Today, the U.S. Department of Energy’s (DOE) Office of Fossil Energy announced that it has awarded contracts from the recent Strategic Petroleum Reserve (SPR) crude oil sale.
On February 28, 2019, DOE issued a Notice of Sale for a price-competitive sale of 6 million barrels of SPR crude oil. Ten companies responded to the Notice of Sale, submitting 72 bids for evaluation. DOE has awarded contracts to the following three companies:
- Marathon Petroleum Corporation
- Motiva Enterprise, LLC
- Phillips 66 Company.
The Congressionally mandated sale was authorized under Section 404 of the Bipartisan Budget Act of 2015, which gives authority to the Secretary of Energy to draw down and sell up to $2 billion of SPR crude oil, for fiscal years (FYs) 2017 through 2020, to carry out an SPR modernization program. In FY 2019, the Secretary is authorized to sell up to $300 million worth of crude oil from the SPR, in accordance with the Energy and Water, Legislative Branch, and Military Construction and Veterans Affairs Appropriations Act, 2019 (Public Law 115-244), to carry out the SPR Life Extension Phase II project which is a component of the SPR modernization program. The proceeds from this sale will be deposited into DOE’s Energy Security and Infrastructure Modernization Fund during FY 2019.
The awarded contracts represent a total sale of 4.32 million barrels of crude oil. Of this amount, 1.2 million barrels will be sold from the SPR’s Bryan Mound site, 1.51 million barrels from the Big Hill site, and 1.61 million barrels from the West Hackberry site. The SPR will schedule deliveries to take place in April and May of 2019.