Interior Department awards $14.3M contract for Hoover Dam fuel, highlighting petroleum product needs

Contract Overview

Contract Amount: $14,296 ($14.3K)

Contractor: MJ Global LLC

Awarding Agency: Department of the Interior

Start Date: 2026-04-10

End Date: 2028-09-14

Contract Duration: 888 days

Daily Burn Rate: $16/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: BULK FUEL DELIVERIES FOR HOOVER DAM

Place of Performance

Location: BOULDER CITY, CLARK County, NEVADA, 89005

State: Nevada Government Spending

Plain-Language Summary

Department of the Interior obligated $14,296 to MJ GLOBAL LLC for work described as: BULK FUEL DELIVERIES FOR HOOVER DAM Key points: 1. Contract value of $14.3 million over approximately 4 years suggests significant ongoing fuel requirements. 2. Awarded to MJ GLOBAL LLC, indicating a specific supplier for bulk fuel deliveries. 3. The contract's fixed-price nature aims to provide cost certainty for the government. 4. Petroleum Lubricating Oil and Grease Manufacturing (NAICS 324191) classification points to specialized product needs. 5. The Bureau of Reclamation's reliance on this contract underscores the operational importance of fuel for the Hoover Dam. 6. Competition under SAP (Simplified Acquisition Procedures) suggests a streamlined process for awards under $250,000, though this award is significantly larger, raising questions about the competition method used for this value.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more detailed cost breakdowns or comparable fuel delivery contracts for large infrastructure projects. The firm fixed-price structure is generally favorable for cost control. However, the lack of detailed cost information makes a definitive value-for-money assessment difficult. The award amount of $14.3 million over nearly 5 years suggests an average annual spend of approximately $2.86 million for bulk fuel, which needs to be compared against market fuel prices and delivery costs in the region.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

The contract was competed under SAP (Simplified Acquisition Procedures). While SAP is intended for procurements under $250,000, it can be used for larger amounts if justified. The specific competition details, such as the number of solicitations and bids received, are not provided. The use of SAP for an award of this magnitude warrants further scrutiny to ensure adequate competition and price discovery were achieved.

Taxpayer Impact: The method of competition impacts taxpayers by influencing the final price paid. A more robust competition could potentially lead to lower prices, while a less competitive process might result in higher costs.

Public Impact

The primary beneficiaries are the operational needs of the Hoover Dam, ensuring continuous power generation and water management. Services delivered include the reliable supply of bulk fuel, essential for the dam's machinery and backup systems. The geographic impact is localized to the Hoover Dam facility and its immediate operational vicinity in Nevada. Workforce implications are likely minimal, primarily affecting the logistics and delivery personnel from the contractor, MJ GLOBAL LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The use of Simplified Acquisition Procedures for a contract valued at $14.3 million raises concerns about the extent of actual competition and potential for overpayment.
Lack of transparency regarding the specific competition details (number of bidders, evaluation criteria) hinders a full assessment of the award process.
The long duration of the contract (nearly 5 years) could expose the government to price volatility if market conditions change significantly.

Positive Signals

The firm fixed-price contract provides cost certainty for the government, mitigating risks associated with fluctuating fuel prices.
Awarding to a single contractor, MJ GLOBAL LLC, can streamline delivery and management processes.
The contract directly supports the critical infrastructure of the Hoover Dam, ensuring its continued operation.

Sector Analysis

This contract falls within the energy and utilities sector, specifically focusing on the supply chain for critical infrastructure. The petroleum lubricating oil and grease manufacturing industry (NAICS 324191) is a key component supporting heavy machinery and power generation facilities. Comparable spending benchmarks would involve analyzing fuel procurement contracts for other large federal power projects or critical infrastructure sites, considering regional fuel price variations and delivery logistics.

Small Business Impact

The provided data indicates that small business participation (SB set-aside and subcontracting) was not a factor in this award (ss: false, sb: false). This suggests the contract was not specifically targeted towards small businesses, and larger prime contractors were likely involved in the competition. The absence of small business considerations means there is no direct impact on the small business ecosystem through this specific contract's structure.

Oversight & Accountability

Oversight for this contract would primarily fall under the Bureau of Reclamation, a division of the Department of the Interior. Accountability measures are embedded in the firm fixed-price contract terms, requiring MJ GLOBAL LLC to deliver specified fuel products. Transparency is limited by the available data; further details on performance metrics and oversight activities would be needed for a comprehensive assessment. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Bulk Fuel Procurement
Hoover Dam Operations and Maintenance
Department of the Interior Energy Contracts
Bureau of Reclamation Infrastructure Support
Petroleum Product Supply Chain Management

Risk Flags

Potential for inadequate competition due to SAP usage for large award value.
Lack of detailed performance metrics and oversight information.
Contract duration may expose government to unfavorable market price shifts.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $14,296 to MJ GLOBAL LLC. BULK FUEL DELIVERIES FOR HOOVER DAM

Who is the contractor on this award?

The obligated recipient is MJ GLOBAL LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Bureau of Reclamation).

What is the total obligated amount?

The obligated amount is $14,296.

What is the period of performance?

Start: 2026-04-10. End: 2028-09-14.

What is the track record of MJ GLOBAL LLC in fulfilling federal contracts, particularly for fuel or lubricant supply?

Information regarding MJ GLOBAL LLC's specific track record with federal contracts is not detailed in the provided data. A comprehensive analysis would require searching federal procurement databases (like SAM.gov or FPDS) for past performance ratings, contract history, and any reported issues or successes. Understanding their experience with similar-sized contracts, delivery locations, and product types would be crucial for assessing their reliability and capability in fulfilling this $14.3 million BPA call for bulk fuel deliveries to the Hoover Dam.

How does the $14.3 million contract value compare to historical spending on fuel for the Hoover Dam?

The provided data does not include historical spending figures for fuel at the Hoover Dam. To make this comparison, one would need to access historical contract awards for fuel supplies to the facility over previous years. Analyzing trends in annual spending, contract durations, and awarded amounts would reveal whether this $14.3 million award represents an increase, decrease, or stable level of investment. Such a comparison is essential for understanding the long-term financial commitment and potential changes in operational needs or pricing.

What are the specific risks associated with a nearly five-year firm fixed-price contract for bulk fuel deliveries?

A significant risk with a long-term firm fixed-price contract for bulk fuel is price volatility. While the fixed price protects the government from upward price surges, if market fuel prices were to decrease substantially, the government might be paying above market rates for a prolonged period. Conversely, if prices increase dramatically, the contractor could face financial strain, potentially impacting delivery reliability. Other risks include potential supply chain disruptions affecting the contractor, changes in fuel quality requirements, and the challenge of enforcing performance standards over an extended period without regular re-competition.

How effective is the Bureau of Reclamation's procurement process when using SAP for awards significantly exceeding the typical SAP threshold?

The effectiveness of the Bureau of Reclamation's procurement process using SAP for an award of $14.3 million is questionable without further details. Simplified Acquisition Procedures (SAP) are generally intended for procurements under $250,000 to streamline the process. While FAR allows for exceptions, using SAP for such a large value suggests either a specific justification was made or the competition might have been less robust than a full and open competition under FAR Part 15. Assessing effectiveness would require examining the justification for SAP use, the number of bids received, and whether the pricing achieved was competitive compared to market rates or other large federal fuel contracts.

What are the potential implications of awarding this contract to MJ GLOBAL LLC, given its classification under NAICS 324191 (Petroleum Lubricating Oil and Grease Manufacturing)?

The classification of MJ GLOBAL LLC under NAICS 324191 suggests the company specializes in the manufacturing of petroleum-based oils and greases. While this classification is relevant to lubricants, the contract is for 'BULK FUEL DELIVERIES.' This raises a question about whether MJ GLOBAL LLC is primarily a manufacturer or a distributor/supplier capable of handling bulk fuel. If they are primarily a manufacturer, their capability to manage large-scale fuel logistics, storage, and delivery for a critical facility like Hoover Dam needs to be thoroughly vetted. It could imply they are acting as a supplier of specialized lubricants alongside fuel, or that their business scope extends beyond manufacturing to include fuel distribution.

Industry Classification

NAICS: Manufacturing › Petroleum and Coal Products Manufacturing › Petroleum Lubricating Oil and Grease Manufacturing

Product/Service Code: FUELS, LUBRICANTS, OILS, WAXES

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 72-3982 HAWAII BELT RD, KAILUA KONA, HI, 96740

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $14,296

Exercised Options: $14,296

Current Obligation: $14,296

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 140R3025A0008

IDV Type: BPA

Timeline