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T-AO 205 John LewisT-AO(X) Fleet Replenishment Oilers

The Navy plans to procure the first T-AO(X) in the FYDP starting in FY2016 with serial production at a rate of one per year beginning in FY2018. This class of 17 ships [14 as of 2010] would be built with a double hull to meet International Convention for the Prevention of Pollution from Ships (MARPOL) standards while recapitalizing and maintaining operationally available Fleet Oilers (AOs). The goal of 17 TAO(X)s was determined as part of a Force Structure Analysis (FSA) that the Navy completed in 2012 and presented to Congress in 2013.

The Navys T-AO(X) program is an effort to replace its 15 existing fleet oilers. These ships entered service between 1986 and 1996 and have an expected service life of 35 years. The first ship would reach that age in 2021. The primary role of fleet oilers is to transfer fuel to Navy surface ships that are operating at sea, so as to extend the operating endurance of these ships and the aircraft they carry. Fleet oilers also provide other surface ships with lubricants, fresh water, and small amounts of dry cargo. Fleet oilers transfer fuel and other supplies to other surface ships in operations called underway replenishments. During underway replenishments, an oiler steams next to the receiving ship and transfers fuel by hose. The Navys acquisition strategy for the T-AO(X) program includes competitive contract awards for industry studies, detailed design and construction, and follow-on ship procurement.

On July 3, 2013, General Dynamics (GD) National Steel and Shipbuilding Company (NASSCO), Huntington Ingalls Incorporated (HII) - Ingalls Shipbuilding Division, and VT Halter Marine (VTHM) Incorporated were each awarded firm-fixed price contracts at or below the not-to-exceed amount of $1.7 million as contained in the solicitation for Trade-Off Industry Studies to support a new class of Navy Fleet Replenishment Oilers (T-AO(X)). The awarded contracts also include options for a ship integration study, inert gas system cost study, and the potential for additional special studies, analyses and reviews.

T-AO(X) would replace legacy Fleet Oilers (T-AO 187 Class), providing fuel and cargo delivery to support a full range of Fleet operations. Compared to the Kaiser-class design, the TAO(X) would have increased space for dry cargo, as well as a refuelling capability for helicopters on its deck. In addition, T-AO(X), in conjunction with a T-AKE 1 Class ship, would operate as a "station ship," accompanying and staying on-station with a Carrier Strike Group (CSG) or Amphibious Readiness Group (ARG) to provide fuel as required. "T-AO(X) is needed to replace our aging Fleet Oilers," said Frank McCarthey, program manager for Support Ships, Boats and Craft. "This award will help the Navy achieve an affordable design that supports energy efficiency, equipment reliability, and efficient cargo handling and transportation."

NASSCO based in San Diego, California, HII based in Pascagoula, Mississippi, and VTHM also based in Pascagoula, Mississippi, would provide studies for the government applying their shipbuilding design and construction experiences - leading to an affordable design solution. The six to ten month industry studies effort would support the development of the T-AO(X) system specification. The next contract phase would support award for detail design and construction, with a planned Fiscal Year 2016 lead ship. The 2013 procurement plan is for a total of 17 ships, with the lead ship scheduled to deliver in 2020. As of 2012 the first three T-AO(X)s were budgeted at just over $2 billion - about $667 million per ship.

As one of the Defense Department's largest acquisition organizations, PEO Ships is responsible for executing the development and procurement of all destroyers, amphibious ships, special mission and support ships, and special warfare craft. Delivering high-quality war fighting assets - while balancing affordability and capability - is key to supporting the Navy's Maritime Strategy.

The Navy required replenishment oiler capabilities to support Fleet operations across the full range of military operations. The concept for the T-AO(X) Class ships is to shuttle from resupply ports to station ships (T-AOE 6 Class). As T-AO 187 Class ships currently do, the T-AO(X) Class would provide the primary fuel pipeline linking Navy ships and their embarked aircraft, with logistics nodes ashore.

Additionally, when T-AOE 6 Class ships are unavailable, a T-AO(X), in conjunction with a T-AKE 1 Class ship, would operate as a “station ship, accompanying and staying on-station with a Carrier Strike Group (CSG) or Amphibious Readiness Group (ARG) to provide fuel as required to customer ships.

The Trade-Off Studies seek affordable system design solutions that may be considered for the new class while supporting program goals of: (a) Energy efficiency, (b) Equipment reliability, and (c) Cargo handling efficiency. DoD initiative, "Better Buying Power", challenges industry to design and manufacture products that have the lowest cost of ownership at an affordable price.

On July 15, 2014, GAO received notice from DOD that it had waived the competitive prototyping requirement for the Fleet Replenishment Oiler (T-AO(X)) program. The Weapon Systems Acquisition Reform Act of 2009, as amended (WSARA), requires the Secretary of Defense to modify defense guidance to ensure that the acquisition strategy for each major defense acquisition program provides for competitive prototypes before Milestone B approvalwhich authorizes entry into system developmentunless the Milestone Decision Authority waives the requirement.

WSARA also provides that whenever a Milestone Decision Authority authorizes a waiver of the competitive prototyping requirement on the basis of what WSARA describes as excessive cost, the Milestone Decision Authority is required to submit notification of the waiver, together with the rationale, to the Comptroller General of the United States at the same time it is submitted to the congressional defense committees. WSARA further provides that no later than 60 days after receipt of a notification of a waiver, GAO is to review the rationale for the waiver and submit a written assessment of that rationale to the congressional defense committees.

Competitive prototyping, which involves commercial, government, or academic sources producing early prototypes of weapon systems or critical subsystems, can help Department of Defense (DOD) programs reduce technical risk, refine requirements, validate designs and cost estimates, and evaluate manufacturing processes prior to making major commitments of resources. It can also help reduce the time it takes to field a system, and as a result, its acquisition cost. WSARA states that the Milestone Decision Authority may waive the competitive prototyping requirement only on the basis that (1) the cost of producing competitive prototypes exceeds the expected life-cycle benefits (in constant dollars) of producing such prototypes, including the benefits of improved performance and increased technological and design maturity that may be achieved through competitive prototyping; or (2) but for such a waiver, DOD would be unable to meet critical national security objectives.

According to the waiver, the T-AO(X) program is a non-developmental ship acquisition program that requires no new technology development. In the waiver, DOD concluded that the Navys cost-benefit analysis was reasonable. GAO also found that the Navys cost-benefit analysis was consistent with key principles in DODs policy on economic analysis. The Navy cost-benefit analysis supporting the waiver examined two prototyping scenarios: competitively producing and testing two ship prototypes, which would increase acquisition costs by $1.35 billion (in base year 2013 dollars), and producing and testing a single ship prototype, which would increase the acquisition costs by $742 million (in base year 2013 dollars).

Because the T-AO(X) program is a non-developmental ship acquisition program, requires no technology development, and utilizes limited military unique systems and equipment, the Navy concluded the only life-cycle benefits that could likely be realized from prototyping was a reduction in operations and support costs through savings in fuel consumption, maintenance, and sustainment support. The Navys analysis assumed $370 million (in base year 2013 dollars) in operations and support cost savings for both scenarios, but based on similar shipbuilding programs the likely cost savings would be lower.

The only military unique systems planned are in the areas of command, control, communications, computers, and intelligence; aviation; and underway replenishment. The command, control, communications, computers, and intelligence and aviation systems are existing Navy programs. The underway replenishment system for both fuel and solid cargo transfer is currently being developed, prototyped, and tested by the Navy. According to DOD, the system is not a new technology, but rather a new application of existing technologies. The Navy plans to complete prototyping and testing efforts of this subsystem prior to procuring the system for the T-AO(X) program.

On 25 June 2015 the Navy was reported to have quietly [no notice on FedBizOps] issued a combined Request for Proposals to two shipyards for a third America-class amphibious warship (LHA-8) and six TAO(X) next-generation oilers. The RFP, sent to General Dynamics NASSCO and Huntington Ingalls Industries, would put the two yards in competition for contracts to manufacture the first six oilers or LHA-8.

Secretary of the Navy (SECNAV) Ray Mabus announced 06 January 2016 that the first ship of the next generation of fleet replenishment oilers (T-AO 205) will be named USNS John Lewis after the civil rights movement hero and current US representative of Georgia's Fifth Congressional District. The future USNS John Lewis will be operated by Military Sealift Command and provide underway replenishment of fuel and stores to U.S. Navy ships at sea and jet fuel for aircraft assigned to aircraft carriers. A contract will be awarded for the ship in summer 2016 and construction is expected to begin in 2018.

General Dynamics, National Steel and Shipbuilding Co., San Diego, California, was awarded a fixed-price-incentive block buy contract on 30 June 2016 for the detail design and construction of six T-AO 205 Class Fleet Replenishment Oilers (lead ship in fiscal 2016 and, if appropriated, one follow ship per year from fiscal 2018 to fiscal 2022). The award amount of this contract is $640,206,756 for the lead ship. This contract includes line items for five follow ships, and options for special studies, engineering and industrial services, provisioned items orders, LX(R) contract design support, cost reduction and implementation, other direct costs, and special incentives that, if funding is made available for all ships and all options are exercised/authorized, would bring the cumulative value of this contract to $3,156,828,444.

Work will be performed in: San Diego, California (59 percent); Iron Mountain, Michigan (11 percent); Crozet, Virginia (5 percent); Mexicali, Mexico (4 percent); Beloit, Wisconsin (2 percent); Metairie, Louisiana (2 percent); Santa Fe Springs, California (2 percent); Portland, Oregon (2 percent); Walpole, Massachusetts (2 percent); Chesapeake, Virginia (2 percent); Chula Vista, California (1 percent); and various other locations (totaling 8 percent).Work for the lead ship is expected to be completed by July 2020 and work for the follow ships is expected to complete by July 2025. Fiscal 2016 shipbuilding and conversion (Navy) funding in the amount of $640,206,756 will be obligated at time of award, and will not expire at the end of the current fiscal year. This contract was competitively procured via limited competition pursuant to 10 U.S .Code 2304(c)(3), with two offers received. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity (N00024-16-C-2229).



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