Fluor Work Called Sloppy, Wasteful in Federal Audit
A federal audit says Fluor Corp. has been sloppy and wasteful at times in carrying out its $2.4-billion contract to clean up a federal nuclear material processing site in southern Ohio.
But the audit, released Tuesday, also found that Irvine-based Fluor has not committed any criminal acts or caused safety problems since taking over the massive job in 1992. The audit by the General Accounting Office was requested by Ohio’s U.S. senators and two Cincinnati-area congressmen after the Cincinnati Enquirer published a series of articles last year alleging gross financial mismanagement and safety violations at the Fernald site.
In a joint statement Tuesday, the politicians who sought the audit acknowledged that the audit cleared Fluor of wrongdoing. But they urged that Fluor’s contract not be renewed at the end of the year unless the company improves its financial reporting controls and resolves serious problems with a process called vitrification for making the nuclear waste there safe to store.
Largely because of cost overruns associated with a pilot vitrification plant at Fernald, Fluor and the Department of Energy are jointly responsible “for tens of millions of taxpayer dollars that have been wasted,” Sens. John Glenn and Michael DeWine and Reps. Rob Portman and John Boehner said in their statement.
Congressional staff members said that despite the tone of the political statements, the audit is a mild rebuke that is not likely to cause Fluor problems with its separate $5-billion contract for cleanup of the nuclear waste site at Hanford, Wash. Fluor officials have said that they intend to pursue nuclear cleanup projects throughout the world because it is a lucrative new market.
In all, GAO auditors looked into six separate programs Fluor is running at Fernald and found five of them to be on time and under budget.
A Fluor spokesman in Irvine said Tuesday that while the company “might take issue with some of the findings [in the Fernald audit], for the most part it is a fair representation.” He said Fluor already has begun most of the corrective measures recommended in the audit.
The company also has hired outside consultants to help identify and correct problems with the vitrification process--a method of melting down radioactive material and encapsulating it in spheres or slabs of glass.
While vitrification has worked successfully in several other areas, Fluor maintains that the nuclear material in those projects was all of one type and relatively easy to vitrify. At Fernald, the company claims, at least a third of the material is a mix of solids and liquids, all with different reactions to the heat and chemicals used in vitrification.
“This is an experimental process,” said Lee Tashjian, a Fluor vice president. “It is a pilot plant and it has not been done before.” That, rather than incompetence, led to substantial cost overruns on the project, he said.
And while the estimated cost of the vitrification project has risen to $56 million from $14.1 million in 1994, the estimated cost of the entire cleanup has fallen by more than 40% under Fluor’s management in the past year. It now is pegged at $2.4 billion, down from a June 1995 estimate of $4.2 billion, the audit says.
