Jockeying underway for DOE cleanup contracts at site

Workers at the Advanced Mixed Waste Treatment Project remove dirt from around a box containing radioactive waste as they prepare to retrieve and process the contents of the box, which has been stored on pad 1 for 40 years.

Photographer: Monte LaOrange/mlaorange@postregister.com, Date: 4/18/12, Camera: NIKON D3S, Lens: 35, Shutter: 1/160, Aperture: 4, ISO: 1250

Last week, the U.S. Department of Energy announced the two radioactive waste cleanup and management contracts at Idaho National Laboratory — set to expire Sept. 30, 2015 — will be split into four contracts. Bids will be solicited for those contracts from major engineering and cleanup companies.

That information was published on the DOE’s website.

So far, that’s all DOE will say.

Rather than tamping down the rumors, the stone wall erected by DOE only succeeded in touching off a wildfire of speculation.

The Post Register, meanwhile, still is waiting for answers to a specific list of questions emailed last week to a DOE representative. Initially, the newspaper contacted local DOE officials, who refused comment. The questions then went to a DOE spokeswoman in Cincinnati. By Friday, the questions had made their way to the DOE Public Affairs Office in the nation’s capital.

But with potentially billions of dollars in federal funding at stake, this much is certain: Idaho Falls once again will become a hotbed of activity by multinational contractors, all seeking a very large slice of a very rich pie.

Ultimately, who gets the contracts not only will affect the eastern Idaho economy, but will ripple through the entire state as well.

As cleanup of INL’s desert site winds down, jobs undoubtedly will be lost. But as one door closes, another could open — and with it, the possibility of a new category of jobs built around possible new research opportunities at INL.

Jockeying for position

The race between companies to see which can best position itself in Idaho Falls — with an eye on that pie — already is underway.

Several would-be front-runners have hosted news conferences and VIP cocktail parities. Top executives, accompanied by prominent state lawmakers, are visiting the city — touting their support of local business, bolstering education and creating jobs.

While none has issued a statement, potential bidders aren’t exactly keeping their aspirations a secret, either.

Representatives of Fluor, a Fortune 500 engineering and construction firm, spent Thursday in Idaho Falls — with Gov. C.L. “Butch” Otter in tow — ostensibly celebrating the opening of an operations office for its subsidiary, NuScale Power.

Fluor Government Group President Bruce Stanski said the company has big plans for future expansion in Idaho Falls, assuring local business and political leaders that the firm was committed to everything eastern Idaho.

Earlier this year, fellow Fortune 500 company Huntington Ingalls Industries, and subsidiary Newport News Shipbuilding, acquired S.M. Stoller, an environmental remediation contractor with an Idaho Falls office.

In February, Newport News executive Peter Diakun told the Post Register the acquisition provided Newport News with expanded ability for environmental cleanup. Officials said the merger puts them in the mix to land major research and cleanup contracts at DOE’s desert site. They also committed to helping community growth.

Insiders speculate that Bechtel Corporation, which previously held major DOE contracts here, and retains a local presence, is a possible major contender.

EnergySolutions Federal Services and CH2M Hill (part of current Idaho Cleanup Project contractor CH2M-WG Idaho LLC) also are considered likely players.

Historically, contracts aren’t awarded to a single company. Instead, a conglomeration of corporations will join forces to bid on such contracts — creating an alphabet-soup of acronyms — enough to make an editor’s head explode.

Possible players include: URS, AREVA, CBI, B&W, Honeywell, Lockheed Martin, Jacobs Engineering, Black &Veatch, Foster Wheeler and Idaho Falls North Wind Group.

What’s at stake? Big money

At least $1.1 billion in federal contracts, and almost certainly a lot more.

Following is a quick look at the four contracts:

A king’s ransom

The most lucrative prize is a contract DOE calls “ICP Core.” It requires the winning bidder to take on remediation of toxic and radioactive contamination at the DOE’s desert site, which has been branded as an Environmental Protection Agency Superfund site.

The five-year contract also includes keeping track of the environmental management infrastructure along with managing radioactive waste and spent nuclear fuel. It combines many of the cleanup activities — now performed by the Idaho Treatment Group and/or CH2M-WG — into a single contract. Idaho Treatment Group runs the Advanced Mixed Waste Treatment Project.

The contract’s value is estimated at a minimum of $1 billion, with no top end listed. The contract will cover all of the winner’s costs and build in bonuses for meeting cleanup milestones.

Wild cards

The next highest-valued contracts will pay from $50 million to $1 billion. So far, DOE has not responded to requests to explain that wide range.

A nine-year contract calls for design of a process to dispose of 4,400 cubic meters of “calcine,” a granular high-level radioactive waste — the byproduct of early efforts to reprocess spent nuclear fuel.

A five-year contract, which requires a small business to take the lead, would deal with decommissioning and demolishing old waste treatment facilities, as well as building new waste storage facilities.

A pauper’s pittance

At a measly $25 million to $50 million, the final, five-year contract covers managing spent nuclear fuel storage facilities regulated by the Nuclear Regulatory Commission. It, too, requires a small business lead.

The Post Register asked DOE how many jobs would be associated with each of the four contracts. DOE did not respond.

Phone calls seeking interviews with DOE contract managers were not returned.

What the bigwigs say

State and local business and political leaders know the outcome of the contract rebidding process could have big effects on the regional economy. Here’s what they had to say:

“Like everyone else, we have a number of questions about the new contracts and the impact those contracts will have on cleanup, jobs and budgets. Congressman Simpson will be asking those questions of DOE over the coming days and working to ensure any new path forward continues the successes we’ve seen over the past several years.” — John Revier, Simpson spokesman.

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“As one of INL’s key stakeholders, the state of Idaho has a keen interest in the cleanup work at the site. Our immediate priority is to ensure that the cleanup is able to successfully continue on schedule. In the near term, DOE needs to complete the work on the liquid waste, get all of the targeted waste out of the ground and then get caps installed. The current contractors are making progress on those milestones, and we want to see that progress continue. We look forward to reviewing the DOE’s contract proposals to ensure that the scope of work properly reflects Idaho’s priorities and our vested interests.” — Gov. C.L. “Butch” Otter.

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“The INL cleanup efforts are one of Idaho’s highest priorities and we appreciate DOE’s commitment to that effort. We will continue to support them any way we can and look forward to a strong partnership going forward.” — Jeffery Sayer, director of the Idaho Department of Commerce and a member of LINE 2.0 commission.

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“The contract bidding process carries tremendous potential and opportunity for the entire community. I am particularly hopeful the DOE will look with favor upon on those contractors who have demonstrated their willingness to be good community partners and who are committed to building up our entire region. In turn, Idaho Falls commits to being a good and supportive host city for all lab functions, including the vital aspects of environmental management.” — Idaho Falls Mayor Rebecca Casper.

Assistant City Editor Mike Mooney contributed to this report.

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