The US Department of Energy’s Office of Fossil Energy and Carbon Management (FECM) formally announced that it will sell as much as 40.1 million bbl of crude oil (39 million bbl of sour crude, 1.1 million bbl of sweet crude) from four Strategic Petroleum Reserve storage sites.
The May 24 notice comes as part of President Biden’s announcement on Mar. 31, 2022, to release one million b/d of crude oil for 6 months to address the global supply disruption from Russia’s war on Ukraine (OGJ Online, Mar. 31, 2022). Today’s notice of sale represents the next step in executing on this release.
As much as 12.5 million bbl each will be sold from the Big Hill site in Texas and the West Hackberry site in Louisiana, while up to 8 million bbl will be sold from Bryan Mound in Texas, and up to 7.1 million bbl will be sold from Bayou Choctaw in Louisiana, DOE said in the May 24 notice.
The overall release is being done in stages. The first 90 million bbl will be released between May to mid-August. This includes 20 million bbl already scheduled to be released in May before the March announcement, 30 million bbl noticed for sale on Apr. 1 following the announcement, and the 40 million bbl being released through this notice of sale. The remaining 90 million bbl will be released between August and October.
Bids must be received no later than June 1 at 10:00 a.m. CST, and contracts will be awarded to successful bidders no later than June 10. Deliveries of SPR sweet crude oil are scheduled to take place from June 21 until June 30, and SPR sour crude oil from July 1 until Aug. 15.