CMRR’s Initial Cost Estimate Has Significantly Increased and Its Schedule Has Been Delayed

The estimated cost to construct the CMRR, according to estimates  prepared in April 2010, is nearly six times higher than the project’s initial  cost estimate that was prepared in 2005. In February 2012, after  we had provided NNSA with a draft of this report for its comments, NNSA  announced that it had decided to defer CMRR construction by at least an  additional 5 years, bringing the total delay from NNSA’s original plans to 8  to 12 years. Namely, according to our guide, a  high-quality schedule requires a schedule risk analysis that uses already  identified risks, among other things, to predict the level of confidence in  meeting a project’s completion date and the amount of contingency time  needed to cover unexpected delays. CMRR project officials identified and  documented hundreds of risks to the project, but these risks were not  used in preparing a schedule risk analysis. However, without a schedule risk analysis  that contains risks identified by CMRR project officials, NNSA cannot be  fully confident, once it decides to resume CMRR construction plans, that  sufficient schedule contingency is established to ensure that the project  will be completed on time and within estimated costs. As a result, overall  project costs could potentially exceed NNSA’s April 2010 estimate of  between $3.7 billion and $5.8 billion and NNSA had not yet determined  the impact to the project’s costs of its recent decision to defer CMRR  construction for at least 5 years. NNSA Considered Several Options to Preserve Plutonium- Related Research Capabilities, but Ultimately Chose to Build a Minimally Sized Facility at Los Alamos

To replace the plutonium-related research capabilities in Los Alamos’s  deteriorating Chemistry and Metallurgy Research facility, NNSA  considered several options. In the end, NNSA decided to build a  minimally sized CMRR facility at Los Alamos with a broad suite of  capabilities to meet nuclear weapons stockpile needs over the long-term. These capabilities would also be used to support plutonium-related  research needs of other departmental missions. To house these needed capabilities, NNSA assessed three potential  sizes for a new facility—22,500 square feet, 31,500 square feet, and  40,500 square feet. NNSA officials told us that cost was the primary driver of this decision. As part of NNSA’s decision to consolidate plutonium  research at Los Alamos, NNSA also decided that the CMRR would be  used to support plutonium-related research needs of other non-weapons  activities, including nuclear nonproliferation activities; homeland security  activities, such as nuclear forensics and nuclear counterterrorism; waste  management; and material recycle and recovery programs. NNSA’s CMRR Plans Focus on Meeting Nuclear Weapons Stockpile Requirements, But Some Plutonium-Related Work for the Stockpile May Not Be Accommodated

NNSA’s plans to construct the CMRR primarily focus on maintaining  plutonium-related research capabilities that are necessary for meeting  nuclear weapons stockpile requirements. CMRR May Not Meet Other Plutonium-Related Research and Storage Needs As DOE and NNSA Have Not Fully Analyzed Programs Outside of Nuclear Weapons Stockpile Work

DOE and NNSA conduct important plutonium-related research in other  mission areas outside of nuclear weapons stockpile work, and it is  unclear whether the CMRR as designed will be large enough to  accommodate these nonweapons activities because they have not  comprehensively studied their long-term research and storage needs. As a result,  expansion of CMRR or construction of costly additional plutonium  research, storage, and testing facilities at Los Alamos or elsewhere may  be needed sometime in the future. Therefore, we clarified our recommendation to specify  that NNSA should take action to ensure that the CMRR’s schedule risk  analysis is appropriately revised to account for all project risks when  NNSA resumes the project and before it establishes a new cost and  schedule baseline. GAO staff who made major contributions to this report  are listed in appendix V.

Appendix I: Objectives, Scope, and Methodology

Our objectives were to examine (1) changes in the cost and schedule  estimates for the construction of the facility and the extent to which its  most recent estimates reflect best practices, (2) options the National  Nuclear Security Administration (NNSA) considered to ensure that  plutonium-related research activities could continue as needed, and (3)  the extent to which NNSA’s plans to construct the Chemistry and  Metallurgy Research Replacement Nuclear Facility (CMRR) and its  consideration of options reflected changes in nuclear weapons stockpile  requirements and other plutonium-related research needs. We also visited Los Alamos and  Lawrence Livermore National Laboratories.
Why GAO Did This Study

Plutoniuma man-made element produced by irradiating uranium in nuclear reactorsis vital to the nuclear weapons stockpile. Much of the nations current plutonium research capabilities are housed in aging facilities at Los Alamos National Laboratory in New Mexico. These facilities pose safety hazards. The National Nuclear Security Administration (NNSA) has decided to construct a multibillion dollar Chemistry and Metallurgy Research Replacement Nuclear Facility (CMRR) to modernize the laboratorys capabilities to analyze and store plutonium. GAO was asked to examine (1) the cost and schedule estimates to construct CMRR and the extent to which its most recent estimates reflect best practices, (2) options NNSA considered to ensure that needed plutonium research activities could continue, and (3) the extent to which NNSA's plans reflected changes in stockpile requirements and other plutonium research needs. GAO reviewed NNSA and contractor project design documents and visited Los Alamos and another plutonium facility at Lawrence Livermore National Laboratory in California.

What GAO Found

The estimated cost to construct the CMRR has greatly increased since NNSAs initial plans, and the projects schedule has been significantly delayed. According to its most recent estimates prepared in April 2010, NNSA determined that the CMRR will cost between $3.7 billion and $5.8 billionnearly a six-fold increase from the initial estimate. Construction has also been repeatedly delayed and, in February 2012 after GAO provided its draft report to NNSA for comment, NNSA decided to defer CMRR construction by at least an additional 5 years, bringing the total delay to between 8 and 12 years from NNSAs original plans. Infrastructure-related design changes and longer-than-expected overall project duration have contributed to these cost increases and delays. GAOs review of NNSAs April 2010 cost and schedule estimates for CMRR found that the estimates were generally well prepared, but important weaknesses remain. For example, a high-quality schedule requires a schedule risk analysis that incorporates known risks to predict the level of confidence in meeting a projects completion date and the amount of contingency time needed to cover unexpected delays. CMRR project officials identified hundreds of risks to the project, but GAO found that these risks were not used in preparing a schedule risk analysis. As a result of these weaknesses, NNSA cannot be fully confident, once it decides to resume the CMRR project, that the project will be completed on time and within estimated costs.
NNSA considered several options to preserve its plutonium-related research capabilities in its decision to build CMRR at Los Alamos. NNSA assessed three different sizes for a new facility22,500, 31,500, and 40,500 square feet. In 2004, NNSA chose the smallest option. NNSA officials stated that cost was the primary driver of the decision, but that building a smaller facility would result in trade-offs, including the elimination of contingency space. In the end, NNSA decided to build a minimally-sized CMRR facility at Los Alamos with a broad suite of capabilities to meet nuclear weapons stockpile needs over the long-term. These capabilities would also be used to support plutonium-related research needs of other departmental missions.
NNSAs plans to construct CMRR focused on meeting nuclear weapons stockpile requirements, but CMRR may not meet all stockpile and other plutonium-related research needs. NNSA analyzed data on past workload and the expected need for new weapon components to help ensure CMRRs design included the necessary plutonium-related research capabilities for maintaining the safety and reliability of the nuclear stockpile. However, some plutonium research, storage, and environmental testing capabilities that exist at Lawrence Livermore National Laboratory may no longer be available after NNSA consolidates plutonium-related research at Los Alamos. Furthermore, NNSA conducts important plutonium-related research in other areas such as homeland security and nuclear nonproliferation, but it has not comprehensively analyzed plutonium research and storage needs of these other programs outside of its nuclear weapons stockpile work and therefore cannot be sure that the CMRR plans will effectively accommodate these needs. As a result, expansion of CMRR or construction of more plutonium research and storage facilities at Los Alamos or elsewhere may be needed in the future, potentially further adding to costs.

What GAO Recommends

GAO is making recommendations to improve CMRRs schedule risk analysis and to conduct an assessment of plutonium research needs. NNSA agreed with GAOs recommendations to assess plutonium research needs, but disagreed that its schedule risk analysis should be revised, citing its recent decision to defer the project. GAO clarified the recommendation to specify that NNSA should take action when it resumes the project.