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B-188513 1 (1978-04-10)

handle is hein.gao/gaobadfzj0001 and id is 1 raw text is: A~ I lo / TME COMPTROLLEN DENNRALTw.- DECIUION OP THE U NITED ETATES WASMINGTON, D.C. 054U FILE: 5,18513 DATE: APR 1 Q igsg MATTER OF: Legal sufficiency of conract for transportation of petroleum products b pipeline DIGEST: 1. Contracts for pipeline transportation services may be procured by negotiation under ASPR. 2. Bilateral contract for pipeline transportation services should have been negotiated under and contain appropriate provisions from ASPR where bill of Inding is not the basic procurement document but im used to accomplish the trans- portation service. covered by the bilaterrjl contract. The Directutate of SupplyiOperation., Defense Fuel Supply Center, Defense Lo3istics Agen cy, Departmnt'of Defense, has requested our evaluation of aconirict for pipeline transporta- tion services for its legal sufficiency and overall efficiency as a rate agreement entered ilto under the provisions of Section22 of the Interstate Cowmerce Act, as anended, 49 U.S.C. 22 (1970). We also have been asked to comment on whether pipeline transportation services may be procured by negotiation under the provisions of the Armed Services Procuremant Regulations (ASPR). The contract is between Southern Pacific Pipe Lines. Inc. (Southern Pacific), and the United Status Government -anc Covers the trinsportationof petroleum products, by-Southern Pacific's pipeline from Norwalk, California, to Norton Air Force Base, California. Under the terms of the contract, Southerr Pacific is to fulfill all of the Government's actual pipeline transporta- tion service requirements for an indefinite period at specified rates or at rates to be determined by subsequent negotiations. While the Government doas not guarantee any particular violiume of traffic, the contract obligates it to procure all of Norton Air Force Base's r-qiraments for pipeline transportation services from Southern Pacific. Procurement officiils of the United States have greater latitude ihan do private paities in arranging with intsrested carriers for-reduced rates or for services not offtrid to the general public because of specific provisions in the Interstate Commerce Act authorizivg service to the Government free or at - 1

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