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DOE Approves Modified Contract and Baseline for Hanford Waste Treatment Plant

WASHINGTON, D.C. – The U.S. Department of Energy (DOE) and Bechtel National Inc. (BNI) have modified the contract and baseline for the Hanford Waste Treatment and Immobilization Plant (WTP) project to support the Department’s approach to begin treating Hanford’s tank waste as soon as practicable.

The contract modification implements DOE’s Direct Feed Low Activity Waste (DFLAW) approach for the Hanford tank waste treatment mission. The DFLAW approach involves the WTP Low Activity Waste (LAW) Facility, Analytical Laboratory (LAB) and a set of 23 support facilities, collectively known as Balance of Facilities (BOF). Together, these three areas are commonly referred to as “LBL.” The contract modification aligns both the contractor responsibility and the project risks through the restructuring of incentives in order to deliver the best value for the Federal government and the taxpayer.

“DOE is committed to addressing the environmental legacy of decades of nuclear weapons production activities at the Hanford Site in a safe and cost-effective manner. We are confident that the modified contract and baseline represents the most effective and expeditious path towards beginning tank waste treatment at Hanford as soon as practicable,” said Kevin Smith, Manager of the DOE Office of River Protection, which oversees the WTP Project.

The contract modification includes incentives for BNI to complete the LBL sections of the WTP by specific dates and for the contractor to share in cost savings for completing work early. It also includes sections to benefit the American taxpayer by reducing the fee for work that fails to meet the agreed upon schedule.

To date, BNI has made significant progress on the LBL sections of the WTP, with the LAB and BOF near completion and some support systems commencing activities for startup. In addition, nearly all major pieces of equipment have been installed in the LAW Facility.

Along with the contract modification, DOE has revised the baseline for the LBL sections of the WTP project. The cost increase for the approved baseline change of the project is approximately $4.5 billion and results from multiple factors, including changes in quality standards, performance and construction challenges, and updated commissioning costs based on improved understanding of current industry best practices. As a result, the incremental total project cost for the entire WTP has increased to $16.8 billion. This revised baseline has been thoroughly reviewed by the Project Management Risk Committee and the revitalized Energy Systems Acquisition Advisory Board, reflecting the Department's recent project management improvements.

To learn more about the WTP project, please visit the DOE Office of River Protection website.