PETALING JAYA, MALAYSIA - Crude palm oil worth billions of ringgit is being siphoned off by syndicates while being transported from mills to refineries.

The culprits involved in the racket include tanker drivers, depot operators and transporters.

Between 100 litres and 200 litres are siphoned off from each tanker which transports about 40 tonnes of crude palm oil per trip.

The drivers are paid between RM100 (S$41.41) and RM200 (S$82.82) per operation depending on the quantity of oil siphoned from the tankers.

The amount siphoned off is replaced with liquid such as water, used oil or sludge so the end-buyer would not realise the theft.

The hotspots in the Klang Valley where the siphoning is rampant include Kuala Selangor, Rantau Panjang in Port Klang, Dengkil, Jeram, Kapar, Rawang and Klang.

Beyond that, the active areas include Gambang, Temerloh, Mentakab, Johor Baru, Segamat, Yong Peng, Mersing, Simpang Renggam, Kota Tinggi, Senai, Masai, Kamunting, Manjung, Sitiawan, Sungai Siput, Bahau, Batu Kikir and Tampin.

Crude palm oil is mainly exported for production of items such as cooking oil, non-dairy creamer, condensed milk, butter and margarine.

Statistics provided by the Malaysian Palm Oil Board revealed that the thefts costs the industry RM325mil in losses in 2008.

With the crude palm oil price averaging at RM2,600 per tonne now, the extent of losses is this year expected to match last year's figure.

Over 20 transporters are said to be operating 1,500 tankers moving crude palm oil.

Most people do not suspect anything amiss when they see tankers going off the road and heading to "depots" in plantations or villages, where the siphoning takes place.

The "depots" are manned by men who look like foreign workers. Outside, along the main road, other men move in cars and keep watch.

A StarProbe team tracked the movements of several tankers for more than two weeks to uncover the theft.

Most of the "depots" have two access routes - an entrance and exit. Some of these "depots" are said to be operated by small-time transporters.

The team also found that some of the "depots" operated into the late hours of the night under bright spotlights.

At these "depots", workers used tubes and mini motors - similar to those used in fish aquariums - to siphon the crude palm oil into plastic buckets and drums.

The thieves were also seen tampering with the oil seals at the back of the tankers.

After the siphoning is completed, the workers were seen pouring liquid believed to be water, sludge and used cooking oil, into the tankers.

At one such "depot" in Kuala Selangor, the team recorded seven tankers, including four laden with crude palm oil, entering and then exiting from the site half an hour later.

The siphoning process takes only between five and 10 minutes. Up to 200 litres of crude palm oil can be siphoned in that time.

One "depot" in Jalan Rantau Panjang in Klang was fully covered with zinc hoarding and later put up dark nets when the thieves realised their illegal activities were visible from a flyover along the Shapadu Highway.

Another "depot" located off Jalan Kem in Port Klang was strategically located in an industrial lot away from the main road.

The StarProbe checks revealed that between 10 and 40 tankers patronised the "depots".

The "depot operators" pay the drivers about 50 per cent of the market price for the crude palm oil which amounted between RM100 and RM200 per trip.

A "depot" can make up to RM4,000 daily from the sales of the siphoned crude palm oil. That works out to almost RM1.5mil a year.