road, Albany
BP Australia Limited, Shenton Street, Geraldton
Caltex Australia Petroleum Pty Ltd, Shenton Street, Geraldton
The Shell Company of Australia Limited, Augustus Street, Geraldton
BP Australia Limited, Leehey Street, Port Hedland
Caltex Australia Petroleum Pty Ltd, Weston Street, Port Hedland
Mobil Oil Australia Pty Ltd, Wyndham Coastal Bulk Plant, Wyndham

When?
You will need to comply from 19 December 20023.
3
    Notification of TGP’s for 19 December 2002 will need to take place by 2.00pm on 18 December 2002.

What are you required to do under the new arrangements?

1. Notify to the Prices Commissioner, by direct upload to the FuelWatch website4:
           a. The next day’s TGP for Regular Unleaded Petroleum, Premium Unleaded
              Petroleum, Lead Replacement Petroleum or Diesel supplied from each terminal;
              and
           b. The amount of each of the following components which make up the TGP:
                    i. Platts Singapore Products Assessment (Spot) Price;
                    ii. WA Specification Premium;
                   iii. Freight;
                   iv.   Insurance and Loss;
                    v.   Wharfage;                                              (cont’d)

4
 After the first TGP notifications further TGP notifications are only required when the TGP changes. When the TGP
does not change, the previously notified TGP will automatically be “rolled over” to the next day (and each
subsequent day until the supplier notifies a new TGP).
                                                          3


What are you required to do under the new arrangements? (cont’d)

                 vi. Terminal Operating Margin;
                 vii. Excise;
                viii. GST;
                 ix. Any other amount.
2. Display at the terminal, so as to be clearly visible to an intending purchaser, the following
   information:
         a. The Terminal Gate Price;
         b. The Spot price (if different to the Terminal Gate Price5); and
         c. The previous month’s weighted average price calculated in accordance with the
            regulations.
3. Notify the Prices Commissioner by direct upload to the Fuelwatch website of any changes
   to the spot price.
4. Not make any sales of motor fuel to an uncontracted purchaser, or to a purchaser under a
   contract entered into after 1 November 2000, at a price which is greater than the TGP.
5. Provide on invoices for all sales of motor fuel from the terminal, details of the amount
   charged for any of the following components:
         a. Delivery of the fuel;
         b. Use of a brand;
         c. A credit facility; or
         d. Anything else connected with the sale of the motor fuel.
6. Show on invoices for spot sales:
         a. The displayed spot price; and
         b. The TGP.
7. Supply fuel at the TGP to any reseller who makes a demand for a quantity of fuel and
   tenders payment for that quantity at the TGP5.
5
  The Terminal Gate Price is a maximum price under section 12 of the Act and therefore the spot price must be
equal to or lower than the Terminal Gate Price.
6
   Please note that certain defences do apply to the requirement to supply under section 19 of the Act. Suppliers
should refer to subsection 19(2) of the Act for details of these defences.




Further information

This guide is a summary of your principal obligations under the new Terminal Gate Pricing
System and should be read in conjunction with the Petroleum Products Pricing (Maximum
Terminal Gate Price) Order 2002 and the Petroleum Products Pricing Act 1983. For a precise
statement of the law, we recommend that you refer to the legislation, or seek independent
legal advice. Further information or assistance can also be obtained by contacting FuelWatch
on 1300 55 45 45 or by email at fuelwatch@docep.wa.gov.au .