(Adds background on SPR, previous sale)
WASHINGTON Feb 8 The U.S. Energy Department
said on Wednesday it will sell 10 million barrels of oil from
the government's emergency crude reserve in late February.
The sale from the Strategic Petroleum Reserve (SPR) was
required by a law passed last year as a way to help increase
funding for medical research. The law mandated sales of 25
million barrels from the SPR over three years, starting with the
sale of 10 million barrels this year.
The reserve, a series of heavily guarded underground salt
caverns along the coast in Texas and Louisiana, currently holds
about 690 million barrels of mostly sour oil, a type containing
high sulfur that many U.S. refineries can process.
It will be the second sale of oil from the emergency stash
this year. Last month, Shell bought 6.2 million barrels
from the reserve and Phillips 66 bought 200,000 barrels.
The federal government held that sale to fund a
modernization of the SPR. More sales are expected be held in
coming years to fund up to $2 billion for the revamp.
(Reporting by Timothy Gardner; Editing by Grant McCool and Dan