United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 2008-04-24 monographic deposited born digital 15 p. GA 1.13:GAO-08-726T https://www.govinfo.gov/app/details/GAOREPORTS-GAO-08-726T P0b002ee180378c73 f:d08726t DGPO 2010-08-12 2011-03-23 GAOREPORTS-GAO-08-726T machine generated eng fdlp REPORT GAOREPORTS-GAO-08-726T GAO-08-726T Bid evaluation Cost analysis Cost effectiveness analysis Crude oil Energy consumption Energy costs Energy demand Energy management Energy planning Energy shortages Energy supplies Evaluation methods International organizations International relations Oil importing Oil resources Petroleum industry Petroleum refining facilities Procurement evaluation Program evaluation Royalty payments Supply and demand Strategic Petroleum Reserve Testimony A81872 The Strategic Petroleum Reserve (SPR) was created in 1975 to help protect the U.S. economy from oil supply disruptions and currently holds about 700 million barrels of crude oil. The Energy Policy Act of 2005 directed the Department of Energy (DOE) to increase the SPR storage capacity from 727 million barrels to 1 billion barrels, which it plans to accomplish by 2018. Since 1999, oil for the SPR has generally been obtained through the royalty-in-kind program, whereby the government receives oil instead of cash for payment of royalties on leases of federal property. The Department of Interior's Minerals Management Service (MMS) collects the royalty oil and transfers it to DOE, which then trades it for oil suitable for the SPR. As DOE begins to expand the SPR, past experiences can help inform future efforts to fill the reserve in the most cost-effective manner. In that context, GAO's testimony today will focus on: (1) factors GAO recommends DOE consider when filling the SPR, and (2) the cost-effectiveness of using oil received through the royalty-in-kind program to fill the SPR. To address these issues, GAO relied on its 2006 report on the SPR, as well as its ongoing review of the royalty-in-kind program, where GAO interviewed officials at both DOE and MMS, and reviewed DOE's SPR policies and procedures. DOE provided comments on a draft of this testimony, which we incorporated where appropriate. https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-08-726T/html/GAOREPORTS-GAO-08-726T.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-08-726T/pdf/GAOREPORTS-GAO-08-726T.pdf GAO-08-726T https://www.govinfo.gov/app/details/GAOREPORTS-GAO-08-726T Testimony GAO-08-726T; Strategic Petroleum Reserve: Improving the Cost-Effectiveness of Filling the Reserve; Bid evaluation Cost analysis Cost effectiveness analysis Crude oil Energy consumption Energy costs Energy demand Energy management Energy planning Energy shortages Energy supplies Evaluation methods International organizations International relations Oil importing Oil resources Petroleum industry Petroleum refining facilities Procurement evaluation Program evaluation Royalty payments Supply and demand Strategic Petroleum Reserve Public Law 94-163 Public Law 109-58