The Strategic Petroleum Reserve

GAO examined issues concerning the Strategic Petroleum Reserve (SPR), which plays a vital role in protecting the Nation's security and economic health during oil supply disruptions. GAO noted that two problem areas which plagued the early development of SPR were delays in construction and in oil acquisition. The administration's proposed fill rates for fiscal years (FY) 1984 through 1986 delay by at least 2 years the achievement of a 500 million barrel reserve. In FY 1982, Congress rejected the administration's attempt to defer $53 million for development of the new Big Hill storage site in Texas. The administration maintains that it is committed to achieving a reserve of 750 million barrels; however, it has deferred the decision of whether to develop the Big Hill site until next year. GAO believes that the administration needs to do more analysis and provide more policy guidance on such issues as the timing of SPR drawdown, optimum drawdown strategies in various types of disruptions, and coordination of stock drawdown with other countries. Further, the administration appears to be doing little to resolve potential conflicts between Federal and State policies that could arise in disruptions. One of the major programs the administration intends to use in responding to a severe energy emergency is the Federal Executive Manpower Reserve. The objective of this program is to use experienced industry personnel who can assess supply and demand and assist in coordinating energy production and distribution during energy emergencies. While this is a potentially useful program, the administration has not resolved legal problems that could hinder its effectiveness.