The United States Department of Energy’s (DOE) Office of Fossil Energy (FE) announced today a Notice of Sale of crude oil from the Strategic Petroleum Reserve (SPR).
DOE plans to draw down and sell crude oil from three SPR sites—Bryan Mound and Big Hill in Texas, and West Hackberry in Louisiana. This sale will fulfill requirements for Section 404 of the Bipartisan Budget Act of 2015 (Public Law 114-74) and Section 158 of the Bipartisan Budget Act of 2018 (Public Law 115-123).
Section 404 of the Bipartisan Budget Act of 2015 authorizes the Secretary of Energy to draw down and sell up to $2 billion of SPR crude oil, for fiscal years 2017 through 2020, to carry out an SPR modernization program. On February 9, 2018, a Continuing Resolution was passed that included a provision to allow DOE to sell up to $350 million worth of crude oil from the SPR, to carry out the SPR Life Extension Phase II project—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 fiscal year 2018.
The Notice of Sale announced today includes a price-competitive sale of up to 7 million barrels of SPR crude. The sale will be conducted with crude oil from the following three SPR sites:
- Up to 3 million barrels from Bryan Mound
- Up to 2.5 million barrels from Big Hill
- Up to 1.5 million barrels from West Hackberry.
DOE must receive bids no later than 2:00 p.m. Central Time March 21, 2018. DOE will award contracts to successful offerors no later than April 6, 2018. Deliveries will take place in April and May.
Any company registered in the SPR’s Crude Oil Sales Offer Program is eligible to participate in SPR crude oil sales. Other interested companies may register through the SPR website’s Crude Oil Sales Offer Program.