DoD awards $156M to ExxonMobil for petroleum refining, with 27 modifications
Contract Overview
Contract Amount: $156,398,740 ($156.4M)
Contractor: Exxon Mobil Corporation
Awarding Agency: Department of Defense
Start Date: 2012-11-23
End Date: 2014-01-30
Contract Duration: 433 days
Daily Burn Rate: $361.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 27
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Other
Official Description: IEG AWARD TO EXXONMOBIL FOR 8,882,000 JAA VIA PL
Place of Performance
Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22037
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $156.4 million to EXXON MOBIL CORPORATION for work described as: IEG AWARD TO EXXONMOBIL FOR 8,882,000 JAA VIA PL Key points: 1. Significant contract value awarded to a major corporation. 2. Full and open competition was utilized. 3. Potential for price fluctuations due to economic price adjustment. 4. Contract falls within the petroleum refining sector.
Value Assessment
Rating: fair
The contract's fixed price with economic price adjustment makes direct comparison difficult. However, the total award value of $156M over two years suggests a substantial expenditure for petroleum refining services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating a competitive bidding process. This method generally promotes price discovery and potentially better pricing for the government.
Taxpayer Impact: The use of economic price adjustment introduces a risk of increased costs for taxpayers if market prices rise significantly.
Public Impact
Taxpayers may be exposed to fluctuating fuel costs due to the economic price adjustment clause. The large award to a single major corporation raises questions about market concentration. The contract duration and modifications suggest ongoing needs for petroleum products by the Department of Defense.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Economic price adjustment clause can lead to cost overruns.
- Contract modifications (27) may indicate scope creep or evolving requirements.
- Lack of small business participation noted.
Positive Signals
- Awarded through full and open competition.
- Contract supports critical Department of Defense needs.
Sector Analysis
This contract falls within the Petroleum Refineries sector (NAICS 324110). Spending in this sector is crucial for national security and energy independence, with typical contracts varying widely in value based on specific products and services.
Small Business Impact
The data indicates no small business participation in this contract. This is common for large-scale industrial contracts requiring specialized capabilities and significant resources, but it represents a missed opportunity for small business engagement.
Oversight & Accountability
The contract was subject to standard federal procurement oversight. The 27 modifications warrant review to ensure they were necessary and justified, and that pricing remained competitive throughout the contract's life.
Related Government Programs
- Petroleum Refineries
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Economic Price Adjustment (EPA) risk
- High number of contract modifications
- No small business participation
- Concentration with a single large contractor
Tags
petroleum-refineries, department-of-defense, va, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $156.4 million to EXXON MOBIL CORPORATION. IEG AWARD TO EXXONMOBIL FOR 8,882,000 JAA VIA PL
Who is the contractor on this award?
The obligated recipient is EXXON MOBIL CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $156.4 million.
What is the period of performance?
Start: 2012-11-23. End: 2014-01-30.
What was the total price increase due to the economic price adjustment clause over the life of the contract?
The provided data does not detail the specific impact of the economic price adjustment. To determine the total price increase, a thorough analysis of contract modifications and market price indices during the contract period would be required. This information is crucial for assessing the true cost to the government and taxpayers.
Were the 27 contract modifications justified and did they result in significant cost increases?
The high number of modifications (27) suggests potential issues with initial contract scope definition or evolving requirements. A detailed review of each modification is necessary to ascertain their justification, necessity, and impact on the overall contract cost. Without this granular data, it's difficult to assess if these changes were efficient or led to unnecessary spending.
How does the per-unit cost of petroleum products under this contract compare to market rates at the time of award and during its performance?
Direct per-unit cost comparison is challenging without specific product details and market data. The economic price adjustment clause inherently allows for price fluctuations. Benchmarking against similar government contracts or commercial price lists for the specific petroleum products would be necessary to evaluate cost-effectiveness.
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
Solicitation ID: SP060012R0061
Offers Received: 27
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Address: 3225 GALLOWS RD, FAIRFAX, VA, 11
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $156,398,740
Exercised Options: $156,398,740
Current Obligation: $156,398,740
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SP060013D0451
IDV Type: IDC
Timeline
Start Date: 2012-11-23
Current End Date: 2014-01-30
Potential End Date: 2014-01-30 00:00:00
Last Modified: 2014-03-10
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