Fernald pilot plant cost jumps

Problems add $14M


BY MIKE GALLAGHER
The Cincinnati Enquirer

The price for a problem-plagued pilot cleanup plant at Fernald has jumped an additional $14 million because of design, construction and testing problems, The Enquirer has learned.

This is the second increase in the estimated cost since 1993 and officials of Fernald Environmental Restoration Management Co. (FERMCO), the company hired by the government to clean up the nuclear site, said they cannot rule out further pilot plant cost increases.

The taxpayer-funded cost of completing the pilot project now is estimated at about $56 million, an increase from the $42 million estimated during the past year, according to internal FERMCO reports.

In 1993, FERMCO originally estimated the cost of the pilot plant at $14.4 million.

Responding to Enquirer questions Thursday, U.S. Department of Energy officials, in a written statement, confirmed the latest increase.

''DOE is evaluating the situation,'' but has not yet determined how to react to it, the statement said.

Design, construction and testing problems already have caused FERMCO to miss two deadlines - in November and March - to start testing material through the pilot plant.

The Energy Department penalized FERMCO $675,000 in November for missing that start-up. Government investigations into the pilot plant problems revealed FERMCO employees had purposely hidden the severity of the problems that led to the delays.

Some of the past problems at the pilot plant cited by the government include faulty and poorly designed pipes; misplaced valves; missing safety rails; and welding problems on tanks that will hold radioactive material.

FERMCO, also responding to Enquirer questions in writing Thursday, said the $14 million cost increase was due to ''a change in the estimated operating efficiency of the facility.''

Additionally, FERMCO also plans to delay the pilot project's completion date by another six months into 1998, a move that energy department sources said could result in possibly hundreds of thousands of dollars in penalties against the company.

The pilot plant is designed to test a vitrification process that would encapsulate about 20 million pounds of radioactive waste into glass pellets. The wastes now are stored in two silos at the 1,050-acre former uranium-processing plant.

If the pilot project is successful, FERMCO plans to use the process in a full-scale plant that will cost an estimated $200 million.

Critics of the FERMCO vitrification project say it is a gamble of taxpayers' money because the vitrification process being developed at Fernald never has been used successfully in the United States. Even the Energy Department's Fernald area manager, Jack Craig, in earlier interviews, conceded Fernald's vitrification project may not work.

According to internal company reports, FERMCO cost and scheduling experts have determined that the pilot vitrification project cannot be completed without at least a $14 million increase and six-month schedule delay. They have suggested issuing a ''change proposal'' - a formal, written request asking the Energy Department to approve the additional money and time.

However, on Thursday, senior management officials decided instead to first prepare a proposal to take funding from other site cleanup projects to use for the increased pilot plant costs, FERMCO records and senior management sources said.

If the Energy Department agrees to allow FERMCO to fund the pilot plant costs from other cleanup projects' budgets, those other projects would be delayed or halted, resulting in additional costs to the taxpayers when they are re-funded, Energy Department sources said.

FERMCO also could face additional and substantial financial penalties even if the government allows the company to raid the other projects' budgets, several Energy Department officials told The Enquirer.

''No matter what is decided or how it will be funded, taxpayers will still be footing the bill for the additional $14 million increase,'' said one FERMCO senior management official.

The Energy Department would have to approve any reshuffling of funds already budgeted for other projects to pay for the pilot plant increases and whether any other Fernald cleanup project can be delayed or halted.

Published May 17, 1996.