CB&I AREVA MOX Services provided “misleading” information in determining how much construction of the Savannah River Site’s Mixed Oxide Fuel Fabrication Facility (MFFF) will cost, and how long it will take to build the plant, according to an updated project baseline report released Sept. 23 by the Energy Department’s Office of Project Management Oversight and Assessments. The report, which has already received criticism from MOX supporters, denounces the contractor’s $9.99 billion construction cost estimate, including the $5 billion already spent. The estimate contradicts the $17 billion construction forecast DOE reported on Sept. 8.
The MFFF would be used to convert 34 metric tons of weapon-usable plutonium into commercial reactor fuel under a U.S.-Russian nonproliferation agreement. But the Obama administration’s fiscal 2017 budget proposal seeks to replace the project with a downblending alternative that would dilute the plutonium at SRS using inhibitor materials and send the final product to the Waste Isolation Pilot Plant (WIPP) near Carlsbad, N.M., for final storage. The Energy Department believes the entire downblending project will only cost $17 billion, compared to $51 billion to complete the MOX project.
The DOE project management office partnered with the U.S. Army Corps of Engineers on the report. In the baseline document, DOE compared its estimates to build the MFFF to recent funding and timetable estimates provided by CB&I AREVA MOX Services. Projections are based on annual congressional appropriations of $350 million each year for construction. In fiscal 2016, lawmakers appropriated $340 million. In the two prior years, Congress delivered $345 million annually.
With $350 million in funding each year, CB&I AREVA MOX Services believes it would wrap up construction by 2029, compared to DOE’s projection of 2048 with the same funding level. The department said the difference arises because the contractor is playing down the potential cost escalation. For example, DOE’s projection assumes the cost will rise by about $5 billion during the life cycle of construction, compared to MOX Services’ projection of roughly $374 million. DOE wrote that the contractor did not properly address escalation in its evaluation, which led to the major difference in the two projections. “The contractor assumes all funding is applied to work and no risks are realized during execution; (management reserve) and contingency are not allocated or escalated annually in their spend plan,” DOE stated.
The department added that CB&I AREVA MOX Services has been providing a questionable construction completion percentage. The contractor uses actual cost data to determine the MFFF completion rate. Under that system, the facility is 61 percent complete, according to DOE. “This percentage is misleading for much of the mechanical piping, electrical, and heating, ventilation, and air conditioning systems due to the fact that much of the material was procured prior to completion of design and is stored on site awaiting installation,” the report says.
Once the figures are adjusted to reflect piping, installation, and the other factors, DOE said the completion rate should equal out to 48 percent. Meanwhile, DOE numbers add up to a much lower completion rate of 28 percent.
CB&I corporate communications did not respond to a request for comment.
The report, and several others that have concluded that the MOX method is too expensive, have drawn criticism from those in favor of the program, including U.S. Rep. Joe Wilson (R-S.C.). In an email sent on Monday, Wilson said the report is “insulting” because it claims that it will take another three decades to complete MOX. “I have visited the facility many times—in less than 10 years of construction, the facility is over two-thirds complete,” Wilson wrote. “I find it difficult to understand how the new NNSA report claims would take over 30 years to finish the remaining third of the project.”
The head of a Washington-based nuclear trade group, meanwhile, ripped DOE right back on its latest agency-funded MFFF cost estimate, telling NS&D Monitor in a Friday telephone interview that the DOE-chartered report included no figures from CB&I AREVA MOX Services.
“How can you have a report of any credibility when you don’t talk to the existing contractor?” David Blee, executive director of the U.S. Nuclear Infrastructure Council, asked rhetorically.
In addition, Blee said, the DOE report makes no mention of the U.S. nonproliferation agreement with Russia that would have to be renegotiated in order to abandon MFFF.
“This report has no traction, it’s not credible,” Blee said. “And it’ll be five years before WIPP can accept anything of this magnitude.”
WIPP is not slated to accept new shipments of transuranic waste until next year, possibly as late as April, and the mine at any rate would have to be expanded to accommodate the volumes of downblended plutonium DOE has mulled sending there. Expanding the salt mine would also would not be possible until some time in the 2020s, when DOE plans to finish major ventilation upgrades that will significantly increase underground airflow and enable safe use of diesel-powered mining equipment.
