Hanford vit plant builder earns half of award payment

Annette Cary, Tri-City HeraldSeptember 18, 2013 

Bechtel National has been awarded 49.6 percent of the performance pay possible for the first half of 2013 for its work on the Hanford vitrification plant, according to the Department of Energy.

Bechtel will receive a little more than $3.1 million of a possible $6.3 million for satisfactory ratings for the two categories considered -- project management and cost.

In each category it will be awarded just under 50 percent of the maximum pay possible.

The last pay period, the second half of 2012, Bechtel voluntarily gave up its performance fee. And in the first half of 2012, it received about $3.1 million, which was its lowest performance award payment to date.

Although it received the same pay for the first half of this year, new Bechtel project director Peggy McCullough was encouraged by improvements.

DOE recognized significant improvement in several areas, especially in the last two months of the performance period, she said in a memo to the vit project's 2,300 workers. Improvements in nuclear safety and quality culture received high ratings, she said.

Those areas had been the focus of criticism and numerous reviews.

DOE also liked the way Bechtel managed its contract and purchases during an uncertain financial period. Hanford officials had to wait to learn if money appropriated by Congress could be moved among vit plant and other Hanford work.

Mandatory federal budget cuts were in place, and with no 2013 budget passed by Congress Hanford work was done under a continuing resolution.

Coordination was improved between Bechtel and Department of Energy engineering, according to the award pay scorecard prepared by DOE. DOE also praised Bechtel for identifying a vessel or tank for the plant that did not meet quality assurance requirements before it was delivered and refusing to accept it.

Under the cost category, positives included updating risk management plans and procedures and that 91 percent of risk mitigation actions were effective, DOE said.

"Early identification of risks continues to be effective and helpful," said the DOE scorecard.

However, DOE also identified areas needing improvement, especially in quality.

Bechtel did not agree with all aspects of DOE's evaluation of quality, McCullough said. But it is continuing to aggressively identify and correct deficiencies to make sure the completed plant meets quality requirements and DOE expectations for operations, she said.

The plant will turn up to 56 million gallons of radioactive and hazardous chemical waste now held in underground tanks into a stable glass form for disposal. The waste is left from the past production of plutonium for the nation's nuclear weapons program.

"To meet the DOE goal of verifying readiness to safely operate the WTP (Waste Treatment Plant or vit plant), we must address DOE's concerns regarding quality pedigrees," she said. "We will satisfy those concerns."

Bechtel needs to move faster in making some project management improvements, DOE said. It found Bechtel was slow to develop a plan to correct some problems and made slow progress in resolving some issues related to the eventual safe operation of the plant.

It also has not adequately integrated design of the plant and work to ensure its eventual safe operation, DOE said.

DOE indicated that only 7 of 20 milestones were reached on time, but several of the milestones were missed because of sequestration, the mandatory cuts to the federal budget.

Bechtel needs to find a better way of forecasting the effects of budget reductions, DOE said. DOE also was disappointed that Bechtel found no opportunities for cost efficiency or risk reduction in the first half of the year.

"We will continue to improve and meet future contract milestones," McCullough told staff.

-- Annette Cary: 582-1533; acary@tricityherald.com; Twitter: @HanfordNews

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