Suchergebnisse

"Date originated 11/13/79; date updated 02/29/80." ; Includes bibliographical references. ; Mode of access: Internet. ; Description based on print resource; title from title page.

Testimony issued by the Government Accountability Office with an abstract that begins "The possibility of storing refined petroleum products as part of the Strategic Petroleum Reserve (SPR) has been contemplated since the SPR was created in 1975. The SPR, which currently holds about 700 million barrels of crude oil, was created to help insulate the U.S. economy from oil supply disruptions. However, the SPR does not contain refined products such as gasoline, diesel fuel, or jet fuel. The Energy Policy Act of 2005 directed the Department of Energy (DOE) to increase the SPR's capacity from 727 million barrels to 1 billion barrels, which it plans to do by 2018. With the possibility of including refined products as part of the expansion of the SPR, this testimony discusses (1) some of the arguments for and against including refined products in the SPR and (2) lessons learned from the management of the existing crude oil SPR that may be applicable to refined products. To address these issues, GAO relied on its 2006 report on the SPR (GAO-06-872), 2007 report on the globalization of petroleum products (GAO-08-14), and two 2008 testimonies on the cost-effectiveness of filling the SPR (GAO-08-512T and GAO-08-726T). GAO also reviewed prior DOE and International Energy Agency studies on refined product reserves."

ABSTRACTAt each stage of program implementation – strategic planning, systems design, development of the management control infrastructure, and project execution – different types of expertise are most critical to success. The civil service system, which is oriented toward the hiring of permanent employees, and personnel ceilings, which are often arbitrarily set in the budgeting process, interact to impede the transition from one implementation stage to the next. Cost overruns and long-run schedule slippage may result from attempts to expedite programs by beginning implementation stages in parallel, particularly if compensatory resources are not provided. These problems are illustrated with the history of the implementation of the strategic petroleum reserve program, a key element of US policy for reducing vulnerability to disruptions of the world oil market.

Sweeping changes in US and global oil markets call for a rethink of the Strategic Petroleum Reserve (SPR), an institution born of the first oil shock of 1973 and rooted in a vastly different oil market than today's. The perceived redundancy of the SPR reflects a mood swing in policymaking circles. Until recently, the SPR enjoyed wholehearted support from Congress and successive administrations as a tool of energy security that helped shield the US economy from the adverse consequences of oil shortages. Admittedly, the SPR had its critics, but those came from a relatively narrow fringe for the most part. Today, the idea that the SPR is too large or even altogether useless has moved to the mainstream and is gaining traction. Fundamental changes have reshaped the global oil market as a whole during the four and a half decades since the creation of the SPR in ways that seem to call into question the traditional calculus of energy security. The debate over the fate of the SPR should not be limited to a binary choice between keeping it whole or cutting it down to size. Rather, it ought to focus on how to best repurpose the SPR to address the myriad new threats facing oil consumers and the global economy. This must include new forms of financing the SPR and the possibility of joint stockpiling with both oil producers and consumers. At a time of uncertainty about future supply and demand and elevated risks to markets and future investment, the very possibility of an uneven energy transition strengthens rather than weakens the case for the SPR. While the evolution of oil markets has led to the emergence of new energy security risks, it has also created new opportunities for innovation in risk management and SPR design. It is essential for the SPR to catch up with the transformation of the global energy landscape, rather than simply disband.

Testimony issued by the Government Accountability Office with an abstract that begins "The Strategic Petroleum Reserve (SPR) was created in 1975 to help protect the U.S. economy from oil supply disruptions and currently holds about 700 million barrels of crude oil. The Energy Policy Act of 2005 directed the Department of Energy (DOE) to increase the SPR storage capacity from 727 million barrels to 1 billion barrels, which it plans to accomplish by 2018. Since 1999, oil for the SPR has generally been obtained through the royalty-in-kind program, whereby the government receives oil instead of cash for payment of royalties on leases of federal property. The Department of Interior's Minerals Management Service (MMS) collects the royalty oil and transfers it to DOE, which then trades it for oil suitable for the SPR. As DOE begins to expand the SPR, past experiences can help inform future efforts to fill the reserve in the most cost-effective manner. In that context, GAO's testimony today will focus on: (1) factors GAO recommends DOE consider when filling the SPR, and (2) the cost-effectiveness of using oil received through the royalty-in-kind program to fill the SPR. To address these issues, GAO relied on its 2006 report on the SPR, as well as its ongoing review of the royalty-in-kind program, where GAO interviewed officials at both DOE and MMS, and reviewed DOE's SPR policies and procedures. DOE provided comments on a draft of this testimony, which we incorporated where appropriate."