DoD's $25.7M Firm Fixed Price Contract for Offshore Service Vessels Awarded to Offshore Service Vessels, L.L.C
Contract Overview
Contract Amount: $25,721,876 ($25.7M)
Contractor: Offshore Service Vessels, L.L.C.
Awarding Agency: Department of Defense
Start Date: 2017-09-08
End Date: 2022-08-31
Contract Duration: 1,818 days
Daily Burn Rate: $14.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Transportation
Official Description: IGF::OT::IGF PPOE N103A FIRM PERIOD CHARTER HIRE
Place of Performance
Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23518
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $25.7 million to OFFSHORE SERVICE VESSELS, L.L.C. for work described as: IGF::OT::IGF PPOE N103A FIRM PERIOD CHARTER HIRE Key points: 1. The contract value is $25.7 million over 1818 days. 2. Awarded under full and open competition, indicating a competitive bidding process. 3. The contract is for deep sea freight transportation services. 4. The contractor is Offshore Service Vessels, L.L.C.
Value Assessment
Rating: fair
The firm fixed price contract type suggests a defined scope and cost. However, without specific unit cost data or benchmarks for similar deep sea freight transportation services, a precise value assessment is difficult. The duration of the contract (1818 days) also makes it challenging to assess current market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which generally promotes competitive pricing. The existence of multiple bids (no: 4) suggests a degree of price discovery. However, the specific pricing outcomes relative to market rates are not detailed.
Taxpayer Impact: Taxpayer funds are utilized for deep sea freight transportation. The competitive award process aims to ensure reasonable pricing, but the ultimate efficiency depends on the negotiated rates against actual service costs.
Public Impact
Ensures critical deep sea freight transportation capabilities for the Department of the Navy. Supports maritime logistics and operational readiness for defense missions. The contract's duration implies a long-term need for these specialized services. Potential impact on commercial shipping rates if significant capacity is utilized.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of detailed cost breakdown for services rendered.
- Potential for cost overruns if unforeseen operational challenges arise.
- Limited transparency on specific performance metrics and their relation to price.
Positive Signals
- Awarded through full and open competition.
- Firm fixed price contract provides cost certainty.
- Multiple bids received, indicating market interest.
Sector Analysis
This contract falls within the transportation and logistics sector, specifically focusing on maritime freight. Benchmarks for deep sea freight transportation can vary significantly based on vessel type, route, duration, and cargo. The $25.7 million value over nearly five years suggests a substantial, long-term service requirement.
Small Business Impact
The data does not indicate if small businesses were involved as subcontractors or prime contractors. Further analysis would be needed to determine the extent of small business participation in this contract.
Oversight & Accountability
Oversight would typically involve monitoring contract performance, adherence to terms, and financial accountability by the Department of the Navy. The firm fixed price nature may reduce some financial oversight needs compared to cost-plus contracts, but performance monitoring remains crucial.
Related Government Programs
- Deep Sea Freight Transportation
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Contract duration is extensive (1818 days).
- Limited transparency on specific performance metrics.
- Potential for price escalation if market conditions change significantly.
- Dependence on a single contractor for critical services.
Tags
deep-sea-freight-transportation, department-of-defense, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.7 million to OFFSHORE SERVICE VESSELS, L.L.C.. IGF::OT::IGF PPOE N103A FIRM PERIOD CHARTER HIRE
Who is the contractor on this award?
The obligated recipient is OFFSHORE SERVICE VESSELS, L.L.C..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $25.7 million.
What is the period of performance?
Start: 2017-09-08. End: 2022-08-31.
What is the average cost per day or per nautical mile for the services provided under this contract, and how does it compare to industry benchmarks?
Calculating the average cost per day requires dividing the total contract value ($25,721,875.99) by the contract duration in days (1818), resulting in approximately $14,148 per day. Comparing this to industry benchmarks for similar offshore service vessels is crucial. Factors like vessel size, capabilities, crew, and operational area significantly influence daily rates. Without specific details on the vessel class and operational scope, a definitive comparison is challenging, but this daily rate provides a starting point for further analysis against market data.
What specific risks are associated with relying on a single firm for deep sea freight transportation over an extended period, and what mitigation strategies are in place?
Key risks include potential vendor lock-in, reduced flexibility in adapting to changing operational needs, and the possibility of service degradation if the contractor faces financial or operational difficulties. Mitigation strategies could involve performance clauses in the contract, regular reviews of service quality, contingency planning for alternative providers, and ensuring clear communication channels for addressing issues promptly. The firm fixed price nature might also incentivize the contractor to maintain service levels to ensure profitability.
How effectively does this contract support the Department of the Navy's strategic objectives for maritime logistics and operational readiness?
The contract's effectiveness hinges on its ability to consistently provide the necessary deep sea freight transportation services as and when required by the Navy. If the services are delivered reliably, on time, and meet all specifications, it directly contributes to operational readiness by ensuring supplies and equipment reach their destinations. The long-term nature suggests a strategic alignment with ongoing logistical requirements, but continuous performance monitoring is essential to confirm sustained effectiveness.
Industry Classification
NAICS: Transportation and Warehousing › Deep Sea, Coastal, and Great Lakes Water Transportation › Deep Sea Freight Transportation
Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N3220517R3515
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 16201 E MAIN ST, CUT OFF, LA, 70345
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $25,721,876
Exercised Options: $25,721,876
Current Obligation: $25,721,876
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2017-09-08
Current End Date: 2022-08-31
Potential End Date: 2022-08-31 00:00:00
Last Modified: 2022-07-06
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