There could be more leadership changes at Energy Department sites with a CH2M Hill Co. presence, thanks to a corporate-level reorganization that has already precipitated a top-spot swap at DOE’s main solid-waste contractor for the Hanford Site in Washington state.
CH2M announced the pending restructuring in a Wednesday 8-K filing with the U.S. Securities and Exchange Commission, two days after news broke that John Ciucci would step down as president of CH2M Hill Plateau Remediation Co. (CHPRC) and take a job at the company’s corporate office in Denver. The move, Ciucci told employees at Hanford, was part of the corporate reorganization.
CH2M spokeswoman Lorri Crum declined to discuss the reorganization’s specific effect on the DOE complex, but said that,company wide, “some leaders have been who have worked on some of the projects will be working in a new role, whether it’s in the corporate organization at CH2M or in other parts of the company.”
Ciucci will be replaced at CHPRC by Ty Blackford, a Hanford Site veteran now at Savannah River Remediation, the CH2M-affiliated liquid waste contractor at DOE’s Savannah River Site in South Carolina. Several other personnel shifts are also being made at CH2M Hill Plateau Remediation as part of the reorganization.
Besides leading plateau cleanup at Hanford under a 10-year contract awarded in 2008 and worth roughly $6 billion, CH2M is the junior partner in the AECOM-led UCOR: prime contractor for demolition and decommissioning of the former uranium enrichment campus at the Oak Ridge site in Tennessee under a nine-year contract awarded in 2011 and worth roughly $2.5 billion.
CH2M also leads the CH2M Hill BWXT West Valley joint venture that handles cleanup of the West Valley Demonstration Project in upstate New York under a roughly $525 million contract awarded in 2011 and good through at least early 2020.
Aside from the Hanford Site leadership changes, none of those CH2M affiliates had announced personnel changes as of press time for Weapons Complex Monitor. UCOR spokeswoman Ashley Hartman and CH2M BWXT West Valley spokeswoman Lynette Bennett on Thursday deferred to Crum for comment.
Besides its involvement at the prime level at Hanford, Oak Ridge, and West Valley, Ch2M is also a major subcontractor on Fluor-BWXT Portsmouth’s gaseous diffusion plant cleanup contract at the Portsmouth Site in Ohio. The company got a shot in the arm from DOE’s April decision to extend that contract two-and-a-half years through Sept. 30, 2018.
As part of the corporate reorganization expected to be complete by the first quarter of 2017, CH2M is cutting its global workforce of roughly 22,000 by 800 — about a 3 percent cut, according to Tuesday’s 8-K.
CH2M’s contracts for DOE’s Office of Environmental Management have been a bright spot in the company’s sometimes disappointing earnings this year. In the first half of 2016, segment revenue rose about 25 percent year over year to roughly $1 billion, with profit for the half treading even at about $40 million.
Currently, CH2M’s legacy nuclear-cleanup work for DOE is reported under the Environment and Nuclear segment: a branch that accounted for roughly 30 percent of the company’s 2015 revenue of $3.6 billion, and which will be eliminated in name by the reorganization.
By early January, Crum said, CH2M will replace its four vertically integrated, industry-focused business units with three horizontal units aligned with the company’s main customer groups: national governments; state and local governments; and the private sector.
Work done under contract for DOE EM will be slotted under the national governments group, according to Crum.
“Eliminating the duplicative, matrixed management structure that’s been organized along vertical and regional lines will simplify our organization and move decision-making closer to clients,” Crum said. “This will create a simplified structure and eliminate internal client-service conflicts between vertical business lines, making it easier for clients to do business with CH2M.”
