HRJ Slides.ppt

Hydrotreated Renewable Jet Fuel Pre-Proposal Conference Defense Energy Support Center

Unclassified

Mission:

Vision:

Values:

To Provide the Department of Defense and Other Government Agencies with Comprehensive Energy Solutions in the Most Efficient and Economical Manner Possible!

Our Customers First Choice for Energy Solutions

Enterprise Petroleum Sales

Foreign Military Sales FY08 Net Sales 4M barrels - $512.1M

Expanding Energy Solutions

(multi year awards) Military Fuel FY08

Forward Presence FY08

Personnel On Board FY08

Alternative Fuels

Why Do This?

Driven by energy security concerns Utilization of domestic resources Environmental considerations Who Could Do This?

Existing Suppliers Partnerships

Agenda

Program, Quality and Specification Requirements Pamela Serino Director – Quality / Tech Support Office

Alternative Energy Drivers Energy Independence

Energy Independence and Security Act of 2007 Compliance with environmental regulations

Energy Policy Act of 2005

Requirements

Fuel and Feedstocks (HRJ-5) Hydrotreated Renewable JP-5 fuel supplied shall consist predominately of n-paraffins, iso-paraffins and cycloparaffins and shall be produced solely from triglycerides and free fatty acids derived from either plant or algal oils.

Fuel and Feedstocks (HRJ-8) Hydro-treated renewable JP-8 supplied shall consist predominantly of n-paraffins, iso-paraffins, and cycloparaffins and shall be produced solely from triglycerides and free fatty acids derived from either plant or algal oils or animal fat or mixtures thereof.

Explanation of Feedstock Requirements For a plant oil product, the oil will be considered to be different from another product if it contains more than 25% of an oil or oils not contained in the other product.

Specifications HRJ-5 and HRJ-8 Critical Specification Properties

Density freezing point Net heat of combustion Jet Fuel Thermal Oxidation Tester Metals Nitrogen Hydrocarbon composition Flash Point

Additive Requirements HRJ-5 and HRJ-8

HRJ-5

1,500 gallon requirement Algal oil only Antioxidant

HRJ-5

Initial 1,500 gallons contains only antioxidant Remainder 188,500 gallons contains antioxidant and corrosion inhibitor

HRJ-8

Antioxidant (for all deliveries) Static Dissipater Additive (Stadis® 450) (for all deliveries)

Quality Assurance Provisions Quality Control Plan

Receiving Blending Sampling Testing Calibration Storage and handling Loading and shipping Corrective action

Commercial Industry Commercial Aviation Alternative Fuels Initiative (CAAFI)

Cooperative effort between DESC, Services and Commercial Industry Commercial specification through ASTM

Current Issues Timeline

Environmental Considerations Energy Independence and Security Act

Section 526 No Federal agency shall enter into a contract for procurement of an alternative or synthetic fuel, including a fuel produced from nonconventional petroleum sources, for any mobility-related use, other than for research or testing, unless the contract specifies that the lifecycle greenhouse gas emissions associated with the production and combustion of the fuel supplied under the contract must, on an ongoing basis, be less than or equal to such emissions from the equivalent conventional fuel produced from conventional petroleum sources.

Environmental Considerations Interagency Working Group for Alternative Fuels Lifecycle Analysis

Military Services, Environmental Protection Agency, Department of Energy, Federal Aviation Administration, and DESC-Q Ensuring rules and tools for evaluating alternative fuels, greenhouse gas footprint Development of a model / metrics to fairly evaluate greenhouse gas emissions of conventional and unconventional fuels Metrics (Section 526 Compliance) EPA / DoE Responsible for Conventional Jet Petroleum Baseline

How To Do Business With The Defense Energy Support Center Virginia R. Broadnax Small Business Specialist Office of Small Business Programs

Federal Acquisition Regulation (FAR) Requirement - Policy Current FAR Policy (FAR Part 19.201 (a)) States:

“It is the policy of the Government to provide maximum practicable opportunities in its acquisitions to small business, Veteran-owned Small Business, Service Disabled Veteran-owned Small Business, HUBZone small business, small disadvantaged business, and woman-owned small business concerns. Such concerns shall also have the maximum practicable opportunity to participate as subcontractors in the contracts awarded by any executive agency, consistent with efficient contract performance.”

Definitions

NAICS

Bulk Refined Product 324110 (mfr) 424720 (dealer)

324110 – No more than 1,500 employees nor more than 125,000 barrels per calendar day

424720 – 500 employees or less

DoD Subcontracting Program Subcontracting Plan Requirements

Clause at FAR 52.219-9 (applies to OTSB)

Acquisition greater than $550K ($1M for construction)

With Subcontracting Possibilities Submit Acceptable Plan or Ineligible for Award

Multi-Year Contracts / Contract With Options

Cumulative Value of Basic Contract + All Options considered in determining if a plan is necessary If Individual Plan : Separate Goals for Basic + Each Option

Contractor Responsibility Requirements Federal Acquisition Regulation (FAR) 9.104-1 – General Standards States

“To be determined responsible, a prospective contractor must --

(a) Have adequate financial resources to perform the contract, or the ability to obtain them (see 9.104-3(a));

(b) Be able to comply with the required or proposed delivery or performance schedule, taking into consideration all existing commercial and governmental business commitments;

(c) Have a satisfactory performance record (see 9.104-3(b) and Subpart 42.15). A prospective contractor shall not be determined responsible or nonresponsible solely on the basis of a lack of relevant performance history, except as provided in 9.104-2;

Contractor Responsibility Requirements

(d) Have a satisfactory record of integrity and business ethics;

(e) Have the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them (including, as appropriate, such elements as production control procedures, property control systems, quality assurance measures, and safety programs applicable to materials to be produced or services to be performed by the prospective contractor and subcontractors). (See 9.104-3 (a).)

(f) Have the necessary production, construction, and technical equipment and facilities, or the ability to obtain them (see 9.104-3(a)); and

(g) Be otherwise qualified and eligible to receive an award under applicable laws and regulations.”

Questions?

CONTACT INFORMATION

Director, Lula Manley (703) 767-9465

Pre-Award Team Garrell Armstrong (703) 767-8530 Virginia Broadnax (703) 767-9400 Sheila McClain 767-9678

Subcontracting Team Jackie Craft (703) 767-9681 Robert Mitchell (703) 767-8555 Noel Echevarria (703) 767-9704

Procurement Process Phyllis Orange Chief – Domestic Bulk Fuels Contracting Bulk Petroleum

Agenda

Contracting Overview Procure MILSPEC products in very large volumes

Award annual indefinite quantity contracts Estimated Quantity with a 75% minimum lift guarantee Firm fixed price Evaluate modes of transportation

Transport truck Intermodal container

Procurement Process – Contract Approach

HRJ-8 (Air Force)

400,000 USG (total requirement) 200,000 USG (initial award) Additional 200,000 USG in option quantities Award to single or multiple sources with different feedstocks Animal fat, plant and / or algal oils feedstocks

HRJ-5 (Navy)

190,000 USG

40,000 (initial award) Additional 150,000 USG in option quantities Single source award Plant or algal oils feedstocks Feedstock used to produce all HRJ fuel shall come from the same source American Recovery and Reinvestment Act of 2009 funds HRJ-5 (Navy)

1,500 USG

Algal oils feedstock only Feedstock used to produce the HRJ fuel shall come from same source American Recovery and Reinvestment Act of 2009 funds

Key Points in the Procurement Process

Requirement Definition Post Award Evaluation/ Award

Negotiations

Solicitation Award Contract(s) Open Negotiations Issue RFP

Final Offers

Month Purchase Request Discuss/Resolve Offer Discrepancies / Process Exceptions Delivery Period

Notional Timeline

Solicitation Process

DESC web page FedBizOpps Time and date for receipt of offers is 3:00 p.m. (local time) on July 13, 2009

Late is Late

Time and date for receipt of offers stated on SF 1449 Initial offers Final proposal revisions Specific to local time Offers received after time and date specified will not be accepted Exceptions Mishandling by the government Late modifications of an otherwise acceptable proposal

Solicitation Format:

Standard Form 1449 Table of Contents Section B – Supplies to be Furnished / Customers / EPA Clause Section C – Description / Specification / Statement of Work Section E – Inspection & Acceptance Section F – Deliveries or Performance Section G – Contract Administration Data Section I – Contract Clauses Section J – List of Attachments Section K – Representations, Certifications, & other Statements Section L – Instructions, Conditions, & Notices to Offerors Section M – Evaluation Factors for Award

Standard Form 1449

Point of Contact with contact information Proposal due date Important Notices to Offerors

Central Contractor Registration (CCR) required Prospective awardee shall be registered in the CCR database Registration required prior to award, during performance, and throughout final payment of the contract

Indefinite Delivery Indefinite Quantity (IDIQ) Minimum guarantee Orders issued by ordering officer Firm fixed price FOB origin Schedule B – Supplies / Services and Prices / Costs

Contract line item description and quantities National stock number Period of performance

Section C – Description / Specification / Statement of Work

Statement of Objectives / Work and / or Specification Product specification requirements Unique delivery requirements Customer specific information

Inspection and Acceptance

Contractor inspection responsibilities for Hydro-treated Renewable JP5 (HR-J5) and JP8 (HR-J8) E5 Inspection of supplies – fixed-price (Aug 1996) E35 Nonconforming supplies and services (DESC Jan 2004)

Section F – Deliveries or Performance

Transportation F1.09 Determination of Quantity Free Time and Detention Section G – Contract Administration Data

Submission of Invoices for Payment Section I – Contract Clauses

Contract Terms and Conditions Federal Statutory Clauses DoD Statutory Clauses

Amendment 0001, Paragraph G

Offerors are required to provide a general description of how it will ensure reliable supply of on-spec product to meet the Government’s requirements by addressing all items stated in paragraph G

Section M – Evaluation of Offers

Lowest Price Technically Acceptable Technically Acceptable Specification (i.e., feedstocks, plant locations, etc.)

Ability to meet the delivery schedule Ability to maintain the same feedstock over the life of the contract Then Price Transportation

Section M – Responsibility

Evaluate Technical Capability Conduct Pre-award survey Ability to produce required quantity Ability to meet delivery schedule Proposed feedstock

Payment Terms

30 days Net 10 discounted to T-bill rate

Funding Navy

American Recovery and Reinvestment Act of 2009 (Recovery Act) funds (See clauses I1.03-2, I1.04, and I1.04-1) Contractor required to report all work funded using recovery funds Recovery funds shall be tracked at http://www.FederalReporting.gov Reports required no later than 10th day after the end of each calendar quarter (IAW FAR Clause 52.204.11) Air Force – Not Applicable

Finding Information FedBizOpps (www.fedbizopps.gov)

- All solicitations greater than $25,000

- Automatically notifies vendors of new solicitations

DESC Homepage (www.desc.dla.mil)

- Reference current and past award reports

DESC Web Page www.desc.dla.mil

DESC Solicitation Programs

Improper Business Practices and Personal Conflicts of Interest Kay Bushman Assistant Counsel Office of Counsel

Contractor / Government Restrictions

Contractor Prohibitions

Government Employee Restrictions

Violations Violations can result in loss of the contract and criminal prosecutions