Company Part of Incumbent CH2M-WG Idaho
Mike Nartker
WC Monitor
12/5/2014
As industry officials await the release of a final request for proposals for the new Idaho Cleanup Project (ICP) Core contract, a major shakeup appears to be in the works among the teams that have reportedly formed to go after the job should the Department of Energy make sufficient changes in the final RFP. Nearly all potential bidders made it clear after the release of the draft RFP in October that they could not bid on the contract, as currently conceived. WC Monitor has learned that CH2M Hill has dropped its plans to lead a bid for the new contract, and according to industry officials, may now be looking to take a subcontractor role on a team led by Fluor that also includes North Wind and Portage. Notably, CH2M Hill is the lead in CH2M-WG Idaho, which also includes URS and is currently responsible for the majority of the cleanup work underway at the Department of Energy’s Idaho site.
CH2M Hill late this week said it was unable to comment on an active procurement, but noted that “CH2M HILL has been entrusted to lead the cleanup of the Idaho site for the last decade. We are part of the local community, and are dedicated to the cleanup mission. We are proud of the accomplishments of the workforce to date in delivering safe, effective solutions to Idaho’s most complex challenges. We are committed to supporting the workforce and DOE in achieving the cleanup of the Idaho site.” Fluor declined to comment this week.
For the new ICP Core contract, CH2M Hill had been teamed with Huntington Ingalls Industries, and it remains to be seen if HII will look to join another team or lead its own bid going forward. In a statement late this week, HII spokeswoman Beci Brenton said, “Stoller and Newport News Shipbuilding are interested in competing for the contract in Idaho. Newport News’s extensive work in the nuclear field and their demonstrated ability to safely manage and reduce risk, coupled with Stoller’s proven record of performance in remediation and environmental management make Stoller-NNS a valued partner in a future team.”
CH2M Hill Seen as Strong Contender for New Contract
The CH2M Hill- and Fluor-led teams were two of the four reportedly that have formed to compete for the new ICP Core contract. The other two, according to industry officials, are Bechtel-EnergySolutions and Babcock and Wilcox-URS. Together, B&W, URS and EnergySolutions make up Idaho Treatment Group, LLC, which currently has the other main cleanup contract at the Idaho site responsible for the Advanced Mixed Waste Treatment Project. The new ICP Core contract is intended to replace those currently held by CWI and ITG, each of which are now set to expire in September 2015. The draft RFP for the ICP Core contract suggests, however, that extensions for both are likely since the new contractor is not expected to be in place until April 2016.
CH2M Hill had been seen as a strong contender for the new Idaho cleanup contract. As part of CWI, CH2M Hill has been at the Idaho site since 2005. CWI was seen as having performed well for its first seven-year contract at the Idaho site, having completed a number of projects ahead of schedule and under budget, and having realized a total of approximately $520 million in cost savings. The contractor has struggled, though, with a key project at the Idaho site—getting into operation the Integrated Waste Treatment Unit, which is intended to treat the remaining liquid waste at the site. That project has experienced significant cost-and-schedule overruns, and it remains to be seen when it will begin operation.
Will DOE Change RFP in Response to Industry Concerns?
The new ICP Core contract is set to run for five years, and will cover EM facility infrastructure, environmental remediation, waste management and spent nuclear fuel surveillance, maintenance and stabilization. DOE is planning for the new Idaho cleanup contract to have cost-plus-incentive-fee (CPIF) Contract Line Item Numbers (CLINs) with hybrid fee structures for both CPIF and milestone fees. Industry officials have expressed concerns, though, with provisions in the draft RFP that would severely restrict a contractor’s ability to earn fee if the target cost for the new contract is exceeded and make the contractor liable for costs above the target cost. In remarks this fall at this year’s Weapons Complex Monitor Decisionmakers’ Forum, senior executives from most major DOE cleanup contractors warned that their companies would likely not bid on the new contract unless changes were made to the draft RFP.
In recent weeks, DOE officials have said they are considering industry feedback as they prepare the final RFP for the new Idaho contract, but have not provided any details as to what specific changes may be made. “There have been a lot of concerns expressed about that draft information. Those have come through loud and clear,” acting Assistant Energy Secretary for Environmental Management Mark Whitney said at the ETEBA Business Opportunities Conference, held in Knoxville, Tenn, in late November. “We are working in the Department to consider those before we come out with any additional information.” It also remains to be seen when the final RFP will be released, with DOE officials having said at the ETEBA meeting that it may be pushed into early next year. “We are going to want to move as quickly as we can to a final RFP. That could still be December that we get a final RFP out. It could slip a little bit, but we are pushing hard to resolve any of the loose ends. EM Deputy Assistant Secretary for Acquisition and Project Management Jack Surash told WC Monitor on the sidelines of the meeting.
