1 Letter of Interest ArcticOffshore Patrol Ship (AOPS) Project

Letter of Interest Arctic/Offshore Patrol Ship (AOPS) Project 1. PURPOSE The purpose of this Letter of Interest (LOI) is to request companies interested in the Arctic/Offshore Patrol Ship (AOPS) Project to form teams and identify themselves pursuant to the requirements stipulated hereinafter. This LOI is neither a call for Tenders nor a Request For Proposal (RFP). No agreement or contract will be entered into, with any person or entity, based on this LOI. The issuance of this LOI is not to be considered in any way a commitment by the Government of Canada or as authority to potential participants to undertake any work, which could be charged to Canada. This LOI is not to be considered as a commitment to issue a RFP or award contract(s) for this Project. Canada welcomes your feedback/comments on any or all aspects of this procurement. 2. SECURITY There will be a requirement for companies to handle documents classified up to the level of SECRET during the solicitation stage and for any resulting contract(s). Companies wishing to receive these documents will be required to hold a valid Facility Security Clearance (FSC) from the Canadian and International Industrial Security Directorate (CIISD) of Public Works and Government Services Canada, or by a National Security Authority recognized by Canada, at the SECRET level. 3. BACKGROUND On July 9th, 2007 the Government of Canada announced its intention to acquire six to eight Arctic/Offshore Patrol Ships to conduct armed sea-borne surveillance in Canada's Economic Exclusion Zone, including the Arctic. This project, known as the Arctic/Offshore Patrol Ship (AOPS) Project, will be conducted in two phases consisting of the Definition Phase and the Implementation Phase. Definition Phase: The Project Management Office (PMO), with the support of BMT Fleet Technology Ltd, the project Definition, Engineering, Logistics and Management Support (DELMS) contractor, will refine the requirements, develop a contractable design, develop the concept of support, and issue a competitive RFP, and evaluate bids for the implementation phase. Implementation Phase: The selected contractor will complete the design and construct the ships, provide the Integrated Logistics Support (ILS) and provide the long-term InService Support (ISS) for AOPS. 1 A project web site has been created to provide information to industry regarding the AOPS Project. The address of this web site is: http://www.forces.gc.ca/admmatsmamat/aops-npea/home-accueil-eng.asp . 4. LEGISLATION, TRADE AGREEMENTS AND GOVERNMENT POLICIES The following is indicative of some of the legislation, trade agreements and government policies, which will be addressed by the RFP for the AOPS Project: a. The Department of National Defence has invoked a National Security Exception (NSE) for the procurement of AOPS; b. This procurement is not subject to the AIT as a NSE has been invoked; c. North American Free Trade Agreement (NAFTA) and World Trade Organization Agreement on Government Procurement (WTO-AGP): This procurement is excluded from (NAFTA) in accordance with NAFTA Chapter Ten, Annex 1001.1b-2 Section B, Annex 1001.2b General Note 1(a), and from WTO-AGP Appendix 1, Annex 1 and Annex 4, Note No. 4; d. Comprehensive Land Claims Agreements (CLCAs): CLCAs do not apply as no work will be performed in and no goods will be delivered to a land claim settlement area; e. Shipbuilding Policy Framework: “A New Policy Framework for the Canadian Shipbuilding and Industrial Marine Industry - FOCUS ON OPPORTUNITIES 2001” will apply; f. Canadian Content Policy: The Canadian Content Policy does not apply to procurements subject to Cabinet-mandated sourcing relating to shipbuilding, ship repair, refit and mid-life modernization; g. Industrial and Regional Benefits (IRBs): Industrial and Regional Benefits (IRBs) are mandatory elements in this project, and the Respondents’ proposals relating to these requirements will be evaluated as part of any subsequent RFP. IRBs totaling 100% of the contract value (comprised of direct and indirect IRBs with no prescribed percentage of direct versus indirect IRBs) will be sought for the Project Implementation and In-Service support contracts. Additional information regarding the federal IRB Policy can be found in the Industrial and Regional Benefit Guide available from the Aerospace and Automotive Branch of Industry Canada or http://strategis.ic.gc.ca/epic/internet/inad-ad.nsf/en/ad03663e.html 2 h. Controlled Goods Program (CGP): This procurement is subject to the CGP Further information is available at: http://sacc.pwgsc.gc.ca/sacc/query.do?lang=en&id=A9130T&date=2008/12/12&eid=1 i. Federal Contractors Program for Employment Equity: The Federal Contractors Program for Employment Equity will apply to this procurement. Further information is available at: http://sacc.pwgsc.gc.ca/sacc/query.do?lang=en&id=A3030T&date=2008/12/12&eid=1 and j. Procurement Business Number: This procurement requires suppliers to obtain a Procurement Business Number as per the following: http//contractscanada.gc.ca/en/index.html 5. PROJECT REQUIREMENTS The project requirements, draft specifications, and documentation are posted on the Project Web site and are being updated frequently to reflect the improvements suggested by industry and the iterative nature of finalizing the ship design and Supportability requirements. Canada intends to provide a Contract Design and associated specifications to industry in order to expedite the procurement of these vessels. Additional information, such as the Contract Design package, will be provided only to those companies who have selfidentified in order to solicit their feedback on procurement questions, drawings, and other draft documents. 6. TENTATIVE PROJECT SCHEDULE Post LOI on the Government Electronic Tendering System (GETS) LOI Closing Notice of Proposed Procurement published on GETS to advise that RFP has been issued Bidders’ Conference RFP Closing Award of PI & ISS Contracts Delivery of First Ship Delivery of Last Ship 3 7. INDICATIVE BUDGET Canada intends to award two contracts: one for the Project Implementation (PI) which includes the completion of the design, the construction of these ships and Integrated Logistics Support (ILS); and one for the In-Service Support (ISS) of these ships for a period which is expected to be up to the life of the vessels, PI (up to 6 to 8 ships sail-away cost+ ILS costs): $2.1B (BY) ISS Steady State: $4.3B (BY) Personnel Operational & Maintenance (PO&M), over 30 years. Note: (BY) means Budget Year estimates characterized by the fact that an inflation factor of 1.8% per year has been applied to the Calendar Year (CY) $ estimates. 8. DELMS CONTRACTOR and CONFLICT OF INTEREST BMT Fleet Technology Limited, hereto after referred to as BMT, is the holder of a longterm contract to provide Definition, Engineering, Logistics and Management Support (DELMS) to Project Management Office (PMO) AOPS. Work to be performed under this contract requires this company to provide services and advice to PMO AOPS. To avoid any conflict of interest, this company, including its subcontractors and employees has restrictions on participating in the preparation of proposals and participating in the work required in response to future AOPS Request for Proposals (RFPs). 9. PROCUREMENT PROCESS for IMPLEMENTATION PHASE The second phase, to select a contractor for the implementation of AOPS Procurement, will be conducted in 3 steps: Step 1 - Team Self-Identification- LOI / Formation of Competitive Teams: Interested companies are requested to form teams to compete. Any interested company can be a member of more than one team. Teams who meet the self-identification criteria are requested to identify themselves as viable teams in response to this letter of interest as per the instructions in section 10 of this LOI. Viable teams will be invited to review the draft Request for Proposal, or portion(s) thereof, that will be posted on the AOPS Project web site, when available, and will include elements such as the anticipated evaluation factors and drafts of the potential Contract(s). Appendix “B” to this LOI provides draft guidelines of the evaluation factors that are expected to form part of the RFP to qualify viable teams at the RFP stage. Project web site http://www.forces.gc.ca/admmat/dgmepm/pmoAOPS/index_e.asp ? Which one is the correct one. 4 Only those teams identified as viable will be allowed to receive and comment on the proposed ship drawings, which will be provided to those teams on an iterative basis. These viable teams will have the right to submit a proposal in response to the PI & ISS RFP when a notice is published on the Government Electronic Tendering System provided by MERX. Any other team may, until 60 days prior to the formal RFP closing date, undergo the same self-identification process to obtain the right to submit a proposal. Canada will not consider requests for an extension to the RFP closing date from latecomers. Step 2 - Issuance of the Request for Proposal A Request for Proposal (RFP) will be sent to only the viable self-identified teams directly from the AOPS Project Office by courier, not through www.merx.com. A Notifice of Proposed Procurement (NPP) will be posted on MERX listing the viable self-identified teams who have the right to submit a proposal, to advise industry that an RFP has been issued and of the planned closing date. Step 3 - Project Implementation (PI) Phase Subject to Effective Project Approval (EPA) by the Government, the selected team will be awarded two separate contracts; one for the PI (Construction and ILS) Contract for the ships, and a second contract for long-term ISS of these ships. The AOPS Project includes a mandatory requirement that proposed IRBs must meet the stated eligibility criteria and equal a minimum of 100% of each of the PI and ISS Contract values in direct and indirect benefits. IRB performance guarantees will form part of any resultant contract(s). Industry Canada (IC) representatives are available to provide advice and assistance in attaining IRB objectives up to the date that the RFP is issued. IC representatives, in cooperation with the Atlantic Canada Opportunities Agency, Western Economic Diversification Canada, and Canada Economic Development for Quebec Regions will ensure that every effort is made to have an optimum IRB commitment included in any resultant contract(s). 10. INSTRUCTIONS TO INTERESTED TEAMS a. Self-Identification Criteria To be considered as a viable team, a group of interested companies is expected to collectively demonstrate in narrative form that they have the capability to manage the 5 design, the construction and the support a ship of the size and complexity as AOPS. The narrative should indicate how it intends to meet the requirement of Appendix “B”. Specifically, the following capabilities are mandatory: i. Current financial capability to undertake and complete a project of this size and complexity; Experience in successfully managing the construction of ships of the size and complexity of AOPS, whether in Canada or overseas; Management Organization infrastructure is in place to manage a project of this size and complexity; Project Management System to manage ship construction comparable in scope and complexity of AOPS. Quality Assurance System modeled on ISO 9001:2000; Environmental, Health and Safety Management System; Experience and capability in marine engineering, design, drafting of ships of similar size and complexity; Experience and capacity in Command Management System Integration Capability of similar scope and complexity to AOPS; Experience and ability to develop and implement an Integrated Logistics Support program of similar scope and complexity to that of AOPS. Experience and capability in the provision of In-Service Support services of similar scope and complexity to that of AOPS. Will have access to a certified launching Capability that has the capacity to construct and launch AOPS in time to meet delivery schedule of AOPS project, and thereafter dry-dock AOPS. If the shipyard must upgrade their facilities to accommodate building and launching the AOPS, a plan and a schedule shall be provided to demonstrate that the upgrade of their facilities will have no impact on the construction and the timely delivery of AOPS. Production capacity to build AOPS in Canada to meet the contracted delivery schedule; ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii. 6 b. Intent of Teaming A viable team must indicate the intent of teaming among its members. The team shall identify the type of corporate structure it intends to establish to undertake this Project. Possible options include: i. ii. iii. A consortium, a joint venture or partnership in which all members are jointly and severally liable for the performance of the work commonly referred to as a contractual joint venture; or A limited company specially set up for this Project commonly referred to as an incorporated joint venture; or An established company qualified as a prime contractor and subcontracting portions of the work where the prime contractor is solely liable for the performance of the work. Financial guarantees including parental guarantees and other forms of financial security will be detailed in the resulting RFP. While establishing teams, it must be kept in mind that the team must include a Canadian Shipyard to build the AOPS vessels in Canada. c. Self- Identification Viable teams who meet the self-identification criteria as described herein are requested to identify themselves by completing the form attached as Appendix A herein. 12. CLOSING DATE The closing date for responses to this LOI is as detailed at page 1 of this Notice. Close of business LOI responses shall include the duly completed form in Appendix A and should be forwarded to the PWGSC Manager responsible for this procurement: Gérard Levesque PWGSC Manager Arctic/Offshore Patrol Ship Project National Defence Headquarters 101 Colonel By Drive Ottawa, Ontario K1A 0K2 Phone: (819) 997-2567 E-Mail: PMOAOPS-BPMNPEA@forces.gc.ca 7 13. TERMS AND CONDITIONS a. This document is for information only. Canada reserves the right to change, at any time, any or all parts of its project requirements, as it considers necessary. b. Any RFP released will take precedence. c. The Crown may reconsider the procurement if only one viable team has selfidentified at the above closing date; d. The Crown will request costing data for determination of reasonable price, and will negotiate with the bidder if only one response is received at RFP closing or if only one proposal is found to be responsive to the RFP. 14. POINT of CONTACT Any questions concerning this LOI are to be directed to the PWGSC Manager identified in this document. The Crown reserves the right to negotiate on any procurement. 8 Appendix A Response to Letter of Interest Arctic/Offshore Patrol Ship Project Pursuant to the LOI document, reference______dated______ released on MERX on behalf of Public Works and Government Services Canada, and the terms therein, we, (name of the team, if applicable), comprising the business entities: (Name of entity, city/ province/country of registration) (Name of entity, city/ province/country of registration) … etc. (Name of Canadian Shipyard) consider that we have met the self-identification criteria for being a viable team to compete for the Arctic/Offshore Patrol Ship (AOPS) Project. We intend that: Ship Construction expertise would be provided by (name of entity) whose credentials are enclosed in Annex A herein. Management Organization would be provided by (name of entity) whose credentials are enclosed in Annex B herein. Project Management System would be provided by (name of entity) whose credentials are enclosed in Annex C herein. Quality Assurance System would be provided by (name of entity) whose credentials are enclosed in Annex D herein. Environmental, Health and Safety Management System would be provided by (name of entity) whose credentials are enclosed in Annex E herein. Marine Engineering, Design and Drafting Service expertise would be provided by (name of entity) whose credentials are enclosed in Annex F herein. System Command Management Integration expertise would be provided by (name of entity) whose credentials are enclosed in Annex G herein. Integrated Logistic support expertise would be provided by (name of entity) whose credentials are enclosed in Annex H herein. In-Service Support Management expertise would be provided by (name of entity) whose credentials are enclosed in Annex I herein. Docking Capabilities would be provided by (name of entity) whose credentials are enclosed in Annex J herein. 9 (Name of Canadian Shipyard), whose credentials are enclosed in Annex K herein, would be building these ships. The credentials shall be supported by a Letter of Intent from a Canadian Shipyard to participate as a member of this team. Production facilities expertise would be provided by (name of entity) whose credentials are enclosed in Annex L herein. We intend to organize our team in (form of legal organizational structure) _______________________. Our team's single point of contact is (name / title / organization / address / telephone /email address) This document serves to identify the intent of teaming among the above named entities to pursue the AOPS Project. We understand that the name of our team and its membership will be published. If we would like to provide a different point(s) of contact that interested industry suppliers could contact, the contact information for this person is: (name / title / organization / address / telephone /e-mail address) We acknowledge and accept the terms and conditions of this LOI document. We confirm that the official language in which we wish to exchange correspondence with Canada is ___________. We certify that the undersigned have the authority to state the intent of our respective business entities. (signature / name / title / date) (signature / name / title / date) Ship Design expertise Systems Integration expertise (signature / name / title / date) (signature / name / title / date) Ship Construction expertise Integrated Logistic Support expertise (signature / name / title / date) (signature / name / title / date) Project Management expertise In-Service Support Management expertise (signature / name / title / date) Canadian Shipyard 10 APPENDIX B (GUIDELINES OF INFORMATION TO BE PROVIDED BY THE VIABLE TEAM) GLOBAL RATING GUIDE FOR, ARCTIC/ OFFSHORE PATROL SHIP REQUEST FOR PROPOSAL No. 1 EVALUATION CRITERIA Teaming Agreement Required Scoring Mandatory SCORING Yes/No DETAILED REQUIREMENTS The Bidder must demonstrate that it has a signed Teaming Agreement that will show it to be capable of completing the Work associated with this procurement (both the Project Implementation and the In-Service Support Contracts. The team shall identify the type of corporate structure it intends to establish to undertake and complete this Project. Possible options include: • • • A consortium, a joint venture or partnership in which all members are jointly and severally liable for the performance of the work commonly referred to as a contractual joint venture; or A limited Bidder specially set up for this Project commonly referred to as an incorporated joint venture; or An established Bidder qualified as a prime contractor and subcontracting portions of the work where the prime contractor is solely liable for the performance of the work. DRAFT Notwithstanding the type of corporate structure, each Bidder forming part of the team shall provide a copy of its Certificate of Incorporation under the Federal or the Provincial law. In this context, the Bidder, means a bidder who expects to be a Prime Contractor as a result this Request For Proposal. The Bidder must demonstrate, through a submission of the Bidder’s certified financial statements, that it has the current financial capability to undertake and complete a project of this size and complexity. Bidder shall submit: • • Properly certified financial statements for the past two years that shall include an accountant’s endorsement, an income statement and a balance sheet with associated notes. Evidence of a Bidder’s ability to obtain financial security either in the form of a performance bond (20% of contract value) and a labour and material payment bond (10% of contract value) or proof of security deposit availability (10% of contract value). 2 Financial Assessment Mandatory Yes/No 3 History/Previous Experience Mandatory Yes/No The Bidder must demonstrate the capacity to conduct a ship construction or major refit or project comparable in price, time, scope and complexity of work to the proposed design and construction of No. EVALUATION CRITERIA Required Scoring SCORING AOPS. Bidder shall submit: • • DETAILED REQUIREMENTS A list of example(s) of completed contract(s) within the last five years. Provide letter(s) of reference for non-government contracts that demonstrate the Bidder’s successful management of these projects in terms of meeting contract time, cost and performance objectives. 4 Management Organization Mandatory Yes/No The Bidder shall demonstrate that it has a minimal Management Organization infrastructure by providing details , including Management organizational chart that identifies a minimum of 8 management personnel intended to be assigned to this project that shall include: • • • • • • • • Finance Manager Planner/Estimator Project Manager Engineering Manager Ship Production Manager Quality Assurance Manager ILS Manager ISS Manager The management organizational chart shall include the individuals’ roles and responsibilities and indicate the reporting structure of these individuals up to one single point of contact. The Bidder shall provide a resume of the Project Manager intended on being assigned to this project, that demonstrates at a minimum that they have: • Successfully managed at least one project comparable in price, time, scope and complexity of AOPS work. 5 Project Management System. Mandatory Yes/No The Bidder shall demonstrate that it has the Project Management to manage construction comparable in scope and complexity of AOPS. Notwithstanding that all of the managements systems hereunder will be required in the performance of the contract, the Bidder shall at least: • • Demonstrate that it has a cost accounting management system capable of scheduling, monitoring and reporting labor and material costs scheduled and consumed against all WBS work packaged, and that the cost accounting management system is auditable. Demonstrate that Bidder’s Project Management System includes a Risk Management system, and at least 2 of the following as been integrated as part of its Project Management System: No. EVALUATION CRITERIA Required Scoring SCORING • • • • • • DETAILED REQUIREMENTS Contract and Subcontract management, Intellectual property management Design changes management Unscheduled work Management Additional tasks management Provide previous example(s) of its Project Management documents completed on a ship construction project comparable in scope and complexity of AOPS work within the last five years. 6 Quality Assurance System Mandatory Yes/No The Bidder shall demonstrate that it has Quality Assurance capabilities. The Bidder shall: • • Provide objective evidence of its implemented Quality Assurance system modeled on ISO9001: 2000 The objective evidence may be in the form of a registration certificate, or a copy of its Quality Assurance Manual. Bidder’s facility may be audited by Canada, or its authorized representative, prior to award of contract to corroborate information provided by the Bidder. 7 Environmental, Health and Safety Management System Mandatory Yes/No The Bidder shall demonstrate that it has an Environmental, Health and Safety Management System capabilities. The Bidder shall: • • • • Provide Certification that it complies with all Municipal, Provincial, Federal and municipal regulations with respect to Environment, Health and Safety. Provide details of its implemented Environmental Management system modeled on ISO14001. Provide records of performance with respect to Environmental, Health and Management System. Obtain Certification that it is good standing with the provincial WCB. 8 Marine Engineering, Design & Drafting Service Mandatory Yes/No The Bidder shall demonstrate that it has marine engineering, design and drafting capabilities. The Bidder shall: • Provide details of its marine engineering, design and drafting capabilities. No. EVALUATION CRITERIA Required Scoring SCORING • DETAILED REQUIREMENTS Describe previous marine engineering and drafting work completed within the last five years ship construction or major refit project comparable in price, time, scope and complexity of AOPS Project. Provide the resume of a Senior Marine Engineer intended to be assigned to the project that shall have: • A minimum of 5 years experience as a marine engineer or naval architect • Worked on a project comparable in price, time, scope and complexity of AOPS Project within the last 5 years • Professional engineer designation. Provide the resume of a senior draftsman intended to be assigned to the project that shall have: • A minimum of 5 years related experience • Worked on a project comparable in price, time, scope and complexity of AOPS work within the last 5 years • Drafting technologist • • 9 Command Management Systems Integration Capability Mandatory Yes/No 10 Integrated Logistic Support Mandatory Yes/No Demonstrate that it has the capability to perform inspection and survey work to identify vessel continuous survey requirements in order to ensure compliance with Regulatory and Classification Society requirements. The Bidder shall demonstrate that it has Command Management Systems integration capability sufficient for the scope of systems envisaged for AOPS. The Bidder shall provide objective evidence of having managed the integration of Command Management Systems of similar scope and complexity to AOPS. The Bidder shall demonstrate that it has the experience and capability in the development and implementation an Integrated Logistics Support Program in at least 4 of the following logistic support areas of a major weapon system or equivalent commercial product of the size and complexity of AOPS: ILS Planning and control; Performing Logistics Engineering; Performing Maintenance Analysis; Performing Sparing Analysis; and Performing Acquisition Management for logistic elements such as Engineering Data, Supply Support, Packaging, Handling, Storage and Transportability, Support Equipment, Technical Data, Training, IM/IT Support, and Facilities. 11 In-Service Support Mandatory Yes/No The Bidder shall demonstrate that it has the experience and capability in the management of at least 5 of the following In-Service Support areas to a major weapon system program or equivalent commercial program of the size and complexity of AOPS: Maintenance Management; Supply Support Management; Engineering Support Management; Packaging, Handling, Storage and No. EVALUATION CRITERIA Required Scoring SCORING DETAILED REQUIREMENTS Transportability Management; Technical Data Management; Training Management; IM/IT Support Management; and Facilities Management. The Bidder shall demonstrate that it has the Capability to support the AOPS ships on both coasts. 12 Launching Capability Mandatory Yes/No The Bidder shall: • • • Demonstrate that it has the capacity to construct and launch a vessel of the size and complexity of AOPS. Demonstrate that it has access, or will have access to a certified launching facilities capable of handling a vessel of the size and complexity of AOPS. If the shipyard must upgrade their facilities to accommodate building and launching the AOPS, a plan and a schedule shall be provided to demonstrate the upgrade of their facilities will have no impact on the construction and the timely delivery of AOPS. 13 Production facilities Mandatory Yes/No The Bidder shall demonstrate that it has Production Capability to build AOPS in Canada to meet the contracted delivery. The Bidder shall provide a production plant that clearly indicates how the ship will be fabricated, assembled and launched. The production plan would be expected to indicate how the following types of facilities are provided: • • • • • • • • Fabrication, manufacturing and storage facilities (Onsite or subcontracted) Production office Crown office facilities Fitting out berth (sufficient for AOPS) Length of wall (sufficient for AOPS) Material holding area Contractor’s project office Launching facility The Bidders shall also demonstrate that it has access to existing fabrication, manufacturing and storage facilities adequately equipped to perform the Work under AOPS. Such facilities could includes as an example outfitting facilities, Steel fabrication shop, Machine shop, pipe fitting, electrical shop, painting shop and Stores Facilities. The Bidder shall provide details of transportation plans between all facilities, launching facility, No. EVALUATION CRITERIA Required Scoring SCORING DETAILED REQUIREMENTS mobile crane access and the number and location of sub contractors. 14 Facilities Evaluation Mandatory Yes/No Notwithstanding, all the above, prior contract award, Canada reserves the right to conduct a facility evaluation corroborate the information received from the Bidder to ensure that the successful Bidder has Legal status, the financial, managerial and technical capability to perform the AOPS Implementation Contract and the In-Service Support Contract.