MODIFICATION
B -- Assessment of the Federal Royalty-in-Kind (RIK) Program and Development of a RIK Business Plan.
- Notice Date
- 11/14/2002
- Notice Type
- Modification
- Contracting Office
- Minerals Management Service, GovWorks, 381 Elden Street, MS 2500, Herndon, VA 20170-4817
- ZIP Code
- 20170-4817
- Solicitation Number
- 70585
- Response Due
- 11/22/2002
- Archive Date
- 12/30/2002
- Point of Contact
- Anna Brown, 703-787-1369 or Wallace O. Adcox, 703-787-1362
- E-Mail Address
-
Email your questions to Contracting Officer E-mail Address
(anna.brown@mms.gov)
- Description
- THIS IS AN AMENDMENT TO A PREVIOUS ANNOUNCEMENT. The entire corrected announcement is given below. Here is a summary of the changes: SUMMARY: Two additional sub items are now added to Item 1 under "EXPECTED OUTCOMES OF THE CONTRACT". Item 1 should now read as follows: "1. Assess the current capabilities and performance of the Federal RIK Program and provide recommendations for improvement. a. Evaluate effectiveness of the current RIK business model and operational processes and recommend areas for improvement. Include in the evaluation a review of the crude oil marketing practices of the Canadian Province of Alberta and identify any procedures or practices with potential to improve the Federal RIK Program. b. Identify and evaluate RIK functions with high potential for outsourcing. Specifically include an assessment of the feasibility of outsourcing Federal RIK marketing functions, address implementation and operational costs and benefits, and evaluate overall impacts on in kind royalty revenues." The total cubic feet cited in section "DESCRIPTION OF SUBJECT MATTER ISSUES" is now corrected from "(380,000 MMBtu/day)" to "(350,000 Mcf/day)". In addition, the date for receipt of the written portion of the proposal is now changed from December 3, 2002, to December 9, 2002, and the date for oral presentations is now changed from the week of December 9, 2002, to the week of December 16, 2002. THE DUE DATE FOR CAPABILITY STATEMENTS REMAINS UNCHANGED AT NOVEMBER 22, 2002. HERE IS THE CORRECTED NOTICE IN ITS ENTIRETY: PLEASE READ THIS ENTIRE NOTICE CAREFULLY AS IT CONSTITUTES THE ONLY NOTICE THAT WILL BE ISSUED. This is a combined synopsis/solicitation for commercial items prepared in accordance with the format in Subpart 12.6, as supplemented with additional information included in this notice. This notice constitutes the only solicitation, and is a request for proposals (RFP). The Department of the Interior, Minerals Management Service (MMS) intends to competitively award a contract to assist in the continuing development of a top-tier professional organization within MMS responsible for managing activities associated with commodity sales and/or exchanges of royalty crude oil and natural gas. Contract work includes assessments of and recommendations on operational and technical issues and development of a 5-year Business Plan. The program of interest is MMS' royalty in kind (RIK) program, in which oil and gas production royalties are taken in kind as physical commodities delivered to the federal government by producers, as distinct from the historically prevalent payment of royalties by producers in cash. MINERALS MANAGEMENT SERVICE STRUCTURE. The mission of MMS is managing the mineral resources on the outer continental shelf in an environmentally sound manner and to timely collect, verify, and distribute mineral revenues from Federal and Indian lands. The organizational components of MMS are described as follows. Minerals Revenue Management (MRM) provides management, policy, and direction for all minerals revenue management processes to ensure the efficient, timely, and accurate collection and disbursement of mineral leasing revenue due to American Indian Trust Tribes, individual Indian lessors, States, and the U.S. Treasury. The RIK program is currently administered by MRM. Administration and Budget (A&B) provides management, policy, and direction of the information technology, personnel, procurement, administrative support, budgetary, and financial management processes to support the bureau's program offices and other federal activities. A&B provides contracting, budgetary, and financial management support to the RIK program. Offshore Minerals Management (OMM) provides management, policy, and direction for all offshore oil, gas, and mineral lease, production, and inspection activities to ensure an effective economic return and a safe environment that balances the interests of the nation's economic welfare and a partnership with the industry. OMM provides data access and verification support to the RIK program. Policy and Management Improvement (PMI) provides policy review, special studies, and coordinated program and policy positions for the Director; manages the strategic planning process; oversees the regulatory and information collection programs; provides policy analysis; and manages the MMS appeals process. PMI provides analytic support for the RIK program. DESCRIPTION OF SUBJECT MATTER ISSUES. The MMS has managed energy commodity sales "pilot" programs for 3 years, and a Small Refiner Program for several decades. Commercial projects include oil sales from Wyoming production (4,000 barrels/day); gas sales from Gulf of Mexico offshore production (350,000 Mcf/day); and oil sales to small refiners from Gulf of Mexico and Pacific offshore production (55,000 barrels/day). In addition, MMS and DOE manage the Strategic Petroleum Reserve (SPR) fill initiative through exchange agreements involving up to 130,000 barrels/day of Gulf of Mexico royalty oil. Some 1,100 Federal oil and gas leases are involved, with RIK commodities valued at well over $1 billion annually. The current primary RIK organization, the RIK Program Office, is headquartered in MRM's Lakewood Colorado office, with a Senior Executive Service Assistant Program Director reporting to the Washington, D.C. based Associate Director for MRM, and managing approximately 34 employees. The RIK Program Office performs the front office and mid office functions of the RIK program. The back office functions are performed by the Onshore and Offshore Compliance and Asset Management offices in Lakewood, CO, Houston, TX, and New Orleans, LA. Financial accounting for RIK business activities is provided by MRM's Financial Management organization located in Lakewood, CO. Contractors are not currently used for operational functions, although Accenture LLP provides system-related development and support. The RIK Program Office has responsibility and accountability for the RIK enterprise, including selection and conversion of RIK properties, marketing and sales, contracting, crude oil and natural gas volume control, invoicing and payment, payables management, performance evaluation and management reporting. Payments are integrated with and flow through the overall MRM financial management system. Reconciliation of volumes taken to those entitled to be taken is performed by the compliance offices, which also monitor payment compliance with contract terms. The MRM RIK Office has successfully built the new RIK business enterprise and has expanded the RIK portfolio. Roles are functionally aligned with proven industry best practices. RIK personnel identify and evaluate business cases, perform economic analyses, conduct competitive sales, schedule product deliveries, and verify receipts. Business processes have been implemented and assigned personnel are effectively performing commercial commodity sales activities. Based on the RIK pilot programs' success, MMS concluded in its January 2001 RIK Road Map to the Future that RIK will be a permanent method to use, along with the traditional cash royalty approach, to manage the public's mineral royalty asset stream. The Road Map set forth the strategic direction and specific actions to develop core business processes, organization, and supporting technology to move the RIK program from pilot to operational status by the end of 2003. However, the strategic direction and implementation actions provided by the Road Map do not extend beyond 2003. Moreover, a recent internal MMS RIK needs assessment concluded that additional capabilities and resources will be needed to support a permanent RIK program of significant scale and that some operational areas may need to be outsourced. The needs assessment also concluded that technical assistance is needed for optimizing the RIK business model and associated strategies. Based on the foregoing, MMS believes it is timely and desirable to obtain expert advice on how to improve and expand the permanent RIK program. MMS is also proposing the development of a 5-year Business Plan to guide the administration and expansion of the Federal RIK Program in the future. EXPECTED OUTCOMES OF THE CONTRACT. An independent assessment of current RIK program capabilities and performance, recommendations to improve overall program performance, and development of a 5-year RIK Business Plan. Specific deliverables follow: 1. Assess the current capabilities and performance of the Federal RIK Program and provide recommendations for improvement. a. Evaluate effectiveness of the current RIK business model and operational processes and recommend areas for improvement. Include in the evaluation a review of the crude oil marketing practices of the Canadian Province of Alberta and identify any procedures or practices with potential to improve the Federal RIK Program. b. Identify and evaluate RIK functions with high potential for outsourcing. Specifically include an assessment of the feasibility of outsourcing Federal RIK marketing functions, address implementation and operational costs and benefits, and evaluate overall impacts on in kind royalty revenues. c. Recommend internal control process improvements, including RIK performance measurement tools and metrics. d. Recommend strategies to optimize revenue receipts from the Federal portfolio of royalty assets, including processes and support tools. e. Recommend strategies to acquire transportation and processing services. f. Recommend alternative approaches for the aggregation, marketing, and delivery of RIK sales volumes. 2. Develop RIK Business Plan for the future. a. Provide detailed strategic plan to guide the administration and expansion of the Federal RIK Program for the period 2004-2008. b. Provide actions, timelines, and milestones to achieve RIK expansion goals -190,000 barrels/day of OCS oil and 1.5 bcf/day of OCS gas. c. Recommend strategies for expanding the Federal oil and gas RIK property portfolio, including onshore producing properties. d. Provide recommendations on the RIK property portfolio, operational processes, organizational structures, and human resources to effectively support the permanent Federal RIK Program. 3. Briefings, progress reviews, and final reports. a. Senior Executive briefings will be conducted at the beginning and end of the contract or more frequently as requested. b. Contractor will provide monthly status reports. c. Contractor will provide draft reports for review and concurrence by MMS management. Final reports to be in print and electronic format. CONTRACT TYPE/DESCRIPTION. The total estimated value of this effort (not including ad hoc continuing task orders after the Business Plan completion) is between $300,000-$500,000. The anticipated contract type is a firm-fixed price contract for the Independent Assessment and Business Plan. The performance period for both tasks is 12 months or less. Ad hoc task orders will be issued to implement the Business Plan. These will be priced on a time-and-materials basis. The total period of performance inclusive of all ad hoc task orders shall be 24 months or less. For the fixed-price portion of the work (Independent Assessment and Business Plan), payment will be 50% of the contract cost based on incremental completion of milestones. The remaining 50% of the cost will be paid upon acceptance of the final deliverable for both tasks. The acceptance and payment of the incremental completion costs will not preclude the government from rejecting the project on conclusion if it determines the project has not met expectations. The following criteria will be applied when determining acceptance of the project deliverables: A) Independent assessment report and related deliverables that respond to specific direction, (1) are understood by MMS executive, contracting and RIK management, (2) specifically address current RIK capabilities and performance, (3) include recommendations that demonstrate how each strategy, tool or alternative business approach presented or provided will result in improvements to the RIK program. B) A comprehensive 5-year Business Plan that: 1) can be implemented; 2) considers all technical, organizational, resource, regulatory, and economic issues related to energy commodity sales by a federal government entity; and 3) is highly likely to be accepted by stakeholders to the federal royalty program. HOW TO RESPOND. An interested party must demonstrate that your organization is qualified to perform work by providing a Capabilities Statement detailing: 1) Key staff that will work on the contract (those contractor employees that will have primary responsibility for performing/managing the work), with associated knowledge of and experience with MMS and energy sales issues. 2) Organizational experience and facilities, including working knowledge of energy commodity sales, federal oil and gas valuation, and RIK programs, and ability to combine the above experience to provide external insights, perspectives, analysis, and solutions independent from those used in developing the current program 3) Potential for conflict of interest, including affiliated relationships with federal lessees and current/planned business activity in performing energy commodity sales or accounting activities for sellers/buyers of energy commodities. 4) Past performance, including specific references for similar work that your firm has successfully performed within the last 3 years. Include number, size, and complexity of similar projects, adherence to schedules and budgets, effectiveness of program management, acceptability of delivered products, and client information with a point of contact and phone number that is current. All references will be checked. An original plus five (5) copies of the Capability Statement are due November 22, 2002, by 4 PM ET to Minerals Management Service, Procurement Operations Branch, Mail Stop 2510, Second Floor, 381 Elden Street, Herndon, VA 20170-4817. If delivery is made in person or by courier, the building has a security check in at the rear of the building, which may delay timely receipt of proposals. Allow extra time for security check in when hand delivering documents. An electronic copy of the Capability Statement may be sent by e-mail to anna.brown@mms.gov. A FAX copy of Capability Statements or written cost and business proposal will not be accepted. Following the evaluation of Capability Statements, only firms demonstrating the best experience, organizational capability, and assigned personnel to complete the work will be invited to give an oral presentation. The estimated date for oral presentation is the week of December 16, 2002. Offerors will be given one day and time for oral presentation, and no alternative days or times will be negotiated. Only those offerors giving an oral presentation will be requested to submit a written cost and business proposal detailing how the work will be performed. Written cost and business proposals are due December 9, 2002 by noon ET. Each firm giving an oral presentation must also submit a written summary of the oral presentation on December 9, 2002. EVALUATION CRITERIA. The following criteria will be used in the evaluation of offers: 1) Superior Capability Statement detailing the offerors key personnel, past experience, and corporate capability. 2) Innovative Yet Practical Solutions 3) Thoroughness of Presentation 4) Commitment to Schedule 5) Price Reasonableness Criteria 1-4 are equally weighted. Contract award shall be made to the responsible Offeror whose offer, in conforming to this RFP, provides an overall best value to the Government, technical evaluation factors, and cost considered. The Government's objective is to obtain the highest technical quality considered necessary to achieve the project objectives, with a realistic and reasonable cost. Technical evaluation factors are more important than cost; however between proposals that are evaluated as technically equal in quality, cost will become a major consideration in selecting the successful. QUESTIONS AND POINTS OF CONTACT. Questions should be sent via fax or Email as soon as possible to Fax (703) 787-1836 or email to anna.brown@mms.gov. Please include with your question(s) your full name, the solicitation number and title, your organization, complete address with telephone and fax numbers. Telephonic questions or requests will not be accepted. Address for receipt of offers: Minerals Management Service, Procurement Operations Branch, Attention: Anna Brown, 381 Elden Street - MS 2510, Herndon, VA 20170. Anna Brown is the Contracting Officer and Wallace Adcox (Wallace.Adcox@mms.gov) is the alternate point of contact. Dominique King is the Procurement Technician.
- Record
- SN00205067-W 20021116/021114213405 (fbodaily.com)
- Source
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