Companies interested in managing the two main civilian nuclear-weapon production sites under a potential 10-year, $28-billion contract with the National Nuclear Security Administration will be allowed to visit the facilities on Sept. 22 and Sept. 24.
The agency announced in June that it would not pick up further options on incumbent Consolidated Nuclear Security’s contract to manage the Y-12 National Security Complex in Oak Ridge, Tenn., and the Pantex Plant in Amarillo, Texas. The semiautonomous Department of Energy branch aims to transition to a new contractor by Oct. 1, 2021, and just about every major player in the DOE business is expected to line up for a shot.
BWX Technologies, which ran the sites before Consolidated Nuclear Security, has said it is interested in the follow-on work, as has Amentum — the former AECOM Management Services. One source said BWX Technologies and Huntington Ingalls Industries have explored a joint bid.
Y-12 processes uranium for nuclear-weapon secondary stages, and manufactures the stages, which are also called canned subassemblies. Pantex is the NNSA’s servicing center for all U.S. nuclear weapons. The Texas panhandle site is in charge of everything from minor modifications and routine maintenance to major weapons life-extension programs.
Interested teams can send a maximum of two representatives to Y-12 on Sept. 22, and to Pantex on Sept. 24, according to a notice published late last week.
Visitors to both locations will have to abide by COVID-19 protocols, which include mandatory face coverings, health questionnaires, and temperature checks. Both facilities put those protocols in place over the summer, after it became clear that nuclear-weapon servicing and production would have to continue under pandemic conditions for the foreseeable future.
One-on-one meetings between NNSA representatives and potential bidders will come after the scheduled site visits. With COVID-19 still raging, the meetings will be virtual, the NNSA said. The agency expects to release its final solicitation for the work after the scheduled tours.
The draft solicitation was issued last month. It says Consolidated Nuclear Security will remain on site at Y-12 after the new contractor takes over, solely to finish building the Uranium Processing Facility. That three-building facility, which Consolidated Nuclear Security lead partner Bechtel National is building under a subcontract to the prime, will replace Y-12’s Building 9212 as the manufacturing hub for nuclear-weapon secondary stages. The contractor broke ground on the plant in 2018, and the NNSA has said it will finish construction by 2025 for no more than $6.5 billion.
NNSA Should Split Production Site Contract, Interest Group Says
The Washington, D.C.-based Energy Communities Alliance, which represents localities that host Department of Energy nuclear-weapon sites, wants the NNSA to again split the Production Office contract into two separate site management awards.
“[D]oes one contract between two very different sites still make sense?” Seth Kirshenberg, executive director of the Energy Communities Alliance, wrote in a Sept. 8 letter to NNSA Administrator Lisa Gordon-Hagerty.
The alliance was not alone in its advocacy. The City of Oak Ridge, which popped off its own letter to Gordon-Hagerty Sept. 2, also wants to see NNSA split up the production site contract. So does Rep. Chuck Fleischmann (R-Tenn.), whose district includes the site and the Y-12 site.
“Although improving efficiencies and achieving cost-savings at NNSA sites are worthy goals that I enthusiastically support, the pursuit of these objectives cannot come at the expense of our communities,” Fleischmann wrote in a Sept. 8 letter to Gordon-Hagerty.
In his somewhat more pointed letter, Kirshenberg pointed to the NNSA’s latest annual performance assessment of Consolidated Nuclear Security’s combined site contract, as a result of which the agency said it would re-compete the contract, as evidence that the management experiment had failed. The agency listed various management and safety issues, including a time-card fraud scandal and repeated criticality safety issues at Y-12, among its reasons for pushing the incumbent out.
“The existing [management and operations] contract has existed for the past six years and is not considered to be successful by NNSA,” Kirshenberg wrote. “NNSA stressed safety and other concerns in this notice but there is an underlying belief that contracts that are not renewed due to safety concerns can be deduced to be a failure.”
Kirshenberg also questioned the NNSA’s touted cost savings in combining duplicative administrative functions such as payroll at the two sites, which the Consolidated Nuclear Security took over from separate teams led by competitor BWXT in 2014.
“As the contract is not being renewed we don’t know whether the original contract ‘savings’ would have been achieved,” Kirshenberg wrote.
Consolidated Nuclear Security will cede management of Y-12 and Pantex after Sept. 30, 2021, leaving three years’ worth of options on the table. The company’s contract is worth about $2 billion annually, and the incumbent wanted to save the NNSA roughly $3 billion over the 10-year life of its contract.
The Government Accountability Office has verified some $515 million in savings under Consolidated Nuclear Security’s contract through fiscal 2018. That was about four-fifths of the amount proposed to that point, according to the GAO report.
Earlier this year, Bechtel National said that combining the previously separate site-management contracts has so far saved the government some $740 million.
Editor’s note 09/14/2020, 08:41 a.m. Eastern time, U.S.: the story was changed to clarify the timing of the City of Oak Ridge’s letter to the NNSA.
