Consolidated Nuclear Security LLC, a team that includes Bechtel National Inc. and Lockheed Martin Services Inc., has won a five-year contract to manage and operate the Y-12 National Security Complex in Oak Ridge and the Pantex Plant near Amarillo, Texas, federal officials announced Tuesday morning.
The winning team also includes ATK Launch Systems Inc. and SOC LLC. Besides managing and operating Y-12 and Pantex, Consolidated Nuclear Security, or CNS, will also manage construction of the Uranium Processing Facility at Y-12 and could manage tritium operations at the Savannah River Site near Aiken, S.C.
Including the possible tritium work, the contract has a total available fee of up to $446 million for CNS to manage the three sites for the U.S. Department of Energy and the National Nuclear Security Administration. CNS may also earn up to an additional $263 million as their share of savings, an NNSA announcement said, although CNS cannot share any savings related to employee benefits.
The four-month transition to CNS will begin immediately, and CNS will take over the work on May 1, the NNSA said in a Tuesday morning announcement. The contract will be administered by the NNSA Production Office, or NPO, which which was created in June and oversees nuclear production missions at Y-12 and Pantex.
“We found a strong, experienced partner in CNS,” NNSA Principal Deputy Administrator Neile Miller said. “Their team, and the leadership and capabilities they bring with them, are an exciting addition to the NNSA family. Their focus on continuously improving while driving for cost efficiencies helps us plan for the future while ensuring that we’re delivering on our commitments to our partners.”
Y-12, Pantex, and the Savannah River Site are key plants in the nation’s nuclear production work. The NNSA said each site provides unique capabilities in areas such as high explosives, precision machining, and tritium production.
Y-12 has been operated by B&W Y-12, a partnership of the Babcock and Wilcox Company and Bechtel Corporation, for 12 years. Pantex is managed and operated by Babcock & Wilcox Technical Services Pantex LLC. Bechtel, which has operational headquarters in Reston, Va., is a partner on that project as well.
In a statement early Tuesday afternoon, The Babcock & Wilcox Company, or B&W, said it was “disappointed” to learn that its team had not won the contract competition. Among other things, the company said it had increased weapons dismantlements and Y-12 production capacity, and removed 1.3 million square feet of aging facilities.
“We believe our proposal was a very strong choice for moving closer to NNSA’s vision of a consolidated nuclear security enterprise,” B&W said. “We will carefully evaluate information received during NNSA’s debriefing process and consider the options available to us within the procurement process. We will continue to manage both facilities at the highest level of performance through the transition period.”
Federal officials said the consolidated contract, the result of years of work, could save $3.27 billion during the next decade. The contract has options that would allow it to be extended up to five years.
“Our nuclear production capabilities are critical to our national security, and this contract puts NNSA in a position to improve mission delivery by generating significant savings that will be reinvested to improve safety, security, quality, and infrastructure,” NNSA Administrator Thomas D’Agostino said. “This award will have a lasting impact on NNSA for years to come. It is the culmination of years of hard work focused on continuously improving the way we operate, saving taxpayer dollars, and aligning ourselves for the future.”
The NNSA said CNS will use Booz Hamilton Inc. as a merger and transformation specialist and will use General Atomics for Savannah River Tritium Operations if that option is exercised after the first year.
In a press release, the NNSA laid out four objectives it expects to be met through the consolidated contract:
- Improve performance in the completion of national security missions for nuclear production operations;
- Transition and merge operations at geographically dispersed centers of excellence for nuclear weapon assembly and disassembly, enriched uranium, high-explosive production and tritium supply management under a single contract;
- Reduce the cost of performing work; and
- Require actions that support operation as an integrated U.S. Department of Energy/NNSA enterprise. The NNSA is a separate DOE agency.