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Bunker Contract Locations

The ships' bunker program provides commercial ship propulsion fuels for military & other US Government vessels worldwide. Bunker fuels are defined as those commercial fuel products consumed for ship's propulsion. These worldwide contracts provide a third level of supply where U.S. Government owned stocks and FEAs are not available. The contracts are established through the Defense Energy Support Center (DESC) (formerly Defense Fuel Supply Center (DFSC)) bunker fuel program to support Navy, MSC, Coast Guard, and other federal agencies. They are awarded to contractors for a 2-year period. The Navy pays a standard price for this fuel, thus eliminating market price fluctuations and lowering overall fuel costs. The type of fuel received from these contracts is Marine Gas Oil (MGO); F76; Intermediate Fuel Oils (IFO) 180 and 380; and Diesel Fuel #2 (DF2).

Naval Regional Contracting Center Naples Detachment Bahrain awarded the Navy's Persian Gulf Bahrain Husbanding Services Contract in October 1998 covering the complete range of logistical support for the visiting fleet. The contract provides for improved port services, reduced contract administration, ease of use for the peacekeepers and documented savings of $3.9 million over five years. It combined fleet support requirements in Bahrain into one consolidated contract to replace seven previous contracts. The effort utilized Performance Based Statement of Work, decreased acquisition lead-time by 60%, and streamlined and simplified solicitation. As a consequence of combining seven contracts into one, it was critical to ensure that individual concerns of the seven customers were covered. Issues included incorporating uniformity in areas such as inspection and acceptance and converting from functional to performance based Statement of Work.

Historically, there have been instances where Navy ships have received fuel with high particulate content, large volumes of water, and/or contaminants from waste products. This off-spec fuel was discovered after the ships were already underway thus resulting in a required offloading at the next port. To minimize these occurrences, the Navy Petroleum Office and the Defense Energy Support Center (DESC) established the In-Line Fuel Sampling Program. The program is designed to provide a better means to monitor the quality of Marine Gas Oil (MGO) received from commercial bunker contractors. With increased use of commercial MGO, this program will provide the capability to monitor fuel quality from each supplier and location. The In-Line Fuel Sampling Program consists of a DESC-funded contract awarded to a commercial source (DNV Petroleum Services) which provides sampling equipment and testing services to analyze and evaluate the quality of fuels lifted under DESC bunker contracts.

In September 1996, an important change to the Naval Ship's Technical Manual was achieved. In chapter 541, the use of Marine Gas Oil (MGO) was modified to meet the ever changing fuel requirements of the Navy. MGO is now defined as an "acceptable substitute fuel" replacing the previous description as an "emergency substitute fuel." After much effort, the Navy Petroleum Office and Naval Sea Systems Command reached an agreement that increases the availability of quality marine fuel for the Naval Fleet in areas where F76 distillate is not available. This was accomplished by designing a specification that would meet Navy's engine requirements, and at the same time, permit the use of a commercial spec product.

Defense Fuel Supply Center is now awarding bunker contracts using the new Navy MGO requirement in areas where the supply of F76 is not available. However, MGO must be promptly consumed by the receiving vessel only and may not be stored long term since the fuel has not been researched for long-term stability results. In the short time that this technical requirement has been in effect, there have been no reported engine problems related to the use of the Navy MGO. Naval Sea Systems Command and the Navy Petroleum Office are monitoring any increased engine maintenance that can be correlated to the use of MGO.

To acquire increased knowledge of the quality of worldwide fuel sources, Naval Surface Warfare Center has recently completed a survey of 42 commercial marine fuels. This has resulted in identifying worldwide locations where commercial fuels meet the requirements specified in the Navy MGO description. Those fuels that are found to be of poor quality and could increase engine maintenance will be avoided for contracting and any future lifts from Navy vessels.

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Page last modified: 05-07-2011 02:43:40 ZULU