DLA Awards $33.3M for Marine Gas Oil to Plaza Marine Inc. Under Full and Open Competition
Contract Overview
Contract Amount: $33,304,836 ($33.3M)
Contractor: Plaza Marine Inc
Awarding Agency: Department of Defense
Start Date: 2015-10-01
End Date: 2019-04-30
Contract Duration: 1,307 days
Daily Burn Rate: $25.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 34
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Energy
Official Description: PROVIDE MARINE GAS OIL TO U.S. GOVERNMENT VESSELS AT VARIOUS LOCATIONS.
Place of Performance
Location: MANASQUAN, MONMOUTH County, NEW JERSEY, 08736
Plain-Language Summary
Department of Defense obligated $33.3 million to PLAZA MARINE INC for work described as: PROVIDE MARINE GAS OIL TO U.S. GOVERNMENT VESSELS AT VARIOUS LOCATIONS. Key points: 1. Significant contract value of $33.3 million for essential marine fuel. 2. Full and open competition suggests a potentially competitive pricing environment. 3. Fixed price with economic price adjustment introduces some cost fluctuation risk. 4. The contract supports U.S. Government vessels, indicating critical operational needs.
Value Assessment
Rating: good
The contract value of $33.3 million over approximately 3.5 years appears reasonable for bulk fuel supply. Benchmarking against similar fuel contracts would provide a more precise assessment of value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This method generally promotes competitive pricing and ensures the government receives fair market value.
Taxpayer Impact: The competitive nature of the award is expected to result in cost savings for taxpayers compared to a sole-source or limited competition scenario.
Public Impact
Ensures operational readiness of U.S. Government maritime assets. Supports critical supply chains for national defense and logistical operations. Provides essential fuel for vessels operating in various global locations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Economic price adjustment clause may lead to cost overruns if fuel prices spike significantly.
- Dependence on a single vendor for delivery orders could pose supply chain risks if not managed proactively.
Positive Signals
- Full and open competition likely secured competitive pricing.
- Contract duration provides stability for fuel supply.
- Supports critical national defense logistics.
Sector Analysis
The petroleum refining and distribution sector is vital for energy security and national defense. This contract falls within the broader energy and logistics sectors, with spending benchmarks varying based on fuel type and volume.
Small Business Impact
The data indicates this contract was not awarded to small businesses (sb: false). Further analysis would be needed to determine if small businesses were excluded or if the scope of work inherently favored larger entities.
Oversight & Accountability
The Department of Defense, through the Defense Logistics Agency, is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms are expected to be in place to ensure compliance and performance.
Related Government Programs
- Petroleum Refineries
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Potential for cost overruns due to economic price adjustment.
- Supply chain disruption risk if delivery orders are concentrated.
- Lack of small business participation noted.
- Dependence on specific geographic locations for delivery.
Tags
petroleum-refineries, department-of-defense, nj, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $33.3 million to PLAZA MARINE INC. PROVIDE MARINE GAS OIL TO U.S. GOVERNMENT VESSELS AT VARIOUS LOCATIONS.
Who is the contractor on this award?
The obligated recipient is PLAZA MARINE INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $33.3 million.
What is the period of performance?
Start: 2015-10-01. End: 2019-04-30.
What is the average per-gallon cost of the marine gas oil under this contract, and how does it compare to market rates at the time of award and during the contract period?
Calculating the average per-gallon cost requires dividing the total award amount by the estimated volume of fuel. Comparing this to prevailing market rates for marine gas oil during the contract's lifespan (October 2015 - April 2019) would reveal if the economic price adjustment clause effectively managed cost fluctuations or led to above-market pricing.
What specific risks are associated with the economic price adjustment (EPA) clause in this contract, and what mitigation strategies were employed by the Defense Logistics Agency?
The primary risk of an EPA clause is potential cost escalation if market prices for marine gas oil increase significantly. Mitigation strategies could include setting caps on price increases, using specific indices for adjustments, and robust market monitoring by the DLA to ensure fairness and prevent excessive price hikes.
How effectively did the full and open competition process ensure the government received the best value for its marine gas oil needs, considering the fixed-price with EPA structure?
Full and open competition generally drives competitive bids, suggesting the government likely received a favorable initial price. However, the effectiveness of value realization also depends on how the EPA clause was structured and managed, ensuring that price adjustments remained tied to legitimate market changes rather than vendor opportunism.
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: SP060014R0275
Offers Received: 34
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Address: 370 W PLEASANTVIEW AVE STE 341, HACKENSACK, NJ, 07601
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $33,304,836
Exercised Options: $33,304,836
Current Obligation: $33,304,836
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SP060015D0376
IDV Type: IDC
Timeline
Start Date: 2015-10-01
Current End Date: 2019-04-30
Potential End Date: 2019-10-30 00:00:00
Last Modified: 2019-09-09
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