U.S. Strategic Petroleum Reserve at a Turning Point--Management of Cost, Oil Supply Problems, and Future Site Development

The Strategic Petroleum Reserve, established to provide a cushion of as much as 1 billion barrels of oil against interruptions in imported oil supplies, has not met its initial goal of having at least 150 million barrels of petroleum products by December 1978. The reserve has been plagued by problems: low initial cost estimates, resulting in cost overruns; an inability to meet oil storage goals; and the failure of four oil supply contractors to deliver their quotas. As a result the reserve is at a turning point in its management of facility costs, future oil supply, and future site development. Major changes being made in these three areas may significantly affect timely completion of the reserve at a reasonable cost.