The U.S. Department of Energy (DOE), Strategic Petroleum Reserve (SPR), is seeking comments from industry, the public and other stakeholders on Draft Request for Proposal (RFP) No. DE-RP96-02PO92207 for the Management and Operation of the Strategic Petroleum Reserve sites located in the Gulf Coast region of Louisiana and Texas. The Draft RFP and cover letter will be available in the DOE Interactive Industry Procurement System (IIPS) on or about April 15, 2002. We would appreciate your comments on all aspects of the RFP with particular attention to the terms and conditions of the contract, the evaluation criteria in Section M, and the proposal preparation instructions in Section L. In addition, your comments on the general clarity and consistency of the RFP, as well as the appropriateness of the solicitation open period, are solicited. Please note that, as stated in Section M of the solicitation, proposing any exceptions or deviations to the terms and conditions of the resulting contract may make the offer unacceptable for award without discussions. Therefore, if you have concerns over specific terms and conditions of the Draft RFP, this comment period is the proper time to raise them. In addition to the requirements contained in the draft solicitation, the Government is considering including an aggressive cost incentive fee provision (i.e., producing the same or greater value to the Government for significantly less cost) providing the contractor with the opportunity to earn significantly more fee (i.e., 150 to 200%) over the term of the contract. We are specifically seeking industry perspective and comments on this concept. Your attention is called to the Cost Reduction Goals and the 2002 Performance Evaluation and Measurement Plan currently posted in the M&O Contract Reading Room at http://www.spr.doe.gov. These documents reflect the baseline performance plan for the current contract. While the Draft Solicitation includes the Department of Energy Acquisition Regulation clause entitled CONDITIONAL PAYMENT OF FEE, PROFIT or INCENTIVES dated December 2000, the Department has published a proposed rulemaking in the Federal Register on 2/1/01 revising this clause. One of the primary objectives of this proposed rulemaking is to make fee reductions less subjective, including the consideration of mitigating circumstances. Comments and recommendations on the proposed rulemaking clause, with particular attention to establishing objective mitigating factors, are encouraged. As noted in Clause I.95, when the new clause comes into effect from this rulemaking, the contractor may elect to retain the current December 2000 clause or modify the contract to incorporate the new clause. A review of the Directives applicable to this solicitation is currently being conducted to determine which Directives can be replaced by commercial or other standards, where appropriate. Comments with respect to the list of applicable directives located in the Solicitation at Section J, Appendix F, and the use of commercial or other standards are encouraged. The DOE contemplates award of a cost-plus-award-fee performance based management and operating contract as a result of this solicitation, which includes a cost-reimbursement (no fee) phase-in transition period (approximately 2 months). The principle functions to be performed by the Contractor are: Operations and Maintenance of SPR oil storage facilities; Engineering; Construction Management; Integrated Management and Control; Acquisition and Materiel Management; Human Resources Management; Environmental, Safety and Health Programs; Quality Assurance; Security (including Guard Services); and Information System Services. DynMcDermott Petroleum Operations Company currently operates the SPR sites. The current contract with DynMcDermott expires on March 31, 2003. The magnitude of the proposed contract is estimated at $100 to $120 million per annum. The cost-plus-award-fee performance based contract will be for a period of 5-years (5) years and will include options for up to an additional 5 years. The DOE anticipates issuing the RFP in May 2002, with offers due in July 2002. A tour of the facilities and a preproposal conference will be conducted approximately three weeks after issuance of the RFP (See Section L of the RFP for details). All information related to this RFP will be posted through IIPS at http://e-center.doe.gov. This website will be the sole distribution medium for the RFP and will be used to provide acquisition information, including the solicitation, any amendments or clarifications, and other related information. Interested offerors are strongly encouraged to frequently check this website for new information. No paper copies or diskette copies of this solicitation will be distributed by the agency. Comments on the Draft RFP should be forwarded to Anne Quern via the Submit/ Question feature in the IIPS by COB on April 30, 2002.
