NFS Phase 2 JOFOC_SAM.pdf

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

NATIONAL NUCLEAR SECURITY ADMINISTRATION

OFFICE OF SECONDARY STAGE PRODUCTION MODERNIZATION

I. AGENCY IDENTITY AND CONTRACTING OFFICE

The Office of Secondary Stage Production Modernization (NA-195) of the U.S. Department of Energy (DOE), National Nuclear Security Administration (NNSA) plans to contract for services for initial production and up to two years of full production for the purification and conversion of highly enriched uranium (HEU) and very highly enriched uranium (VHEU), by means of other than full and open competition. The contracting activity is the NNSA Contracting Operations Division, Headquarters Services Acquisition Branch.

II. NATURE AND/OR DESCRIPTION OF THE ACTION BEING APPROVED

This document sets forth the justification and approval of the use of one of the exceptions to full-and-open competition allowed under the Competition in Contracting Act (CICA) of 1984. This new contract action is for a five-year, sole source acquisition to Nuclear Fuel Services, Inc.

(NFS), 1205 Banner Hill Rd, Erwin, TN 37650, for initial production and up to two years of full production for the purification and conversion of highly enriched uranium (HEU) and very highly enriched uranium (VHEU), for NNSA Defense Programs in support of the NNSA Uranium Program Manager. The contract will also allow NFS to produce fuel feedstock for potential use by Naval Reactors. Nuclear Fuel Services is owned by BWX Technologies, Inc.

(BWXT).

III. DESCRIPTION OF SUPPLIES AND/OR SERVICES

NNSA is currently modernizing facilities, equipment, and processes used at the Y-12 National Security Complex (Y-12) to recycle and recover HEU. A purification and conversion services contract will ensure an oxide-to-metal conversion capability is maintained while the site draws down its current oxide-to-metal conversion capability to later ramp up with the establishment of new technologies such as Direct Electrolytic Reduction (DER) in enduring facilities at Y-12. In addition to ensuring an oxide-to-metal conversion capability is maintained, this contract with NFS provides an opportunity to convert VHEU oxide-to-metal. Y-12 does not have the capability nor plans to establish the capability to convert VHEU oxide to purified metal. NNSA will utilize NFS capabilities to convert this material to purified metal. HEU and VHEU purified metal recycled through the oxide-to-metal conversion process at NFS will be returned to NNSA for placement into storage for future use. The contract will also allow NFS to produce fuel feedstock for potential use by Naval Reactors. NNSA anticipates issuing a five-year contract, with NFS, completing initial production and up to the first two years of full production of HEU oxide-to-metal purification and conversion.

IV. AUTHORITY

The statutory authority permitting other than full and open competition is 41 U.S.C.

§ 3304(a)(1), as implemented by Federal Acquisition Regulation (FAR) Subpart 6.302-1 entitled “Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.”

V. APPLICATION OF AUTHORITY

BWXT/NFS is the only responsible source capable of meeting NNSA’s requirements to convert impure HEU oxides into purified HEU oxide and metal. BWXT/NFS controls the only Nuclear Regulatory Commission (NRC) licensed, Category 1 nuclear processing facilities with the capability to meet NNSA’s production requirements in the near term.

VI. EFFORTS TO IDENTIFY ADDITIONAL SOURCES

Through market research (see § VIII), NNSA was only able to identify two U.S. commercial facilities licensed by the NRC as a Category 1 HEU-capable facility, both of which are owned by BWXT. The two locations are the NFS facility in Erwin, TN; and a BWXT facility in Lynchburg, VA. BWXT is the only commercial company in the U.S. capable of accepting, managing, and processing HEU.

Additionally, on April 13, 2022, NNSA posted a Synopsis/Notice of Intent to Sole Source to Federal Business Opportunities (SAM.gov), allowing responsible sources that believe they could perform the required services an opportunity to submit a capability statement. NNSA did not receive any responses by the closing date of April 29, 2022.

VII. DETERMINATION OF REASONABLENESS OF COST OR PRICE

The Contracting Officer will determine, as part of the evaluation of the vendor’s proposal, that the costs are fair and reasonable based on a combination of cost and price analysis of the contractor’s proposal. This requirement is being procured on a firm-fixed-price basis.

VIII. MARKET RESEARCH

Additional market research, in the form of engaging the U.S. Nuclear Regulatory Commission, validates that BWXT possesses the only available NRC-licensed Category 1 nuclear facilities capable of processing HEU. NRC is the sole federal authority which grants licenses to operate domestic nuclear facilities.

IX. OTHER FACTS

There are no other facts relevant to this Justification for Other than Full and Open Competition.

X. INTERESTED SOURCES

NNSA posted a “Synopsis/Notice of Intent to award a sole source contract to NFS” on April 13, 2022, seeking capability statements from responsible sources that believed they could perform the required services, but received no capability statements.

XI. STEPS TO FOSTER COMPETITION

NNSA will continually monitor the market to determine whether any new vendors have been licensed by the NRC to commercially process HEU.

XII. CERTIFICATION

The information contained in this Justification for Other than Full and Open Competition is certified accurate and complete to the best of my knowledge and belief.