Department of Energy awards $35.8M for Lebanon-based engineering and construction services
Contract Overview
Contract Amount: $35,808,712 ($35.8M)
Contractor: Tech2 Solutions
Awarding Agency: Department of Energy
Start Date: 2018-09-13
End Date: 2025-05-30
Contract Duration: 2,451 days
Daily Burn Rate: $14.6K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: Construction
Official Description: IGF::OT::IGF TASK ORDER LEBANON, DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING 2.
Plain-Language Summary
Department of Energy obligated $35.8 million to TECH2 SOLUTIONS for work described as: IGF::OT::IGF TASK ORDER LEBANON, DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING 2. Key points: 1. Contract awarded to TECH2 SOLUTIONS for comprehensive engineering and construction services. 2. The contract spans over six years, indicating a long-term need for these services. 3. Services include design, integration, construction, communication, and engineering. 4. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 5. The award was made under full and open competition after exclusion of sources, suggesting a specific justification for the initial exclusion. 6. The contract has a duration of 2451 days, equivalent to approximately 6.7 years. 7. The base contract value is $35.8 million, with potential for growth through subsequent orders.
Value Assessment
Rating: fair
The contract's value of $35.8 million over nearly seven years suggests a significant investment. Benchmarking this against similar large-scale international construction and engineering projects is difficult without more specific details on the scope of work and location. The Cost Plus Fixed Fee (CPFF) contract type introduces inherent risk for cost control, as the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This structure can incentivize cost-consciousness but also carries the potential for costs to exceed initial estimates if not rigorously overseen.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This designation implies that while the competition was intended to be open, there was an initial exclusion of certain sources, which was later justified. The specific reasons for this exclusion are not detailed but could relate to specialized capabilities, security requirements, or prior performance issues with other potential bidders. The fact that it moved to full and open competition after an exclusion suggests an effort to broaden the field, but the initial exclusion might have limited the overall pool of potential offerors.
Taxpayer Impact: The 'after exclusion of sources' clause warrants scrutiny to ensure that the exclusion was indeed justified and did not unduly restrict competition, potentially leading to less favorable pricing for taxpayers.
Public Impact
The primary beneficiaries are likely the Department of Energy and potentially other U.S. government entities operating in Lebanon requiring specialized engineering and construction support. The services delivered are critical for maintaining and developing infrastructure, communication systems, and potentially supporting U.S. government operations or projects in the region. The geographic impact is focused on Lebanon, where the contractor will be executing the project. Workforce implications could include the hiring of engineers, construction workers, project managers, and support staff, potentially both locally in Lebanon and from the U.S.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not managed with stringent oversight.
- The 'after exclusion of sources' clause in the competition method requires further investigation to ensure fair and open competition principles were upheld.
- The long duration of the contract (nearly 7 years) increases the risk of scope creep or changing requirements over time.
- Performance risks associated with operating in a potentially volatile region like Lebanon need careful management.
- Lack of specific details on the project's deliverables makes it difficult to assess value for money comprehensively.
Positive Signals
- The contract was awarded under a competitive process, indicating multiple parties likely vied for the opportunity.
- The selection of TECH2 SOLUTIONS suggests they possess the specialized technical and engineering capabilities required for this complex project.
- The long-term nature of the contract provides stability for the contractor and ensures continuity of essential services.
- The Department of Energy's involvement implies a strategic national interest in the project's successful execution.
Sector Analysis
This contract falls within the Heavy and Civil Engineering Construction sector, specifically focusing on specialized engineering, design, integration, and construction services. This sector is characterized by large-scale projects, often with significant lead times and complex logistical requirements. The market size for such international engineering and construction contracts can be substantial, driven by government infrastructure needs, reconstruction efforts, and operational support in various global regions. Comparable spending benchmarks would typically involve other large federal contracts for overseas construction and engineering support, often awarded to specialized firms with international experience.
Small Business Impact
The data indicates that small business participation (ss and sb fields are false) was not a primary set-aside consideration for this specific award. There is no explicit mention of small business subcontracting goals. This suggests that the prime contractor, TECH2 SOLUTIONS, is likely a large business, and the nature of the specialized services may not lend itself easily to subcontracting opportunities for small businesses, or such requirements were not mandated in this instance.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Energy's contracting and program management offices. Given the international nature and potential complexity, an Inspector General (IG) review is plausible, particularly concerning financial accountability and adherence to contract terms. Transparency would be enhanced by public reporting of contract performance, expenditures, and any modifications. Accountability measures would be embedded in the CPFF structure, requiring detailed cost reporting and justification from the contractor, alongside performance metrics.
Related Government Programs
- Department of Defense Overseas Construction Contracts
- State Department Facilities Engineering and Construction
- USAID Infrastructure Development Projects
- Army Corps of Engineers International Contracts
Risk Flags
- Potential for cost overruns due to CPFF contract type.
- Security and geopolitical risks in Lebanon.
- Limited transparency on specific project scope.
- Justification for 'exclusion of sources' needs review.
- Long contract duration increases risk of scope changes.
Tags
construction, engineering, design, integration, communication, department-of-energy, lebanon, full-and-open-competition, cost-plus-fixed-fee, large-contract, international-services, heavy-and-civil-engineering
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $35.8 million to TECH2 SOLUTIONS. IGF::OT::IGF TASK ORDER LEBANON, DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING 2.
Who is the contractor on this award?
The obligated recipient is TECH2 SOLUTIONS.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $35.8 million.
What is the period of performance?
Start: 2018-09-13. End: 2025-05-30.
What specific projects or facilities in Lebanon does this contract support?
The provided data does not specify the exact projects or facilities in Lebanon that this contract supports. The description 'DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING' is broad. It could encompass a range of activities, from building or renovating physical infrastructure (like facilities, roads, or utilities) to establishing or upgrading communication networks, and providing general engineering support for U.S. government interests or operations in the region. Without further details from the contracting agency (Department of Energy) or the contract award notice, the precise nature of the supported activities remains unspecified. This lack of specificity makes it challenging to fully assess the strategic importance or the detailed scope of work.
How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar international projects?
The Cost Plus Fixed Fee (CPFF) contract type is often used for complex projects where the scope of work is not fully defined at the outset, or where unforeseen technical challenges are anticipated, such as in international construction and engineering. It allows the contractor to be reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility for the government if requirements change, but it shifts more cost risk to the government. Compared to Cost Plus Incentive Fee (CPIF) or Cost Plus Award Fee (CPAF) contracts, CPFF provides less direct incentive for the contractor to control costs beyond avoiding disallowed expenses, as the profit (fee) is fixed regardless of the final cost. For international projects, the choice of contract type often balances the need for flexibility with the imperative to control costs in potentially high-risk environments.
What are the potential risks associated with performing construction and engineering services in Lebanon for the U.S. Department of Energy?
Performing construction and engineering services in Lebanon presents several potential risks. Security is a primary concern, given the geopolitical complexities and potential for instability in the region, which could impact personnel safety, project continuity, and supply chain logistics. Political and economic instability can also affect the availability of local resources, labor, and materials, potentially leading to delays and cost increases. Furthermore, navigating local regulations, customs, and business practices can be challenging. Environmental factors and the condition of existing infrastructure may also pose technical hurdles. The Department of Energy must ensure robust risk mitigation strategies are in place, including comprehensive security protocols, contingency planning for supply chain disruptions, and close coordination with relevant U.S. and local authorities.
What is TECH2 SOLUTIONS' track record with similar international engineering and construction contracts?
Information regarding TECH2 SOLUTIONS' specific track record with similar international engineering and construction contracts is not detailed in the provided data. To assess their suitability and past performance, one would need to consult databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) for past federal contracts awarded to TECH2 SOLUTIONS. Key areas to investigate would include their experience in the Middle East or similar geopolitical regions, their history with Cost Plus Fixed Fee contracts, their performance on projects of comparable scale and complexity, and any reported issues related to cost control, schedule adherence, or quality of work. Without this external data, it's difficult to evaluate their specific capabilities and reliability for this Lebanon-based project.
How does the $35.8 million contract value compare to historical spending on similar services by the Department of Energy or other agencies?
The $35.8 million contract value for design, integration, construction, communication, and engineering services in Lebanon is a significant sum, indicative of a substantial project. To benchmark this against historical spending, one would need to analyze similar contracts awarded by the Department of Energy (DOE) or other agencies like the Department of Defense (DoD) or the Department of State for overseas construction, engineering, and facility support. For instance, DoD often awards large contracts for base construction and maintenance in various global theaters. The State Department also funds significant infrastructure and security-related construction projects abroad. Comparing this contract's value requires identifying contracts with similar scopes of work, geographic locations (especially those with complex operating environments), and contract types (like CPFF). Without such comparative data, it's difficult to definitively state whether $35.8 million represents a high, low, or average investment for the services rendered.
Industry Classification
NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 3200 GEORGE WASHINGTON WAY STE D, RICHLAND, WA, 99354
Business Categories: Category Business, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $42,767,487
Exercised Options: $42,767,487
Current Obligation: $35,808,712
Actual Outlays: $23,980,769
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DENA0003366
IDV Type: IDC
Timeline
Start Date: 2018-09-13
Current End Date: 2025-05-30
Potential End Date: 2025-05-30 00:00:00
Last Modified: 2025-11-19
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