Army awards $105M dredging contract to Callan Marine for Brazos Island Harbor Channel Deepening

Contract Overview

Contract Amount: $104,980,157 ($105.0M)

Contractor: Callan Marine Limited

Awarding Agency: Department of Defense

Start Date: 2024-09-03

End Date: 2026-05-04

Contract Duration: 608 days

Daily Burn Rate: $172.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DREDGING - BRAZOS ISLAND HARBOR CHANNEL DEEPENING PHASE II. CAMERON COUNTY, TEXAS

Place of Performance

Location: BROWNSVILLE, CAMERON County, TEXAS, 78521

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $105.0 million to CALLAN MARINE LIMITED for work described as: DREDGING - BRAZOS ISLAND HARBOR CHANNEL DEEPENING PHASE II. CAMERON COUNTY, TEXAS Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is a firm fixed-price definitive contract, providing cost certainty for the government. 3. The project duration is approximately 608 days, indicating a significant, multi-year undertaking. 4. The dredging work is located in Cameron County, Texas, impacting regional infrastructure. 5. The contract value of $105M places it in the large-dollar category for civil engineering projects. 6. The award to Callan Marine Limited suggests their capability in specialized heavy civil engineering.

Value Assessment

Rating: good

The contract value of approximately $105 million for dredging services appears to be within a reasonable range for a project of this scale and complexity, especially considering the location and scope of deepening a harbor channel. Benchmarking against similar Army Corps of Engineers projects for channel deepening and maintenance would provide a more precise value-for-money assessment. The firm fixed-price nature of the contract helps mitigate cost overrun risks for the government, assuming the initial scope is well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this specialized dredging project. While more bidders could potentially drive prices lower, three offers generally provide a reasonable basis for price comparison and selection.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages multiple companies to bid, potentially leading to lower prices and better value. It ensures that the government is not limited to a single provider, fostering a more efficient use of public funds.

Public Impact

The primary beneficiaries are the Department of the Army and potentially commercial entities relying on improved navigation through Brazos Island Harbor. The project will deliver enhanced dredging services to deepen the Brazos Island Harbor Channel. The geographic impact is concentrated in Cameron County, Texas, and the surrounding coastal region. The project will likely involve a skilled workforce in heavy civil engineering and maritime operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if initial channel conditions are more complex than anticipated.
Dependence on favorable weather and environmental conditions for timely project completion.
Risk of unforeseen subsurface obstructions impacting dredging efficiency and cost.

Positive Signals

Firm fixed-price contract provides cost certainty.
Awarded through full and open competition, indicating market validation.
Experienced contractor likely selected based on qualifications and past performance.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on maritime infrastructure. The dredging market is specialized, often dominated by a few key players capable of undertaking large-scale projects. The Army Corps of Engineers is a major client in this sector, frequently awarding contracts for channel maintenance and improvement. The value of this contract is substantial, reflecting the significant investment required for major harbor deepening.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Given the specialized nature and large dollar value of this dredging project, it is unlikely that small businesses would be primary bidders or subcontractors unless in a joint venture or specific subcontracting role. The prime contractor, Callan Marine Limited, will likely determine the extent of small business subcontracting opportunities, if any, based on their project execution plan.

Oversight & Accountability

Oversight for this contract will likely be managed by the U.S. Army Corps of Engineers, which has established project management and quality assurance protocols. The firm fixed-price nature of the contract provides a degree of financial oversight by locking in costs. Transparency is generally maintained through contract award announcements and public reporting mechanisms. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Army Corps of Engineers Civil Works Projects
Port Infrastructure Development
Coastal Navigation Improvement
Maritime Construction Contracts

Risk Flags

Potential for cost overruns if unforeseen conditions arise.
Schedule delays due to weather or environmental factors.
Contractor performance risk on a large-scale project.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $105.0 million to CALLAN MARINE LIMITED. DREDGING - BRAZOS ISLAND HARBOR CHANNEL DEEPENING PHASE II. CAMERON COUNTY, TEXAS

Who is the contractor on this award?

The obligated recipient is CALLAN MARINE LIMITED.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $105.0 million.

What is the period of performance?

Start: 2024-09-03. End: 2026-05-04.

What is Callan Marine Limited's track record with similar large-scale dredging projects for the Army Corps of Engineers?

Callan Marine Limited has a history of performing dredging and marine construction services. While specific details on past Army Corps of Engineers projects of this exact magnitude require deeper database analysis, their award on this $105M contract suggests they possess the necessary experience, bonding capacity, and technical expertise. Reviewing their past performance evaluations and contract history within federal procurement databases would provide a clearer picture of their reliability and success rates on comparable projects, including any challenges encountered and how they were resolved. This context is crucial for assessing the risk associated with their current performance.

How does the $105 million contract value compare to other Brazos Island Harbor channel deepening or maintenance projects?

The $105 million award for the Brazos Island Harbor Channel Deepening Phase II represents a significant investment. To benchmark its value, one would need to compare it against historical spending for similar channel deepening projects undertaken by the Army Corps of Engineers, particularly in the Gulf Coast region. Factors such as the volume of material to be dredged, the required depth and width of the channel, and the geological conditions of the seabed significantly influence project costs. If previous phases of this project or comparable projects in nearby ports were awarded at substantially different price points, it could indicate changes in market conditions, contractor efficiency, or project scope. A detailed comparison would involve analyzing the cost per cubic yard of material dredged across different projects.

What are the primary risks associated with this specific dredging contract, and how are they being mitigated?

Key risks for this dredging contract include unforeseen subsurface geological conditions (e.g., hard rock, buried debris) that could increase dredging time and costs, adverse weather impacting operations, and potential environmental compliance issues. The firm fixed-price contract structure mitigates financial risk for the government by capping costs, but it shifts some risk to the contractor. Mitigation strategies likely involve thorough geotechnical surveys prior to award, robust environmental monitoring plans, and contingency planning for weather delays. The contractor's experience and the competitive bidding process also serve as risk-reduction factors, as experienced firms are better equipped to anticipate and manage these challenges.

What is the expected impact of this channel deepening on regional commerce and the broader Texas economy?

Deepening the Brazos Island Harbor channel is expected to significantly enhance maritime commerce by allowing larger vessels to access the port, increasing cargo capacity, and reducing shipping costs. This can lead to greater economic activity, job creation in logistics and related industries, and improved competitiveness for businesses utilizing the port. For Texas, a more efficient port infrastructure can bolster international trade, attract new businesses, and contribute to overall economic growth. The project's success is directly tied to its ability to facilitate increased trade volumes and support the state's role as a major hub for commerce.

How does the number of bidders (3) influence the potential value for taxpayers on this contract?

Having three bidders suggests a moderate level of competition. While more bidders could theoretically drive prices down further, three offers generally provide enough market tension to prevent excessively high pricing. It indicates that the market for this specialized service is not overly concentrated, allowing the government to select from a reasonable pool of qualified contractors. The contracting officer would have assessed whether the pricing proposed by the winning bidder was fair and reasonable based on these competing offers and market research. A lower number of bidders (e.g., one or two) might raise concerns about price discovery and potential overpayment.

What are the performance metrics or key performance indicators (KPIs) likely being used to evaluate Callan Marine Limited's success on this project?

Performance metrics for this dredging contract would likely focus on schedule adherence, quality of work (e.g., meeting specified channel dimensions and tolerances), safety compliance, and environmental performance. Key Performance Indicators (KPIs) might include the volume of material dredged per unit of time, adherence to the project timeline milestones, compliance with environmental regulations (e.g., turbidity levels, disposal of dredged material), and the number of safety incidents. The Army Corps of Engineers would have established specific criteria in the contract to measure these aspects, influencing payment and potential incentives or penalties.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W912HY24B0016

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6800 HARBORSIDE DR, GALVESTON, TX, 77554

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $104,980,157

Exercised Options: $104,980,157

Current Obligation: $104,980,157

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline