February 11th - 2008

TSSA warns of pitfalls of purchasing gasoline stations

With some economists telling Canadians to prepare themselves to pay $1.50 a litre for gasoline and predicting oil to reach US$150 per barrel, purchasing a gasoline station may seem like a sound investment.

With some economists telling Canadians to prepare themselves to pay $1.50 a litre for gasoline and predicting oil to reach US$150 per barrel, purchasing a gasoline station may seem like a sound investment. But like the purchase of any business, there are very specific requirements of the buyer and seller.

The Technical Standards and Safety Authority (TSSA) regulates fuel supply, storage and transport and is concerned that potential owners are unaware, on purchasing or leasing a property, that they are assuming the liability for problems with the equipment or contamination in the ground. The cost to replace equipment and/or remediate contamination can be up to hundreds of thousands of dollars.

In order to protect the potential purchaser, TSSA suggests that REALTORS® advise clients or customers to request the following items:

  • A copy of the license for the facility. If the license has lapsed for more than 12 months, the facility has lost grandparented status and must meet current code requirements. In the case of a station with single-wall, underground equipment the new owner will either have to replace the equipment or apply to TSSA for a variance to use it. These variances are difficult to obtain and the documentation required for the variance is expensive.
  • Written confirmation from the seller that there are no outstanding orders against the facility.
  • Copies of all maintenance records for the equipment, including cathodic protection records for steel tanks.
  • A current environmental assessment report.
  • A current precision leak test of all underground equipment.

The Fuels page on the TSSA Web site (www.tssa.org) has a lot of information regarding the licensing and operation of a gas station. For specific information, REALTORS® or purchasers can contact a customer services advisor at 1-877-682-TSSA (8772) or email customerservices@tssa.org.

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For more information contact

Ontario Real Estate Association

Jean-Adrien Delicano

Manager, Media Relations

JeanAdrienD@orea.com

416-445-9910 ext. 246

Ontario Real Estate Association
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