Mike Nartker
WC Monitor
3/21/2014
The Department of Energy is now projecting to complete a final cost-and-schedule baseline for D&D efforts at the Separations Process Research Unit (SPRU) site by the end of this fiscal year, and to complete physical work at the site by the end of FY 2015, according to detailed budgetary documents released this week. According to DOE’s FY 2015 budget request, DOE is using as an “interim baseline” one submitted by URS in the fall of 2012. However, the request says, “In January 2013 the contractor began implementation of a slower rate of progress than required by the interim baseline and working to a URS baseline, which has not been shared with or validated by DOE.” DOE and its contractor URS are continuing to move forward with more active D&D work at the two facilities to be addressed at SPRU, but it still remains to be seen when the two will come to a final agreement as to who is responsible for what portion of the costs incurred on the project following a set of contamination incidents that occurred in 2010 and significantly disrupted work.
In 2011, DOE modified URS’ contract to establish a cost cap in response to the contamination incidents that established a cost-sharing formula under which DOE is responsible for all project costs up to $105 million; DOE and URS will split all costs incurred from $105-145 million; and URS will be fully responsible for covering all costs exceeding $145 million. URS has been pushing back, though, against being held responsible for a significant portions of the costs to date incurred at SPRU, which have included among other issues, addressing the impacts of bad weather at the site. According to a filing with the Securities and Exchange Commission earlier this month, URS has incurred through Jan. 3 total project costs of $261.3 million at SPRU—an increase of $9 million from a previous estimate from late September.
URS has said it is seeking recovery of $112.5 million in unfunded requests for equitable adjustment and proposal costs incurred through April 2013, as well as $5 million in fee on the expanded work scope performed at SPRU. As of Jan. 3, the filing says, URS has “recorded $81.5 million in accounts receivable for project costs incurred to date in excess of the DOE contracted amount that may not be collected unless and until the claims are favorably resolved.” The filing also notes that URS “can provide no certainty that it will recover the $112.5 million in submitted DOE claims for costs incurred through April 2013 related to REAs, hurricane-caused work or other directed changes, as well as any other project costs after April 2013 that [URS] is obligated to incur to finalize and complete this project including the accounts receivable, any of which could negatively impact URS’ future results of operations.”
DOE Seeking No Funds for SPRU Next Year
In its FY 2015 budget request, DOE said that it “retains responsibility for funding hillside stabilization as a result of tropical storms Irene and Lee,” adding, “Changes to the contract directed by the government are funded by the government. The contractor has exceeded the cost cap and has submitted contract claims. The resolution of contract claims is ongoing through the alternate dispute resolution process.”
As part of its FY 2015 budget request, DOE is seeking no funding for activities at SPRU next year, saying there is enough available in carryover funding to “cover surveillance and maintenance costs associated with contract changes attributable to Federal Government requirements.” DOE has approximately $31 million in currently available carryover funding at the site. “We’re still looking at our REAs and that’s still in litigation, so at this point we feel we have enough in carryover balances for basically our responsibilities for keeping the site secure, and I don’t think we need anything in ‘15 at this point,” a DOE official told WC Monitor this week.
URS Moving Forward With D&D Activities
Last month, DOE and URS marked a major step forward in the completion of the SPRU D&D project with the removal of the remaining radioactive sludge waste at the site. Now, URS is working to demobilize the sludge equipment by the end of this month, as well as removing debris from Building H2 and beginning preparations for pumping the building’s basement of water believed to have come from Hurricane Irene and water intrusion from ground or surface water. “Once debris has been removed from below grade areas, access to below grade process areas will be restored and characterization activities can begin. Characterization activities will identify the hazardous materials within the contaminated piping and equipment which needs to be removed from the process rooms and cells. All removal efforts and deactivation need to occur, followed by decontamination and/or fixative application to lock down contamination prior to building demolition,” URS said this week. URS is also performing at Building G2 activities such as hazardous material removal and preparing for entry into the first of the building’s five totals cells, as well as pumping water from the building’s basement. “The major work will be done in Building G2’s five former process cells. These cells need to be re-entered and characterized. Following completion of characterization activities, the same removal, deactivation, decontamination activities will be followed as in Building H2 prior to building demolition,” URS said.
