DoD's $34M Craney Island Fuel Terminal Construction Contract Awarded to McLean Contracting Company

Contract Overview

Contract Amount: $33,964,660 ($34.0M)

Contractor: Mclean Contracting Company

Awarding Agency: Department of Defense

Start Date: 2011-09-12

End Date: 2015-06-24

Contract Duration: 1,381 days

Daily Burn Rate: $24.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P838 REPLACE FUEL PIER D CRANEY ISLAND FUEL TERMINAL

Place of Performance

Location: PORTSMOUTH, PORTSMOUTH CITY County, VIRGINIA, 23703

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $34.0 million to MCLEAN CONTRACTING COMPANY for work described as: P838 REPLACE FUEL PIER D CRANEY ISLAND FUEL TERMINAL Key points: 1. The contract aimed to replace a fuel pier, a critical infrastructure component. 2. Awarded under full and open competition, suggesting a robust bidding process. 3. The firm-fixed-price contract type shifts cost risk to the contractor. 4. The project duration of 1381 days indicates a significant construction undertaking. 5. The North American Industry Classification System (NAICS) code 237120 points to specialized pipeline and related structures construction. 6. The contract was awarded by the Department of the Navy, a branch of the DoD. 7. The project was located in Virginia, a key logistical hub.

Value Assessment

Rating: good

The contract value of approximately $34 million for the replacement of a fuel pier appears reasonable given the scope of specialized construction involved. While direct comparisons are difficult without specific project details, similar large-scale maritime infrastructure projects often fall within this general cost range. The firm-fixed-price nature of the award suggests that the pricing was established upfront, providing a degree of cost certainty for the government. Benchmarking against other fuel terminal construction projects would offer further insight into the value proposition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 9 bidders suggests a healthy level of competition for this specialized construction project. A competitive bidding process generally leads to more favorable pricing for the government as contractors vie for the award. The number of bidders provides a good indication that the market was adequately engaged.

Taxpayer Impact: The full and open competition for this contract likely resulted in a more competitive price, saving taxpayer dollars compared to a sole-source or limited competition award.

Public Impact

The primary beneficiaries are the Department of Defense and its naval operations, ensuring continued fuel supply capabilities. The service delivered is the construction of critical maritime fuel infrastructure. The geographic impact is localized to Craney Island, Virginia, but supports broader naval logistics. The workforce implications include employment for construction workers, engineers, and project managers in the Virginia area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the fixed-price nature.
Delays in construction could impact operational readiness and fuel supply chains.
Ensuring the long-term durability and safety of the replaced fuel pier is paramount.

Positive Signals

The firm-fixed-price contract structure provides cost certainty for the government.
Awarding under full and open competition suggests a competitive market and potentially better pricing.
The contractor, McLean Contracting Company, has experience in heavy civil and marine construction.

Sector Analysis

The construction of fuel terminals falls within the broader heavy civil engineering and construction sector, specifically focusing on maritime and pipeline infrastructure. This sector is characterized by large-scale projects requiring specialized expertise and significant capital investment. The market size for such infrastructure projects is substantial, driven by both government and private sector needs for energy logistics and transportation. This contract fits within the government's ongoing efforts to maintain and modernize critical defense infrastructure.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions. However, the prime contractor, McLean Contracting Company, may engage small businesses for subcontracting opportunities to fulfill specific project requirements. The impact on the small business ecosystem would depend on the extent to which the prime contractor utilizes small business subcontractors for specialized services or materials.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Navy contracting command. Performance would be monitored through regular progress reports, site inspections, and adherence to contract milestones. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Naval Facilities Engineering Command (NAVFAC) projects
Department of Defense infrastructure modernization programs
Maritime construction contracts
Fuel storage and distribution infrastructure

Risk Flags

Potential for construction delays
Unforeseen site conditions
Environmental compliance risks
Contractor performance issues

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.0 million to MCLEAN CONTRACTING COMPANY. P838 REPLACE FUEL PIER D CRANEY ISLAND FUEL TERMINAL

Who is the contractor on this award?

The obligated recipient is MCLEAN CONTRACTING COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $34.0 million.

What is the period of performance?

Start: 2011-09-12. End: 2015-06-24.

What is the track record of McLean Contracting Company on similar federal projects?

McLean Contracting Company has a history of performing large-scale marine and heavy civil construction projects for various government agencies, including the Department of Defense and the Army Corps of Engineers. Their portfolio includes bridge construction, port facilities, and other maritime infrastructure. While specific details on past fuel terminal projects require deeper investigation, their general experience in complex marine environments suggests a capability to handle projects of this nature. Reviewing past performance evaluations and any contract disputes or claims associated with their federal awards would provide a more comprehensive understanding of their track record.

How does the $34 million cost compare to similar fuel pier replacement projects?

Benchmarking the $34 million cost requires detailed comparison with similar fuel pier replacement projects, considering factors like pier size, complexity, environmental conditions, and the specific scope of work (e.g., dredging, pile driving, pipeline connections). Without access to detailed cost breakdowns or data on comparable projects, a precise value-for-money assessment is challenging. However, for a significant infrastructure replacement of this nature, the amount appears within a plausible range for specialized maritime construction. Further analysis would involve comparing unit costs for key construction elements if available.

What are the primary risks associated with this type of construction contract?

The primary risks associated with this firm-fixed-price construction contract include potential cost overruns due to unforeseen site conditions (e.g., subsurface obstructions, environmental hazards), contractor performance issues leading to delays, and potential disputes over contract scope or quality. For a fuel terminal, risks also extend to ensuring the integrity of fuel containment and transfer systems to prevent environmental damage. The fixed-price nature shifts most cost risk to the contractor, but significant delays or contractor failure could still impact the government through extended oversight or the need to re-procure services.

How effective was the competition in driving down costs for this contract?

The award under full and open competition with 9 bidders suggests a robust market response, which is generally effective in driving down costs. A higher number of bids typically indicates greater price competition. While the specific bid amounts are not provided, the presence of multiple competing firms creates pressure on each bidder to offer their most competitive price to win the contract. This competitive dynamic is a key mechanism for ensuring that taxpayer funds are used efficiently in such procurements.

What is the historical spending pattern for fuel terminal construction by the Department of the Navy?

Historical spending patterns for fuel terminal construction by the Department of the Navy would likely show a consistent need for maintenance, repair, and replacement of aging infrastructure, alongside upgrades to meet evolving operational and environmental standards. Spending can fluctuate based on budget allocations, strategic priorities, and the lifecycle of existing facilities. Analyzing past contract awards for similar projects over several fiscal years would reveal trends in contract values, types of services procured, and the frequency of such investments. This specific $34 million contract represents one such investment in maintaining critical fuel logistics capabilities.

What are the implications of the 1381-day duration on project management and oversight?

A contract duration of 1381 days (approximately 3.8 years) signifies a large-scale, complex construction project requiring sustained project management and oversight. This extended timeline necessitates robust planning, scheduling, and resource allocation by both the contractor and the government's contracting officer's representative (COR). The government must maintain consistent oversight to monitor progress, ensure quality control, manage any change orders, and verify milestones are met. The extended duration also means that potential risks, such as material price fluctuations or changes in regulatory requirements, need to be managed over a longer period.

Industry Classification

NAICS: Construction › Utility System Construction › Oil and Gas Pipeline and Related Structures Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N4008511R0001

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6700 MCLEAN WAY, GLEN BURNIE, MD, 21060

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,964,660

Exercised Options: $33,964,660

Current Obligation: $33,964,660

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline