2017 Report details for project: Magnox and RSRL PBO Competition

Project name: Magnox and RSRL PBO Competition - there are 7 reports for this project: 2013, 2014, 2015, 2016, 2017, 2018, 2019
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Organisation: BEIS (D1198) - see all reports for this organisation
Report year: 2017 (data is from Sept 2016)
Category: Infrastructure - see all reports for this category
Description: The objective of the procurement (the Magnox Competition) is the delivery of a series of outputs largely based on the extant baselines of Magnox and RSRL, currently defined as outcomes of the Magnox Optimised Decommissioning Plan (MODP) and Optimised RSRL Baseline (HOP and WOP) at 10% lower cost. The performance obligations associated with delivery of this objective are embodied within a Client Specification which forms the basis of the Site Licence Company Agreement (SLCA) and Parent Body Agreement (PBA). Following the application of competitive tension via the competition process and share transfer to a new PBO, a target cost incentivised contract arrangement is in place for delivery of the performance obligations in the contract. A contract period of 14 years is envisaged in two phases each of circa 7 years. The target cost as bid is £2.4bn for phase 1 and £1.4bn for phase 2. Currently the project is focussed on "Consolidation" of the successful bidders commitments into the SLC Lifetime Performance Plan (LTPP).The SLCA anticipates some change to the Target Cost during the Consolidation phase but the full extent of the change will only be known at the end of May 2016. A key enabler to achieving a lower cost for delivering the programme is the NDA's ability to put in place funding to match the programme established by the contractor in the updated LTPP. Should the updated LTPP prove to be unaffordable a further iteration may be required.
DCA (RAG): Amber
DCA text: Although the DCA was rated amber in the Quarter 2 and Quarter 3 GMPP returns, there has since been a change in circumstances. The Parent Body (CFP) started work on the Magnox estate on 1st September 2014. There then started a process to ensure that the scope of the contract assumed in the 2012 tender matched the actual status of the decommissioning to be done on each site – a process known as Consolidation. It has become clear to the NDA through this Consolidation process that there is a significant difference between the work when the contract was tendered in 2012 and awarded in 2014, and the work that actually needs to be done. The scale of the additional work is such that the NDA Board considers that it could amount to a material change to the specification on which bidders were invited in 2012 to tender. In the light of this the NDA Board has exercised its right to terminate the contract on 2 years’ notice. The contract will be terminated in September 2019, after 5 years rather than its full term of 14 years. This termination is made with the agreement of CFP. During the period to September 2019, the NDA will establish arrangements for a replacement contracting structure to be put in place when the current contract ends.
Start date: 2012-04-03
End date: 2015-08-31
Schedule text: With the announcement on the 27th March 2017 that the Magnox Contract has been terminated by mutual consent, the NDA will now embark on a process to establish replacement arrangements. At the same time a timetable and schedule of activities for delivering this alternative will be prepared and the required assurance framework will be established to run alongside
Baseline: £692.00m
Forecast: £434.00m
Variance: -37.00%
Variance text: The 2016/17 variance between the baseline and the forecast reflects a pre-consolidation position for the Target Cost. At the time of the termination announcement, the Consolidation process remains incomplete, and as a result a variance commentary is not meaningful. On completion of Consolidation an updated variance commentary will be provided.
Whole Life Cost: £3,860.00m
WLCost text: The comment above relating to the 2016/17 variance is also applicable to the Whole Life Cost.
Notes1: Magnox & RSRL PBO Competition
Notes2:
Sourcefile: IPA_2017.csv

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Acknowledgement: GMPP data has been re-used under the Open Government Licence.