ML20024B000

Comments on Jcp&L Draft Oyster Creek Unit 2 Contract Transmitted by G Gray 680327 Ltr.Comments Based on Belief That Contract Should Pose No More or No Less Burden on Vendor than Met Ed Contract

ML20024B000
Person / Time
Site:	Oyster Creek, Three Mile Island
Issue date:	04/26/1968
From:	Ward E BABCOCK & WILCOX CO.
To:	Favret L BABCOCK & WILCOX CO.
References
TASK-*, TASK-GB GPU-0204, GPU-204, NUDOCS 8307010289
Download: ML20024B000 (5)

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Dn . 3-D N* Contrt.:t Draft - Oyster Creek Un I!o. 2 , April 26, 1968 TrA t u., n. w..: . , udna er.! ,: , di5.i ...! f . .f '.C.lI ie L'e haic re eleved the dra.'t contre.ct docurer.t prep t;cd by Jersey Central and transmitted by G. Cr: y'c letter of March 27 Our cc ments are based on the belief that this contract should pese no tore or no less burden on P.&W than the 1:et Ed contrt.ct except as modified by J. E. Ivcan's letter dsted June 12, 1967 Centract for D.:c]ca.r Ecuimert end Services J_ ten Pare; rnrh 1 f.rticle I, E The words " consistent uith the Project Schedule developed by Jersey Centre.1" have been e.dded. As stated, ELi.' has no input into the schedule nor. protection from delt./s not of our ccking. 2' 1,E,(5)(a)L(b) We note 30 copics rather than lo included in !!et Ed contract and also in the Proposal are listed. Also note these are required one month prior to shipment. The operating and meintenance manuals vill probably net be available by this date. Installation

                                                                       " requirements" (probably not books) vill be supplied at earlier dates for co:tponente and systems.

3 I,B(6)(a) We note " suitable office facilities" has been changed to a "maxiv.m of 500 square feet". This space may be

                                      ,                                marginal at a peak period for both erection and servi personnel.

4 I,3(7)(a) We may be called upen to supply detailed vritten testing " procedures". The word "specificati'ons" woul be preferred. (Met Ed also used this word.) 5 I,B,(8) A specific procedure is detailed for progress reports requiring a report by the 15th of each month. Met Ed j G9U only requires progress reports on a timely basis. der. Exh. For ID 0V If we are to do this thoroughly every month, substanti: U EMV time vill te diverted from other project activity and Charles Shapiro CSR

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(? will become a burden. Inanyevent,thereportingperiodshouldcoincideg existing conthly status reperting procedures and not be this specific as to time. " 6 D B&W is to p'rovide unit prices and recommend spare

                         "                           parto "at the tine fabrication of original equipmen%

is started". This means nov - snd they nay not be availabic for some time. 7 II,B,(1) Recocmond adding the vords "at B&V expense" to end o last sentence. There is a procedure with Met Ed for changes to ncet AEC licencing requirce.ents whereby the total cost of the change may not accrue to B&U. 8 II,E

• The Control Rod Drive paracraph needs reworking. Ve suggest: E&U shall test both the Diamond Power Specialty Corporation rack and pinion control rod-drive and the Royal Industrics roller nut drive. BM shall select one of these drives by January 31, 1969 for incorporation into the final plant design.

Following such selection etc..... 9 Article III,A,(1) We note the engineering and design schedules are now

      ,                                           made a part of' the essence of this contract rather than shipment of equipment only as in Met Ed contracG We probably cannot object except to be covered in event the delay in engineering or design is not of-B&W making.      Extra studies, analyses, or equipment evaluations for example.

10 III.A,(2)

                                                'We are presently determining the cost addition for shipment to Oyster Creek. We have not initiated a study for " counting on crawlers", as details are not yet available. Unless this verk is completed prior tt contract discussions, this paragraph should revert to.

the original designated destinations with proviso to supply alternate quotation for ~ delivery to the. site. Uc1294

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L. M. Favret Pace 3 < April 26,1968 - J

• r Contre.ct Draft - NSS-6 COMff.h .

_ Item Para,q yl_ h 11 III,A,(3) As vr3tten, we can be responsible for damage during storage. We should li! cit BLU responsibility for damage only until delivery is made. 12 III,B,(1)L(2) We note a distinction between " security title" and'

                                                       " full legnl and equitable title". We leave this to D. R. Wi3 son, but the paragraph (1) looks messy to administrate.

13 Article IV,B,(4) This provision for cdjusting pa'yment schedules is going to be the biggest problem to resolve. In an'y event, if ve egree such adjustment is reasonable; a means of determining, "vhen," and "how much" must te defined. Ib Article V,A,(1) Blenk should be "10,521,000". 15 , Krticle V,A,(2)a Blank should be Janucry 31, 1967 16 V,A,(3)(b) We must cr_op out the vords "orier to_ delivery" at end of last sentence. 7his vould prevent any reconcendation frou being forceful after this date. 17 V,A,(3),(c) Again the "-rds, "in sufficient time to permit Jersey Central to incorporate such characteristics into the plant" places the onus on BLU for any "after thoughts". 18 V,B,(2)(a)

                                                  ' Last sentence, cross out " prior to delivery"." Same reasons as above in items 16 and 17 19        Article VI,A.

This parrsraph is comparab3e to Met Ed Article I.B. 6(a) except-that in addition to B&W facilities, Jersey: Central and,its agents have free access to any B&W subcontraetcrd clants performing vork or supplying materials. We expect to allow this freedom; however , it should not be guaranteed as a part of our' contract.: Some vendor may object to JC or its agent having

                                                   " free access"..

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A Contract Draft - NSS-6 COUNSc_, _ ONLY Item ~Paragrabh 20 VI,A We are also required to " notify Jersey Central of scheduled principal tests so they may be present". This can becone a burden if nany tests are considered

                                           " principal". Most tests are made when the product.

reaches a certain stage of cocpletion and advance prediction of such a date accurately will be difficult. 21 XIII,B,(1) This para 6raph supposes B&W vill 6o out for bids on all subcontracted items. Actually in many cases suppliers have previously been evaluated and to add additional potential contractors would add to our engineering effort and create delays. Paragraph (2) should provi,de the protection they seek. 22 XVIII This secticn provides no penalty for cancellation, only actual costs plus profit "cn vork performed". Centract for I:velear Equi rent and Services - Suenle ent I.'o.1

1. General It is not clear why a letter with an offer plus a a clear letter of acceptence does not constitute a -

valid agreement without need for such formalization. (G. Gray's letter of August 30, 1967 and J. E. Logan's of September 29,1967.)

2. 1(a) . This paragraph was not a pcrt of a supplemental agree-ment but is covered under Article IX of the NSS g

Contract.

3. Paragraph 2 Mr. G. Gray's letter says "as and if additional service is revealed by the initial analysis, B&W vill quote separately." '1his pcragraph implies we vill describe the additional engineering and equipeant chang-es required to attain an ulti:t. ate USS power level of 2788 HMt. - This is only true if such additional work or changes were indicated by the ssfety analysis work covered by this agreement.

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