Northrop Grumman wins $2.5 billion M&O deal with Energy

(Updated) A joint venture led by Northrop Grumman Corp. beat two major competitors to win a five-year $2.5 billion contract from the Energy Department to manage and operate the Nevada Test Site. The contract, valued at $500 million annually, carries five option years.

The Los Angeles-based company defeated teams led by contract incumbent Bechtel Nevada Corp. and Washington International Group Inc., said David Apt, communications director with Northrop Grumman Technical Services.

The contract win is the largest technical services-related award to date for Northrop Grumman, as well as the first award won by the defense contractor's new technical services business sector, said Gregg Donley, vice president and general manager of systems support at the company's Technical Service sector, which was formed in January.

Northrop Grumman Technical Services sector leads the joint venture, known as National Security Technologies LLC. The team includes AECOM Technology Corp. of Los Angeles, CH2M Hill Companies Ltd. of Englewood, Colo., and Nuclear Fuel Services Inc. of Erwin, Tenn.

The contracting team will handle everything from remote field experiments to the fabrication and testing of various electronic, mechanical and structural systems. The teams also will manage laboratory facilities, conduct construction and mining operations and handle hazardous material and waste management.

The project involves everything from infrastructure management and IT systems "to supporting the various users out there for whatever kind of experimental testing that they're doing," Donley said. The transition to the new contractor begins next week.

The contactor also will handle more mundane, but essential daily support activities such as food service operations and site administrative and maintenance work, said Darwin Morgan, director of public affairs at the National Nuclear Security Administration's Nevada Site Office.

The contractor will be responsible for everything that needs to be done "to manage and keep the Nevada Test Site running on a day-to-day basis," he said.

Work will be performed at the Energy Department's Nevada Test Site near Las Vegas as well as five other satellite and laboratory locations in North Las Vegas, Nev., Nellis Air Force Base, Nev., Andrews Air Force Base, Washington, Los Alamos, N.M., Livermore, Calif., and Santa Barbara, Calif. About 3,000 employees will work on the contract.

The Nevada Test Site is a 1,375-square-mile area in southern Nevada where the Energy Department conducted underground and atmospheric nuclear weapons tests for more than four decades. Today, the site supports the department's National Nuclear Security Administration's national security missions, conventional weapons testing, hazardous chemical spill testing, emergency response training and environmental restoration and waste management activities.

Northrop Grumman of Los Angeles has more than 125,000 employees and had annual revenue of $30.7 billion in fiscal 2005. The company ranks No. 2 on Washington Technology's 2005 Top 100 list of federal prime contractors.

(Originally posted March 29 at 4:01 p.m. and updated March 30 at 4:58 P.M.)

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