The Virgin Islands Water and Power Authority reissued an invitation for bids Monday, seeking an entity to supply fuel oil for the utility’s generating facilities on St. Thomas and St. Croix.
Bid proposals are due by 3 p.m. Aug. 22, according to a news release from WAPA. The agreement will be for one year and can be automatically renewed by the parties for another nine months.
According to WAPA Executive Director Hugo Hodge Jr., the utility was forced to seek a new fuel supplier after the current provider, Hovensa, announced in January it would cease refinery operations on St. Croix and would no longer supply fuel oil to the utility after June 30.
At the time of the announcement, the authority had been in the process of preparing its annual invitation to bid for fuel oil to which Hovensa traditionally has been the most responsive bidder. At that time the oil company offered an alternate option to deliver fuel oil at discounted rates until the end of the year.
Only one company, New York-based Atlantic Petroleum Trading Ltd., responded to the original request for bids by the April 10 deadline. Hodge said at the time that the authority would evaluate the reasons for the limited response. After studying the situation, Hodge thought he had an answer.
“After the authority’s request for bids went out, Gov. John deJongh Jr. was able to secure a commitment from Hovensa to provide fuel oil through the end of the year at prices that will remain below market prices,” Hodge said. “Despite the great interest shown by potential bidders, it is possible that most suppliers determined they could not compete with those prices, and therefore declined to bid.”
Based on feedback from major fuel suppliers over the last several months, Hodge said Monday his management and technical team are confident WAPA will receive competitive responses to the most recent bid invitation.
“The invitation to bid will be widely circulated as we continue our mission to secure a quality fuel supply at the lowest cost per kilowatt hour produced, resulting in the most reasonable rates for our customers,” Hodge said.
The utility will seek delivery of as much as 80,000 barrels per shipment based on generation needs in the two power plants. Delivery will begin no later than Dec. 1.
The invitation for bid instructions, the conditions and specifications, and a model contract for the distillate fuel oil purchase can be reviewed online by going to WAPA’s home page at www.viwapa.vi and clicking on the “Business Opportunities” link. Questions can be directed to Madeline Stevens-Webster, manager of contract administration, at IB-01-13@viwapa.vi or by calling 774-3552 ext. 2032 or 2038.
