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Fluor Wins a Huge Cleanup Contract : Environment: The $2.2 billion for work at a former uranium fuel plant in Ohio is the most that the federal government has ever awarded for such a project.

August 12, 1992|SUSAN CHRISTIAN | TIMES STAFF WRITER

IRVINE — Flour Corp. said Tuesday that it has won a $2.2-billion federal contract to clean up a closed uranium fuel plant in Fernald, Ohio--the largest environmental cleanup project ever.

The initial 5-year contract--the first awarded under the U.S. Department of Energy's 3-year-old "environmental restoration management plan"--includes an option for an additional three years valued at $1.8 billion.

The contract, which was awarded to the Irvine company's main subsidiary, Flour Daniel Inc., represents the unit's largest contract in more than a decade, said Vince Kontny, president of Fluor Daniel.

"Needless to say, we are extremely proud of this contract," Kontny said. "It is the largest environmental effort ever taken any place in the world."

The announcement was made after the end of trading Tuesday on the New York Stock Exchange, where Fluor closed at $38, down 62.5 cents.

The contract gives a huge boost to Fluor's already impressive $12-billion backlog of unfinished projects. In recent years, the company has prospered from government jobs.

"Beyond the obvious financial gain we achieve through its profits, the highly visible contract enhances our credibility in the environmental marketplace," said Nick Kaufman, president of Fluor Daniel's Environmental Restoration Management Corp.

"We hope that it will win us more contracts of this sort," he said.

Last November, the Energy Department announced that it was looking for a contractor to supervise the cleanup. More than 200 companies sought the contract.

The huge project dwarfs a $110-million contract in 1991 that was the largest previous such federal award. It was for cleaning up a Slydell, La., site.

Fluor Daniel's principal subcontractors are Jacobs Engineering Group in Pasadena, Halliburton NUS in Gaithersburg, Md., and Nuclear Fuel Services in Irwin, Tenn.

Kaufman said Fluor and the subcontractors will share the $2.2 billion. He would not say how much Fluor Daniel would receive.

Fernald, a 1,050-acre facility 17 miles northwest of Cincinnati, processed uranium from 1953 to 1988 for nuclear arms and plutonium production reactors.

Fluor Daniel will start the work in December. The cleanup will involve between 2,000 and 3,000 employees during the first five years.

"It is quite a dirty site," Kontny said. "We will be dealing with radioactive waste and with radon leaks."

Kaufman said the complex cleanup will require dismantling "100 acres of buildings."

"Ground water needs to be pumped out and cleaned to an acceptable level," he explained. "Top soil will be treated, and waste product will be disposed of."

He said the plant was shut down in 1988 when the then-Soviet Union and the United States agreed to reduce the manufacture of nuclear weapons. In addition, he said, the public and the government had become concerned about "the environmental degradation of the area."

Gail Brice, president of Brice Enviro Ventures in Newport Beach, said the contract is the largest ever for an environmental cleanup partly because the Energy Department opted to grant it to one team of companies rather than numerous companies.

"In the past, the government frequently divided sites into a lot of smaller projects," said Brice, whose company specializes in brokering such contracts for small companies. "Up until this point, a $100-million contract was a big deal. This is quite a coup for Fluor."

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