MFR_SPE600-15-R-0711_FAQ.pdf

MEMORANDUM FOR RECORD

DOMESTIC BULK PETROLEUM

SOLICITATION NUMBER: SPE600-15-R-0711

PURCHASE PROGRAMS: 2.2b/2.2d/2.5b LOCATION(S): Rocky Mountain/West Coast/Offshore (RMW) PERFORMANCE PERIOD: October 1, 2015 through September 30, 2016, plus 30-day carryover

SUBJECT: Frequently Asked Questions (FAQ)

The following items on this “living document” serve as a record of questions asked in response to the RMW solicitation and their respective answers. The questions and answers will have dates associated with them so if there is a pending answer or an updated answer, readers will know what is the most current information for that question and answer.

1) Question: Last year, there were two solicitations with one of them being solely small business set-asides. Will there be a similar solicitation this year?

(Dated April 10, 2015)

Answer: DLA Energy solicitation (SPE600-15-R-0711) contains all of this year's Rocky Mountain/

West Coast/Offshore (RMW) program requirements. This solicitation also includes small business set-aside requirements, so no separate solicitation set aside for small businesses will be issued.

Small businesses must meet NAICS code 324110 to be eligible for the set aside requirements.

(Dated April 13, 2015)

2) Question: Last year there was a waiver to the non-manufacturer rule by the SBA. Do you anticipate this being the case this year?

Answer: The RMW requirement no longer meets the SBA's criteria for a waiver, as there are multiple small business refineries in the geographical area within the RMW program.

3) Question: It appears that there are some inconsistencies in the procurement quantities on the schedule. The quantity numbers seem to be duplicates of other locations; the quantities seem low for certain locations and/or types of product; the quantity numbers are exact numbers as opposed to what has been seen in the past with rounded quantity numbers. Can you explain?

Answer: The 2015 RMW Program DLA Energy solicitation is the first larger Domestic Bulk

Petroleum program to be fully executed in the Enterprise Business System (EBS). As such, the requirement quantity numbers are fed into the solicitation from other integrated systems based on historical program volumes. These requirement quantity numbers are then required to be manually changed to reflect planning projections and rounded. Due to the amount of time it has taken to

SOURCE SELECTION INFORMATION – SEE FAR 2.101 AND 3.104

generate the documents in EBS to allow the schedule to produced (and subsequently the solicitation), it was felt that it would be better to get the solicitation out as it currently is and plan to amend the quantities in the very near future. An amendment is planned to be posted approximately 7-10 days from now to correct those quantities on the schedule.

4) Question: Is there going to be a Pre-Proposal Conference? (Dated April 10, 2015)

Answer: Yes. The date for the pre-proposal conference is April 29, 2015 with a tentative time of 8:00am – 3:00pm, Local Fort Belvoir Time. The pre-proposal conference will be held off-site from DLA Headquarters at the Hilton Springfield Hotel, located at 6550 Loisdale Rd, Springfield, VA 22150. If you plan to attend, you will need to RSVP by April 22, 2015, 3:00pm Local Fort Belvoir Time, with the designated DLA Energy representative (see the FBO Posting for details or the letter sent to current RMW contract providers). There will be signs within the hotel lobby to direct the vendors to the rooms assigned for the conference. An itinerary of the conference schedule and briefings along with briefing slides is currently planned to be sent out to all who plan to attend and RSVP by the RSVP deadline.

5) Question: Why has the solicitation number changed from previous years (SP0600-XX-R-0161)?

Why has the solicitation number changed from SPE600-15-R-0161?

Petroleum program to be fully executed in the Enterprise Business System (EBS). Unfortunately, EBS automatically assigns solicitation numbers on a serial basis (next number available is selected) and does not allow for manual selection of number series previously associated with each program.

6) Question: There is conflicting information in the solicitation schedule and in the clause regarding the Base Reference date and prices; the schedule shows January 26, 2015 and the clause is February 24, 2015. Which is correct if any?

(Dated April 15, 2015)

Petroleum program to be fully executed in the Enterprise Business System (EBS) and due to this, some of the information did not feed through properly. The correct base reference date is February 24, 2015 and is the date found in the Economic Price Adjustment clause, FAR 52.216-9069(g) which can be found in Section B. An amendment is planned to be posted approximately 7-10 days from now to correct those quantities on the schedule.

(Dated April 16, 2015)

7) Question: In many cases there is no maximum or minimum parcel size listed for an activity in the schedule. Does this mean there is no restriction?

Answer: No. The 2015 RMW Program DLA Energy solicitation is the first larger Domestic Bulk Petroleum program to be fully executed in the Enterprise Business System (EBS) and due to this, some of the information did not feed through properly. This is one of the areas where information did not fully feed through. An amendment is planned to be posted approximately 7-10 days from now to correct those quantities on the schedule.

8) Question: What does the field “FOB restriction” in the schedule mean?

Answer: This field indicates if an activity has a restriction on the method of delivery. An “O” means that activity can only receive FOB Origin. A “D” means that activity is restricted to only FOB Destination deliveries. “O/D” means that activity can receive in either manner.

9) Question: Can biofuels be shipped via pipeline?

Answer: In some cases, biofuel can be shipped via pipeline. It depends on the pipeline being utilized and whether the pipeline company allows it. The biofuel will have to be blended prior to shipping, it cannot be blended as it is passed into the pipeline.

10) Question: Expand on the Green Fleet 2016 project, how much fuel is expected for operations?

(Dated May 4, 2015)

Answer: For the Green Fleet West Coast use, the exact amount is unknown. However, the fuel is not just for the Green Fleet but also for use throughout the fleet. (Dated May 4, 2015)

11) Follow-on Question: What time period is expected? (Dated May 4, 2015)

Answer: The fuel will be purchased throughout the life of the contract. (Dated May 4, 2015)

12) Question: Is waste fryer grease an eligible feedstock? (Dated May 4, 2015)

Answer: It is not eligible for CCC. (Dated May 4, 2015)

Solicitation Overview:

13) Question: Different volumes were stated than what is in the Solicitation? (Dated May 4, 2015)

Answer: An Amendment will be released shortly. (Dated May 4, 2015)

14) Question: For the JP5 quantities, under 2.2D there are two different quantities stated one under OS and the other under WC… what is the significance of OS? (Dated May 4, 2015)

Answer: OS stands for Offshore. WC stands for West Coast. This is reflective of regional indicators for the Rocky Mountain/West Coast/Offshore program. (Dated May 4, 2015)

15) Question: When are offers due? (Dated May 4, 2015)

Answer: May 8, 2015 (Dated May 4, 2015)

16) Follow-on Question: will there be an extension due to the Amendment that is expected to be released? (Dated May 4, 2015)

Answer: There may, it depends. (Dated May 4, 2015)

17) Follow-on Question: Until when will you extend? Significant changes impacts our offer, if possible can we be notified if you expect to extend the closing deadline preferably by this week.

Answer: We will let you know as soon as we can. (Dated May 4, 2015)

18) Question: Is the technical evaluation criteria weighted and/or prioritized? (Dated May 4, 2015)

Answer: Each technical subfactor is weighted equally. However, an unacceptable rating for any single subfactor would result in the entire technical proposal being found unacceptable. (Dated May 4, 2015)

19) Question: Referenced Line Item 0042 and Nellis but the question was in regards to Additives and why the Additives stated were different from the additives stated per mode. (Dated May 4, 2015)

Answer: Additives will be addressed in detail during the supply and BEM sections. (Dated May 4, 2015)

20) Question: For OET, if an offer is submitted manually can it be converted into OET during the negotiation period or during request for interim offers? (Dated May 4, 2015)

Answer: Yes, it can be converted during negotiations and/or when interim offers are due into OET, but extra time will not be granted if the offeror chooses to use OET. (Dated May 4, 2015)

21) Question: What platform will be used for Reverse Auction? (Dated May 4, 2015)

Answer: Procurex will still be used for this Solicitation but OET will be used in the future for Reverse Auction. (Dated May 4, 2015)

22) Question: Are discussions for clarification and/or negotiations expected to be done on-site, orally?

Answer: No, negotiations are not expected to be done in person and can be completed via phone, phone conference, teleconference, and email. (Dated May 4, 2015)

Technical Evaluation:

23) Question: Continuation of question 7, Additives? (Dated May 4, 2015)

Answer: If the requirement location does not require additives, you must pay attention to the additives identified per mode. (Dated May 4, 2015)

Further clarification: – Legacy systems only had additive requirements by mode. If for example in

Nellis under that location we require additives (YYY) and via PL mode we do not require additives (NNN) then what that means is that we are injecting the additives in-bound at the base. If for truck mode the additives are required (YYY) then we are requiring the additives to be injected at the truck rack. There’s consideration in changing the schedule to only show the additives per mode but currently on this Solicitation we are showing both. (Dated May 4, 2015)

24) Follow-on Question: In this case the location requirement for additives is NNN and the mode is showing YYY? (Dated May 4, 2015)

Answer: Then that may be a mistake. Please bring that up to the Contracting Officer’s attention.

Quality Requirements/CCC/Section 526:

25) Question: Previous Inland East Coast Solicitation, the bio-fuel/synthetic product had to be on-spec in tank and in vessel? Can you consider taking the product just on-spec in the vessel? [Question relates to verifying quality prior to government acceptance via tanker loading] (Dated May 4, 2015)

Answer: The neat synthetic fuel needs to have a full CoA showing conformance to the spec requirements prior to blending with petroleum and then the final finished blend must show conformance with an additional CoA. Ideally, the fuel would be blended in a stationary storage facility, then the fuel would be sampled and tested, and once quality has been verified would be loaded onto the mode of transportation. Typically, practices such as “splash blending” are not allowed, however specific situations may warrant a more tailored approach to traditional practices which DLA Energy may be willing to consider given sufficient information. (Dated May 4, 2015)

26) Question: In regards to (the F-76 traceability requirements in C16.23), please provide clarification on specific molecules… if the molecule is available closer, than isn’t that more attractive?

Molecules had to be identified so the molecules have to come from the refiner? As a trader, it is difficult to trace molecules? This is in regards to the traceability requirement? (Dated May 4, 2015)

Answer: The traceability requirement in C16.23 for F-76 is intended to provide assurance that no unapproved materials as described in Sec 3.2 of MIL-DTL-16884N have been intentionally blended into the product either at the refinery or downstream at an intermediate location. These would include blend components such as residual fuels, un-hydrotreated light cycle oils, or oxygenated compounds (i.e. FAME) or any unapproved additives, such as stabilizer additives, not specifically allowed in the specification. The intent was not to try to control contaminants that may be picked up through normal distribution and transportation systems, but rather the intentional blending of the aforementioned materials. (Dated May 4, 2015)

27) Question: Antioxidant where is it injected? (Dated May 4, 2015)

Answer: As soon as it has been hydro-treated and before tankage. Antioxidant shall be added as soon as practicable after hydroprocessing or fractionation synthesizing and prior to the product being passed into storage to prevent peroxide and gum formation after manufacture. (Dated May 4, 2015)

Bid Evaluation and OET:

28) Question: For OET do you require separate registrations, one for Bulk and one for Direct

Delivery? (Dated May 4, 2015)

Answer: Yes, they are separate roles so we require separate accounts. Also, if you offer using more than one Cage Code then you have to create a separate account for each cage code. (Dated May 4, 2015)

29) Question: How do you award if you receive two offers, an alt fuel company after CCC offer and a petroleum offer, both at the same exact price, $3.50? (Dated May 4, 2015)

Answer: For that to occur, both offers will have to be exactly the same. The BEM will usually give the award result to one or the other but if there is a true tie then the Contracting Officer can award the highest biofuel percentage offer. It is rare that there is a tie. (Dated May 4, 2015)

30) Continuation Question 7 and 11 – Additives?

Answer: If there is a mistake, let contracting know because you cannot have no additives (N) at the requiring location and then have (Y) additives by mode. You can have additives (Y) at the location and then by mode it can be different (either Y or N). (Dated May 4, 2015)

31) Question: You mentioned a "doomsday clock" on OET; does this show on a per instance case?

Answer: Yes. It is set specifically for the particular instance in OET. (Dated May 4, 2015)

32) Question: Can I change my offer once I submit in OET? (Dated May 4, 2015)

Answer: Yes. Up to the closing time for offers for that particular round. Once you have submitted your offer, when you select that offer again, you will be asked if you want to remain in 'read only' mode or if you want to 'unsubmit' your offer to make changes and resubmit. NOTE. If you do 'unsubmit' to make changes and fail to resubmit by the closing time set for offers, you will NOT have a timely offer in place. (Dated May 4, 2015)

33) Question: If I don't bid on one product (in OET), can I then add a product to my offer the next round (i.e. initial then interim offer, interim then FPR, etc)? (Dated May 4, 2015)

Answer: The current configuration of OET does not restrict you from adding products, shipping points, method of delivery, etc. during any round of the solicitation up to the final offers. During a Reverse Auction round, you can only change price. It will be up to the Contracting Officer if the new product/location will be considered for award. (Dated May 4, 2015)

34) Question: When will the BEM run (be provided)? (Dated May 4, 2015)

Answer: A typical distribution would be; first Minimum Cost Bid Evaluation Worksheet (MCBEW) and Laid Down Cost Report (LDCR) issued approximately 1 week before Final Proposals, the next set of reports issued before each subsequent Reverse Auction round. The actual sequence and timing of distribution of the MCBEW and LDCR will be determined by the Contracting Officer. (Dated May 4, 2015)

35) Question: Can we have a cooperative agreement with other business to go after opportunities DLA

Energy is offering (i.e., joint venture, prime, etc.)? (Dated May 11, 2015)

Answer: Yes. Here's the link to the DoD Guide for Teaming Arrangements:

http://www.dla.mil/SmallBusiness/Pages/OtherLinks.aspx (Dated May 11, 2015)

36) Question: Are there any advantages for the Indian Incentive program? (Dated May 11, 2015)

Answer: In accordance with FAR 26.102, the Indian Incentive Program allows an incentive payment equal to 5 percent of the amount paid to a subcontractor in performing the contract. In addition, FAR 19.703(c)(1) allows large businesses to include these awards in their subcontracting plans. (Dated May 11, 2015)

37) Question: How exactly does COC work? (Dated May 11, 2015)

Answer: In accordance with FAR 19.602-1(a), Upon determining and documenting that an apparent successful small business offeror lacks certain elements of responsibility (including, but not limited to, capability, competency, capacity, credit, integrity, perseverance, tenacity, and limitations on subcontracting, but for sureties see 28.101-3(f) and 28.203(c)), the contracting officer shall --

(1) Withhold contract award (see 19.602-3); and

(2) Refer the matter to the cognizant SBA Government Contracting Area Office (Area Office) serving the area in which the headquarters of the offeror is located, in accordance with agency procedures. (Dated May 11, 2015)

38) Question: Does the DLA Energy Small Business Office make NAICS codes determination or is that strictly the SBA? (Dated May 11, 2015) http://www.dla.mil/SmallBusiness/Pages/OtherLinks.aspx

Answer: No, SBA in accordance with FAR 19.102 (a) (b) and (c):

(a) (1) The SBA establishes small business size standards on an industry-by-industry basis. (See 13 CFR

121). Small business size standards matched to industry NAICS codes are published by the Small Business Administration and are available at http://www.sba.gov/content/table-small-business-size-standards.

(2) NAICS codes are updated by the Office of Management and Budget through its Economic

Classification Policy Committee every five years. New NAICS codes are not available for use in Federal contracting until the Small Business Administration publishes corresponding industry size standards (see 19.102(a)(1)).

(b) Small business size standards are applied by --

(1) Classifying the product or service being acquired in the industry whose definition, as found in the

North American Industry Classification System (NAICS) Manual (available at http://www.census.gov/epcd/www/naics.html ), best describes the principal nature of the product or service being acquired;

(2) Identifying the size standard SBA established for that industry; and

(3) Specifying the size standard in the solicitation so that offerors can appropriately represent themselves as small or large.

(c) For size standard purposes, a product or service shall be classified in only one industry, whose definition best describes the principal nature of the product or service being acquired even though for other purposes it could be classified in more than one.

(d) When acquiring a product or service that could be classified in two or more industries with different size standards, contracting officers shall apply the size standard for the industry accounting for the greatest percentage of the contract price. (Dated May 11, 2015)

39) Question: Listing of Small Refineries: (Dated May 11, 2015)

Answer: 1. Calcasieu Refining Co. (LA), 2. Placid Oil., Placid Refining Co. (LA), 3. Arctic Slope Regional Corp., Petro Star Inc (AK), 4. Countrymark Coop Inc. (IN), 5. Kern Oil & Refining Co.

(CA), 6. San Joaquin Refining Co., Inc. (CA), 7. Silver Eagle Refining Inc. (UT) (WY), 8.

Connacher Oil & Gas Ltd, Montana Refining Co. (MT), 9. American Refining Group Inc (PA), 10.

Greka Energy (CA), 11. Foreland Refining Corp. NV, 12. Par Petroleum (HI), 13. Lazarus Energy (Dated May 11, 2015)

40) Question: What is SBA's definition of a small refinery? (Dated May 11, 2015)

Answer: NAICS code 324110 – For purposes of Government procurement, the petroleum refiner must be a concern that has no more than 1,500 employees nor more than 125,000 barrels per calendar day total Operable Atmospheric Crude Oil Distillation capacity. Capacity includes owned or leased facilities as well as facilities under a processing agreement or an arrangement such as an exchange agreement or a throughput. The total product to be delivered under the contract must be at least 90 percent refined by the successful bidder from either crude oil or bona fide feedstocks.

(Dated May 11, 2015)