J_A Kittiwake fbo.pdf

DEPARTMENT OF THE NAVY

COMMANDER MILITARY SEALIFT COMMAND REFER TO:

914 CHARLES MORRIS CT SE

WASHINGTON NAVY YARD DC 20398-5540

Justification for Other than Full and Open Competition

Upon the basis of the following justification, I, as Competition Advocate, hereby approve the use of other than full and open competition for the proposed contractual action described below, pursuant to the authority cited herein.

1. Agency Contracting Activity: Military Sealift Command (MSC), Services and Ship Support Division (N102).

2. Nature of the Action: This will be a firm fixed-price indefinite-delivery, indefinite-quantity contract for the provision of lubricant oil and fuel oil handling products, equipment and related services. The Contractor shall provide the Government with some products that must be procured from the following source: Kittiwake Developments Ltd.

3. Description of Supplies/Services: The Contractor shall provide lubricant oil and fuel oil handling equipment to MSC vessels worldwide to support MSC’s analysis program. The analysis program supports MSC’s compliance with regulations related to oil quality and pollution restrictions.

The Contractor must provide sample bottles, filter carts, measuring and testing devices, and test center components and consumables. While most products under the proposed contract are described using salient characteristics and allow competitive sourcing, one of the testing devices, and its related components and consumables, must be purchased from the licensed distributors of the test center manufacturer, Kittiwake Developments Ltd. This device and its related products are the only ones currently available that can ensure accurate testing results to support MSC’s lubricant oil testing program requirements.

The period of performance will start 01 November 2009. Completion of the task is scheduled for 31 October 2014, if all options are exercised. The estimated total value of these services required from the single source is estimated at $1,374,307.00.

4. Statutory Authority: This acquisition is conducted under FAR Part 12 using the procedures of FAR Part 15, Contracting by Negotiation. Competition for the prime contract has been limited to small business concerns pursuant to FAR 19.502-2. The Government is requiring the provision of the name brand products referenced above pursuant to the authority of FAR 6.302-1.

5. Rationale Supporting Use of the Authority: Pursuant to the standard set forth in FAR 6.302- 1, competition can be limited when the services required are available from only one responsible source, and no other type of services will satisfy the requirements. Competition has been restricted to Kittiwake Developments Ltd. for the above-referenced products for the following reasons:

a. MSC’s Oil Analysis Program requires the Ship’s force to sample and test various operating equipment lubricants both daily and weekly. In addition, upon receipt of new oil, the storage tanks must be tested to establish reference values. Any testing which indicates a failure in the oil’s properties requires a sample submission to MSC’s oil test laboratory. The Ship’s force is tasked with testing viscosity, total base number, insolubles, and water-in oil parameters using onboard test equipment.

b. The test equipment used for conducting shipboard testing is the Kittiwake Oil Test Center (OTC).

The Kittiwake OTC has been onboard MSC ships since 1989. The Kittiwake OTC was available under the original Lube Oil Program contracts. Currently, it is being procured through the existing fuel oil and lubricant oil handling contract. The Kittiwake OTC unit is also used by the U.S. Navy for their onboard testing. This unit is still considered state-of-the-art, and it is the benchmark of shipboard testing equipment. Its technology, accuracy, and testing efficiency have not been effectively duplicated by any other manufacturer to date.

c. The current contract for lubricant oil and fuel oil handling equipment, N00033-05-D-8005, is fulfilled by Chase Supply, Inc., a small business concern. The procurement did not restrict the testing units to Kittiwake products; therefore, Chase Supply initially provided the Government with Ashland Chemical’s Combomar Test Unit. MSC attempted to utilize the Combomar units under the existing fuel oil and lubricant oil handling contract. However, the Combomar units proved unreliable and gave inaccurate lubricant oil test results onboard MSC vessels. Chase Supply submitted the Viscomar, also produced by Ashland Chemical, as a substitute for the Combomar unit. MSC N7 found the Viscomar technically unacceptable, given the erratic test results and the four-fold increase in the length of time needed for conducting the test.

d. Consistent functionality of the test equipment is crucial, and both the Combomar and Viscomar units failed to demonstrate this functionality. The Government executed a modification to allow the substitution of Kittiwake products until the problems with the Combomar units could be resolved. Although N7 representatives found that the Combomar units performed acceptably in later tests, N7 intended to use the units only for testing residual fuel oils, because the units were still considered unreliable for testing lubricant oil. However, with the recent implementation of MARPOL ANNEX VI, new EPA regulations, and international laws to reduce ships’ emissions, chemical changes to bunker fuel have driven a requirement to test all bunker fuels at a fuel laboratory, rather than onboard. MSC has not purchased Combomar units or related equipment since before Option Period Two of the contract, which began 01 January 2007. Since that time, MSC has purchased only Kittiwake units to test lubricant oil.

e. The Kittiwake OTC requires the use of Kittiwake consumables and components to ensure functionality and accuracy. Therefore, consumables and components produced by the manufacturer of the OTC must be purchased for use with both the existing OTCs and any new units purchased.

This contract will allow for the Kittiwake OTC, its consumables, and its parts to be procured by the MSC fleet.

f. Responses to both the market survey and draft solicitation failed to identify any products equal in capability to the Kittiwake OTC.

g. The requirement for this contract was synopsized on FedBizOpps on 03 April 2009. Only one company expressed interest in supplying a product other than the Kittiwake OTC. The company expressing interest, Pall Corporation, is a large business. N7 indicated that the information provided does not appear to meet MSC’s testing capabilities requirements. The information submitted appears to relate to aerospace fluids testing, rather than to marine fluids testing. Pall was asked to clarify, but it provided no additional information.

h. In addition to the market survey, draft RFP, and synopsis, N10 and N7 representatives independently conducted internet searches for products with the capabilities listed for the Kittiwake OTC. The searches yielded no meaningful results. A website listing information on Combomar products was located, but it provided no characteristics for the unit. The site referenced Ashland Chemical, and a search on Ashland’s website and a call to their Government Contracts Representative yielded no information.

6. Description of Efforts Made to Solicit Offers from as Many Potential Sources as Practicable:

See Paragraph 5.

7. Contracting Officer’s Determination that the Anticipated Costs to the Government Will Be Fair and Reasonable: The Contracting Officer anticipates that the cost to the Government of the supplies/services covered by this J&A will be fair and reasonable. The fair and reasonable determination will be made based on a comparison to the rates in the current contract, the IGE, and catalog prices for the products.

8. Description of Market Research Conducted: See Paragraph 5.

9. Other Facts Supporting Use of Other Than Full and Open Competition: The Government maintains a pool of five (5) Kittiwake OTCs to be sent out to vessels. To ensure that the units function properly, the Government must use compatible components and consumables produced by Kittiwake. The oil test centers are priced under the current contract at $19,213.21 per unit, and the Government purchases 6 new units per year. The Government also has 15 units refurbished each year, at a cost of $4,637.82 each.

10. List of Sources that Expressed Interest in Writing: As described above in Paragraph 5, only one company (Pall Corporation) expressed an interest in writing regarding an alternate product to the Kittiwake OTC.

11. Action Planned to Remove or Overcome Any Barriers to Competition Prior to Subsequent Acquisitions: The technical experts and contracting will continue working to identify acceptable substitute products to eliminate the need for this single item. A potential product has been identified, the Foster-Miller FluidScan-H Oil Monitor, which would decrease lifecycle costs for the overall test program. However, the equipment does not yet have the full range of capabilities that the Government requires.

12. Delivery Requirement: This J&A will cover the following period of performance: 01 November 2009 through 31 October 2014.

13. Total Estimated Dollar Value: A $1,374,307.00 increase in estimated contract value for the entire period of performance is required.

14. Acquisition Plan Supporting This Acquisition: Not Applicable. This procurement does not require an acquisition plan.

15. Issues Relating to Contractor Performance: None

16. Congressional Interest: None