Strategic Petroleum Reserve

The Energy Security Act requires the President to fill the Strategic Petroleum Reserve (SPR) at an average rate of at least 100,000 barrels per day for fiscal year 1981 and succeeding years. The Department of Energy's (DOE) fiscal year (FY) 1981 appropriation provided that the President should seek to fill the SPR at an average annual rate of at least 300,000 barrels per day or at a rate which will fully utilize appropriated funds. Recently, DOE took steps to exceed the 100,000-barrel-per-day minimum supply reuirements during FY 1981. The adequacy of SPR storage capacity to sustain these or higher fill rates is an issue of critical importance to the effectiveness of the program and one which is in need of more attention. GAO previously concluded that DOE has enough existing capacity to fill SPR at a 100,000-barrel-per-day rate through FY 1983. DOE can maintain a fill rate of 215,000 barrels per day with existing capacity through December 1982, assuming storage sites come on line as planned. DOE believes that it can maintain this fill rate through the third quarter of FY 1984 under its Phase II expansion schedule. However, it is too early to tell whether this schedule will be met. DOE cannot maintain a fill rate of 300,000 barrels per day beyond July 1982, assuming oil injection at this level begins in June 1981. Previously, GAO recommended that the Secretary of Energy set specific goals for SPR fill during 1981 and succeeding fiscal years consistent with congressional intent; insure that adequate storage capacity is available on a timely basis to meet the needs of an accelerated SPR fill effort; and report to Congress on (1) the costs, advantages, and disadvantages of an accelerated construction program and other storage operations, and (2) the feasibility and appropriateness of SPR financing mechanisms which may be used to reduce financing through appropriated funds.