New Build

In this edition, we take a look at $6.4bn employee-owned, Colorado-based CH2M HILL, an engineering group that will soon be feeding the nuclear supply chain once government loan guarantees are set free to support US projects.

Incentivised staff

Link onto the careers section of the $6.4bn employee-owned, Colorado-based CH2M HILL’s website, and you may think that you have come across a slick advertising campaign for Engineers Without Borders.

But it is rather employees and not volunteers, many new to the company, taking part in a video stream that highlights the entrepreneurial spirit and hands-on experience that they have gained as early as their first year on the job at CH2M HILL.

Last year was particularly a big year for the engineering, procurement, construction, and operations firm. Well, in the awards stakes that is.

In January 2009, it became the first engineering and construction firm to win the Catalyst Award, which annually “honors innovative organizational approaches with proven, measurable results that address the recruitment, development, and advancement of all women, including women of color.”

But it was a few months later in April of the same year that the company was added to the FORTUNE “100 Best Companies to Work For” list.

It was also recognized as one of the “World’s Most Ethical Companies” by international think-tank, Ethisphere Institute.

In the first half of this year, however, the company was not busy accepting awards, but rather its bid of UK-based engineering consultancy Scott Wilson.

But on 30 June, 2010 CH2M HILL announced that, in light of a competing higher offer for Scott Wilson Group plc, it would no longer proceed with its reported $286m acquisition bid.

URS Corporation (“URS”), however, has offered to acquire all outstanding shares of Scott Wilson Group plc, in an all-cash transaction, which values the target company at $242m, according to news reports.

Closing of the transaction is subject to shareholder approval and clearances from regulators.

Scott Wilson’s 2010 turnover was £340m ($510m) and would have been a feather in CH2M HILL’s cap given the UK company’s global network and exposure to the environment and natural resources sectors, including nuclear power.

But despite the dropped deal, the fact that CH2M HILL has diversified business operations and is in a position to make consolidation plays at all has given its 25,000 strong employees added reassurance in volatile economic markets.

Feeding the supply chain

The company’s nuclear operations are of obvious importance to Nuclear Energy Insider readers given the scope that the company has in terms of procurement opportunities.

“CH2M HILL is leading the global nuclear renaissance,” the company says, “through program management of civil nuclear power programs, and the planning, permitting, and licensing of new nuclear generating stations within current international regulatory environments and economic frameworks.”

And that is not only on the new build side, but decommissioning as well and across many markets.

An example of the latter is the 2005 nuclear environmental cleanup programme in the world at the time at Rocky Flats, a former plutonium and uranium weapons component plant in Golden Colorado.

Rocky Flats is considered the most complex environmental cleanup project in US history.

It was the first large nuclear-weapons facility to be decommissioned and closed anywhere in the world.

This high-hazard project was according to CH2M HILL, completed “within strict safety and environmental parameters approximately 60 years ahead of original government estimates, and 14 months in advance of our own aggressive schedule, saving nearly US $30bn.”

In the UK, it has also provided programme management support to UKAEA at Harwell, Winfrith, Windscale and Dounreay.

But some of the company’s more recent projects includes its CH2M HILL Newport News Nuclear, LLC (CHN) business, which was selected to lead the $592m Advanced Mixed Waste Treatment Project (AMWTP).

The contract will run through September 30, 2015 under a Cost-Plus-Award-Fee contract with performance-based incentives.

The AMWTP will treat, package, ship and dispose of the estimated 30,200 cubic meters of waste currently remaining.

CH2M HILL and its minority LLC partner Newport News Nuclear, a wholly-owned subsidiary of Northrop Grumman Corporation, have teamed up to take on the project.

Other pre-selected subcontractors will include Cavanagh Services Group, GEM Technology International Corporation (GEM) and Epsilon System Solutions, Inc.

Other contract wins include its role as prime contractor for the cleanup of the $4.5bn five-year Central Plateau of the US Department of Energy's Hanford nuclear site in south-central Washington state.

Other notable programme management wins include the world’s first carbon-neutral, “green” community in Masdar City, a two-square-mile area in Abu Dhabi, United Arab Emirates. 

New man of the moment

As the DOE starts to actually free up the loan guarantees it has been allocated by the Obama administration for nuclear power station projects, Mark Fallon, the recently appointed President of its Nuclear Business Group, will be an even busier man.  

Fallon will serve as the senior executive responsible for all nuclear activities within CH2M HILL across the defense and civil nuclear liabilities management, commercial nuclear power and national security markets.

Fallon brings 17 years of experience in energy, environmental and national security fields; however, is not a new face at the company.

He spent nearly 10 years with CH2M HILL serving as President of Bartlett Services Inc and served as a senior advisor to the U.S. Secretary of Energy on matters including, environmental management, nuclear national security, strategic planning, labor relations, Congressional affairs and the restructuring of the nuclear weapons production complex.

But John Mika, senior vice president of procurement, will also be a man that many in the supply chain will want to create lasting ties with.

The company realises the potential it has for many companies in the nuclear construction supply chain and has set up an e-portal specifically for procurement purposes, which outlines procedures, code of ethics, projects and materials it sources.

For those that think that a company of this ilk does not work with smaller companies, it has also set up a special centre for SMEs that can provide goods and services.

Waiting game

Every renaissance needs its funding, the nuclear one being of no exception.

That is why CH2M HILL will not be the deciding party as to whether projects get off the ground in the latter half of 2010.

It is largely up to the Department of Energy and the Obama administration behind the billions in loan guarantees that will feed the “nuclear renaissance” and subsequently the nuclear supply chain.

But once projects start to get support, and CH2M HILL is potentially selected for lead project managent roles, its employees, old and new, may be celebrating yet another milestone year in 2011.

Company background:

CH2M HILL’s Nuclear Business Group specialises in managing and operating commercial and government nuclear facilities and providing innovative cleanup and environmental remediation of complex nuclear programs and projects around the world.

Image: Lee McIntire, CH2M HILL chief executive officer