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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (40099)	3/16/1999 11:55:00 AM
From: Mike from La.	Respond to of 95453

U.S. oil storage plan succeeds, attracts bids NEW YORK (Reuters) - The U.S. Department of Energy's offer to store up to 70 million barrels of crude oil in the nation's oil reserve attracted "multiple" bids before last week's deadline, the agency said Tuesday. The DOE declined to give details of the bids, but said it was hopeful that contracts to store commercial oil in the reserve would be awarded by April 10. "The bids that were most promising will require further negotiating with the companies to clarify the proposals," a DoE official said. The bids will remain valid for a month from March 10. The DOE failed to attract any acceptable bids when it made a similar offer in August. Under the current plan, companies will pay storage fees in the form of oil, which will be added to the reserve's current 561 million barrel inventory. The companies must store the oil for at least a year in one or more of six unfilled salt caverns at the Big Hill site south of Beaumont Texas. The country's Strategic Petroleum Reserve (SPR) was established 25 years ago to cushion again oil prices shocks, but its inventory has fallen steady from a 1994 peak of 592 million barrels as Congress has withheld funding. The SPR has a total capacity of about 680 million barrels. In a related move, the DOE will start adding an additional 28 million barrels to the SPR in April under a plan which allows companies to turn over a portion of the crude they produce from federally leased wells in the Gulf of Mexico as a royalty payment instead of cash.