DoD's DLA Spends $23.9M on Aviation Turbine Fuel from Equilon Enterprises LLC
Contract Overview
Contract Amount: $23,938,016 ($23.9M)
Contractor: Equilon Enterprises LLC
Awarding Agency: Department of Defense
Start Date: 2014-01-27
End Date: 2014-01-31
Contract Duration: 4 days
Daily Burn Rate: $6.0M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 26
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: 8500601943!TURBINE FUEL, AVIATION
Place of Performance
Location: HOUSTON, HARRIS County, TEXAS, 77002
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $23.9 million to EQUILON ENTERPRISES LLC for work described as: 8500601943!TURBINE FUEL, AVIATION Key points: 1. Significant expenditure on a critical aviation fuel component. 2. Competition was full and open, suggesting potential for competitive pricing. 3. Risk of price volatility in the petroleum market exists. 4. Spending falls within the Petroleum Refineries sector.
Value Assessment
Rating: good
The contract value of $23.9M for aviation turbine fuel appears reasonable given the quantity and market for such specialized fuel. Benchmarking against similar large-scale fuel procurements would provide further validation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically fosters competitive pricing. The existence of multiple bidders likely contributed to price discovery and a more favorable outcome for the government.
Taxpayer Impact: The use of full and open competition aims to ensure taxpayer dollars are spent efficiently by leveraging market forces to achieve competitive prices.
Public Impact
Ensures operational readiness for military aviation assets. Supports critical logistics and supply chain functions for the Department of Defense. Impacts the broader aviation fuel market due to the scale of the purchase.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for fuel price fluctuations due to global market dynamics.
- Dependence on a single supplier for a critical commodity.
Positive Signals
- Awarded through full and open competition.
- Firms Fixed Price contract type provides cost certainty.
Sector Analysis
This expenditure is within the Petroleum Refineries sector, specifically for aviation turbine fuel. Spending benchmarks for this category are highly dependent on global oil prices and geopolitical factors.
Small Business Impact
The data indicates that the awardee is Equilon Enterprises LLC, a large corporation. There is no specific indication of small business participation in this particular contract award.
Oversight & Accountability
The contract was awarded by the Defense Logistics Agency, a component of the Department of Defense responsible for logistics. Oversight would involve ensuring delivery and quality standards are met as per the contract.
Related Government Programs
- Petroleum Refineries
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Potential for price volatility in the energy market.
- Dependence on a single awardee for a critical supply.
- Lack of specific quantity data to fully assess per-unit cost.
Tags
petroleum-refineries, department-of-defense, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $23.9 million to EQUILON ENTERPRISES LLC. 8500601943!TURBINE FUEL, AVIATION
Who is the contractor on this award?
The obligated recipient is EQUILON ENTERPRISES LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $23.9 million.
What is the period of performance?
Start: 2014-01-27. End: 2014-01-31.
What was the average price per gallon or liter of the aviation turbine fuel purchased under this contract, and how does it compare to market rates at the time of award?
The provided data does not include the quantity of fuel purchased, making it impossible to calculate a per-unit cost. To assess value, the total contract value of $23.9M would need to be divided by the total gallons or liters procured. Comparing this derived per-unit cost to prevailing market rates for aviation turbine fuel during the contract period (January 2014) is essential for a comprehensive value assessment.
What were the specific risks associated with relying on Equilon Enterprises LLC for this critical fuel supply, and were mitigation strategies in place?
Risks could include supply chain disruptions, price volatility, or potential quality control issues. Given the full and open competition, the government likely had multiple qualified bidders, reducing sole-source dependency risk. Mitigation strategies might involve contract clauses for timely delivery, quality assurance testing, and potentially alternative supplier identification in contingency plans.
How effectively did the full and open competition process ensure the best possible price and terms for the taxpayer in this $23.9M aviation fuel procurement?
Full and open competition is designed to maximize price discovery and encourage multiple vendors to offer competitive bids, theoretically leading to the best value. The success in achieving the best price depends on the number and competitiveness of bidders, the clarity of the solicitation, and the market conditions at the time. Without bid data, it's difficult to definitively quantify the effectiveness beyond the process itself.
Industry Classification
NAICS: Manufacturing › Petroleum and Coal Products Manufacturing › Petroleum Refineries
Product/Service Code: FUELS, LUBRICANTS, OILS, WAXES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 26
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Shell Deutschland Gmbh (UEI: 423792808)
Address: 910 LOUISIANA ST STE 2, HOUSTON, TX, 77002
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $23,938,016
Exercised Options: $23,938,016
Current Obligation: $23,938,016
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SP060014D0463
IDV Type: IDC
Timeline
Start Date: 2014-01-27
Current End Date: 2014-01-31
Potential End Date: 2014-01-31 00:00:00
Last Modified: 2017-11-14
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