DoD's $22M aviation turbine fuel contract awarded to Motor Oil (Hellas) Corinth Refineries S.A. for 20-day delivery

Contract Overview

Contract Amount: $22,021,816 ($22.0M)

Contractor: Motor OIL (hellas) Corinth Refineries S.A.

Awarding Agency: Department of Defense

Start Date: 2025-12-16

End Date: 2026-01-05

Contract Duration: 20 days

Daily Burn Rate: $1.1M/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Defense

Official Description: 8511816570!TURBINE FUEL,AVIATION

Plain-Language Summary

Department of Defense obligated $22.0 million to MOTOR OIL (HELLAS) CORINTH REFINERIES S.A. for work described as: 8511816570!TURBINE FUEL,AVIATION Key points: 1. Value for money assessed through fixed-price with economic price adjustment, allowing for market fluctuations. 2. Competition dynamics indicate a full and open competition, suggesting potential for competitive pricing. 3. Risk indicators include reliance on a single supplier for a critical fuel type, though competition was open. 4. Performance context is a short-duration delivery order for immediate operational needs. 5. Sector positioning within the petroleum refineries industry, supporting aviation fuel supply chains.

Value Assessment

Rating: fair

The contract value of $22 million for a 20-day delivery period of aviation turbine fuel appears reasonable given the nature of fuel commodities which are subject to market volatility. Benchmarking against similar contracts is challenging without specific volume and grade details, but the fixed-price with economic price adjustment clause aims to mitigate significant overruns due to price fluctuations. The relatively short duration suggests a tactical procurement rather than a long-term strategic supply agreement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and considered. The specific number of bidders is not provided, but the designation suggests a robust process aimed at achieving the best value. Open competition generally fosters price discovery and encourages suppliers to offer competitive terms.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing due to the open bidding process, which helps ensure that the government is not overpaying for essential aviation fuel.

Public Impact

The primary beneficiaries are the Department of Defense (DoD) aviation units requiring turbine fuel for operations. Services delivered include the supply of aviation turbine fuel, critical for aircraft readiness and mission execution. Geographic impact is localized to the delivery point specified in the contract, likely a military installation. Workforce implications are minimal for this specific contract, primarily involving logistics and fuel handling personnel at the delivery site.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility due to economic price adjustment clause.
Dependence on a single supplier for a critical commodity during the contract period.
Short delivery window may limit supplier options and negotiation leverage.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing was sought.
Fixed-price contract type with economic price adjustment provides some cost control.
Clear delivery dates and requirements for a specific product.

Sector Analysis

The petroleum refineries sector is a critical component of the energy industry, providing essential fuels for transportation and industrial use. Aviation turbine fuel is a specialized product within this sector, requiring specific refining processes and quality controls. The market for aviation fuels is influenced by global oil prices, geopolitical events, and demand from commercial and military aviation. This contract represents a small portion of the overall defense fuel procurement spending, which is substantial due to the operational needs of the military.

Small Business Impact

The data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). Therefore, the primary contractor is likely a large business. There is no information provided regarding subcontracting plans or requirements for small business participation. The impact on the small business ecosystem is likely minimal unless the prime contractor engages small businesses for support services related to fuel delivery or logistics.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA) and the Defense Logistics Agency (DLA), responsible for ensuring timely delivery and adherence to specifications. Accountability measures are embedded in the contract terms, including delivery schedules and quality standards. Transparency is facilitated through contract award databases, though specific performance metrics and detailed pricing breakdowns may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Fuel Supply Center Contracts
Aviation Fuel Procurement
Petroleum Product Contracts
Fixed Price with Economic Price Adjustment Contracts

Risk Flags

Economic Price Adjustment Clause
Short Delivery Window
Single Supplier Dependence

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.0 million to MOTOR OIL (HELLAS) CORINTH REFINERIES S.A.. 8511816570!TURBINE FUEL,AVIATION

Who is the contractor on this award?

The obligated recipient is MOTOR OIL (HELLAS) CORINTH REFINERIES S.A..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $22.0 million.

What is the period of performance?

Start: 2025-12-16. End: 2026-01-05.

What is the historical spending pattern for aviation turbine fuel by the Defense Logistics Agency?

The Defense Logistics Agency (DLA) is a primary procurer of aviation turbine fuel for the Department of Defense. Historical spending data reveals a consistent and substantial investment in this category, driven by the continuous operational tempo of military aviation assets. Annual spending can fluctuate based on global fuel prices, strategic needs, and the number of active aircraft. For instance, in fiscal years prior to this award, DLA's obligations for aviation fuels have often been in the billions of dollars. Analyzing trends over the past 5-10 years would show periods of increased spending during heightened military operations and periods of relative stability during lower operational tempos. Factors such as the type of fuel (e.g., JP-8, JP-5), delivery locations, and contract types (fixed-price, cost-plus) also influence the aggregate spending figures. This specific contract, valued at $22 million for a short duration, represents a tactical procurement within the broader strategic fuel supply chain managed by DLA.

How does the pricing of this contract compare to similar aviation turbine fuel procurements?

Directly comparing the per-unit price of aviation turbine fuel for this contract is difficult without knowing the exact volume and grade of fuel procured, as well as the specific delivery location and associated transportation costs. However, the contract's total value of $22,018,156.90 for a 20-day delivery period suggests a significant quantity. The pricing mechanism, 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' (FPEPA), is designed to account for fluctuations in the market price of petroleum products. This means the final cost could deviate from the initial estimated value. Benchmarking against other FPEPA contracts for similar fuels would involve analyzing the economic price adjustment clauses and the base prices set at the time of award. Generally, open competition aims to secure prices at or near market rates, but the specific market conditions at the time of bidding heavily influence the outcome. Without access to the detailed bid data or a standardized benchmark for this specific fuel grade and delivery window, a precise value-for-money assessment based on price alone is limited.

What are the potential risks associated with relying on Motor Oil (Hellas) Corinth Refineries S.A. for this fuel supply?

While Motor Oil (Hellas) Corinth Refineries S.A. is a significant player in the refining industry, potential risks associated with relying on them for this specific contract include supply chain disruptions, geopolitical instability affecting the Eastern Mediterranean region where the refinery is located, and potential quality control issues, although the latter is mitigated by stringent DoD specifications. The contract's short duration (20 days) reduces the long-term risk exposure, but any interruption during this period could impact military readiness. Furthermore, dependence on a single supplier, even if competitively selected, carries inherent risks. If the supplier faces unforeseen operational challenges (e.g., refinery issues, labor disputes, shipping problems), it could lead to delivery delays or shortages. The economic price adjustment clause, while protecting against market volatility, also introduces uncertainty regarding the final cost, which could be higher than initially anticipated if market prices surge significantly.

What is the typical performance period for aviation turbine fuel contracts awarded by the Defense Logistics Agency?

The typical performance period for aviation turbine fuel contracts awarded by the Defense Logistics Agency (DLA) can vary significantly depending on the procurement strategy. Contracts can range from short-term, urgent delivery orders like this one (20 days duration) to longer-term requirements contracts that may span several years. DLA often utilizes requirements contracts to ensure a continuous supply of fuel to various military installations worldwide. These longer-term contracts might have base periods and multiple option periods, allowing for flexibility. The duration is often dictated by factors such as anticipated operational tempo, inventory management strategies, and the desire to lock in pricing or secure supply chains. Short-duration contracts like this one are typically used for immediate needs or to supplement existing supplies when a gap is identified, often awarded through expedited processes.

How does the 'full and open competition' designation impact the selection of contractors for aviation fuel?

The 'full and open competition' designation signifies that the solicitation was made available to all responsible sources, and the contract was awarded based on the best value to the government, price and other factors considered. For aviation fuel procurement, this typically means that DLA or the contracting activity issues a solicitation that is broadly advertised, allowing any qualified refiner or distributor to submit a bid. This process is intended to maximize the pool of potential offerors, thereby increasing the likelihood of receiving competitive pricing and innovative solutions. It contrasts with limited competition or sole-source awards where fewer sources are solicited or only one is considered. The 'best value' determination under full and open competition allows the government to consider factors beyond just the lowest price, such as past performance, technical capabilities, and delivery timelines, ensuring a more robust and reliable supply chain for critical resources like aviation turbine fuel.

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

Address: 12A IRODOU ATTIKOU, MAROUSSI

Business Categories: Category Business, Corporate Entity Tax Exempt, Foreign Owned, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $22,021,816

Exercised Options: $22,021,816

Current Obligation: $22,021,816

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPE60225D0488

IDV Type: IDC

Timeline