DoD's $44.7M Guam Water Well Field Contract Awarded to Environmental Chemical Corp
Contract Overview
Contract Amount: $44,720,512 ($44.7M)
Contractor: Environmental Chemical Corporation
Awarding Agency: Department of Defense
Start Date: 2022-02-17
End Date: 2025-01-22
Contract Duration: 1,070 days
Daily Burn Rate: $41.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: N62742-22-C-1320, FY18 MCON P-103 WATER WELL FIELD, US NAVSUPACT ANDERSEN, GUAM
Place of Performance
Location: YIGO, GUAM County, GUAM, 96929
Plain-Language Summary
Department of Defense obligated $44.7 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: N62742-22-C-1320, FY18 MCON P-103 WATER WELL FIELD, US NAVSUPACT ANDERSEN, GUAM Key points: 1. The contract is for water well field construction in Guam, a critical infrastructure project. 2. Environmental Chemical Corporation, the sole awardee, has a history with DoD contracts. 3. The project's fixed-price nature aims to control costs, but potential risks exist in remote construction. 4. The sector is Construction, specifically water infrastructure, vital for military base operations.
Value Assessment
Rating: good
The contract value of $44.7M for a 3-year project appears reasonable for large-scale water infrastructure in a remote location like Guam. Benchmarking against similar MCON projects would provide further context.
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 generally expected to yield fair pricing, though specific bid details are not provided.
Taxpayer Impact: Taxpayer funds are being used for essential infrastructure supporting military readiness and personnel in Guam.
Public Impact
Ensures reliable water supply for Naval Support Activity Andersen, Guam. Supports military operations and personnel quality of life in the Indo-Pacific region. Potential for local economic impact through subcontracting and labor, though not explicitly stated. Addresses critical infrastructure needs in a strategically important U.S. territory.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Geographic remoteness of Guam may increase logistical costs and complexity.
- Potential for unforeseen site conditions impacting schedule and budget.
- Reliance on a single contractor for a critical infrastructure project.
Positive Signals
- Firm Fixed Price contract helps mitigate cost overruns.
- Project addresses a critical need for water infrastructure.
- Full and open competition was utilized.
Sector Analysis
This contract falls within the construction sector, specifically focusing on water and sewer line construction. Spending on military construction (MCON) projects like this is common for maintaining and upgrading base infrastructure, with costs varying significantly based on location and project scope.
Small Business Impact
The data indicates the awardee is not a small business, and there is no indication of small business subcontracting goals being a primary focus for this specific award. Further analysis would be needed to determine if small businesses were involved in the supply chain or subcontracting.
Oversight & Accountability
The contract is managed by the Department of the Navy, part of the Department of Defense. Standard oversight mechanisms for federal contracts, including performance monitoring and financial reviews, would apply. The duration and value suggest significant oversight is warranted.
Related Government Programs
- Water and Sewer Line and Related Structures Construction
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Geographic remoteness
- Potential for unforeseen site conditions
- Environmental compliance in a sensitive ecosystem
- Logistical challenges for materials and equipment
- Reliance on a single contractor for critical infrastructure
Tags
water-and-sewer-line-and-related-structu, department-of-defense, gu, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $44.7 million to ENVIRONMENTAL CHEMICAL CORPORATION. N62742-22-C-1320, FY18 MCON P-103 WATER WELL FIELD, US NAVSUPACT ANDERSEN, GUAM
Who is the contractor on this award?
The obligated recipient is ENVIRONMENTAL CHEMICAL CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $44.7 million.
What is the period of performance?
Start: 2022-02-17. End: 2025-01-22.
What is the projected impact of the Guam location on the overall cost and timeline compared to similar projects stateside?
The remote location of Guam significantly increases logistical costs for materials, equipment, and personnel, likely inflating the overall project cost and extending the timeline compared to similar water well field construction projects within the continental United States. Specialized shipping and potential labor challenges contribute to this premium.
What are the specific risks associated with constructing water infrastructure in a tropical island environment like Guam?
Risks include potential for typhoons and extreme weather impacting construction schedules and safety, unique geological conditions affecting drilling and foundation stability, and the need for specialized corrosion-resistant materials due to the humid, salty air. Environmental regulations specific to island ecosystems also require careful management.
How effectively does the firm fixed-price contract mitigate cost escalation for this remote infrastructure project?
The firm fixed-price contract is designed to cap the government's liability, shifting most cost overrun risks to the contractor. However, for remote projects with potential for unforeseen site conditions or significant logistical challenges, contractors may build substantial contingency into their initial bids, potentially leading to a higher baseline price.
Industry Classification
NAICS: Construction › Utility System Construction › Water and Sewer Line and Related Structures Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N6274221R1339
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1240 BAYSHORE HGHWY, BURLINGAME, CA, 94010
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $44,720,512
Exercised Options: $44,720,512
Current Obligation: $44,720,512
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2022-02-17
Current End Date: 2025-01-22
Potential End Date: 2025-01-22 00:00:00
Last Modified: 2024-09-26
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