Followup on audits of purchase of natural gas and natural gas pipeline lease
In April 1990, the Office of Inspector General issued two reports, Purchase of Natural Gas by the Albuquerque Operations Office'' and Natural Gas Pipeline Servicing Los Alamos National Laboratory,'' that criticized the Department for paying excessive costs to purchase and transport natural gas and for leasing its pipeline at less than fair market value. We conducted this followup audit to determine if the Department (1) secured more economical natural gas supplies, transportation, and service for the Los Alamos National Laboratory (Los Alamos) and plants at Kansas City, Mound, and Pantex; and (2) regained control of the Los Alamos pipeline and replaced the lease with an operating agreement more favorable to the Department. The Albuquerque Field office did not follow the course of action recommended, which we believe, would have produced annual savings of about $3.6 million. specifically, Albuquerque did not aggressively pursue competitive supply and transportation contracts and eventually entered into short term contracts based on the spot market prices. Also, Albuquerque continued to use noncompetitive gas distribution contracts and had made no progress in replacing the pipeline lease. This occurred because Albuquerque had not given our prior report recommendations adequate attention and had not assigned responsibility for administering the lease. Thus, we recommend that the Manager of Albuquerque (1) establish a specific plan of actionwith time frames to ensure aggressive pursuit of ways to further reduce natural gas costs and get maximum benefit from ownership of the Los Alamos pipeline, and-(2) assign organizational responsibility for the Los Alamos pipeline lease. The Albuquerque Management concurred with our findings and recommendations.
- Research Organization:
- USDOE Office of Inspector General, Albuquerque, NM (United States). Western Regional Audit Office
- Sponsoring Organization:
- DOE; USDOE, Washington, DC (United States)
- OSTI ID:
- 6867597
- Report Number(s):
- DOE/IG-0322; ON: TI93012078
- Country of Publication:
- United States
- Language:
- English
Similar Records
The natural gas pipeline servicing Los Alamos National Laboratory
Purchase of natural gas by the Albuquerque Operations Office
Related Subjects
030600* -- Natural Gas-- Economic
Industrial
& Business Aspects
AUDITS
CONTRACTS
COST
DEVELOPED COUNTRIES
ENERGY SOURCES
FLUIDS
FOSSIL FUELS
FUEL GAS
FUELS
GAS FUELS
GASES
KANSAS CITY PLANT
LANL
LEASES
LOS ALAMOS
MOUND LABORATORY
NATIONAL ORGANIZATIONS
NATURAL GAS
NEW MEXICO
NORTH AMERICA
PANTEX PLANT
PIPELINES
PROCUREMENT
RECOMMENDATIONS
TRANSPORT
URBAN AREAS
US AEC
US DOE
US ERDA
US ORGANIZATIONS
USA