Port Hope long term waste management facility

Fairness Monitoring final report

November 20, 2015

Submitted to

Fairness Monitoring

Submitted by

Samson & Associates
85, rue Victoria
Gatineau Québec J8X 2A3

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1. Introduction

Samson & Associates was engaged as a fairness monitor (FM) on November 18, 2012 to observe the competitive selection process for Port Hope long-term waste management facility (LTWMF) undertaken by Public Services and Procurement Canada (PSPC) as a result of solicitation # EQ986-140850. Samson & Associates is an independent third party with respect to this activity.

We reviewed all of the information provided and observed all relevant activities. We had full access to all aspects of the procurement process and co-operation from all stakeholders.

We hereby submit the final report, covering the activities of the FM during the industry engagement phase, commencing with an information session and continuing until the procurement was cancelled following Atomic Energy of Canada Limited's (AECL) restructuring.

This report includes our attestation of assurance, a summary of the scope and objectives of our assignment, the methodologies applied and relevant observations from the activities undertaken.

2. Port Hope long term waste management facility

The Port Hope project entails the cleanup of historic low level radioactive waste (LLRW) and industrial waste located throughout the municipality of Port Hope, and the safe containment of those materials within an engineered, aboveground LTWMF. The containment system is to be built at the site of an existing LLRW management facility and adjacent property, a former auto recycling yard. The facility will have the capacity to manage approximately 1.9M m3 of waste.

Radioactive materials and associated wastes from refining radium and uranium were produced at a refinery operated by Eldorado Gold Mines Limited from 1930–60. Process residues and waters were placed at various locations throughout the community and used as a source of fill material for construction and landscaping activities. Today, over 90% of Canada's historic low level radioactive waste is situated in various licensed and unlicensed sites within the Port Hope area and remediation of these sites is required.

The Project is led and sponsored by Natural Resources Canada (NRCan). A legal agreement with the Government of Canada and the Municipality of Port Hope in March 2001 launched the Port Hope Area Initiative (PHAI) by defining the framework and responsibilities for the Port Hope Project and Port Granby project. In 2009, the Port Hope Area Initiative Management Officer (PHAIMO) was formed with NRCan, Atomic Energy of Canada Limited (AECL) and PSPC to carry the project to completion.

On June 26, 2015, the Government of Canada announced that it has completed a step in the restructuring of AECL: the selection of Canadian National Energy Alliance (CNEA) as the successful bidder in the competitive procurement process to implement a government-owned, contractor-operated model for AECL's Nuclear Laboratories.

AECL has undergone important changes, and under the new model, AECL will be looking to CNEA to leverage existing expertise and assets and create value at the Nuclear Laboratories in order to deliver on the Government's decommissioning and waste obligations, provide nuclear expertise to support federal responsibilities, and offer services to users of the Laboratories on commercial terms. As a result of this change, the competitive selection process for Port Hope LTWMF undertaken by PSPC has been cancelled.

3. Attestation of assurance

The FM hereby provides the following unqualified assurance statement concerning the competitive selection process for Port Hope LTWMF concerning the industry engagement phase, commencing with an information session and continuing until the procurement was cancelled following AECL's restructuring.

It is our professional opinion that the competitive selection process for the above activities we observed, was carried out in a fair, open and transparent manner.

Original signed by
Mathieu Farley, CPA auditeur, CA, CIA, CISA
FM Team Leader
Partner, Audit & Advisory
Samson & Associates

Original signed by
Claude Rivard, CPA, CA, CISA
FM Specialist

4. Methodology

Samson & Associates was engaged as a FM to observe the competitive selection process for Port Hope LTWMF, and to attest to the fairness, openness and transparency of this monitored activity.

In accordance with the terms of our engagement, we familiarized ourselves with the relevant documents and activities (e.g., information session and Letter of Interest (LOI)), identifying fairness-related matters to the contracting and technical authorities, and ensuring that responses and actions were reasonable and appropriate.

4.1 Fairness monitor activities and findings related to the industry engagement phase

An industry day notice was issued via buyandsell.gc.ca on July 23, 2013 to invite industry suppliers to engage in a dialogue regarding Port Hope LTWMF delivery options.

PSPC held the Port Hope LTWMF Industry Day session on July 31, 2013 in Toronto, Ontario. The event provided a forum for Canada to engage industry in a presentation on the scope, key requirements and procurement strategy for the competitive procurements of Port Hope LTWMF. Industry day was attended by 44 suppliers.

The FM attended the industry day held by PSPC to ensure fairness-related considerations were satisfactorily addressed.

The key questions and answers provided at industry day were documented and published on buyandsell.gc.ca on August 28, 2013. The FM reviewed the questions and answers prior to their publication.

A Request for Information (RFI) was issued via buyandsell.gc.ca on November 5, 2013. The RFI was issued as a follow-up to the industry engagement day in order to seek ideas related to the current approach that might result in efficiencies and cost savings to Canadians or broader alternative approaches to the overall scope that will result in cost savings to Canadians from industry. The FM reviewed the RFI prior to its issuance.

Comments and questions from the potential respondents were accepted and answers to the initial questions were published on buyandsell.gc.ca on November 7, 2013, following a review by the FM. Following the publication of the initial responses, the competitive selection process was placed on hold to allow the tripartite partners on the Port Hope Project (those partners being NRCan, PSPC and AECL/CNL) to initiate a program review and consider the impact of AECL's restructuring on the proposed procurement. Answers to questions received after the beginning of this review were not published. Subsequently, the Government of Canada announced, on June 26, 2015, that the restructuring of AECL had been completed. As a result of these changes, the Government of Canada, through PSPC, is no longer responsible for the procurement. Therefore, the competitive selection process was cancelled prior to the conclusion of the industry engagement phase.

Observation: The RFI was written in a clear and understandable manner. All questions submitted during the industry engagement phase were responded to in a clear and understandable fashion and responses were provided to all proponents through the amendments issued.

FM summary of findings: It is the opinion of the FM that the industry engagement phase for the Port Hope LTWMF was conducted in a fair manner. In this context, fairness refers to decisions being made objectively, free from bias, favouritism or influence and conform to established rules.

5. Reference documents

The following documents are referenced by number in this report and unless otherwise indicated, are all available through PSPC.

Table summary

The following table includes a list of documents referred to in the report such as the Request for Proposal (RFP), amendments, clarification letters, debriefing letters, etc. Each row is numbered, followed by the document title, then a document identifier such as a date or document number.

No. Document Date
1 Letter of Interest - Industry engagement day notice Published on buyandsell.gc.ca on July 23, 2013
2 Amendment – Letter of Interest Published on buyandsell.gc.ca on August 7, 2013
3 Amendment – Letter of Interest Published on buyandsell.gc.ca on August 28, 2013
4 Amendment – Letter of Interest Published on buyandsell.gc.ca on October 16, 2013
5 Letter of Interest – Request for Information Published on buyandsell.gc.ca on November 5, 2013
6 Amendment – Letter of Interest Published on buyandsell.gc.ca on November 7, 2013
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