The U.S. Department of Energy (DOE) has revealed that it intends to sell up to nine million barrels of crude oil from the Strategic Petroleum Reserve (SPR).
A statement posted on the DOE’s website on Monday outlined that the “price competitive” sale of SPR sour crude oil will be conducted from the West Hackberry, Bryan Mound, and Big Hill sites. The sale, which was said to be announced to fulfill requirements for Section 404 of the Bipartisan Budget Act of 2015, will see up to three million barrels go from each site.
The DOE said it must receive bids by no later than 10am CDT on April 27 and that it will award contracts to successful offerors by no later than May 6. Deliveries will take place in June this year, with early deliveries available in May. Any company registered in the SPR’s crude oil sales offer program is eligible to participate in SPR crude oil sales.
The SPR is the world’s largest supply of emergency crude oil, the DOE highlights on its website. Stored in underground salt caverns at four storage sites in Texas and Louisiana, the federally owned oil stocks have a long history of protecting the economy and American livelihoods in times of emergency oil shortages created by hurricanes and geopolitical events, according to the DOE.
Last month, the DOE revealed that several contracts had been awarded from an SPR sale launched in February, which was for 10.1 million barrels of SPR crude oil. A total of 10 companies responded to the notice of sale, submitting 60 bids for evaluation. The DOE awarded contracts to seven companies - Glencore Ltd., Marathon Petroleum Supply and Trading LLC, Motiva Enterprises LLC, Phillips 66 Company, Shell Trading (US) Company, Valero Marketing, and Supply Company - and the Government of Australia.
Back in January, the DOE announced that it planned to sell crude oil from the SPR over a multi-month period during 2021.
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