Nuclear Security & Deterrence Monitor Vol. 20 No. 46
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Nuclear Security & Deterrence Monitor
Article 5 of 11
December 02, 2016

New BWXT Chief Wants More DOE, NNSA Biz

By Dan Leone

With the impending ascension of former NASA hand Rex Geveden to the top spot at BWX Technologies, the Lynchburg, Va.-company has set an outsider from the aerospace business in charge of an effort to grow the company’s legacy nuclear cleanup business with the Energy Department’s Office of Environmental Management.

“We remain strongly committed to that piece of our business going forward,” Geveden wrote Wednesday in response to Weapons Complex Monitor queries about his plans for DOE’s Cold War-cleanup work. “It is a challenging environment, but we are actively reviewing and pursuing opportunities where we believe our strengths complement the missions at these DOE sites.

“Our strategy for growing our portfolio is straightforward: we have to perform well on the contracts we have in place, and then we have to make sure that our proposals for new work really address the government’s needs,” added Geveden, who joined BWXT as chief operating officer in October 2015.

Geveden on Jan. 1 will take over from BWXT President and CEO Peyton “Sandy” Baker, who will step into an advisory position before formally retiring in May. Baker’s retirement package includes a two-year noncompete clause that bars him from working with any BWXT competitors for two years.

Inclined more to partner than to prime on DOE nuclear waste projects, BWXT has a presence at eight sites throughout the agency’s nuclear complex. The company has lost some ground to competitors in recent years, but is still bucking for more cleanup work.

That said, such contracts make up only a tiny portion of BWXT’s annual revenue. The company books DOE legacy cleanup work in its Technical Services segment, which including other government contracts accounted for only about 6 percent of the $1.5 billion in revenue the company netted in 2015. This segment also includes its work with the NNSA.

Compare that with the Nuclear Operations segment that includes nuclear propulsion work for the U.S. Navy. BWXT and its predecessor company, Babcock & Wilcox, have had a virtual monopoly on this business for nearly 70 years, and it accounts for the overwhelming majority of company revenue: almost 85 percent of BWXT’s 2015 take.

Still, BWXT is on the hunt for more Environmental Management business, and is likewise looking to stay in the mix at active DOE nuclear sites overseen managed by the quasi-independent National Nuclear Security Administration.

“Under Rex’s leadership, BWXT plans to continue its focus on pursuit of NNSA contracts in which BWXT’s nuclear operations expertise can be of benefit to the nuclear security enterprise,” company spokesman Jud Simmons wrote in a Thursday email.

Today, BWXT partners with other major DOE contractors for management and operations of the Los Alamos National Laboratory and Waste Isolation Pilot Plant in New Mexico and the Nevada National Security Site, as well as for cleanup of the West Valley Demonstration Project in upstate New York and the liquid waste contract at the Savannah River Site in South Carolina.

In 2014, before Geveden came on board, Babcock & Wilcox was part of the team that lost contracts at two key NNSA nuclear-weapon facilities: the Pantex Plant in Amarillo, Texas, and the Y-12 National Security Complex near Oak Ridge, Tenn. The company split into BWXT and Babcock & Wilcox the next year.

On the Environmental Management side, a team led by Atkins in September snatched BWXT’s depleted uranium hexafluoride conversion work in Ohio and Kentucky. The five-year, $318-million deal follows up the roughly $530 million pact Babcock & Wilcox won in 2011.

To help fill the gap on the legacy-cleanup side of the house, BWXT is said to be bidding on 10 years’ worth of liquid-waste management work at the Savannah River Site, which including options could be worth $4 billion to $6 billion. BWXT is a partner in the current SRS liquid cleanup incumbent, Savannah River Remediation. That deal, worth $4 billion or so, runs out June 30. Making a play for the follow-on contract means competing with Savannah River Remediation senior partner AECOM, which is also in the mix for follow-on work in Aiken, S.C.

The Savannah River work went out for bid in April. Geveden said that as soon as he joined BWXT in October, 2015 “I began leading a strategic planning effort that engaged our leaders across the business.”

Meet the New Boss

Despite the few nuclear nuggets buried within, Geveden’s resume is heavy on aerospace, and within that, space. The incoming BWXT chief spent nearly two decades with NASA, including plenty of time in the Marshall Space Flight Center: home of the space agency’s rocket-propulsion program.

Insofar as Geveden’s resume dovetails with any of BWXT’s businesses, the Nuclear Operations segment is it. Before joining BWXT, Geveden spent time with a company he would have known well from his NASA days: Teledyne Brown Engineering.

Geveden was president of that Teledyne Technologies subsidiary from 2007 to 2014, during which the company landed a roughly $90-million contract to build hardware for DOE’s American Centrifuge industry-scale uranium enrichment demonstration in Piketon, Ohio. That demonstration, Teledyne hardware and all, ceased operation last year after DOE pulled the plug on its funding.

Geveden joined NASA in 199o and remained with the space agency until departing for Teledyne in 2007. In the final years of the George W. Bush administration, Geveden was a NASA associate administrator.

A decade earlier, as a student in the early 1980s, Geveden had his first almost-professional brush with the nuclear world when he “supported research in liquid metal fast breeder reactors” as a data acquisition specialist at the Argonne National Laboratory some 25 miles southwest by road of Chicago, according to his LinkedIn profile.

This largely non-nuclear background caught the eye of one analyst, who on a Wednesday meet-and-greet conference call with BWXT leadership asked why the company had turned the tiller over to an outsider.

John Fees, BWXT’s executive chairman, replied that Geveden had expertise “in spades” with complex, technical programs, as well as “commercial strengths” from his time at Teledyne.

“There was not a single-line initiative to go outside the company,” which also considered internal candidates for the top post, Fees said Wednesday.

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