Oil Reserve

In response to a congressional request, GAO reported on the Department of Energy's (DOE) progress in filling, developing, and operating the Strategic Petroleum Reserve (SPR) during the first quarter of fiscal year (FY) 1986.

GAO found that DOE added 4.5 million barrels of oil to the SPR, bringing total SPR volume to 493.3 million barrels. The oil-fill rate averaged about 49,000 barrels per day during the quarter. DOE made payments of $178 million for oil acquisition and transportation, had unpaid obligations of about $140 million, and had about $668 million in unobligated funds. On October 1, 1985, the administration reported a deferral of approximately $537 million held in the SPR oil account for FY 1986. GAO found that the storage capacity development program proceeded during the quarter, but the West Hackberry, Louisiana site's leaching program was stopped in December due to a leak in the brine disposal line. At the Big Hill site in Texas, existing construction contracts have slipped from the planned September 1985 completion dates to January and February 1986. GAO also found that approximately 1 million barrels of oil were competitively sold to oil company bidders. On December 27, 1985, DOE formally notified cognizant congressional committees that it was planning to submit a deferral of funds for SPR storage facilities development, which would indefinitely delay Texas and Bayou Choctaw, Louisiana, storage sites and stop all leaching activities as of January 1, 1986.