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Livermore Contract Announcement

May 8, 2007 - 12:45pm

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Remarks as Prepared for Energy Secretary Samuel Bodman

Good afternoon.  Thank you all for coming and welcome to the Lawrence Livermore National Laboratory employees who are watching this on our Webcast.  I know my remarks are of special importance to you.

The Lawrence Livermore National Laboratory opened in 1952 using the "team science" approach pioneered by Ernest O. Lawrence.  Livermore was - and is - a place where "new ideas" are dominant.  Few would have predicted back then how deeply the work conducted at Lawrence Livermore would influence the course of history.

And yet it has.  Today is the 123rd anniversary of President Harry S Truman's birth.  The first Cold War president, Truman's decisive leadership during international uncertainty set the stage for Livermore's work.  The history of the Cold War is the history of Lawrence Livermore and the weapons designed here helped keep the peace.  But you have done more than that.  The men and women of Lawrence Livermore shaped an era of global change in ways that advanced the highest ideals of peace and the dignity of mankind.

Livermore has branched out from its original mission into bioscience and environmental programs, laser research, supercomputing, energy technology research - even forensic science.  Livermore continues to fulfill its vital national security responsibilities, including the Stockpile Stewardship Program ensuring the safety and reliability of the nation's nuclear deterrent and combating the dangers of proliferation.

Lawrence Livermore is, as its golden anniversary motto proudly stated, "Making History, Making a Difference."  But rather than the past, it's the future I want to speak about today.

In 2004 the decision was made to put the contract to manage LLNL up for bid on a full and open basis.

And, as has been the case for other contract decisions of this magnitude at the Department, the requisite fact-finding, evaluation and the final selection were carried out by career -not political - personnel.  I strongly endorse that decision; there can be no hint of politics in a decision of such national significance.

As we did with the contract to manage Los Alamos, the Department of Energy and NNSA instituted a meticulous, thorough process to choose a contractor to run the day-to-day operations.  Your role as a critical facility performing key roles in science, homeland security, supercomputing, and, of course, nuclear stockpile development and maintenance demanded as much.

Tyler Przybylek, former general counsel for NNSA made the selection decision based on the work of a team of professionals, led by Walt Lips, who have been hard at work weighing all the information pertinent to such a momentous decision.

This Source Evaluation Board has produced a thorough analysis of the proposals.  Let me stress that both were strong and of exceptionally high caliber.  However, only one could prevail.  And so, it gives me great pleasure today to announce that Lawrence Livermore National Security LLC a consortium composed of comprised of Bechtel National, the University of California, BWX Technologies, Washington Group International, Battelle Memorial Institute, and several small business partners has been selected as the new Management and Operating Contractor.

This contract, which we estimate will cost close to $1.7 billion annually over a base period of seven years, has the potential for extension for up to 13 additional years if LLNS earns annual one-year term extensions.

Since 1952, Livermore has been managed under successive contracts with the University of California.  The contract with LLNS marks the beginning of a new approach to management and operation.  I'm confident the national security of the United States will benefit through superb science and technology supported by more effective and efficient business and laboratory operations.

It is my firm conviction the critical mission work currently underway at Livermore will continue uninterrupted; in fact, I believe security and business practices will be greatly improved, with our scientists and technicians able to place an even greater focus on core missions.

The potential contributions possible through the partnering of the University of California with Battelle Memorial Institute bode well for the scientific capability and contributions of the laboratory.  The capability and experience in facility operations, nuclear operations, and business operations contributed by Bechtel, BWXT and WGI mean that the improved scientific output and results will be produced with enhanced security, safety of operations, and cost effectiveness.

LLNS was selected through a rigorous, competitive process.  I believe in competition.  I am convinced this new contract provides the Department with the means for achieving great benefits under a new management team with increased involvement of the parent organizations.

The key is for NNSA to be a demanding customer and hold LLNS accountable.  We must see improved performance and cost efficiency and appropriate rewards for improved performance.

Transition activities begin with contract award.  LLNS will take over full management and operation of the Laboratory starting October 1, 2007.  The increased fees and potential award term incentives should provide powerful motivation for immediate and ongoing performance improvement at the laboratory.

I congratulate the LLNS team members and parent companies for a hard fought competitive victory today.  The Department and NNSA look forward to working together with LLNS as demanding but fair customers, to achieve the full potential benefits of the new contract.

Let me also congratulate the employees at Lawrence Livermore.  This is an exciting day for you because it assures a robust future for your hallowed institution.  It's a good decision for the men and women who make up the lab and you are its real value.

It's a good decision for the American taxpayers.  The new contract puts concrete measures of accountability in place, ensuring that the tax dollars spent at Livermore are well spent.

It is a good decision for the future of science in this country and for our national security.  Livermore's science is absolutely vital to the safety and security of the American people.

The work you do is of unquestionable importance to the safety and security of America and our allies to the future of scientific inquiry and endeavor.  With the announcement we are making today, Livermore will continue, I am sure, to make history and make a difference.

Location: Washington, DC

Media contact(s): Anne Kolton, (202) 586-4940

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