Bulk Oil Storage and Dispensing Best Practices

Jim Fitch, Noria Corporation

Lubricant health is essential to extending the life of machinery. Proper oil storage is critical to maintaining a clean and healthy fluid. Many things can happen to the lubricant between bulk delivery and dispensing to the machine application. Adhering to some general recommended practices for the storage and handling of bulk lubricants can greatly improve the chances of having healthy machines with long service lives.


Bulk Oil Storage and Dispensing System
Oil Storage/Dispensing System
(Oil Safe)


Bulk Oil Storage Tank Design Features

A proper tank or vessel is necessary to avoid contamination and to prolong the life of the lubricant in storage.

Some tank design criteria are described below. However, it is recommended to consult the following American Petroleum Institute (API) standards relating to tank design, fabrication and commissioning:

API Standard 620 - Design and Construction of Large, Welded, Low-pressure Storage Tanks API Standard

650 - Welded Steel Tanks for Oil Storage

Tank Construction Materials

Storage tanks can be made from stainless steel, mild steel plate, anodized aluminum or plastic. Stainless steel and anodized aluminum have a relatively high material cost. In return, their maintenance costs are low. In certain cases, a thinner-gauge stainless steel may also be suitable to better contain the costs of construction.

Some mild steel tank designs and fabrication processes require shot or sand blasting plus the addition of one of the following depending on the type of product to be stored: a)lanolin-based rust preventive, b) oil-resistant paint, c) coating with plastic or epoxy resins or d) aluminum spraying. Galvanized steels should not be used for tanks or piping due to risks associated with additive reactions in the formulated oil. Tank seams should be riveted or welded.

The benefits of using plastic or poly tanks are that these materials prevent rust and are clear enough that their fluid levels can be easily seen. Some suppliers provide plastic tanks that are also stackable to save floor space.

Sight Gauges for Bulk Oil Storage Systems
Sight Gauges Indicate
How Much Product is Left in Each
Container (IFH Group, Rock Falls, Ill.)

Breathers and Ventilators

Above the tank’s oil level and beneath the roof of the same tank lies the headspace. Every tank produces different conditions within its headspace as the contents of oil mist, dirt and water vapor vary considerably. A high percentage of moisture and solid contaminants that enter lubricating oils and hydraulic fluids in storage vessels must pass through the headspace.

Breathers are necessary to exclude contamination. The breather needs to have a particle size and capture efficiency similar to that expected for the transfer oil filter. For example, if the oil filter that is used when discharging the lubricant out of the tank has a 10-micron filter and 90 percent capture efficiency (Beta10 10), then the breather performance should be the same or better.

If the lubricant is a hydraulic fluid, then the breather usually requires fine breather filtration - around three microns. Gear oils by comparison may need only 10- to 20-micron filters at 90 percent capture efficiency.

Mobile Lube Maintenance Cart
Mobile Lube Maintenance Cart
(IFH Group, Rock Falls, Ill.)

If the air in the environment is humid or if there are substantial temperature differences throughout the day, then there is a need to control condensation on the walls of the tank in the headspace. Otherwise, the condensate will often drip and settle at the bottom of the tank and accumulate. The collection over time can result in a water phase of several inches or even one to two feet.

Bulk storage tanks should be equipped with breathers positioned at least eight feet above ground. The lower the breather is to the ground, the more rapidly it will plug with dirt. If the location is humid, it is a good idea to use desiccating breathers to exclude moisture.

Headspace water vapor and suspended water within the lube oil continuously seek equilibrium. By controlling headspace moisture, water residing within the oil will move into the headspace, thereby reducing the water content of the lube oil. The continuous process is called headspace dehumidification. It is a filterless process designed to keep water in lube oils within safe limits.

Vapor extraction fans, or forced ventilators, are sometimes used to purge volatile hydrocarbon products and water vapor from the headspace. An alternate method involves metering dry and clean instrument air into and through the headspace (purging to atmosphere through a port across the tank). This also helps keep the oil dry and clean.

Bulk Lubricant Totes

a) 120-gallon Tank and 240-gallon Tank with Converting Bracket, Pump, Hose Reel and Quart Meter
b) Two 70-gallon Tanks with 240-gallon Tank, Stacked with Converting Bracket
c) 180-gallon Tank with Air Pump and Dispensing Gun (Photos Courtesy Tote-A-Lube, a Division of Davtone, Inc.)

Water-phase Floaters

Some bulk oils constantly build up water at the bottom of the tank. In these cases, a floater can be used to both indicate the amount of free water and facilitate purging of the free water phase. The difference between the water’s density and the oil’s density is such that a properly designed floater can sit on top of the water and settle in the oil. When the oil is discharged from the tank, the oil suction can be taken from above the water phase.

Filtration and Separation

The lubricant should be filtered before it enters and leaves the storage tank. The fluid cleanliness should be brought up to a level of one to two ISO 4406 range numbers below alarm levels. For example if the alarm level is an ISO 19/16/13, the filter should clean to a level of ISO 17/14/11.

The filters need to be selected with the ability to maintain this target cleanliness level. New oil should be filled through a transfer filter or other suitable filtration technology. For small tanks, a filter cart can also be used to clean the oil before it enters the tank. Some filter carts come fitted with an online particle counter to monitor performance. A good practice is to filter the lubricant whenever it is transferred.

In general, filters with performance rates per ISO 16889 (formerly ISO 4572), known as the Beta rating, should be used. The Beta rating can then be translated into a capture-efficiency at different micron sizes.

Large high-flow rate filters generally provide the best economy from the standpoint of the cost of a gram of dirt removed. For instance, when you double the size of a filter element you often triple its dirt-holding capacity. High-integrity Beta-rated filters are typically pleated synthetic media.

Super absorbent filters can be used where low concentrations of free or emulsified water exist. Super absorbent filters typically contain starch-based polymers that can absorb as much as 500 times their weight in water. Most large filter suppliers keep these filters in stock. However, they may cost significantly more than particle-retention filters.

Oil Tank Bottoms and Drainage Points

The drain port should be located at the lowest point of the tank. This will prevent oil at the bottom of the tank from becoming stagnant and collecting heavy contaminants, sediment and water. It is helpful if the bottom slope is between 1:10 to 1:30. While sloped or flat-bottom tanks are the most common, conical- or funnel-bottom tanks are the best to prevent accumulation of sludge and water and are preferred by many.

Placing a baffle over the drain helps to remove the bottom layer of fluid first. The size and position of the drain must be designed to allow access for fittings to be removed for repair and easy cleaning. Manholes and ladders may be needed for large tanks.


Sometimes heating stored lubricants is necessary in cold climates or when fluids are very viscous. Heating lowers an oil’s viscosity which makes it easier to flow or pump from the tank. For heaters in a bulk storage tank, the watt density should not exceed 15 watts per square inch for circulating fluids and 10 watts per square inch for static fluids.

If the watt density exceeds this threshold, the oil can begin to thermally fail. This often results in heavy sludge forming around the heating elements and volatiles forming in the oil (from cracking the oil) leading to sharp loss of viscosity.


Stiffeners prevent rectangular tanks with flat walls from bulging at the sides and reduce stresses at the edges in large tanks. External stiffening is often preferred to simplify tank cleaning by avoiding dirt traps. If internal baffles or compartment walls are used in the storage tank, separate stiffening may not be necessary.

Hoses, Tubing, Pumps and Valves

When hoses and other tank hardware are not being used, exposed hose ends and hardware ports should be sealed from environmental contamination. In the event that the hoses or lines become contaminated, they should be flushed or pneumatically pigged out using sponge-like projectiles.

Oil Level Determining Devices

One of the key responsibilities in inspection and maintenance is checking and maintaining proper fluid levels in supply tanks. A drop below a buffer level in a storage tank may result in insufficient availability of lubricants to critical machinery. The consequence could be machines that don’t get serviced on time and perhaps are temporarily starved of the appropriate amount of oil to keep them running properly and reliably.

Overfilling the storage tanks can also be harmful. Spillage is one of the most overlooked issues in bulk storage management. Many small spills can remain in the ground for several years. The following standard by the American Petroleum Institute should be consulted:

API Recommended Practice 2350 - Overfill Protection for Storage Tanks in Petroleum Facilities

Additionally, the U.S. government has issued Title 40 of the Code of Federal Regulations (CFR) Part 280.20(c) that defines the use of tank overfill prevention instruments. According to this guideline, the equipment should either: a) automatically shut off the supply flow when the tank is 95 percent full, b) alert the operator when the tank is more than 90 percent full, or c) restrict the flow 30 minutes prior to overfilling and alert the operator with a high-level alarm one minute before overfilling. Various simple oil level devices are available.

Dipstick and Water-level Detection

A dipstick is a basic visual oil level check device that must be designed into a system and typically is used only in smaller tanks. Assessing oil level with a dipstick is easy. The dipstick seat should be kept clean and the O-ring maintained in good condition.

The typical disadvantage of using a dipstick is the risk of contaminant ingression during the level inspection process. Both the tank and the dipstick are momentarily exposed to terrain dust. A dipstick is often inconvenient and time consuming.

It is not possible to completely clean a dipstick with a shop rag pulled from the pocket of a lubrication technician going through the daily tank inspection rounds. However, the dipstick should be cleaned of excess oil and dirt prior to inspection. A lint-free paper towel can be helpful; however, the extra level of attention is typically not followed. For this reason alone, other nonintrusive methods of determining oil level are often preferred.

Visual Sight Glasses and Level Gauges

Tanks should have a visual sight glass or level gauge with reference marks. This gives an immediate level indication to the operator or maintenance technician. Routine observations should be made through the sight glass. A noticeable change in the appearance is an indication of contamination, particularly water, air or sediment.

The sight gauge should be mounted in a protective metal jacket for safety reasons and to avoid catastrophic lubricant loss. The location should be in a protected area to avoid accidental damage from any activity near the tank. Yet it must also be easily accessible for checking and occasional cleaning.

The protective metal sleeve allows the level scale to be stamped to prevent external accumulations of oil and dirt on the scale from making the markings illegible. It is best to locate level gauges near fill ports so that the gauge can be observed during filling and discharge operations.

The next step is to calibrate the level graduations with reference marks. On small tanks, the intervals will be around 10, 20 or 50 gallons. The volume should be worked out internally, then the required interval graduations should be calculated. The height on the sight gauge where these marks are required must also be calculated. This is an important factor for recording the volume of oil either delivered to or used from the storage tank.

Level Sensors and Alarm Options

While visual inspection should be a priority, automated level meters offer a number of benefits. Utilizing low-cost level gauges and switches - capacitance-based, magnetic, optical or mechanical (float type) - signals can be sent to generate either a purchase order for new delivery or a work order for a top-up. On a more advanced level, these can be set to activate a pump that will automatically replenish lubricant from a bulk store to the machine reservoir.

These switches can then reset when the required volume has been supplied. Other depth finder-type level sensors are available, using acoustic technology to determine the precise oil level. Like a fuel tank on mobile equipment, the level switch must have some damping to avoid constantly fluctuating level changes from fluid movement and turbulence.

Additionally, where an automated tank volume-registering device is in use it should incorporate an alarm for a sudden change of fluid volume, such as from a hose burst or ingress of water.

Other Instruments

Thermometers and temperature gauges are important when heaters are used to ensure that temperatures inside the tank do not exceed critical alarm levels.


  1. Advice on Lubricants, Storage and Handling - A Trainee’s Guide. (1985). TPC USA: TPC Training Systems.

  1. API 620. Design and Construction of Large, Welded, Low-Pressure Storage Tanks.

  1. API 650. Welded Steel Tanks for Oil Storage.

  1. API 1604. Closure of Underground Storage Tanks.

  1. API 1615. Installation of Underground Storage Systems.
  1. API 1631. Interior Lining of Underground Storage Tanks.
  1. API 1632. Cathodic Protection of Underground Petroleum Storage Tanks and Piping Systems.
  1. API 2015. Requirements for Safe Entry and Cleaning of Petroleum Storage Tanks.
  1. API 2016. Guidelines and Procedures for Entering and Cleaning of Petroleum Storage Tanks.
  1. API Recommended Practice 2021. Fight Fires in and Around Flammable and Combustible Liquid Atmospheric Storage Tanks.
  1. API Recommended Practice 2350. Overfill Protection for Storage Tanks in Petroleum Facilities.
  1. ASTM D4057. Standard Practice for Manual Sampling of Petroleum and Petroleum Products.
  1. ASTM D6224. Standard Practice for In-Service Monitoring of Lubricating Oil for Auxiliary Power Plant Equipment.
  1. ASTM D6439. Standard Guide for Cleaning, Flushing and Purification of Steam, Gas and Hydroelectric Turbine Lubrication Systems.
  1. Booser, E. (2000). CRC Handbook of Lubrication (Theory and Practice of Tribology), Vol. 1. Boston: CRC Press, Inc.
  1. EPCRA Section 313: Petroleum Terminals and Bulk Storage Facilities.
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  1. Marks, A. (1983). Petroleum Storage Principles. Tulsa: Pennwell Publishing Co.
  1. Neale, M. (1995). Lubrication - A Tribology Handbook. Oxford: Butterworth Heinemann.
  1. OSHA 1910.110. Storage and Handling of Liquefied Petroleum Gases.
  1. OSHA 1910.146. Permit-Required Confined Spaces.
  1. OSHA 1915 Subpart I, App A. “Nonmandatory Guidelines for Hazard Assessment, Personal Protective Equipment (PPE) Selection, and PPE Training Program.”
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About the Author

Jim Fitch, a founder and CEO of Noria Corporation, has a wealth of experience in lubrication, oil analysis, and machinery failure investigations. He has advise...