Petro-Canada Lubricants Achieves Significant Logistics Costs Savings with PSA BDP

About Petro-Canada Lubricants

Industry

  • Oil & Gas/Projects

SERVICES PROVIDED

  • Transportation Services
  • Domestic Facilitation

The Challenge

Prior to working with PSA BDP, Petro-Canada Lubricants had two separate providers, one that handled audit and freight payments, and the other that managed their domestic logistics and transportation needs. Utilizing two different providers brought about significant challenges.

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Challenges included:

  • Payment delays and issues with carrier relations: The implementation of the previous audit and freight payment vendor’s solutions led to significant operational disruptions for Petro-Canada Lubricants and overall dissatisfaction.

  • Complexity due to Rule 11 Rail Interline Regulations: Petro-Canada Lubricants experienced an increase in invoices and internal processing difficulties, particularly for North American rail shipments. Due to the new regulation, Petro was unable to accurately audit and allocate freight costs.

  • The ability to leverage economies of scale: Petro-Canada Lubricants has multiple downstream business units utilizing separate logistics process and solutions across North America. This limits the visibility of financial information and prevents the organization from leveraging their combined buying power.

  • Cost and visibility concerns: The 3PL provider was not optimizing Petro-Canada Lubricants’ domestic transportation in North America. Petro-Canada Lubricants was looking to lower transportation costs and improve real-time shipment visibility. • Limited IT resources: inability to integrate and implement advanced technology needed for shipment optimization and visibility.

Petro Canada sought a more reliable, effective and proactive partner to handle their managed road transportation due to the failed audit and freight payment implementation, lack of visibility and inability to optimize their logistics spend.

The Solution

In 2016, Petro-Canada Lubricants transitioned to PSA BDP for audit and freight payment services, marking the start of a strong and collaborative partnership.

After seeing results and cost savings from their initial collaboration, Petro-Canada Lubricants deepened their partnership with PSA BDP, beginning with network and consulting projects between 2017 and 2020. In 2019, PSA BDP supported Petro-Canada Lubricants with international audit and freight payment services, followed by Rail-Rule 11 audit and freight payment in 2022. Most recently, in 2024, Petro Canada Lubricants engaged PSA BDP to assist in bulk audit and freight payment services.

As Petro-Canada Lubricants’ trusted partner in freight audit and payment, PSA BDP identified opportunities for Petro-Canada Lubricants to further optimize their supply chain through PSA BDP’s managed road transportation solution.

Today, PSA BDP oversees all of Petro-Canada Lubricants’ road transportation across North America, ensuring seamless communication with carriers and efficient management of all activities. This includes less-than-truckload (LTL), truckload (TL), bulk, and intermodal services, transporting goods such as lubricants, oils, and hazardous materials.

Comprehensive Solutions:

TMS Application and Integration: Utilizing PSA BDP’s TMS for shipment management, shipment and mode consolidation, execution, and visibility; and integrating with Petro-Canada Lubricants’ ERP and order management systems for seamless data flow. Maintaining their master data and rate admin.

Shipment Planning and Execution: Creating daily shipment plans, optimizing cost through consolidation, tendering orders to selected carriers through automated processes, monitoring shipment progress and handling exceptions.

Carrier Management and Administration: Negotiating rates directly with carriers, administering carrier agreements and maintaining tariff ownership, managing carrier relationships and ensuring compliance with contract terms.

Freight Bill Processing & Auditing: Auditing carrier invoices and managing payments. Allocating transportation costs, GL coding application, and generating freight accrual.

Business Intelligence and Reporting: Providing strategic, tactical, and execution-level analysis of logistics activities with customized reporting. Working with Petro-Canada Lubricants to generate specific KPI and businessspecific metrics.

Regulatory Compliance: Ensuring adherence to national and international regulations for transporting dangerous goods (DG) and chemicals through comprehensive documentation and reporting to meet legal requirements.

DG Handling: Partnering with certified carriers experienced in handling hazardous materials while ensuring they adhere to high safety standards to prevent incidents during transit.

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Digital Tools

Transportation Management System (TMS): Optimizes shipment planning, tendering, and execution, integrated with Petro-Canada’s ERP for seamless data exchange.

Business Intelligence Solution: Provides access to customized reports, carrier performance analysis, and costsaving insights.

Audit & Freight Payment System: Ensures invoice accuracy and facilitates payment processes.

ERP / TMS System Integration: Provides seamless connectivity between Petro Canada’s ERP and Surface’s TMS for accurate order intake, real-time data exchange, and enhanced operational efficiency through automation.

Real-Time Transportation Visibility Platform (RTTVP): Enhances Real-Time Tracking with nightly updates to RTTVP, tracking actual carrier details, packing lists, and Bills of Lading (BOL) for precise monitoring

The Result

Through a strong foundational partnership with PSA BDP spanning nearly a decade, Petro-Canada Lubricants has achieved significant improvements in its supply chain:

  • Improved Bottom-line:

    • Achieved US$400k in cost avoidance through freight audits in one year.

    • A 7% reduction in transportation costs due to rate negotiations and TMS ooptimization.

    • Carrier payment terms management reduced late fees, improving financial stability

  • Greater Efficiency: By outsourcing the administrative tasks to PSA BDP, Petro-Canada Lubricants was able to focus on its core activities. They were able to streamline their logistics process while reducing transportation costs.

  • Improved Customer Satisfaction: Improved visibility and order cycle time through tracking and real-time updates for Petro-Canada Lubricants’ customers.

  • Ability to Make Informed Decisions: Enhanced data accuracy and access to logistics information allows for Petro-Canada Lubricants to make informed supply chain decisions

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About Petro-Canada Lubricants

Petro-Canada Lubricants, an Hf Sinclair brand, blends and packages more than 350 different lubricants, specialty fluids and greases that are exported to more than 80 countries on six continents. Petro-Canada Lubricants specializes in products and services proven to maximize equipment performance, productivity and overall savings. From heavy duty engine oils to hydraulic fluids, automatic transmission fluids and gear oils and greases – Petro-Canada Lubricants is committed to delivering innovative solutions that deliver value and keep your business moving.

Located in Mississauga, Ontario, Canada, HF Sinclair’s Petro-Canada Lubricants’ base oil refinery is one of the largest in the world with an annual capacity of up to 15,600 bpd.

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