Naval Nuclear Laboratory Contract Exceeds $13.4 Billion for R&D Services
Contract Overview
Contract Amount: $13,431,022,813 ($13.4B)
Contractor: Fluor Marine Propulsion, LLC
Awarding Agency: Department of Defense
Start Date: 2018-07-12
End Date: 2028-09-30
Contract Duration: 3,733 days
Daily Burn Rate: $3.6M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: NAVAL NUCLEAR LABORATORY
Place of Performance
Location: WEST MIFFLIN, ALLEGHENY County, PENNSYLVANIA, 15122
Plain-Language Summary
Department of Defense obligated $13.43 billion to FLUOR MARINE PROPULSION, LLC for work described as: NAVAL NUCLEAR LABORATORY Key points: 1. Significant investment in advanced research and development for nuclear propulsion. 2. Fluor Marine Propulsion, LLC holds the contract, indicating a key industry player. 3. Potential risks associated with long-term, high-value R&D contracts. 4. Spending is concentrated within the defense sector, specifically naval applications.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee structure for R&D can lead to cost overruns. Benchmarking is difficult due to the specialized nature of nuclear propulsion R&D, but the scale suggests a premium for expertise and long-term commitment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the long duration and specialized nature may limit the pool of qualified bidders, potentially impacting price discovery.
Taxpayer Impact: Taxpayers are funding critical, long-term research and development for national security. The effectiveness of this spending hinges on successful innovation and application in naval nuclear programs.
Public Impact
Supports advanced technological development for national defense. Ensures continued innovation in nuclear propulsion systems for the Navy. Potential for spin-off technologies benefiting other sectors. Long-term commitment may stabilize employment in specialized R&D fields.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Warning Flags
- High contract value and long duration increase financial risk.
- Cost-plus contract type can incentivize higher spending.
- Lack of small business participation noted.
Positive Signals
- Critical R&D for national security.
- Awarded through full and open competition.
- Experienced contractor in a specialized field.
Sector Analysis
This contract falls under Research and Development in Physical, Engineering, and Life Sciences. Spending benchmarks for such highly specialized, long-term defense R&D are difficult to establish due to unique requirements and national security implications.
Small Business Impact
The contract data indicates that small businesses are not directly participating in this large-scale R&D effort. This is common for highly specialized, prime contracts in advanced defense technology.
Oversight & Accountability
The Department of the Navy oversees this contract. Given its critical nature and long duration, robust oversight mechanisms are essential to ensure performance, cost control, and adherence to research objectives.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- High contract value
- Long contract duration
- Cost-plus contract type
- Lack of small business participation
- Specialized R&D field
Tags
research-and-development-in-the-physical, department-of-defense, pa, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $13.43 billion to FLUOR MARINE PROPULSION, LLC. NAVAL NUCLEAR LABORATORY
Who is the contractor on this award?
The obligated recipient is FLUOR MARINE PROPULSION, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $13.43 billion.
What is the period of performance?
Start: 2018-07-12. End: 2028-09-30.
What is the projected return on investment for this significant R&D expenditure?
Quantifying the ROI for R&D, especially in defense, is challenging. Success is measured by technological advancements, operational improvements in naval capabilities, and potential long-term cost savings through innovation. Specific metrics are likely classified or tied to program milestones rather than direct financial returns.
What are the primary risks associated with the 'Cost Plus Fixed Fee' structure in this context?
The primary risk is that the contractor may not be sufficiently incentivized to control costs, as the fee is fixed regardless of the final project expense. This can lead to cost overruns if the government does not maintain rigorous oversight and control over the scope and execution of the R&D work.
How does the 'full and open competition' ensure the best value for taxpayers given the specialized nature of the work?
Full and open competition aims to solicit proposals from all qualified sources, theoretically driving down prices and ensuring the government receives the best technical solution. However, for highly specialized R&D like nuclear propulsion, the pool of capable bidders is inherently limited, potentially reducing the competitive pressure on price.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: FURNACE/STEAM/DRYING; NUCL REACTOR
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0002418R2130
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Fluor Corporation
Address: 100 FLUOR DANIEL DR, GREENVILLE, SC, 29607
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $19,222,256,542
Exercised Options: $14,781,907,212
Current Obligation: $13,431,022,813
Actual Outlays: $935,256,470
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-07-12
Current End Date: 2028-09-30
Potential End Date: 2028-09-30 00:00:00
Last Modified: 2025-12-23
More Contracts from Fluor Marine Propulsion, LLC
- Management and Operation of the Naval Nuclear Laboratory and Naval Nuclear Propulsion Program Support — $14.8B (Department of Energy)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)