N104-T-16-4023_JA_for_USNS_DIEHL_Redacted.pdf

N104-16-T-4023

JUSTIFICATION AND APPROVAL

FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

Contracting Activity: Department of the Navy, Military Sealift Command (MSC).

Description of the Action Being Approved: The Military Sealift Command has a requirement to procure materials from Wartsila Defense of Chesapeake, VA on a sole source basis under requisition number N215796055V008.

Description of Supplies/Services: MSC has a requirement to procure brand name stern tube shaft seals and parts manufactured by Wartsila Corporation for installations as replacement/repair components onboard the USNS DIEHL. MSC normally acquires these stern tube shaft seal components as long lead time repair components and provide them as Government Furnished Material (GFM) for installation during regularly scheduled dry dock ship repair availabilities. The estimated value of the procurement is . Required delivery date is 03 JUNE 2016.

Statutory Authority Permitting Other Than Full and Open Competition: The statutory authority permitting other than full and open competition for FAR subpart 13.5 requirements is 41 U.S.C. 1901.

Rationale Supporting Use of Authority Cited Above: The US Navy's Combat Logistics Force (CLF) T-AO Class Replenishment Oilers provide direct support to US and Allied Forces at sea and support combat conflicts, War on Terrorism and disaster relief around the globe. Their primary mission is to shuttle fuel oil to support ship and aviation operations and to provide sustainment such as fresh fruits and vegetables, vital repair spares and personnel to Carrier Strike Groups (Amphibious Readiness Groups) and allied forces. The critical logistics support provided by the T-AO replenishment oilers enables these afloat operational groups to remain on station without disrupting wartime and/or other military defense operations. Fifteen T-AO class replenishment oilers are dispersed across the five Operational Commander's Areas of Responsibility (AOR). With limited resupply ports around the world along with limited port access for US Navy vessels, T-AO class replenishment oilers are vital to Department of Defense military operations.

In accordance with the MSC Safety Management Systems procedure 10.6-002-AO, the stern tube seals on the replenishment oilers are categorized as critical ship equipment. Critical Ship Equipment is defined as equipment and systems that are necessary to sustain the proper operation and mission capability of the ship. Failure of these equipment and systems would pose a hazard to the ship, its crew, or the environment. This technical risk can be broken down into four subparts: potential for disruption to the ship's mission support operation schedule; potential for increased costs for emergency dry docking events; potential for degradation in performance through a partial or complete failure of the component and potential to cause harm to the crew or the environment.

The components of the T-AO stern tube seal system constitute critical ship equipment because failure of the stern tube system poses a hazard to the ship, the crew and the environment. Stern tube seals are installed on either end of the propulsion shaft stern tube, which is filled with oil to lubricate the installed stern tube bearings. The seals keep the lubrication oil in and the sea water out of the stern tube. For the T-AO class stern tube seals, a seal system failure could cause catastrophic harm to the environment and international embarrassment through the leakage of up to 3400 gallons of oil per stern tube into the sea. An oil spill from the propulsion shaft stern tubes would also potentially violate environmental laws such as the Oil Pollution Act of 1990.

The stern tube seals have a life expectancy of at least 60 months. MSC schedules for routine replacement of the stern tube seals once approximately every 60 months during a regular overhaul and dry-docking of the vessel.

A failure of the stern tube seals can also result in serious damage to critical ship equipment and a partial or complete loss of propulsion, which presents a potential danger to the crew. Sea water intrusion into the stern tube bearing assembly could jeopardize the effectiveness of the stern tube bearing lubrication with a likely outcome being bearing failure and loss of propulsion.

The failure of a stern tube seal would require an emergent repair due to impacts to the environment and the propulsion capability of the ship. T-AO replenishment oilers have two shafts. The loss of one stern tube seal would not prevent the ship from making an emergency transit to a repair facility. The loss of both stern tube seals however, would necessitate the ship having to be towed immediately to the nearest qualified repair facility.

Stern tube seal casualties require immediate emergency dry-docking event, costing upwards of one million dollars per event to accomplish an unplanned, emergent repair. More significantly, the loss of a T-AO oiler for an emergent repair due to a failure of a stern tube seal would disrupt MSC mission readiness and adversely impact US Navy operations supporting national defense because the loss of critical logistics support capability provided by the disabled oiler. The time required to effect an emergency repair to the stern tube seals could take 2-3 weeks, and would have a detrimental effect to vessel mission requirements supporting US Navy and allied Naval forces worldwide, with a cascading effect on other ships and mission schedules.

The T-AO class vessels suffered several casualties as described in the 1990's due to stern tube seal failure. To preclude similar failures in the future, MSC conducted extensive market research and a reliability study on evolving stern tube sealing technologies. The study was based upon commercially available, proven systems and included correspondence with commercial operators to determine the reliability of the sealing system being used on their ships. Based on the results of these studies and a trial period on two T-AO replenishment oilers, MSC conducted a competitive procurement of the stern tube seal system for the T-AO class vessels in 2000. The particular Wartsila 4AS stern tube seal offered the most reliable sealing system and incorporated anti- pollution features that provided back-up sealing capability to our ships. The Wartsila 4AS stern tube seal system incorporates a differential air pressure system along with a compartmentalized housing and four (4) lip seal arrangement to ensure the integrity of the stern tube seal. The Wartsila 4AS stern tube sealing system was the winning stem tube seal system.

By 2002, MSC had installed the Wartsila 4AS anti-pollution stem tube systems on all the T-AO class replenishment oilers.

The Wartsila Viton lip seal ring is the replacement part/component of the more complex Wartsila 4AS stern tube sealing system comprised of many integral components. This Viton seal ring is a wear item, meaning that it wears out through operation and must be replaced as part of normal maintenance requirements. Wear comes from the exposure to both oil and water and through the design of the sealing system where the Viton rubber seal "lip" rides on a rotating tungsten coated seal liner to maintain a continuous seal as the propulsion shaft rotates. The manufacturer controls the wear of this seal through innovative and complex chemical composition design, with a goal of extending the life expectancy of this seal. They also employ innovations in the shape, orientation and tension of this lip ring to ensure a tight seals without accelerating the wear of the soft components.

Since the installation of the Wartsila 4AS stem tube seal system on the T-AO class replenishment oilers, MSC has used only OEM parts and components to maintain the reliability of the OEM stem tube seal system. This is a complex seal system which to date has proven to be effective and oil leak free. The T-AO class replenishment oilers have not experienced a single casualty arising from the failure of a Wartsila 4AS stern tube seal system. The criticality of the stem tube seals and the complexity of the system demands that MSC adhere to its requirement to purchase only OEM stem tube seal components for the T-AO replenishments oilers to reduce the risk of failure of the stern tube seal components or the seal system.

MSC competitively awarded the Wartsila 4AS stern tube seal system as a commercial item under MSC Contract N31980-00-C-0242. Under the contract, MSC did not acquire technical data rights or technical information beyond general arrangement drawings for installation on T-AO class ships, American Bureau of Shipping approval certificates and an equipment technical manual. The arrangement drawings and the technical manual provide schematics and cut-away views of the stern tube seal, but do not provide sufficient information for the layman to accomplish industrial assistance type maintenance or repair to the seal system without possessing additional proprietary information and current technical service bulletins. Additionally, MSC does not possess or have the rights to the manufacturing drawings and processes, OEM specifications, material, tolerances and other technical data pertaining to the Wartsila stern tube seals and is unable to purchase the data rights now due to fiscal constraints and proprietary reasons. Accordingly, the manufacturing, special tools and equipment required to manufacture the Wartsila stern tube seal is not known to MSC. Therefore, MSC does not have the manufacturing and technical information required to reverse engineer/manufacture replacement seal system components and replacement parts will compromise the required reliability and effectiveness of the stern tube seal system as a whole. Wartsila of Japan, a subsidiary of Wartsila of Helsinki, Finland is the OEM for the stern tube seal components. Wartsila Defense of Chesapeake, VA is the only US distributor for these parts.

Description of Efforts Made to Solicit Offers from as Many Potential Sources as Practicable: In accordance with FAR 5.201(b)(1)(i), the Government intends to issue a combined synopsis/solicitation on FEDBIZOPPS on a sole source basis for this requirement.

Determination of Fair and Reasonable Cost: The Contracting Officer will determine that the price for the supplies/services is fair and reasonable pursuant to FAR Part 13.106-3.

Actions to Remove Barriers to Future Competition: For the reasons set forth in Paragraph 5, Wartsila materials are required. MSC has no plans at this time to compete future contracts for the type of supplies covered by this document. There is one known qualified source for the required parts. The Contracting Officer therefore intends to solicit quotes for stern tube seal and parts from Wartsila Defense. The Contracting officer will maximize competition to the fullest extent possible by posting a combined synopsis/solicitation for this requirement on Fed Biz Ops. This combined synopsis/ solicitation will indicate that the procurement is limited to OEM Wartsila Defense stern tube seals and parts.