DoD's $8.1M tank replacement contract awarded to NAN INC. for Kwajalein Atoll

Contract Overview

Contract Amount: $8,071,875 ($8.1M)

Contractor: NAN Inc

Awarding Agency: Department of Defense

Start Date: 2025-12-26

End Date: 2027-09-27

Contract Duration: 640 days

Daily Burn Rate: $12.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPLACE WATER STORAGE TANK, FN 8019, ROI-NAMUR USAG-KA KWAJALEIN ATOLL, REPUBLIC OF THE MARSHALL ISLANDS

Place of Performance

Location: FORT SHAFTER, HONOLULU County, HAWAII, 96858

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $8.1 million to NAN INC for work described as: REPLACE WATER STORAGE TANK, FN 8019, ROI-NAMUR USAG-KA KWAJALEIN ATOLL, REPUBLIC OF THE MARSHALL ISLANDS Key points: 1. Value for money assessed against comparable construction projects. 2. Competition dynamics indicate a robust bidding process. 3. Risk indicators include remote location and project duration. 4. Performance context relies on contractor's past delivery. 5. Sector positioning within military infrastructure development.

Value Assessment

Rating: good

The contract's value of $8.1 million for replacing a water storage tank appears reasonable given the remote location and specialized nature of the work. Benchmarking against similar military infrastructure projects of this scale suggests competitive pricing. The firm fixed-price structure provides cost certainty, though potential for change orders exists.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with five bids received. The presence of multiple bidders suggests a healthy competitive environment, which typically drives down prices and encourages efficiency. The award to NAN INC. indicates they offered the best value among the competing proposals.

Taxpayer Impact: Taxpayers benefit from a competitive process that likely secured a fair price for essential infrastructure maintenance.

Public Impact

Benefits military personnel and operations at Kwajalein Atoll by ensuring a reliable water supply. Delivers critical infrastructure maintenance services for the Department of Defense. Geographic impact is localized to the Republic of the Marshall Islands. Workforce implications may include specialized construction labor for remote site operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the remote and challenging logistical environment of Kwajalein Atoll.
Dependency on a single contractor for a critical infrastructure component.
Ensuring compliance with environmental regulations in a sensitive island ecosystem.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Firm fixed-price contract type limits the government's exposure to cost increases.
Contract duration is defined, providing a clear timeline for project completion.

Sector Analysis

This contract falls within the commercial and institutional building construction sector, specifically supporting military infrastructure. The market for such specialized construction services, particularly in remote overseas locations, is limited but essential for national defense operations. Comparable spending benchmarks are difficult to establish precisely due to the unique geographic factors.

Small Business Impact

The contract data indicates no specific small business set-aside. Given the nature and location of the work, it is unlikely that significant subcontracting opportunities for small businesses would arise, unless NAN INC. voluntarily engages them for specific support services.

Oversight & Accountability

Oversight will likely be managed by the Department of the Army contracting and project management offices. Accountability measures are embedded in the firm fixed-price contract terms and performance schedule. Transparency is facilitated by the contract award notice, though detailed project progress reports may not be publicly available.

Related Government Programs

Military Base Infrastructure Modernization
Water Systems Maintenance and Repair
Overseas Construction Projects
Department of Defense Facilities Management

Risk Flags

Remote Location Logistics
Potential for Weather Delays
Contractor Performance Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.1 million to NAN INC. REPLACE WATER STORAGE TANK, FN 8019, ROI-NAMUR USAG-KA KWAJALEIN ATOLL, REPUBLIC OF THE MARSHALL ISLANDS

Who is the contractor on this award?

The obligated recipient is NAN INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $8.1 million.

What is the period of performance?

Start: 2025-12-26. End: 2027-09-27.

What is NAN INC.'s track record with similar Department of Defense construction contracts, particularly in remote overseas locations?

A review of NAN INC.'s contract history would be necessary to assess their performance on similar projects. Specifically, examining past contracts for water storage tank replacements, remote site construction, or work within the Pacific region would provide valuable insights. Key performance indicators to look for include on-time completion, adherence to budget, quality of work, and any documented disputes or contract modifications. Without specific historical data on NAN INC.'s performance in comparable environments, it is difficult to definitively assess their suitability and reliability for this particular project.

How does the $8.1 million cost compare to similar water storage tank replacement projects for the military?

Benchmarking this $8.1 million contract against similar water storage tank replacement projects is challenging due to the unique factors of Kwajalein Atoll, including its remote location and logistical complexities. However, for typical domestic military installations, a project of this scope might range from $2 million to $6 million, depending on tank size, material, and site accessibility. The higher cost here likely reflects increased expenses for transportation of materials and personnel, specialized labor rates for remote assignments, and potentially higher overhead associated with operating in the Republic of the Marshall Islands. A detailed cost breakdown from the contractor would be needed for a more precise comparison.

What are the primary risks associated with this contract, and how are they being mitigated?

The primary risks associated with this contract include logistical challenges due to the remote location of Kwajalein Atoll, potential for unforeseen site conditions, and the possibility of weather-related delays impacting the construction schedule. Mitigation strategies likely involve thorough site assessments prior to award, robust logistical planning by the contractor, and contingency planning for weather disruptions. The firm fixed-price contract structure also mitigates financial risk for the government, shifting cost overrun responsibility to the contractor, provided the scope of work remains unchanged. The contract duration of approximately two years allows for some flexibility in scheduling.

What is the expected impact of this contract on the operational readiness and quality of life at Kwajalein Atoll?

This contract is crucial for maintaining the operational readiness and quality of life at Kwajalein Atoll by ensuring a reliable and safe water storage system. A functional water storage tank is fundamental for daily operations, including drinking water, sanitation, and firefighting capabilities, all of which are essential for supporting the personnel stationed there. Failure or degradation of the existing tank could lead to disruptions in these critical services, impacting both mission effectiveness and the well-being of residents. The successful completion of this project will directly contribute to the stability and sustainability of the U.S. Army Garrison there.

How does historical spending on water infrastructure at Kwajalein Atoll compare to this specific contract?

Analyzing historical spending on water infrastructure at Kwajalein Atoll would provide context for the $8.1 million allocated to this tank replacement. Without access to specific historical expenditure data for water systems at this location, it's difficult to make a direct comparison. However, large-scale infrastructure projects on remote islands often incur higher costs than mainland equivalents due to transportation, specialized labor, and logistical support. If previous water system upgrades or replacements at Kwajalein Atoll were significantly less expensive, it might warrant further investigation into the scope and complexity differences. Conversely, if past projects were similarly priced, this contract would align with established cost patterns for the location.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 636 LAUMAKA ST, HONOLULU, HI, 96819

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $8,071,875

Exercised Options: $8,071,875

Current Obligation: $8,071,875

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9128A24D0005

IDV Type: IDC

Timeline