Attachment 2 - SOW (003).docx

Attachment 2 Statement of Work Rotating Grade Cobalt Metal Statement of Work Rotating Grade Cobalt Metal

Statement of Work (SOW) Rotating Grade Cobalt Metal

BACKGROUND

The Department of Defense (DoD), has bought, and will continue to buy, parts that contain Cobalt. Cobalt is commonly used in many forms, of which this statement of work will focus on one (1). Cobalt metal rotating grade has numerous applications in metallurgy, specifically in the use of aerospace and defense rotating parts.

DLA Strategic Materials received Congressional authority to procure cobalt. Through research on cobalt, the Government determined to procure cobalt for the National Defense Stockpile (NDS). The NDS already contains an amount of cobalt, however, it has been determined that additional stockpiling of cobalt be pursued.

SCOPE

To reduce the risk of availability in the rotating grade cobalt in the aerospace and defense supply chain, DLA Strategic Materials intends to purchase rotating grade cobalt metal with estimated values shown in Table 1 over a five-year ordering period. DLA Strategic Materials received authority to procure cobalt in the FY2025 National Defense Authorization Act (NDAA).

Table 1: Estimated planned procurement quantities and schedule for cobalt

*Total quantity +/- 1.0%

* Disclaimer: Table 1 provides an estimate of delivery orders and quantities. The government is not obligated to issue the estimated delivery orders.

REFERENCE

The following are incorporated by reference:

a) Harmonized Tariff Schedule, the Tariff Act of 1930, and the Trade Act of 1974

b) United States (US) Customs and Border Protection (CBP) Form 7501

c) US CBP Form 6059, General Declaration

d) US CBP Form 5106 (Request for Importer Number, or Notification of Importer Number)

TECHNICAL REQUIREMENTS

1.1 The following sections define the requirements for the material the Contractor shall provide.

1.1.1 The material shall be alloy-grade cobalt metal in accordance with the quality found under the Fastmarkets MB-CO-0004 Cobalt alloy grade, in-whs Rotterdam, $/lb. index. It shall be in cut cathode, round form, or briquette form and must be sourced from the following sources:

1. Vale Port Colborne rounds Cobalt 99.8% min originating from Canada

2. Sumitomo Metal Mining (SMM) cut cathodes Cobalt 99.8% min, originating from Japan

3. Glencore Nikkelverk cut cathodes Cobalt 99.8% min, originating from Norway

4. Any source that is qualified or in process for being qualified with US-based aerospace alloy manufacturers for rotating parts.

a. If the material is sourced from option 4, at least two (2) letters of support from US-based aerospace alloy manufacturers shall be submitted that state that the manufacturers have qualified the material for rotating parts or have started the qualification process and will likely qualify the material for rotating parts.

1.1.2 Materials shall be in the form of cut cathode, round, or briquette. For all three forms, a maximum of 10% by mass of the material shall pass through a 12.5mm sieve that meets the ASTM E11 standard for sieves.

1.1.3 The contractor shall provide material which is compliant with Table 2.

Table 2. Chemical requirements, by mass.

1.1.4 Each lot shall be approximately 44,100 lbs. (20,000 kg), contained as defined in Section 9.1 of this SOW. Co-mingling of multiple production lots into one larger lot will not be accepted. The Contractor shall assign a unique lot number to each production lot.

1.1.5 Material must be non-radioactive, non-licensable per Nuclear Regulatory Commission (NRC) regulations. It must contain less than 0.05 percent combined thorium and uranium by weight.

1.1.6 The Contractor shall ensure no Government material or samples of Government material leave CONUS once the lots have arrived CONUS.

SAMPLING

1.2 The Government will witness the Contractor’s sampling operations for each lot of material the Contractor intends to deliver to the Government for compliance with the Sampling Plan. Sampling must take place within CONUS.

1.3 The Government reserves the right to waive witnessing of the sampling process on a case-by-case basis.

1.4 The Contractor shall permit the Government access to activities associated with sample collection and distribution at the time the Contractor is manufacturing each lot of material the Contractor intends to provide to the Government. The Contractor’s material distribution facilities must be within the Continental United States (CONUS) for all material the Contractor intends to supply the Government.

1.5 The Contractor shall provide the Government with written notice of the date(s) the Contractor intends to begin processing, sampling, and testing activities of lots of material it intends to provide to the Government, a minimum of 20 (twenty) business days prior to that date.

1.6 The Contractor shall provide the Government with a written summary (via email and in PDF format) of its sampling plan and activities. The summary shall clearly describe the sampling process and cite any relevant sampling standards, as applicable. The Contractor shall submit this summary to the Government no later than thirty (30) business days prior to sampling of the ingots of material the Contractor intends to provide to the Government.

1.6.1 The Contractor shall not make any changes to their Sampling Plan without the explicit written approval of the Quality Assurance Specialist (QAS). If the Contractor wishes to make changes to the approved Sampling Plan, the Contractor shall submit a complete and revised proposed Sampling Plan for approval to the QAS. The QAS will advise the Contractor whether the revised proposed Sampling Plan is acceptable within seven (7) calendar days of receipt of the revised Sampling Plan. All sampling will be in accordance with the approved Sampling Plan.

1.6.2 If subsequent Contractor sampling plans and processes remain unchanged from previous sampling plans, the Contractor shall submit an email to the Government, stating that there have been no changes to its sampling plan and processes ten (10) business days prior to the date the Contractor begins its sampling activities.

1.7 The Contractor’s Sampling Plan shall include, at a minimum, the following:

a) Specify sample size and quantity

b) Provide a detailed description of the sampling process (i.e., individual sampling collection process, preparation of aggregate sample, sample splitting, additional sample preparation, estimated time for completing each lot’s sampling process, etc.)

c) Cite the national or international sampling standards applied to the sampling processes and/or description of industry-accepted sampling processes.

d) Explain how each lot’s sample set will be equivalent in size and properties and be representative of the lot of material in properties.

e) Confirm the Contractor will provide written notice of the date(s) the Contractor intends to begin sampling operations of material it intends to deliver to the Government, a minimum of thirty (30) business days prior to that date.

1.8 The Contractor shall collect samples for each lot of material it intends to provide to the Government. The Contractor’s sampling process and procedures shall be consistent with the sampling process and procedures the Contractor typically uses for this material for other customers.

1.9 The Contractor shall collect four equivalent samples for each lot of material the contractor intends to supply to the Government – one set of samples for the Contractor’s purposes, one set of samples for the Government, one set of samples for independent third-party laboratory analysis, and one sample for the reserve material of the independent third party laboratory reserve, All four samples shall be of the same size and form and shall be representative in chemical properties of the lot of material. All four samples shall have a minimum sample size that satisfies the requirements of the independent third-party laboratory.

1.10 The Contractor shall ship the Government’s sample for each lot with each lot of material it delivers to the Government.

1.11 The Contractor shall document and transfer chain of custody of the lot’s analytical and reserve samples to the independent third-party laboratory.

TESTING

1.12 The Contractor shall employ an independent third-party analytical chemistry laboratory (lab) to chemically characterize each lot of rotating grade cobalt the Contractor intends to deliver to the Government. The lab shall analyze each lot in accordance with industry standards.

1.13 The contractor shall report this information to the government in a Certificate of Analysis (COA). The contractor shall deliver a COA for each representative sample from each lot for which chemical analyses were performed.

1.14 The third-party lab used to perform verification testing shall:

a) Have CONUS (Continental United States) -- based operations.

b) Perform all analytical chemistry activities in this SOW within CONUS.

c) Have an established reputation for experience and excellence in laboratory analytical services.

d) be certified in ISO 17025 through A2LA with the following specific certifications, at a minimum: sample preparation for mineral ore, limestone, ferro-alloys (falling within the A2LA P112 Flexible Scope Policy); Inductively Coupled Plasma (“ICP”) for Al, Ag, As, B, Ba, Bi, Ca, Cd, Ce, Co, Cr, Cu, Fe, K, La, Li, Mg, Mn, Mo, Na, Nb, Ni, P, Pb, Sb, Se, Si, Sn, Sr, Ta, Ti, V, W, Zn (falling within the A2LA P112 Flexible Scope Policy); combustion analysis for C, N, O, S (falling within the A2LA P112 Flexible Scope Policy); Wavelength-Dispersive X-Ray Fluorescence (“WDXRF”) analysis for Al, Ca, Cr, Co, Cu, Fe, Mn, Mo, Na, Nb, Ni, P, S, Si, Ti, V (falling within the A2LA P112 Flexible Scope Policy); gravimetric precipitation analysis for CaF2, Mo, Nb, S, SiO2; volumetric analysis for B, Ca, Cr, Fe, Metallic Fe, Mg, Mn, Ni, Ti, V; gas evolution for CO2 and; miscellaneous gravimetric analysis for sieve testing, Loss on Ignition (“LOI”), moisture at 105°C.

e) Have expert ability and experience in analytical chemistry techniques and methods, and method development in wet chemistry (i.e., sample preparation and digestion, titration, reagent preparation, glovebox work, etc.), and instrumentational analysis.

f) Have expert ability and experience in clean pulverization capabilities; laboratory sample preparation and digestion; titration; and reagent preparation.

g) Have expert ability and experience in instrumental analysis, including Inductively Coupled Plasma Optical Emission Spectroscopy/Atomic Emission Spectroscopy (ICP-OES/AES), ICP-Mass Spectrometry (ICP-MS), and inert gas fusion and combustion analysis, especially using LECO™ or similar instruments.

1.15 The Contractor shall submit a testing plan with their proposal. The testing plan shall include, at a minimum:

a) Name and address of third-party laboratory that the contractor intends to use

b) A summary description of sample preparation techniques

c) A summary description of methodology and instrumentation (as applicable) the lab will employ for each required data value in this SOW’s material specifications

d) Any significant assumptions the lab might elect to make that are beyond the accepted assumptions made for chemical analysis (instruments and wet chemistry)

e) An acknowledgement of the safety portion of the SDS for the specific material being tested

1.16 The Contractor shall not make any changes to the Independent Third-party Analytical Chemistry Laboratory’s testing plan (i.e., the proposed analytical methodologies the independent laboratory will employ will be submitted and approved as part of the Contractor’s proposal) without the explicit written approval of the QAS.

1.17 All testing will be in accordance with the approved Testing Plan. If the Contractor wishes to make changes to the approved Testing Plan, the Contractor shall submit a complete and revised proposed Testing Plan for approval to the QAS. The QAS will advise the Contractor whether the revised proposed Testing Plan is acceptable within seven (7) calendar days of receipt of the revised Testing Plan.

1.17.1 More than 30 calendar days prior to the change: Submit the revised Testing Plan to the government. The government reserves the right to reject the revised Testing Plan and require a resubmission with any issues identified being addressed by the contractor.

1.17.2 30 calendar days or less prior to the change the contractor shall not make any changes to their Testing Plan without written approval (e-mail is sufficient) from the QAS. The QAS will advise the contractor whether the revised proposed Testing Plan is acceptable within seven (7) calendar days of receipt of the revised Testing Plan.

CERTIFICATES OF ANALYSIS (COA)

1.18 The Contractor shall provide a COA with each production lot.

1.19 The contractor shall affix a cover letter with their letterhead to each COA the Contractor submits to the Government. The Contractor’s letterhead shall include all the information the Contractor is required to report and that information is not generated by a separate entity. For example, the third party shall generate an analytical report on a lot of material; the contractor shall not alter that report in any manner but will affix a cover letter to that analytical report from the third-party lab.

1.20 The COA is a legal document, which ensures that the materials delivered by the contractor meet the specifications stated in this SOW. The Government will determine based on the COA if the lot(s) of the material are acceptable for delivery. The Contractor shall carefully sample and test the material to ensure the reliability of each submitted COA.

1.21 The Contractor shall send each COA to the QAS for review and acceptance prior to the shipment of each lot. The COA is a legal document which attests that the material delivered by the Contractor satisfies the specifications stated in the SOW. The Government will review every COA for each lot and advise the contractor if they are permitted to deliver the material. The QAS will notify the Contractor of the acceptability/unacceptability of each COA within fourteen (14) calendar days after receipt of each COA.

1.22 The COA shall have a statement certifying that the material meets and or exceeds the required material specifications.

1.23 The Contractor shall send each COA to the QAS for review and acceptance prior to the shipment of each lot. The COA is a legal document which attests that the material delivered by the Contractor satisfies the specifications stated in the SOW. The Government will review every COA for each lot and advise the contractor if they are permitted to deliver the material. The QAS will notify the Contractor of the acceptability/unacceptability of each COA within fourteen (14) calendar days after receipt of each COA.

1.24 Each COA shall include the following, at a minimum:

a) Lot number

b) Weight and number of containers the COA covers

c) List of tests performed and/or the methodology applied. The Contractor shall include any significant assumptions made, other than typical assumptions for test methodology, as a footnote to the reported value.

d) Numerical results and qualitative results (as applicable)

e) Error ranges/limits for results

f) Specifications/requirements

g) Name of the company or name of the laboratory performing the testing

h) Date(s) each analysis is performed, and

i) Printed name and signature of analyst.

1.25 The COA and all other documents submitted to the Government shall be in English.

ENVIRONMENTAL, SAFETY, AND OCCUPATIONAL HEALTH REQUIREMENTS

1.26 Transporting, Handling, and Management

1.26.1 The Government shall ensure compliance with all federal, state, and local regulations (international laws, as applicable) for the use, transport, emergency response, and disposal of the acquired material.

1.26.2 The Contractor shall ensure compliance with the Department of Transportation (DOT) regulations by certifying hazardous materials are properly classified, described, packaged, marked, and labeled and are in a condition safe to transport the material. (49 CFR 173)

1.26.3 The Contractor shall ensure compliance with the Occupational Safety and Health Administration (OSHA) regulations regarding the proper management, handling, storage, transportation, and disposition of material. (29 CFR 1910)

1.26.4 The Contractor shall communicate the hazards of the material by providing the Safety Data Sheet (SDS) in accordance with The United Nations Globally Harmonized System of Classification and Labeling of Chemicals (GHS). (29 CFR 1910)

1.26.5 The Contractor shall ensure compliance with the Environmental Protection Agency (EPA) regulations for the characterizing waste to determine appropriate disposal of material and any associated packing and shipping material. (40 CFR 260)

1.26.6 The Contractor shall ensure compliance with Strategic Materials’ Environmental, Safety, and Occupational Health (ESOH) Depot Orientation Guide and ESOH Policy Statement available on Strategic Materials website: https://www.dla.mil/Strategic-Materials/ .

PACKAGING

1.27 Material Packaging

1.27.1 Material shall be packaged in new UN 1A2 compliant steel drums.

1.27.2 All material delivered throughout the performance of this SOW in the same size and type (identical in all aspects) of drum.

1.27.3 The contractor shall submit detailed design drawings and manufacturer’s certifications for all steel drums proposed for use under this SOW for review and acceptance approval from the government prior to their utilization.

1.27.4 No steel drums shall be utilized that have not been preapproved for use under this SOW by the government.

1.27.5 The steel drums shall be new. Use of used, recycled, repaired, remanufactured or refurbished drums will not be acceptable.

1.27.6 The steel drums shall have a bolt and ring closure.

1.27.7 The steel drums shall have a gasket made of a synthetic elastomer to prevent the admission of moisture and to prevent leakage of its contents, especially fine particulates. The gasket’s material shall have chemical resistance consistent with the contents of the drum.

1.27.8 Both the steel drums’ exteriors and interiors shall be hot dipped galvanized or painted with a rust preventive coating.

1.27.9 A copy of the drum manufacturer’s certification shall be packaged with each shipment representing all drums in that shipment.

1.27.10 Upon delivery, the drums shall be intact, free of damage, contamination and leaks.

1.28 PALLETIZING REQUIREMENTS

1.28.1 All container/items shall be placed onto new undamaged pallets meeting the specifications listed below and be banded together to prevent container/item movement during handling, transportation or other operations where containers/items and/or personnel could be damaged and/or injured if the container/item shifts. The use of used, recycled, repaired, remanufactured and/or refurbished pallets will not be accepted.

1.28.2 Pallet Design

a) All pallets shall be 48 inches deep (front to back) and 48 inches wide (side to side) in size.

b) All pallets shall contain four (4) full length, solid stringers. One stringer shall be located at each edge (side) and two stringers shall located in the interior of all pallets. Interior stringers shall be spaced 18 1/2 inches (on center) from the outside of each edge (side). Stringers shall be 1 5/8 inches in width and 3 ½ inches in height. Segmented, composite and/or block stringers will not be acceptable.

c) All pallets shall have flush sides (e.g. no wings).

d) All pallets shall contain “top decking” and “bottom decking” boards. All decking boards shall be six (6) inches in width with no more than one (1) inch between boards. All decking boards shall be ¾ inches in thickness and be solid.

e) All pallets shall be of a “two-way entry” configuration.

f) Pallets may be reversible in design.

g) All pallets shall have a minimum rated load capacity of 750 pounds per square foot.

1.28.3 Pallet Construction

a) All pallets shall satisfy the requirements listed in ASTM D6199-18a.

b) All pallets shall be constructed entirely (except fasteners) of high-density hardwood meeting the requirements of paragraph 6 of ASTM D6199-18a. Only high-density hardwood species categorized in “Group IV” of ASTM D6199-18a shall be acceptable for pallet construction. The only acceptable high density hardwood species used for pallet construction are: Beech, Birch, Hackberry, Hard Maple, Hickory, Oak (Eastern), Pecan, Rock Elm, American Elm, White Oak and Green Oak. Pallets may be constructed by mixing together or using different high density hardwood species listed above interchangeability.

c) All pallets shall satisfy the requirements listed in ISPM-15 (International Standards for Phytosanitary Measures Number 15) (e.g. heat treated etc.).

d) Only driven nails that are “helically” threaded, “Annularly” threaded or “fluted” will be acceptable for use in pallet construction. The fastener length shall be sufficient to provide a minimum penetration of 1 ¼ inches into the stringer.

1.28.4 A copy of Safety Data Sheet (SDS), specific to each grade of the contained material, shall be accessible and external to the packed material with each delivery. All packages shall meet all requirements presented in Section 11 to ensure compliance with Federal, state, and local regulations for the transporting, handling, and management of material.

LABELING

1.29 All individual containers pallets shall be identified with attached tags(s)/label(s) as follows:

a) The font size utilized to enter the required information on each tag/label shall be of sufficient size to be legible to the unaided eye.

b) All information on tag(s)/label(s) shall be in English.

c) Any ink used to print tag(s)/label(s) shall be indelible, permanent and suitable for use in unheated warehouses where temperature extremes (both hot and cold) exist. The use of paint on tags/labels to enter the required information on each tag/label is not acceptable.

d) The tag/label material shall be durable and suitable for use in unheated warehouses where temperature extremes (both hot and cold) exist. The tag/label material shall not react with the commodity being tagged/labeled.

e) Tag/label material shall have an expected lifespan of a minimum of twenty years with no degradation.

f) All tag(s)/label(s) shall be of sufficient size to permit the listing of all required information.

g) The information in items 1 through 10 below shall be listed on each tag/label. The marking shall not include a security classification or anything indicating DLA Strategic Materials ownership other than the contract number.

1. Commodity Name

2. Commodity Grade, Type or Form

3. Merge Number

4. Country of Origin

5. Producer Name

6. Producer’s part number

7. Gross Weight in pounds and metric units. (Metric units to be in parentheses.)

8. Net Weight in pounds and metric units. (Metric units to be in parentheses.)

9. Lot Number

10. Government Contract Number

h) Tag(s)/Label(s) shall be attached to each container in a permanent manner that prevents accidental detachment. The means of attachment shall be suitable for use in unheated warehouses where temperature extremes (both hot and cold) exist.

i) One tag/label shall be attached to the exterior of each drum container in a permanent manner that prevents accidental detachment. A second tag/label shall be attached to the topside of the lid of each drum. If possible, a third tag/label shall be attached to the underside of the lid of each drum. The means of attachment shall be suitable for use in unheated warehouses where temperature extremes (both hot and cold) exist. Attachment by adhesive means (e.g., glue, adhesive backed tag/label etc.) is acceptable.

j) All packages shall meet all requirements presented in Section 11 to ensure compliance with Federal, state, and local regulations for the transporting, handling, and management of material.

TRANSPORTATION

1. The Contractor shall be responsible for transport, as well as for Carrier and Insurance Paid to (CIP) of the material to the point of delivery: the Government Storage Depot in Scotia, NY.

DELIVERY

1.31 The Contractor shall deliver materials to the Government Storage Depot (delivery point) at the following address:

SB0812

Defense Logistics Agency Strategic Materials Scotia Depot Route 5, Building #12 Scotia, NY 12302-9463 United States of America Telephone: (518) 370-3347 Unloading Hours: 7:30 AM – 2:30 PM (EST), Monday – Friday Accessibility: Truck

1.32 The Contractor shall schedule all deliveries a minimum of ten (10) business days in advance of their delivery with the QAS. Deliveries will only be accepted between the hours of 7:30 AM – 2:30 PM (EST), Monday – Friday (excluding federal holidays).

1.33 Delivery Orders issued against this IDIQ contract shall have a delivery period not to exceed 24 months.

INSPECTION & ACCEPTANCE

1.34 DLA personnel will perform in-depth visual inspections of material upon transferring to DLA custody at the final delivery point to verify conformance with the requirements stated in the SOW that can be verified visually.

1.35 The Government reserves the right to sample and test each lot of material received to verify the material meets the material specifications set forth in the SOW.

1.36 The QAS will provide written notification of the acceptance/rejection of each delivered lot of material to the Contractor within twenty (20) calendar days of delivery. The Contractor shall not submit an invoice until the QAS has issued a written notification of acceptance of each lot of material delivered.

1.37 If any delivered lot of material or other deliverable does not conform to the requirements stated in the SOW, the Government reserves the right to reject the non-conforming material.

1.38 Material rejected based on non-compliance is to be replaced at no cost to the Government. The Contractor shall be responsible for removal and replacement of rejected lots of material, including all attendant costs, within ninety (90) calendar days of the final delivery. The Government reserves the right to ask for compensation for lost time.

TARRIFS

1.39 Exemption of Tariffs. This purchase of Rotating Grade Cobalt metal, in the form of cut cathode and/or rounds, by DLA Strategic Materials is exempt from tariffs, according to the Harmonized Tariff Schedule, under the provisions of 19 U.S.C. 1202 (Line 9808.00.40, Strategic and Critical Materials Stock Piling Act), 19 U.S.C. 2461, 19 U.S.C. 2463 and 19 U.S.C. 3007 from the Art. I, sec. 8, U.S. Const., as a strategic and critical material.

1.40 Forms of Exemption. The exemption forms shall be filed by the Contractor and executed on the CBP Form 7501 (Entry Summary), where the code (9808.00.40, plus additional code entries) shall be entered on the form with the notation that the Duty and Internal Revenue Taxes are "0," along with the declaration (Form 6059, General Declaration). In addition, the Customs Service requires Form 5106 (Request for Importer Number, or Notification of Importer Number), along with the invoice for the material, the packing list (if available or applicable), and shipping documents.

1.41 Signature of Certificate. The Form (along with its declarations/entries) shall be signed by an "Authorized Agent," who would be the same individual

ACRONYMS:

of Chemicals