DOE awards $48.1M task order for engineering site survey in Kazakhstan, with a 3,185-day duration
Contract Overview
Contract Amount: $48,115,932 ($48.1M)
Contractor: Tech2 Solutions
Awarding Agency: Department of Energy
Start Date: 2017-07-11
End Date: 2026-03-31
Contract Duration: 3,185 days
Daily Burn Rate: $15.1K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Construction
Official Description: IGF::OT::IGF KAZAKHSTAN TASK ORDER FOR DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING 2, CONTRACT LINE ITEM NUMBER 1 (PRE-CONTRACT COST AUTHORIZATION FOR NOTICE TO PROCEED ISSUED ON JULY 11, 2017 FOR ENGINEERING SITE SURVEY IN KAZAKHSTAN).
Plain-Language Summary
Department of Energy obligated $48.1 million to TECH2 SOLUTIONS for work described as: IGF::OT::IGF KAZAKHSTAN TASK ORDER FOR DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING 2, CONTRACT LINE ITEM NUMBER 1 (PRE-CONTRACT COST AUTHORIZATION FOR NOTICE TO PROCEED ISSUED ON JULY 11, 2017 FOR ENGINEERING SITE SURVEY IN KAZAKHSTAN). Key points: 1. The contract's extensive duration suggests a long-term commitment to the project's objectives. 2. The 'Cost Plus Fixed Fee' pricing structure may incentivize cost overruns if not closely monitored. 3. The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating a specific justification for limiting the initial bidder pool. 4. The project's geographic focus in Kazakhstan presents unique logistical and geopolitical considerations. 5. The significant dollar amount warrants scrutiny regarding the value delivered for the taxpayer. 6. The absence of small business set-aside flags potential missed opportunities for smaller enterprises.
Value Assessment
Rating: fair
Benchmarking this specific task order for an engineering site survey in Kazakhstan is challenging due to its unique geographic and operational context. The 'Cost Plus Fixed Fee' (CPFF) contract type, while common for complex projects, requires diligent oversight to ensure cost efficiency. Without comparable data on similar international engineering surveys, a definitive value-for-money assessment is difficult, but the substantial duration and cost suggest a need for rigorous performance monitoring to confirm that the fixed fee remains appropriate for the work performed.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This indicates that while the competition was intended to be open, specific circumstances led to the exclusion of certain sources or a limited initial solicitation. The exact reasons for this exclusion are not detailed, but it suggests that the agency may have had specific requirements or justifications for narrowing the field of potential bidders. The level of competition achieved under these conditions is crucial for understanding price discovery and ensuring a fair market price was obtained.
Taxpayer Impact: The 'exclusion of sources' aspect of the competition raises questions about whether taxpayers received the most competitive pricing possible. A more open competition could potentially have driven down costs.
Public Impact
The primary beneficiaries are likely the Department of Energy and its mission objectives related to international projects or infrastructure. The services delivered include engineering site surveys, design, integration, construction, and communication, indicating a broad scope of work. The geographic impact is centered in Kazakhstan, suggesting a focus on international cooperation or energy-related initiatives in that region. Workforce implications could include the employment of engineers, construction workers, and support staff, both domestically and potentially internationally.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The 'Cost Plus Fixed Fee' structure requires robust oversight to prevent potential cost escalations.
- The 'Full and Open Competition After Exclusion of Sources' needs further clarification to ensure maximum taxpayer value.
- The long contract duration (3,185 days) necessitates sustained performance monitoring and risk management.
- Geopolitical and logistical complexities in Kazakhstan could introduce unforeseen risks and delays.
Positive Signals
- The award signifies the Department of Energy's engagement in significant international projects.
- The comprehensive scope of services (design, integration, construction, engineering) suggests a well-defined project need.
- The contract's duration indicates a commitment to achieving long-term project goals.
Sector Analysis
This contract falls within the Heavy and Civil Engineering Construction sector, specifically related to infrastructure development and engineering services. The market for such services, particularly in international contexts, is often characterized by specialized firms capable of handling complex logistical and technical challenges. The Department of Energy's involvement suggests a focus on energy infrastructure or related scientific endeavors. Comparable spending benchmarks would typically involve large-scale construction and engineering projects, often with significant government funding, both domestically and abroad.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the scope and nature of the work were likely deemed to be beyond the capacity or specialization of most small businesses, or that the competition strategy did not prioritize small business participation. There is no information provided regarding subcontracting plans, so the extent to which small businesses might be involved indirectly through subcontracts remains unknown. This could represent a missed opportunity to engage the small business industrial base.
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 significant dollar value, robust oversight mechanisms, including regular progress reviews, financial audits, and performance evaluations, would be expected. The Inspector General of the Department of Energy would likely have jurisdiction for investigating any potential fraud, waste, or abuse related to this contract, ensuring accountability and transparency.
Related Government Programs
- Department of Energy - International Programs
- Heavy and Civil Engineering Construction Contracts
- Global Infrastructure Development Projects
- Engineering and Design Services
- Cost Plus Fixed Fee Contracts
Risk Flags
- Potential for cost overruns due to CPFF structure.
- Limited competition may impact price discovery.
- Geopolitical and logistical risks in Kazakhstan.
- Long contract duration requires sustained oversight.
- Lack of small business participation noted.
Tags
department-of-energy, kazakhstan, engineering-construction, heavy-civil-engineering, cost-plus-fixed-fee, delivery-order, full-and-open-competition-after-exclusion-of-sources, international-project, site-survey, long-duration-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $48.1 million to TECH2 SOLUTIONS. IGF::OT::IGF KAZAKHSTAN TASK ORDER FOR DESIGN, INTEGRATION, CONSTRUCTION, COMMUNICATION AND ENGINEERING 2, CONTRACT LINE ITEM NUMBER 1 (PRE-CONTRACT COST AUTHORIZATION FOR NOTICE TO PROCEED ISSUED ON JULY 11, 2017 FOR ENGINEERING SITE SURVEY IN KAZAKHSTAN).
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 $48.1 million.
What is the period of performance?
Start: 2017-07-11. End: 2026-03-31.
What specific engineering site survey activities are encompassed by this task order, and what are the key deliverables?
This task order, specifically CLIN 1, authorizes pre-contract costs for an engineering site survey in Kazakhstan. While the exact scope of 'engineering site survey' is not detailed, it typically involves assessing a location's suitability for construction or development. This can include geological surveys, environmental assessments, topographical mapping, and identification of existing infrastructure or utilities. Key deliverables would likely include detailed survey reports, site plans, feasibility studies, and recommendations for subsequent design and construction phases. The extensive duration suggests these surveys might be foundational to a larger, multi-phase project.
How does the 'Cost Plus Fixed Fee' (CPFF) pricing structure compare to other contract types for similar international engineering projects, and what are the associated risks?
The CPFF structure is common for complex, uncertain projects where the final scope or cost is difficult to define upfront, such as extensive international engineering surveys. It allows the contractor to recover all allowable costs plus a predetermined fixed fee representing profit. Compared to fixed-price contracts, CPFF offers flexibility but carries a risk of cost overruns if the contractor does not manage expenses diligently, as the government bears the cost risk. Conversely, it can be more cost-effective than 'Cost Plus Incentive Fee' if the fixed fee is set appropriately and the contractor is motivated by factors other than pure cost reduction. Robust government oversight is critical to manage this risk.
What are the primary justifications for awarding this contract under 'Full and Open Competition After Exclusion of Sources' rather than a purely open solicitation?
The designation 'Full and Open Competition After Exclusion of Sources' implies that while the competition was intended to be broad, specific criteria or circumstances led to the exclusion of certain potential bidders. This could be due to unique technical requirements, specialized expertise needed for the Kazakhstan site, national security considerations, or prior work that established a specific contractor's qualifications. The agency must have documented justification for excluding sources. This method aims to balance competition with the need to secure specific capabilities, but it requires careful justification to ensure it doesn't unduly limit market access or lead to suboptimal pricing for taxpayers.
What are the potential geopolitical and logistical challenges associated with conducting an engineering site survey in Kazakhstan, and how might they impact the contract?
Conducting operations in Kazakhstan presents several potential challenges. Logistically, accessing remote survey sites, transporting equipment, and managing personnel can be complex and costly. Geopolitically, navigating local regulations, customs, and potentially different business practices requires careful planning and local expertise. Security concerns, while not explicitly stated, are always a consideration in international operations. These factors could lead to schedule delays, increased operational costs, and require adaptive management strategies. The long duration of the contract provides some buffer for addressing these issues, but they remain significant risk factors.
What is the historical spending pattern for similar engineering site survey contracts by the Department of Energy, particularly those conducted internationally?
Analyzing historical spending for similar international engineering site surveys by the Department of Energy (DOE) is crucial for context. Without specific data on past contracts of this nature, it's difficult to provide precise benchmarks. However, DOE often engages in large-scale, complex projects, including international collaborations related to energy research, nuclear security, and environmental remediation. Such projects typically involve substantial budgets, long durations, and specialized engineering services. The $48.1 million award for this task order, spanning over 8 years, appears significant, aligning with the scale of DOE's major international initiatives. A deeper dive into DOE's contract database would reveal trends in pricing, duration, and competition for comparable international engineering efforts.
What oversight mechanisms are in place to manage the 'Cost Plus Fixed Fee' aspect and ensure the fixed fee remains appropriate throughout the contract's long duration?
Effective oversight of a CPFF contract, especially one with a long duration like this, is paramount. Mechanisms typically include rigorous Earned Value Management (EVM) systems to track cost and schedule performance against the baseline. Regular progress reviews, audits of contractor expenditures, and detailed performance metrics are essential. The contracting officer must continually assess whether the fixed fee remains fair and reasonable given the work performed and the contractor's performance. Any significant changes in scope or unforeseen circumstances would necessitate a review and potential modification of the fee or contract terms. The long duration implies a need for sustained, vigilant oversight.
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: 1
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: $53,645,077
Exercised Options: $53,645,077
Current Obligation: $48,115,932
Actual Outlays: $31,783,773
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: 2017-07-11
Current End Date: 2026-03-31
Potential End Date: 2026-03-31 00:00:00
Last Modified: 2025-12-02
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