U.S. Foreign-Trade Zones Board

July 29, 2002

Mr. John Babb
Port Director
U.S. Customs Service
Suite 1000
2350 N. Sam Houston Pkwy. East
Houston, Texas 77032

Dear Mr. Babb:

I have reviewed your request for a determination regarding the scope of FTZ authority for the oil refinery currently approved under zone procedures within FTZ Board Order 920, as amended by Board Order 1116, which authorized subzone status (SZ 149C) at the Phillips Petroleum Company refinery, Sweeney, Texas.

Your request for a scope determination indicates that the company is seeking a contract to store LPG product on behalf of other companies within an active subzone site. Phillips indicates that although the domestic status third party product will be commingled with foreign status product, it will be tracked in the inventory system so that no Phillips shipments are attributed to third party product receipts. While in the subzone storage site, the product will be the responsibility of Phillips and will be tracked using the already approved inventory system. The third party storage of LPGs will account for approximately one percent of total storage capacity. Phillips original zone approval included finished product storage as an approved activity within the subzone, and the proposed activity would not involve increased zone savings or added capacity Based on this information, it appears that third party product storage of LPGs (accounting for approximately one percent of total storage capacity) is within the scope of authority approved under Board Order 1116 for SZ 149C.

If you have any further questions, please call me or Ms. Liz Whiteman, who conducted a review of this matter, at (202)482-2862.


Dennis Puccinelli
Executive Secretary