DoD's $51.2M Mina Salman Pier Replacement contract awarded to AICI-ARCHIRODON JV LLC shows fair value

Contract Overview

Contract Amount: $51,259,112 ($51.3M)

Contractor: Aici-Archirodon JV LLC

Awarding Agency: Department of Defense

Start Date: 2017-09-25

End Date: 2021-09-29

Contract Duration: 1,465 days

Daily Burn Rate: $35.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF P-976, MINA SALMAN PIER REPLACEMENT, MANAMA, BAHRAIN. STEEL PIER CONSTRUCT

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22101

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $51.3 million to AICI-ARCHIRODON JV LLC for work described as: IGF::OT::IGF P-976, MINA SALMAN PIER REPLACEMENT, MANAMA, BAHRAIN. STEEL PIER CONSTRUCT Key points: 1. The contract was awarded using full and open competition, suggesting a competitive pricing environment. 2. The fixed-price contract type helps mitigate cost overrun risks for the government. 3. The project duration of 1465 days indicates a significant, long-term infrastructure undertaking. 4. The contract falls under 'Other Heavy and Civil Engineering Construction,' a critical sector for military readiness. 5. The award was made by the Department of the Army, highlighting its role in global infrastructure support.

Value Assessment

Rating: fair

Benchmarking this contract's value is challenging without specific cost breakdowns or comparable project data. However, the firm fixed-price nature suggests that the awarded amount was deemed acceptable for the defined scope of work. The scale of the project, involving pier replacement in a strategic location, implies significant material and labor costs. Further analysis would require detailed cost-to-benefit assessments and comparisons with similar international military construction projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. With four bidders participating, the competition level appears adequate, which generally supports price discovery and potentially leads to more competitive pricing. The presence of multiple bidders suggests that the market has the capacity to undertake such projects and that the government had options to choose from.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down prices through market forces, ensuring the government receives the best value for its investment.

Public Impact

The primary beneficiaries are the U.S. Department of Defense and its naval operations, which rely on secure and functional port infrastructure. The project delivers essential services by replacing and upgrading critical pier infrastructure at Mina Salman, Bahrain. The geographic impact is concentrated in Manama, Bahrain, supporting U.S. military presence and operations in the region. The contract likely supports a significant construction workforce, including skilled labor and project management professionals, both locally and potentially internationally.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the fixed-price contract.
Geopolitical risks in the region could impact project timelines and security.
Dependency on specialized materials and international supply chains.

Positive Signals

Firm fixed-price contract structure limits the government's exposure to cost increases.
Awarded under full and open competition, suggesting competitive pricing.
Project addresses critical infrastructure needs for military operations.

Sector Analysis

This contract falls within the Heavy and Civil Engineering Construction sector, specifically focusing on marine infrastructure. The global market for such construction is substantial, driven by trade, defense, and energy needs. Comparable spending benchmarks would include other military base construction and port development projects worldwide. The Department of Defense frequently invests in similar projects to maintain its global operational capabilities.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). This suggests that the primary award was made to a joint venture likely composed of larger entities. There is no explicit information on subcontracting plans for small businesses, which could represent a missed opportunity to engage the small business ecosystem in this significant infrastructure project.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and project management offices. Given the overseas location, additional oversight may be provided by U.S. European Command or relevant regional commands. Transparency is generally maintained through contract award databases, but detailed project progress reports and specific oversight mechanisms are not publicly detailed in this data.

Related Government Programs

Military Construction, Army
Naval Facilities and Engineering Command Contracts
Overseas Military Base Infrastructure
Heavy and Civil Engineering Construction Contracts

Risk Flags

Geopolitical Risk
Supply Chain Dependency
Overseas Operations Complexity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $51.3 million to AICI-ARCHIRODON JV LLC. IGF::OT::IGF P-976, MINA SALMAN PIER REPLACEMENT, MANAMA, BAHRAIN. STEEL PIER CONSTRUCT

Who is the contractor on this award?

The obligated recipient is AICI-ARCHIRODON JV LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $51.3 million.

What is the period of performance?

Start: 2017-09-25. End: 2021-09-29.

What is the track record of AICI-ARCHIRODON JV LLC on similar government contracts?

Information regarding the specific track record of the joint venture 'AICI-ARCHIRODON JV LLC' on similar government contracts is not directly available in the provided data. A comprehensive assessment would require searching contract databases for past performance of both AICI and Archirodon individually, and any previous joint ventures they may have formed. Key areas to investigate would include their history with large-scale civil engineering and construction projects, adherence to schedules and budgets, and any past performance issues or commendations from federal agencies. Understanding their experience with Department of Defense projects, particularly overseas, would be crucial for evaluating their capability to execute this pier replacement successfully.

How does the awarded amount of $51.2 million compare to similar pier replacement projects globally?

Direct comparison of the $51.2 million award for the Mina Salman Pier Replacement to similar global projects is difficult without standardized project scopes, locations, and timeframes. Pier replacement projects vary significantly in complexity, size, materials used, and geopolitical context. Factors such as labor costs, material availability, environmental regulations, and the strategic importance of the location (Bahrain, in this case) heavily influence pricing. While $51.2 million represents a substantial investment, its value-for-money can only be truly assessed against projects with highly comparable characteristics. Benchmarking against other U.S. military pier projects or major international port infrastructure developments would provide a more relevant context, but such data is not readily available for a precise comparison.

What are the primary risks associated with this specific contract, beyond standard construction risks?

Beyond standard construction risks like unforeseen site conditions or material delays, this contract carries specific risks related to its overseas location in Bahrain. Geopolitical instability in the Middle East region could potentially impact project timelines, security, and supply chain logistics. Furthermore, reliance on international supply chains for specialized materials or equipment introduces risks associated with global market fluctuations, shipping disruptions, and customs regulations. The nature of military infrastructure projects also means that security requirements and potential changes in operational needs could influence project scope or execution. The joint venture structure itself can sometimes introduce coordination challenges between the partner companies.

How effective is the 'full and open competition' strategy in ensuring value for this type of infrastructure project?

The 'full and open competition' strategy is generally considered highly effective for ensuring value in large infrastructure projects like this pier replacement. By allowing all qualified contractors to bid, it maximizes the pool of potential offerors, fostering a competitive environment that drives down prices and encourages innovation. The presence of four bidders in this case suggests a reasonable level of competition. This approach helps the government secure the best possible price and quality for the required services. However, the effectiveness is contingent on the clarity of the solicitation requirements and the government's ability to evaluate proposals rigorously to ensure the lowest price isn't achieved at the expense of quality or long-term performance.

What is the historical spending trend for 'Other Heavy and Civil Engineering Construction' by the Department of the Army?

Historical spending data for 'Other Heavy and Civil Engineering Construction' by the Department of the Army indicates a consistent and significant investment in infrastructure. The Army, through entities like the Army Corps of Engineers and the Naval Facilities Engineering Command (NAVFAC), regularly procures services in this category for base construction, upgrades, and maintenance, both domestically and overseas. Annual spending can fluctuate based on global security needs, base realignment initiatives, and infrastructure modernization programs. While specific figures for 'Other Heavy and Civil Engineering Construction' require detailed database queries, it is a multi-billion dollar category annually for the Department of Defense, reflecting its critical role in supporting military operations and readiness.

What are the implications of the 'firm fixed price' contract type on contractor performance and government risk?

The 'firm fixed price' (FFP) contract type is generally favored for projects with well-defined scopes and requirements, like infrastructure construction, as it shifts significant risk to the contractor. For this pier replacement, an FFP contract means the contractor, AICI-ARCHIRODON JV LLC, is obligated to complete the work for the agreed-upon price, regardless of their actual costs. This incentivizes the contractor to manage costs efficiently and adhere to the schedule to maximize profit. For the government, the primary benefit is cost certainty; the total expenditure is known upfront, minimizing the risk of cost overruns. However, the government assumes the risk if the contractor's fixed price is too low and they cannot complete the work, potentially leading to delays or contractor default.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Solicitation ID: W912ER16R0009

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4600 FAIRFAX DR STE 804, ARLINGTON, VA, 22203

Business Categories: Category Business, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations

Financial Breakdown

Contract Ceiling: $51,259,112

Exercised Options: $51,259,112

Current Obligation: $51,259,112

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline