DOE Awards $18.8M for FK-800 Copolymer Manufacturing, Exceeding 32,000 Pounds
Contract Overview
Contract Amount: $18,813,779 ($18.8M)
Contractor: 3M Company
Awarding Agency: Department of Energy
Start Date: 2024-08-21
End Date: 2026-01-31
Contract Duration: 528 days
Daily Burn Rate: $35.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Other
Official Description: MANUFACTURE FK-800 COPOLYMER TO MEET THE FK-800 RESIN TO BE CERTIFIED IN MEETING THE PRODUCT SPECIFICATIONS REQUIRED AS STATED IN THE SOW TABLE UNDER PARAGRAPH 2, UP TO 32,000 POUNDS.
Place of Performance
Location: SAINT PAUL, RAMSEY County, MINNESOTA, 55144
Plain-Language Summary
Department of Energy obligated $18.8 million to 3M COMPANY for work described as: MANUFACTURE FK-800 COPOLYMER TO MEET THE FK-800 RESIN TO BE CERTIFIED IN MEETING THE PRODUCT SPECIFICATIONS REQUIRED AS STATED IN THE SOW TABLE UNDER PARAGRAPH 2, UP TO 32,000 POUNDS. Key points: 1. Significant award for specialized chemical manufacturing. 2. Sole source procurement raises questions about price discovery. 3. Long-term contract (528 days) with potential for price adjustments. 4. Focus on meeting stringent product specifications.
Value Assessment
Rating: questionable
The contract value of $18.8M for up to 32,000 pounds of FK-800 copolymer is difficult to benchmark without specific industry data. The fixed-price with economic price adjustment structure introduces potential for cost overruns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits competitive pressure, potentially leading to higher prices than if multiple vendors had bid.
Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for this specialized chemical product.
Public Impact
Ensures supply of critical FK-800 copolymer for Department of Energy needs. Supports manufacturing jobs in Minnesota. Potential for price fluctuations due to economic price adjustment clause.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- Economic price adjustment
- Lack of clear competition justification
Positive Signals
- Addresses specific product specification requirements
- Long-term supply agreement
Sector Analysis
This contract falls under the 'All Other Miscellaneous Chemical Product and Preparation Manufacturing' sector. Spending in this sector can vary widely based on material complexity and demand. The award amount is substantial for a niche chemical product.
Small Business Impact
The contract was awarded to 3M Company, a large corporation. There is no indication that small businesses were involved in this specific procurement, either as prime contractors or subcontractors.
Oversight & Accountability
The Department of Energy is the contracting agency. Oversight will focus on ensuring the FK-800 copolymer meets the specified product requirements and that the economic price adjustments are applied fairly.
Related Government Programs
- All Other Miscellaneous Chemical Product and Preparation Manufacturing
- Department of Energy Contracting
- Department of Energy Programs
Risk Flags
- Sole-source award lacks competitive justification.
- Economic price adjustment introduces cost uncertainty.
- Potential for overpayment due to limited price discovery.
- Contract duration may exceed actual need.
- Lack of small business participation.
Tags
all-other-miscellaneous-chemical-product, department-of-energy, mn, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $18.8 million to 3M COMPANY. MANUFACTURE FK-800 COPOLYMER TO MEET THE FK-800 RESIN TO BE CERTIFIED IN MEETING THE PRODUCT SPECIFICATIONS REQUIRED AS STATED IN THE SOW TABLE UNDER PARAGRAPH 2, UP TO 32,000 POUNDS.
Who is the contractor on this award?
The obligated recipient is 3M COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $18.8 million.
What is the period of performance?
Start: 2024-08-21. End: 2026-01-31.
What is the justification for awarding this contract on a sole-source basis, given the potential for competitive pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one vendor can fulfill the requirement. Without further documentation, it's unclear if these criteria were met, raising concerns about whether a competitive process could have yielded better value for the government.
How will the economic price adjustment clause be monitored to prevent excessive cost increases?
Monitoring the economic price adjustment (EPA) clause requires clear baseline indices and defined adjustment formulas tied to specific economic factors like raw material costs or labor. The agency must rigorously track these indices and ensure the adjustments are calculated accurately according to the contract's terms, preventing unwarranted price hikes.
What is the strategic importance of the FK-800 copolymer to the Department of Energy's mission?
The strategic importance of the FK-800 copolymer is likely tied to specific energy research, development, or operational needs within the Department of Energy. Understanding its application, such as in advanced materials for energy storage, nuclear applications, or specialized equipment, would clarify the necessity of securing this specific product.
Industry Classification
NAICS: Manufacturing › Other Chemical Product and Preparation Manufacturing › All Other Miscellaneous Chemical Product and Preparation Manufacturing
Product/Service Code: CHEMICALS AND CHEMICAL PRODUCTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Address: 3M CENTER, SAINT PAUL, MN, 55144
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $18,813,779
Exercised Options: $18,813,779
Current Obligation: $18,813,779
Actual Outlays: $18,565,219
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2024-08-21
Current End Date: 2026-01-31
Potential End Date: 2026-01-31 00:00:00
Last Modified: 2025-12-02
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