DoD Awards $32.5M Charter Hire Contract to Hornbeck Offshore Operators LLC for Deep Sea Freight
Contract Overview
Contract Amount: $32,459,405 ($32.5M)
Contractor: Hornbeck Offshore Operators LLC
Awarding Agency: Department of Defense
Start Date: 2015-12-31
End Date: 2020-09-30
Contract Duration: 1,735 days
Daily Burn Rate: $18.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Transportation
Official Description: IGF::OT::IGF CONTRACT AWARD BASE PERIOD CHARTER HIRE
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92147
Plain-Language Summary
Department of Defense obligated $32.5 million to HORNBECK OFFSHORE OPERATORS LLC for work described as: IGF::OT::IGF CONTRACT AWARD BASE PERIOD CHARTER HIRE Key points: 1. Contract awarded to Hornbeck Offshore Operators LLC for deep sea freight transportation. 2. The contract has a base period value of $32.5 million. 3. Awarded by the Department of the Navy, supporting maritime operations. 4. The duration of the contract is 1735 days, ending September 30, 2020.
Value Assessment
Rating: fair
The contract value of $32.5 million for a period of approximately 4.75 years appears reasonable for specialized deep-sea freight charter services. Benchmarking against similar long-term vessel charters would provide a more precise assessment.
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. This method is expected to yield fair market prices and ensure the government receives the best value.
Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently by securing competitive pricing for essential deep-sea freight services.
Public Impact
Ensures continued operational readiness for the Navy's maritime missions. Supports critical logistics and transportation needs for defense operations. Provides specialized vessel charter services essential for deep-sea deployments.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Contract duration extends over multiple fiscal years.
- Potential for cost overruns if fuel prices or operational demands fluctuate significantly.
- Dependence on a single contractor for critical transportation services.
Positive Signals
- Awarded through full and open competition.
- Firm fixed price contract type helps control costs.
- Supports essential defense logistics and readiness.
Sector Analysis
The defense sector relies heavily on specialized transportation and logistics services. Chartering vessels for deep-sea freight is a common practice to support global operations, with costs varying based on vessel type, duration, and operational requirements.
Small Business Impact
This contract was not awarded to small businesses, as indicated by the 'sb' field being false. The primary contractor, Hornbeck Offshore Operators LLC, is a large entity.
Oversight & Accountability
The award was made by the Department of the Navy, a component of the Department of Defense, which has established oversight mechanisms for contract execution and performance. Further oversight would involve monitoring contract performance against requirements and budget.
Related Government Programs
- Deep Sea Freight Transportation
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Contract duration exceeds 4 years.
- Potential for price volatility in the maritime shipping market.
- Dependence on a single provider for critical freight services.
- No small business participation noted.
Tags
deep-sea-freight-transportation, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $32.5 million to HORNBECK OFFSHORE OPERATORS LLC. IGF::OT::IGF CONTRACT AWARD BASE PERIOD CHARTER HIRE
Who is the contractor on this award?
The obligated recipient is HORNBECK OFFSHORE OPERATORS 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 $32.5 million.
What is the period of performance?
Start: 2015-12-31. End: 2020-09-30.
What specific operational needs does this charter hire contract fulfill for the Department of the Navy?
This contract likely supports the Navy's requirement for specialized deep-sea freight transportation, which could include moving equipment, supplies, or personnel to various operational theaters. The firm fixed price structure suggests a defined scope of service, aiming to ensure predictable costs for these critical logistical movements.
Are there any identified risks associated with the long duration and firm fixed price nature of this contract?
A key risk with long-duration, firm fixed-price contracts is the potential for the contractor to incur losses if unforeseen market changes, such as significant fuel price increases or operational challenges, occur. Conversely, the government might overpay if market conditions improve substantially, though the competitive award aims to mitigate this.
How does this contract contribute to the overall effectiveness of naval operations and readiness?
The contract's effectiveness is tied to its ability to reliably provide necessary deep-sea freight services, ensuring that naval forces have the logistical support required for their missions. Consistent and timely delivery of goods and equipment directly impacts operational readiness and the ability to project power globally.
Industry Classification
NAICS: Transportation and Warehousing › Deep Sea, Coastal, and Great Lakes Water Transportation › Deep Sea Freight Transportation
Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N6238715R2020
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Hornbeck Offshore Services, Inc. (UEI: 947299590)
Address: 103 NORTHPARK BLVD STE 300, COVINGTON, LA, 70433
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: $32,459,405
Exercised Options: $32,459,405
Current Obligation: $32,459,405
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2015-12-31
Current End Date: 2020-09-30
Potential End Date: 2020-11-30 00:00:00
Last Modified: 2020-09-28
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