DoD's $7.99M Aviation Turbine Fuel Contract Awarded to Valero Marketing and Supply Co
Contract Overview
Contract Amount: $7,988,914 ($8.0M)
Contractor: Valero Marketing and Supply CO
Awarding Agency: Department of Defense
Start Date: 2025-12-19
End Date: 2026-01-23
Contract Duration: 35 days
Daily Burn Rate: $228.3K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Energy
Official Description: 8511827343!TURBINE FUEL,AVIATION
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78249
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $8.0 million to VALERO MARKETING AND SUPPLY CO for work described as: 8511827343!TURBINE FUEL,AVIATION Key points: 1. The contract is for aviation turbine fuel, a critical component for military operations. 2. Valero Marketing and Supply Co. secured the award through full and open competition. 3. The contract duration is relatively short, suggesting potential for future re-competition. 4. The sector is energy/fuel, a high-volume and essential government expenditure area.
Value Assessment
Rating: good
The fixed-price contract with economic price adjustment aims to manage fluctuating fuel costs. Benchmarking against similar fuel contracts is necessary to fully assess value, but the competitive award suggests a reasonable price was achieved.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The award was made under full and open competition, indicating multiple bidders likely participated. This method is expected to drive competitive pricing and ensure the government receives fair market value.
Taxpayer Impact: The competitive nature of this award is positive for taxpayers, as it likely resulted in a more favorable price than a sole-source or limited competition scenario.
Public Impact
Ensures continued operational readiness for aircraft requiring specialized turbine fuel. Supports the Defense Logistics Agency's mission to provide essential supplies to the military. Potential for price fluctuations due to economic price adjustment clause impacts overall cost.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Economic price adjustment clause could lead to cost overruns if fuel prices spike significantly.
- Short contract duration may lead to frequent re-procurement efforts and associated administrative costs.
Positive Signals
- Awarded through full and open competition, maximizing potential for competitive pricing.
- Valero Marketing and Supply Co. is a known entity in the fuel market.
- Contract supports critical defense logistics operations.
Sector Analysis
The energy sector, particularly fuel procurement, is a significant area of government spending. This contract falls within the broader category of energy and fuels, essential for national defense operations. Benchmarks for aviation fuel vary widely based on type and market conditions.
Small Business Impact
The data does not indicate if small businesses were involved in this specific contract award. Further analysis would be needed to determine the extent of small business participation, either as prime contractors or subcontractors.
Oversight & Accountability
The Defense Logistics Agency is responsible for this procurement. Standard oversight mechanisms for defense contracts, including performance monitoring and financial audits, would apply to ensure accountability and proper execution.
Related Government Programs
- Petroleum Refineries
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Potential for cost escalation due to economic price adjustment.
- Short contract duration may lead to frequent re-competition.
- Lack of specific fuel type detail hinders precise benchmarking.
- No indication of small business participation.
Tags
petroleum-refineries, department-of-defense, tx, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $8.0 million to VALERO MARKETING AND SUPPLY CO. 8511827343!TURBINE FUEL,AVIATION
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 $8.0 million.
What is the period of performance?
Start: 2025-12-19. End: 2026-01-23.
What is the projected total cost if fuel prices increase by 10% over the contract period?
Without specific baseline pricing and the exact formula for the economic price adjustment, calculating the precise impact of a 10% fuel price increase is difficult. However, the 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' clause suggests that a portion of the cost increase would be passed on to the government, potentially increasing the total contract value beyond the initial $7.99M.
How does the unit price compare to historical averages for this type of aviation fuel?
To assess the unit price effectively, we would need the specific type of aviation turbine fuel (e.g., JP-8, Jet A-1) and historical pricing data from the Defense Logistics Agency or market reports. The provided data lacks this granularity for a direct comparison, but the competitive award suggests it is likely within a reasonable market range.
What are the performance metrics and delivery requirements outlined in the contract?
The provided data indicates the contract is for 'TURBINE FUEL, AVIATION' with a start date of 2025-12-19 and an end date of 2026-01-23, a duration of 35 days. Specific performance metrics and detailed delivery schedules would be found in the full contract documentation, likely including quantity, location, and timeliness of fuel delivery.
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: $7,988,914
Exercised Options: $7,988,914
Current Obligation: $7,988,914
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPE60225D0491
IDV Type: IDC
Timeline
Start Date: 2025-12-19
Current End Date: 2026-01-23
Potential End Date: 2026-01-23 00:00:00
Last Modified: 2026-01-08
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