DOJ's $5.1M Oxygen Supply Contract Awarded to Airgas USA, LLC for Federal Prison System

Contract Overview

Contract Amount: $5,116 ($5.1K)

Contractor: Airgas USA, LLC

Awarding Agency: Department of Justice

Start Date: 2025-10-01

End Date: 2025-12-31

Contract Duration: 91 days

Daily Burn Rate: $56/day

Competition Type: COMPETED UNDER SAP

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: FY26 B1 AIRGAS BULK OXYGEN QTR 1 MEDICAL GRADE BULK OXYGEN SYSTEM LEASE AND SUPPLY PER STATEMENT OF WORK

Place of Performance

Location: TULSA, TULSA County, OKLAHOMA, 74120

State: Oklahoma Government Spending

Plain-Language Summary

Department of Justice obligated $5,116.1 to AIRGAS USA, LLC for work described as: FY26 B1 AIRGAS BULK OXYGEN QTR 1 MEDICAL GRADE BULK OXYGEN SYSTEM LEASE AND SUPPLY PER STATEMENT OF WORK Key points: 1. Contract focuses on essential medical-grade oxygen supply, indicating a critical need for inmate healthcare. 2. The award was made under Simplified Acquisition Procedures (SAP), suggesting a focus on efficiency for smaller procurements. 3. The fixed-price contract type aims to provide cost certainty for the government. 4. The short duration of 91 days points to a tactical, short-term need rather than a long-term strategic supply agreement. 5. The contract is for bulk oxygen, highlighting the scale of medical support required. 6. The supplier, Airgas USA, LLC, is a significant player in the industrial gas market.

Value Assessment

Rating: good

The contract value of approximately $5.1 million for a 91-day period for bulk oxygen supply appears reasonable given the critical nature of medical-grade oxygen. Benchmarking against similar short-term medical supply contracts for federal facilities would provide a more precise value assessment. However, the fixed-price nature suggests an attempt to control costs. Without specific per-unit pricing or historical data for this exact service, a definitive value-for-money assessment is challenging, but the context of essential medical services supports the expenditure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was competed under Simplified Acquisition Procedures (SAP), which typically allows for a broader range of competition than micro-purchases but is less formal than full and open competition for larger contracts. While the specific number of bidders is not provided, SAP is designed to encourage competition among qualified vendors. This method aims to balance the need for competitive pricing with administrative efficiency for procurements below certain thresholds.

Taxpayer Impact: Competition under SAP generally leads to better pricing for taxpayers compared to sole-source awards, as it allows multiple vendors to bid on the requirement.

Public Impact

Inmates within the Federal Prison System will benefit from a reliable supply of medical-grade oxygen, crucial for their healthcare. The services delivered include the lease and supply of a bulk oxygen system, ensuring continuous availability. The geographic impact is focused on facilities managed by the Bureau of Prisons, likely in Oklahoma given the 'OK' state code. The contract supports healthcare professionals and support staff responsible for inmate medical care.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases in future, longer-term contracts if competition dynamics change.
Dependence on a single supplier for a critical medical resource could pose a risk if supply chain issues arise.

Positive Signals

Awarded under a competitive process (SAP), indicating potential for good value.
Fixed-price contract type provides cost certainty for the government.
Supplier is an established entity in the industrial gas market.

Sector Analysis

The industrial gas manufacturing sector (NAICS 325120) is characterized by large-scale production and distribution of essential gases. This contract falls within the broader healthcare support services for government facilities. The market for medical-grade gases is critical and often involves specialized supply chains and regulatory compliance. Comparable spending benchmarks would typically involve other federal or state correctional facilities requiring similar life-support medical gases.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). As the contract was competed under SAP, it's possible that small businesses could have participated, but there's no explicit requirement for it. Subcontracting implications are not detailed, but for a specialized supply like bulk oxygen, direct provision by the primary contractor is common. The impact on the small business ecosystem is likely minimal unless small businesses were involved as subcontractors to Airgas USA, LLC.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Justice's Federal Prison System contracting officers and program managers. Accountability measures are embedded in the contract terms, including performance standards outlined in the Statement of Work and the fixed-price structure. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Federal Prison System Medical Supplies
Department of Justice Healthcare Contracts
Medical Gas Supply Contracts
Bureau of Prisons Operational Support

Risk Flags

Short contract duration may limit long-term supplier commitment.
Dependence on a single supplier for critical medical resource.
Potential for price volatility in future procurements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $5,116.1 to AIRGAS USA, LLC. FY26 B1 AIRGAS BULK OXYGEN QTR 1 MEDICAL GRADE BULK OXYGEN SYSTEM LEASE AND SUPPLY PER STATEMENT OF WORK

Who is the contractor on this award?

The obligated recipient is AIRGAS USA, LLC.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $5,116.1.

What is the period of performance?

Start: 2025-10-01. End: 2025-12-31.

What is the historical spending pattern for bulk oxygen supply to the Federal Prison System, and how does this award compare?

Analyzing historical spending for bulk oxygen within the Federal Prison System requires access to detailed procurement data over multiple fiscal years. Without specific historical data for this exact service and location, a direct comparison is difficult. However, the current award of approximately $5.1 million for a 91-day period suggests a significant, albeit short-term, requirement. If similar needs have arisen previously, comparing the unit costs, total expenditure, and duration of those contracts would reveal trends. Factors such as inflation, changes in inmate population requiring medical support, and market fluctuations in gas prices would influence historical spending. A consistent pattern of short-term, high-value awards might indicate recurring needs or a strategy to re-compete frequently to ensure competitive pricing.

What is Airgas USA, LLC's track record with federal government contracts, particularly for medical supplies?

Airgas USA, LLC has a substantial track record of federal government contracting, often supplying industrial and medical gases. A review of federal procurement databases would likely show numerous awards to Airgas for various agencies, including the Department of Defense, Department of Veterans Affairs, and other health-related entities. Their experience typically includes providing gases like oxygen, nitrogen, and helium, often under complex delivery and supply agreements. For medical-grade oxygen, their track record would be particularly relevant, demonstrating their ability to meet stringent quality standards and regulatory requirements. Assessing past performance ratings on similar contracts, any past disputes or contract terminations, and the overall volume of their federal business would provide a comprehensive view of their reliability and capability.

How does the fixed-price contract type mitigate risks for the government in this oxygen supply agreement?

A Firm Fixed Price (FFP) contract type, as used here, is generally advantageous for the government when the scope of work is well-defined and risks of cost overruns are manageable. For a service like bulk oxygen supply, where the quantity and delivery schedule are specified, FFP locks in the price. This means that if Airgas USA, LLC incurs higher costs due to material price increases, labor issues, or unforeseen operational challenges, the government is protected from those additional expenses. The risk of cost escalation is borne by the contractor. This structure incentivizes the contractor to manage their own costs efficiently to maintain profitability. However, it also means the government might pay a premium upfront to account for the contractor's risk.

What are the potential performance risks associated with this short-term bulk oxygen supply contract?

Performance risks for this short-term bulk oxygen supply contract primarily revolve around ensuring uninterrupted delivery of a critical medical resource. Key risks include potential supply chain disruptions affecting Airgas USA, LLC's ability to procure or transport oxygen, equipment failures in their supply system or the leased system at the facility, and logistical challenges in meeting delivery schedules. Given the short duration (91 days), there's also a risk that the contractor might prioritize longer-term, more lucrative contracts, potentially leading to less attention or slower response times if issues arise. Furthermore, ensuring the consistent quality and purity of 'medical grade' oxygen throughout the contract period is paramount and requires robust quality control measures by the supplier.

What is the significance of 'medical grade' oxygen in the context of federal prison healthcare?

Medical grade oxygen is a highly purified form of oxygen, meeting stringent standards set by regulatory bodies like the U.S. Pharmacopeia (USP). In federal prisons, it is essential for treating a range of medical conditions, including respiratory distress, chronic obstructive pulmonary disease (COPD), pneumonia, and during emergency medical situations. The purity ensures that it is safe for inhalation and free from contaminants that could exacerbate health problems or cause adverse reactions. Providing medical-grade oxygen is a fundamental aspect of healthcare delivery within correctional facilities, directly impacting inmate health outcomes, patient safety, and the ability of medical staff to provide effective care. Failure to supply adequate medical-grade oxygen could have severe consequences for inmate well-being and potentially lead to legal challenges.

Industry Classification

NAICS: Manufacturing › Basic Chemical Manufacturing › Industrial Gas Manufacturing

Product/Service Code: CHEMICALS AND CHEMICAL PRODUCTS

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 15B41424Q00000006

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: L'air Liquide Societe Anonyme Pour L'etude ET L'exploitation DES Procedes Georges Claude

Address: 31 N PEORIA AVE, TULSA, OK, 74120

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $5,116

Exercised Options: $5,116

Current Obligation: $5,116

Actual Outlays: $4,860

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 15B41424D00000059

IDV Type: IDC

Timeline