DoD Awards $12.4M for Naval Distillate Fuel to Valero Marketing, Competition Found
Contract Overview
Contract Amount: $12,365,808 ($12.4M)
Contractor: Valero Marketing and Supply CO
Awarding Agency: Department of Defense
Start Date: 2025-09-16
End Date: 2025-10-04
Contract Duration: 18 days
Daily Burn Rate: $687.0K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Energy
Official Description: 8511644297!DISTILLATE,NAVAL
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78249
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $12.4 million to VALERO MARKETING AND SUPPLY CO for work described as: 8511644297!DISTILLATE,NAVAL Key points: 1. Contract awarded to Valero Marketing and Supply Co. for $12.4 million. 2. Full and open competition was utilized for this award. 3. The contract covers the delivery of naval distillate fuel. 4. The period of performance is short, from September 16, 2025, to October 4, 2025. 5. The North American Industry Classification System (NAICS) code is 324110 (Petroleum Refineries).
Value Assessment
Rating: good
The contract value of $12.4 million for a short delivery period appears reasonable given market prices for petroleum products. Benchmarking against similar fuel supply contracts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Full and open competition was employed, suggesting a robust price discovery process. This method allows multiple qualified vendors to bid, driving competitive pricing.
Taxpayer Impact: Competitive bidding in this full and open process is expected to yield a fair price, minimizing unnecessary taxpayer expenditure for essential fuel.
Public Impact
Ensures operational readiness for naval vessels requiring specific fuel types. Supports the Department of Defense's logistical supply chain for fuel. Impacts the energy sector by creating demand for refined petroleum products.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Warning Flags
- Potential for price volatility in petroleum markets impacting the economic price adjustment.
- Geopolitical factors could affect fuel supply and pricing.
Positive Signals
- Full and open competition ensures a competitive price.
- Short performance period limits long-term price exposure.
- Award to a known supplier like Valero suggests reliability.
Sector Analysis
The petroleum refining sector is critical for national defense, providing essential fuels. Spending in this sector is subject to global commodity prices and geopolitical influences. This contract falls within typical spending for fuel procurement.
Small Business Impact
The data indicates this contract was awarded to Valero Marketing and Supply Co. and does not specify if small businesses were involved as subcontractors. Further investigation would be needed to determine small business participation.
Oversight & Accountability
The Defense Logistics Agency is responsible for this procurement. Oversight would involve monitoring contract performance, delivery schedules, and adherence to pricing adjustments to ensure taxpayer value.
Related Government Programs
- Petroleum Refineries
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Petroleum price volatility
- Supply chain disruptions
- Geopolitical instability affecting fuel markets
- Accuracy of economic price adjustment calculations
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 $12.4 million to VALERO MARKETING AND SUPPLY CO. 8511644297!DISTILLATE,NAVAL
Who is the contractor on this award?
The obligated recipient is VALERO MARKETING AND SUPPLY CO.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $12.4 million.
What is the period of performance?
Start: 2025-09-16. End: 2025-10-04.
What is the projected cost per gallon based on the total award and estimated volume?
The total award is $12,365,808 for naval distillate fuel. While the exact volume is not provided, estimating based on typical fuel prices and the contract duration would be necessary. Without a specified quantity, a precise per-gallon cost cannot be calculated, but it would be a key metric for value assessment.
How are economic price adjustments calculated to protect against market volatility?
The contract utilizes 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT.' This means the price can be adjusted based on fluctuations in specific economic indicators or market prices for petroleum. The contract details would outline the exact formula and indices used for these adjustments, ensuring fairness to both parties while mitigating excessive risk.
What is the historical performance record of Valero Marketing and Supply Co. with the DoD?
Valero Marketing and Supply Co. is a major fuel supplier with a history of contracts with government agencies, including the Department of Defense. Reviewing past performance data, including on-time delivery rates, quality compliance, and any past disputes or issues, would provide insight into their reliability for this specific award.
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
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Parent Company: Valero Energy Corporation
Address: 1 VALERO WAY, SAN ANTONIO, TX, 78249
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: $12,365,808
Exercised Options: $12,365,808
Current Obligation: $12,365,808
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPE60225D0475
IDV Type: IDC
Timeline
Start Date: 2025-09-16
Current End Date: 2025-10-04
Potential End Date: 2025-10-04 00:00:00
Last Modified: 2025-09-16
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