Mike Nartker
WC Monitor
2/7/2014
The Hanford Waste Treatment Plant, already one of the Department of Energy’s most expensive projects, is at risk of another cost increase of almost half-a-billion dollars, according to a report DOE released late this week. The report outlines the result of a Construction Project Review DOE conducted last fall that examined three portions of the Hanford vit plant—the Low Activity Waste Facility, Analytical Laboratory and balance of other ancillary facilities (LBL). “The total project cost has increased $430M [million] from $12,263M to $12,693M since the last CPR because of the establishment of the overtarget baseline for LBL. In addition, $5M for authorized unpriced work for wage adjustments is awaiting the Contracting Officer’s approval,” the report states.
DOE is continuing to move forward with the LBL portion of the Hanford vit plant while work on the other two key facilities at the WTP—the High-Level Waste Facility and the Pretreatment Facility—is largely on hold until long-standing technical concerns are fully addressed. As part of what the Department has called a new “framework” for addressing Hanford’s tank waste, unveiled last fall, DOE put forth the idea of create of an interim pretreatment capability to direct feed waste into the WTP LAW Facility and allow it to begin operation while the technical issues at the Pretreatment and HLW facilities are resolved.
In a statement to WC Monitor, a DOE spokesperson said, “Construction Project Reviews (CPRs) are a valuable tool for the Energy Department as we continually evaluate progress. This most recent CPR acknowledges a number of actions that are already underway related to the Low Level Waste facility, Balance of Facilities, and Analytical Laboratory (LBL) that are nearing completion and identified other areas that need increased attention. The Department recognizes that WTP’s mission presents significant technical and execution challenges, and remains committed to safely and successfully completing WTP.” In a separate statement, Suzanne Heaston, a spokeswoman for WTP contractor Bechtel National, said, “We have seen the Construction Project Review report letter and the recommendations, and we are committed to working with the Department of Energy to implement the recommendations through a collaboratively developed execution plan.”
LBL Baseline ‘Continues to Evolve’
According to a DOE official, the potential cost increase identified in this week’s report is due to “inefficiencies caused by funding uncertainties and other changes that are the responsibility of the Department such as increases in labor and commodity prices.” A complete projection of the cost of the LBL portion of the vit plant, however, will not be available until a new baseline is established, the schedule for which is unclear. “The LBL baseline continues to evolve as baseline change proposals are approved; however, this process has not yet resulted in a complete projection of LBL costs through startup and commissioning. This is partially due to the lack of clarity regarding needed completion dates and likely startup sequencing pending resolution of the direct feed LAW option,” the report says. “In addition, a recent BNI effort to fully evaluate the startup and sequencing process identified significant deficiencies in resources, both in hours/costs ($285M) and duration (11 months) for the startup and commissioning phase in the current LBL baseline. Finally, the incorporation of direct feed into the LBL baseline will require a contract modification.”
According to the DOE official, a new baseline will be prepared after DOE finalizes a contract modification with Bechtel National to implement the direct feed to the Low Activity Waste Facility approach. “DOE will request BNI to provide a proposal for the completion of LBL and the modifications needed to LBL for implementing direct feed LAW, as well as startup and hot commissioning. This will be the basis for discussions with DOE to develop a contract modification. Once the contract modification is finalized for this phase, the project baseline will be updated,” the official said. When asked when the Department expects to make a decision on whether or not to implement such approach, the official said, “The Department is following the DOE project management order which includes a rigorous process for looking at capabilities, requirements, alternatives and prior to making final decisions on major capital projects.”
The review team recommended that by March 31, Bechtel National should provide the contract direction needed to establish a “viable” LBL baseline, with or without the direct feed option to LAW option, through startup and commissioning. By April 1, the DOE Office of River Protection, should provide a plan for the Pretreatment Facility, the High-Level Waste Facility and the LBL portion of the plant elements “to be separated from a baseline management perspective and should brief the Acquisition Executive on the appropriate stages of the project, with cost ranges included,” the report says. By May 15, the WTP Federal Project Director should provide a briefing to the Acquisition Executive on the direct feed to LAW concept and plans for a baseline change proposal and contract modifications, the review team recommended.
Commissioning Concerns
According to the report, the LBL portion of the plant is set to be completed during Fiscal Year 2015. “The LBL facilities are progressing well with respect to engineering, procurement and construction. Bechtel National Inc. (BNI) is increasing staff resources, including engineering staff, in all disciplines. Engineering has been able to maintain the targeted six months of backlog for construction so that these activities can proceed unconstrained,” the report says, noting that engineering activities are 78 percent complete for the Analytical Laboratory, 73 percent for the balance of ancillary facility and 80 percent for the Low Activity Waste Facility.
Last fall, a senior official in DOE’s Office of Environmental Management said the Department hoped to begin processing activities at the LAW Facility by late 2019 (WC Monitor, Vol. 24 No. 46). However, the Construction Project Review found that much more work is needed to be ready to begin commissioning activities. “BNI’s management team has not funded startup and commissioning activities beyond the planning phase. The ramp-up of startup and commissioning personnel resources needed to support startup, commissioning, and operations has not commenced. In order to support the notional 2019 startup of LBL, sufficient lead time is required to staff the needed personnel assets and allow for training and qualification of these resources,” the report says.
The report warns that the “lack of dedicated system engineers continues to be a known but significant issue and could prove to be detrimental to overall project progress in completing the hazard analysis for the documented safety analysis and commissioning planning activities.” It adds, “Commissioning delays due to staffing issues affect the ability to conduct operability evaluations, develop adequate safety basis controls, and prepare operations procedures in a timely manner to support commissioning and subsequent operational readiness reviews.” The review also found that DOE needs to make improvements in its preparations for verifying facility readiness during commissioning activities. “Oversight is not yet integrated across the various organizations with a focus on the ultimate endpoint, which is declaring readiness for operations. This should involve coordinating key oversight activities between engineering, construction, and operations,” the report says.
