Commerce awards $141K for Alaska diesel fuel, sole-source to Seldovia Fuel and Lube
Contract Overview
Contract Amount: $141,000 ($141.0K)
Contractor: Seldovia Fuel and Lube, Inc
Awarding Agency: Department of Commerce
Start Date: 2024-09-08
End Date: 2027-09-07
Contract Duration: 1,094 days
Daily Burn Rate: $129/day
Competition Type: NOT COMPETED UNDER SAP
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: DIESEL HEATING FUEL FOR KASITSNA BAY LAB IN SELDOVIA, AK BASE YEAR
Place of Performance
Location: SELDOVIA, KENAI PENINSULA County, ALASKA, 99663
State: Alaska Government Spending
Plain-Language Summary
Department of Commerce obligated $141,000 to SELDOVIA FUEL AND LUBE, INC for work described as: DIESEL HEATING FUEL FOR KASITSNA BAY LAB IN SELDOVIA, AK BASE YEAR Key points: 1. Spending is for essential heating fuel for a remote research lab. 2. Sole-source award limits price discovery and potential savings. 3. Contract duration extends over three years, increasing long-term cost exposure. 4. Geographic isolation may justify limited competition, but requires scrutiny.
Value Assessment
Rating: fair
The $141,000 award for a three-year fuel supply appears reasonable given the remote location and specialized nature of the requirement. However, without competitive bidding, it's difficult to definitively assess if this represents the best value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed under Simplified Acquisition Procedures (SAP) and was awarded sole-source. This method bypasses competitive bidding, potentially leading to higher prices than if multiple vendors had submitted offers.
Taxpayer Impact: Taxpayer funds are used for this essential service. The lack of competition means potential savings may be forgone, impacting overall value for money.
Public Impact
Ensures operational continuity for a critical scientific research facility in a remote Alaskan location. Supports a local business, Seldovia Fuel and Lube, Inc., contributing to the regional economy. Highlights the challenges and costs associated with providing essential services in geographically isolated areas.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Long contract duration increases exposure to price fluctuations.
- Remote location may create logistical challenges and higher costs.
Positive Signals
- Ensures critical operational support for a research lab.
- Supports a local Alaskan business.
Sector Analysis
This contract falls under support activities for oil and gas operations, specifically providing fuel. Spending benchmarks for such services in remote, Arctic regions are highly variable due to logistical complexities and limited vendor pools.
Small Business Impact
The award went to Seldovia Fuel and Lube, Inc., a small business. While supporting small businesses is a priority, the sole-source nature of this award means competition was not leveraged to ensure the best price.
Oversight & Accountability
The Department of Commerce, through NOAA, is responsible for this award. Oversight should focus on ensuring the necessity of the sole-source justification and monitoring fuel price trends throughout the contract period.
Related Government Programs
- Support Activities for Oil and Gas Operations
- Department of Commerce Contracting
- National Oceanic and Atmospheric Administration Programs
Risk Flags
- Sole-source award lacks competitive pricing.
- Potential for price increases over the 3-year duration.
- Limited transparency on cost justification.
- Geographic isolation may inflate costs.
Tags
support-activities-for-oil-and-gas-opera, department-of-commerce, ak, purchase-order, 100k-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Commerce awarded $141,000 to SELDOVIA FUEL AND LUBE, INC. DIESEL HEATING FUEL FOR KASITSNA BAY LAB IN SELDOVIA, AK BASE YEAR
Who is the contractor on this award?
The obligated recipient is SELDOVIA FUEL AND LUBE, INC.
Which agency awarded this contract?
Awarding agency: Department of Commerce (National Oceanic and Atmospheric Administration).
What is the total obligated amount?
The obligated amount is $141,000.
What is the period of performance?
Start: 2024-09-08. End: 2027-09-07.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for the sole-source award is not detailed in the provided data. Typically, sole-source awards are granted when only one responsible source can provide the required supplies or services. For remote locations, this might be due to limited infrastructure or vendor availability. However, a thorough review should confirm that no other vendors could have realistically met the need, even with modified contract terms or delivery methods.
How does the per-unit cost of diesel fuel compare to regional benchmarks, considering the remote delivery location?
Without specific per-unit pricing data and regional benchmarks for diesel fuel in remote Alaskan locations, a direct comparison is difficult. The $141,000 contract over three years suggests an average annual cost of approximately $47,000. This figure needs to be broken down into gallons to compare against market rates, factoring in the significant logistical costs associated with delivery to Kasitsna Bay Lab.
What measures are in place to mitigate price volatility for diesel fuel over the three-year contract term?
The contract is firm fixed price, which shifts the risk of price fluctuations to the contractor, Seldovia Fuel and Lube, Inc. However, this can also lead to higher initial pricing to account for anticipated volatility. The government should monitor market trends and ensure the fixed price remains competitive throughout the contract's duration, potentially through contract clauses or future renegotiations if market conditions drastically change.
Industry Classification
NAICS: Mining, Quarrying, and Oil and Gas Extraction › Support Activities for Mining › Support Activities for Oil and Gas Operations
Product/Service Code: FUELS, LUBRICANTS, OILS, WAXES
Competition & Pricing
Extent Competed: NOT COMPETED UNDER SAP
Solicitation Procedures: SIMPLIFIED ACQUISITION
Solicitation ID: 141013-24-0128
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 319 MAIN STREET, SELDOVIA, AK, 99663
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $240,000
Exercised Options: $141,000
Current Obligation: $141,000
Actual Outlays: $72,121
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Timeline
Start Date: 2024-09-08
Current End Date: 2027-09-07
Potential End Date: 2029-09-07 00:00:00
Last Modified: 2026-04-08
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