Emergency Petroleum Supply Act

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Emergency Petroleum Supply Act''.

SEC. 2. PURCHASES FROM THE STRATEGIC PETROLEUM RESERVE BY ENTITIES IN 
              THE INSULAR AREAS OF THE UNITED STATES.

    (a) General Provisions.--Section 161 of the Energy Policy and 
Conservation Act (42 U.S.C. 6241) is amended by adding at the end the 
following new subsection:
    ``(j)(1) With respect to each offering of a quantity of petroleum 
product during a drawdown of the Strategic Petroleum Reserve:
            ``(A) the State of Hawaii, in addition to having the 
        opportunity to submit a competitive bid, may--
                    ``(i) submit a binding offer, and shall on 
                submission of the offer, be entitled to purchase a 
                category of petroleum product specified in a notice of 
                sale at a price equal to the volumetrically weighted 
                average of the successful bids made for the remaining 
                quantity of petroleum product within the category that 
                is the subject of the offering; and
                    ``(ii) submit one or more alternative offers, for 
                other categories of petroleum product, that will be 
                binding in the event that no price competitive contract 
                is awarded for the category of petroleum product on 
                which a binding offer is submitted under clause (i); 
                and
            ``(B) at the request of the Governor of the State of 
        Hawaii, petroleum product purchased by the State of Hawaii at a 
        competitive sale or through a binding offer shall have first 
        preference in scheduling for lifting.
    ``(2)(A) In administering this subsection, and with respect to each 
offering, the Secretary may impose the limitation described in 
subparagraph (B) or (C) that results in the purchase of the lesser 
quantity of petroleum product.
    ``(B) The Secretary may limit the quantity of petroleum product 
that the State of Hawaii may purchase through a binding offer at any 
one offering to one-twelfth of the total quantity of imports of 
petroleum product brought into the State during the previous year (or 
other period determined by the Secretary to be representative).
    ``(C) The Secretary may limit the quantity that may be purchased 
through binding offers at any one offering to 3 percent of the 
offering.
    ``(3) Notwithstanding any limitation imposed under paragraph (2), 
in administering this subsection, and with respect to each offering, 
the Secretary shall, at the request of the Governor of the State of 
Hawaii, or an eligible entity certified under paragraph (6), adjust the 
quantity to be sold to the State of Hawaii as follows:
            ``(A) The Secretary shall adjust upward to the next whole 
        number increment of a full tanker load if the quantity to be 
        sold is--
                    ``(i) less than one full tanker load; or
                    ``(ii) greater than or equal to 50 percent of a 
                full tanker load more than a whole number increment of 
                a full tanker load.
            ``(B) The Secretary shall adjust downward to the next whole 
        number increment of a full tanker load if the quantity to be 
        sold is less than 50 percent of a full tanker load more than a 
        whole number increment of a full tanker load.
    ``(4) The State of Hawaii may enter into an exchange or a 
processing agreement that requires delivery to other locations, so long 
as petroleum product of similar value or quantity is delivered to the 
State of Hawaii.
    ``(5) Except as otherwise provided in this Act, the Secretary may 
require the State of Hawaii to comply with the standard sales 
provisions applicable to purchasers of petroleum product at competitive 
sales.
    ``(6)(A) Notwithstanding the foregoing, and subject to 
subparagraphs (B) and (C), if the Governor of the State of Hawaii 
certifies to the Secretary that the State has entered into an agreement 
with an eligible entity to effectuate the purposes of this Act, such 
eligible entity may act on behalf of the State of Hawaii for purposes 
of this subsection.
    ``(B) The Governor of the State of Hawaii shall not certify more 
than one eligible entity under this paragraph for each notice of sale.
    ``(C) If the Secretary has notified the Governor of the State of 
Hawaii that a company has been barred from bidding (either prior to, or 
at the time that a notice of sale is issued), the Governor shall not 
certify such company under the paragraph.
    ``(7) As used in this subsection--
            ``(A) the term `binding offer' means a bid submitted by the 
        State of Hawaii for an assured award of a specific quantity of 
        petroleum product, with a price to be calculated pursuant to 
        this Act, that obligates the offeror to take title to the 
        petroleum product without further negotiation or recourse to 
        withdraw the offer;
            ``(B) the term `category of petroleum product' means a 
        master line item within a notice of sale;
            ``(C) the term `eligible entity' means an entity that owns 
        or controls a refinery that is located within the State of 
        Hawaii;
            ``(D) the term `full tanker load' means a tanker of 
        approximately 700,000 barrels of capacity, or such lesser 
        tanker capacity as may be designated by the State of Hawaii;
            ``(E) the term `offering'' means a solicitation for bids 
        for a quantity or quantities of petroleum product from the 
        Strategic Petroleum Reserve as specified in the notice of sale; 
        and
            ``(F) the term `notice of sale' means the document that 
        announces--
                    ``(i) the sale of Strategic Petroleum Reserve 
                products;
                    ``(ii) the quantity, characteristics, and location 
                of the petroleum product being sold;
                    ``(iii) the delivery period for the sale; and
                    ``(iv) the procedures for submitting offers.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on the date that is 180 days after the date of enactment of 
this Act or the date that final regulations are promulgated pursuant to 
section 3, whichever is sooner.

SEC. 3. REGULATIONS.

    (a) In General.--The Secretary shall promulgate such regulations as 
are necessary to carry out the amendment made by section 2.
    (b) Administrative Procedure.--Regulations issued to carry out this 
section, and the amendment made by section 2, shall not be subject to--
            (1) section 523 of the Energy Policy and Conservation Act 
        (42 U.S.C. 6393); or
            (2) section 501 of the Department of Energy Organization 
        Act (42 U.S.C. 7191).
                                 
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Summary: Emergency Petroleum Supply Act - Amends the Energy Policy and Conservation Act with respect to each offering of a quantity of petroleum product during a drawdown of the Strategic Petroleum Reserve (SPR) to prescribe guidelines according to which the State of Hawaii may:  (1) submit binding offers for and purchase categories of such product, receiving, at the Governor's request, first preference in scheduling for lifting; and (2) enter into agreements with eligible entities (local refineries) which may act on the State's behalf.