Army Awards $16.6M for Kwajalein Atoll Building Repair to Arkel International
Contract Overview
Contract Amount: $16,638,058 ($16.6M)
Contractor: Arkel International, L.L.C.
Awarding Agency: Department of Defense
Start Date: 2018-03-28
End Date: 2026-01-22
Contract Duration: 2,857 days
Daily Burn Rate: $5.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: PN 88862 REPAIR BUILDING 803, VEHICLE MAINTENANCE SHOP, U.S. ARMY GARRISON, KWAJALEIN ATOLL, REPUBLIC OF THE MARSHALL ISLAND
Place of Performance
Location: FORT SHAFTER, HONOLULU County, HAWAII, 96858
State: Hawaii Government Spending
Plain-Language Summary
Department of Defense obligated $16.6 million to ARKEL INTERNATIONAL, L.L.C. for work described as: PN 88862 REPAIR BUILDING 803, VEHICLE MAINTENANCE SHOP, U.S. ARMY GARRISON, KWAJALEIN ATOLL, REPUBLIC OF THE MARSHALL ISLAND Key points: 1. The contract focuses on construction services for a vehicle maintenance shop at a remote U.S. Army garrison. 2. Arkel International, L.L.C. is the sole awardee for this specific delivery order. 3. The project spans nearly 8 years, indicating a long-term need or phased approach. 4. The sector is dominated by large prime contractors, making it challenging for smaller firms to compete.
Value Assessment
Rating: fair
The award amount of $16.6 million for a building repair project of this duration and scope appears within a reasonable range for specialized construction in a remote location. Benchmarking is difficult without more specific project details.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, as a delivery order, it implies it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract, where the initial competition determined the pool of eligible contractors.
Taxpayer Impact: Taxpayer funds are being used for essential infrastructure maintenance and repair at a military installation. The competitive award process aims to ensure reasonable pricing.
Public Impact
Ensures operational readiness of military vehicle maintenance facilities. Supports U.S. Army presence and operations in the Republic of the Marshall Islands. Provides construction jobs and economic activity, though likely concentrated among a few specialized firms. The long duration may indicate a need for sustained infrastructure support.
Waste & Efficiency Indicators
Waste Risk Score: 58 / 10
Warning Flags
- Remote location may increase costs and logistical challenges.
- Long contract duration could lead to cost overruns if not managed effectively.
- Lack of small business participation noted.
Positive Signals
- Awarded under full and open competition.
- Addresses critical infrastructure needs for the U.S. Army.
- Firm fixed price contract provides cost certainty.
Sector Analysis
This contract falls within the Commercial and Institutional Building Construction sector. Spending in this sector is substantial, driven by both government and private sector demand for new construction and renovation. Government construction spending often focuses on military bases, federal buildings, and infrastructure projects.
Small Business Impact
The data indicates this contract was not awarded to small businesses (ss: false, sb: false). This is common in large-scale construction projects, especially those requiring specialized expertise or operating in remote locations, which often favor larger, established firms.
Oversight & Accountability
The Department of the Army, under the Department of Defense, is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms would apply to ensure proper execution and financial accountability.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Geographic isolation and logistical challenges.
- Long contract duration increases risk of cost escalation.
- Potential for scope creep over the contract period.
- Lack of small business participation.
Tags
commercial-and-institutional-building-co, department-of-defense, hi, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.6 million to ARKEL INTERNATIONAL, L.L.C.. PN 88862 REPAIR BUILDING 803, VEHICLE MAINTENANCE SHOP, U.S. ARMY GARRISON, KWAJALEIN ATOLL, REPUBLIC OF THE MARSHALL ISLAND
Who is the contractor on this award?
The obligated recipient is ARKEL INTERNATIONAL, L.L.C..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $16.6 million.
What is the period of performance?
Start: 2018-03-28. End: 2026-01-22.
What specific factors contributed to the long duration (2857 days) of this building repair contract?
The extended duration likely stems from the complexity of the repair work, the remote and challenging logistical environment of Kwajalein Atoll, and potentially a phased approach to construction or integration with other base operations. It may also reflect the need for sustained maintenance over the building's lifecycle rather than a single, intensive repair effort.
How does the cost of construction services in the Republic of the Marshall Islands compare to similar projects within the continental U.S.?
Construction costs in remote overseas locations like Kwajalein Atoll are typically significantly higher than in the continental U.S. due to factors such as increased transportation costs for materials and personnel, specialized labor requirements, logistical complexities, and potentially higher overhead for contractors operating in such environments.
What is the potential impact of the firm fixed price contract type on project cost and contractor performance?
A firm fixed price (FFP) contract provides the greatest cost certainty for the government, as the contractor assumes most of the risk for cost overruns. This incentivizes the contractor to manage costs efficiently. However, it could also lead to less flexibility for scope changes and potentially higher initial bids to account for contractor risk.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: W9128A17R0002
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1055 CONVENTION ST, BATON ROUGE, LA, 70802
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $16,638,058
Exercised Options: $16,638,058
Current Obligation: $16,638,058
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W9128A17D0009
IDV Type: IDC
Timeline
Start Date: 2018-03-28
Current End Date: 2026-01-22
Potential End Date: 2026-01-22 00:00:00
Last Modified: 2025-07-14
More Contracts from Arkel International, L.L.C.
- Replace Fuel Storage Tanks, Defense Fuel Supply Center, Kwajalein Atoll, Marshall Islands — $78.5M (Department of Defense)
- FY14 MCA PN057797 Echo Pier Restoration, U.S. Army Kwajalein Atoll (usaka), Republic of the Marshall Islands Igf::ot::igf — $58.7M (Department of Defense)
- Construction Suva, Fijiigf::cl::igf — $35.8M (Department of State)
- Arkel International Will Support the Department of State by Providing the Design, Fabrication, Shipment, Storage, Installation, and Construction of Hardened Alternative Trailer Systems (hats) in Damascus, Syria. Igf::ot::igf — $20.0M (Department of State)
- Generator Systems Replacement — $19.7M (Department of State)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)