Oil Reserve: Some Concerns Remain About SPR Drawdown and Distribution
RCED-91-16
Published: Nov 28, 1990. Publicly Released: Jan 18, 1991.
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Highlights
Pursuant to a congressional request, GAO examined the Department of Energy's (DOE) Strategic Petroleum Reserve (SPR) drawdown plans, focusing on: (1) DOE capability for withdrawing and distributing SPR oil; (2) SPR compliance with pipeline safety requirements; and (3) the status of DOE actions to correct problems previously identified by GAO.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Because of the likelihood that Jones Act waivers will be needed to move SPR oil expeditiously and the current uncertainties about whether the waiver review process will ensure prompt action on individual waiver requests, Congress may wish to consider granting standby blanket waiver authority that would allow the President to waive the Jones Act requirement if delays resulting from the case-by-case review process were limiting DOE ability to draw down SPR. |
Closed – Not Implemented
|
After the report was issued, the President directed the Secretary of the Treasury to grant "blanket" waivers of the Jones Act when he authorized the drawdown of SPR in January 1991. The Maritime industry did not challenge the government's authority to grant blanket waivers. Also, Congress has not acted on this recommendation, and it may no longer be needed. |
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Energy | To examine the effectiveness of the expedited waiver review process, the Secretary of Energy should direct the Assistant Secretary for Fossil Energy to work with the Maritime Administration and the Department of the Treasury to develop a realistic test that would simulate agency actions to process the number and type of waiver requests expected during SPR drawdowns of various rates. |
Closed – Implemented
DOE asked for the formal views of MARAD and Treasury's Customs Service concerning the feasibility of developing a realistic test. The agencies were not in favor of conducting the test because they believed that maritime and petroleum companies would object to the costs associated with the test and that a general waiver of the Jones Act's requirement for future drawdowns would most likely occur.
|
| Department of Energy | To increase the certainty that SPR pipelines will operate safely and reliably as designed, the Secretary of Energy should direct the manager of the Oak Ridge Operations Office to assign specific responsibility for ensuring compliance with federal safety standards to the recently designated SPR Pipeline Manager and ensure that needed procedures and information systems are developed to monitor contractor operations. |
Closed – Implemented
As of December 31, 1991, the responsibility for ensuring SPR compliance with federal pipeline standards was assigned to the SPR pipeline manager and procedures and information systems needed to monitor contractor compliance had been put in place.
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Topics
Crude oil pipeline operationsEmergency preparednessFuel suppliesMarine transportationOil resourcesPetroleum storageSafety standardsStrategic materialsTankers (Vessels)Water systems