May 17, 2022 Mary B. Powers KEYWORDS Amentum / DOE / federal contract / Fluor / Nuclear waste management Order Reprints No Comments

The US Energy Dept.'s National Nuclear Security Administration will now rebid as separate contracts the management and operations of two large-footprint nuclear waste manaement sites in Texas and Tennessee after cancelling a 10-year award made last year, worth up to $28 billion, to a Fluor Corp. and Amentum-led team.

NNSA cancelled the contract on May 16 for the Pantex site near Amarillo and Y-12 National Security complex in Oak Ridge, Tenn., both nuclear weapons assembly and storage facilities after losing bidders Bechtel and BWXT protested the award in December 2021. Bechtel, which was the contract incumbent, claimed the agency made a “ad hoc” decision when making the award.

NNSA rebid the contract in 2020 after opting not to renew the last three years of Bechtel’s 10-year contract, but it kept the management and operations of the two plants under a single contract.

The Government Accountability Office dismissed the protests in January after NNSA said it was taking voluntary corrective action and would reassess its evaluation of the three bids.

NNSA also said at the time it would reassess alleged conflicts of interest and alleged appearances of impropriety that the bid protests raised, and possibly "terminate the contract."

Fluor and Bechtel have not yet responded to an ENR request for comment.

“Based on NNSA’s review of the procurement record and our assessment of increased requirements at the sites, cancellation of the solicitation and termination of the resulting award is appropriate, given the accelerating workload at both facilities, the challenging geopolitical environment and the urgent need ... to deliver on critical national security missions."

NNSA, a semi-autonomous agency in DOE that maintains the U.S. nuclear weapons stockpile, did not comment further on the bid protest allegations.

But agency Administrator Jill Hruby said in a statement that “fair and open competition is critical to NNSA."

NNSA will award a contract extension June 1 to the Bechtel-led team for management and operations of Pantex and Y-12  for a minimum of two years and an option for a third year. Team members include Leidos; ATK Launch Systems and SOC LLC, with Booz Allen Hamilton as a teaming subcontractor.

“The contract extension is necessary while NNSA develops a new acquisition strategy to manage Y-12 and Pantex under separate contracts and revises the documents to reflect the significant change to the requirements,” the agency said.

NNSA did not disclose schedule or other details of the new contract bidding, which is expected to include the Bechtel, Fluor-Amentum and BWXT teams.

In a May 17 note to investors, Andrew Wittmann, lead construction industry analyst for Baird Equity Research, said the contract "was a major component" of what he said was "an expected $20 billion to 30 billion award pipeline" for Fluor, and 'significant long-term reimbursable contract revenue."

Wittmann estimated that reaward of the contracts wouldl take about one year from solicitation and that Fluor "appears well positioned" to win one.