The U.S. Department of Energy plans this spring to buy up to 4 million barrels of crude oil in the first of a series to replace 11 million barrels in the Strategic Petroleum Reserve that were sold after Hurricane Katrina in 2005.

The purchases will be funded with proceeds from the 2005 sales, which should be far more dollars than the cost of replacing the reserves today. Oil and gas prices jumped after Katrina due to the sudden and severe reduction in supply.

In this first purchase, 2 million barrels of sweet crude are to be delivered to the West Hackberry, Louisiana, reserve site, and/or 2 million barrels of sour crude are to be delivered to the Bryan Mound, Texas, reserve site.

Meanwhile, the DOE reports that salt domes at Richton, Mississippi, will be the new site for the expansion of the SPR. As an inland site, Richton will have less vulnerability to hurricanes, the DOE reports, and will be connected to the Capline pipeline system and to refiners and marine facilities in Pascagoula for oil distribution. The other four SPR sites, two in Louisiana and two in Texas, are on the Gulf Coast.

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