IT system integrator companies built - integrating and testing

IT system integrator companies built - integrating and testing

A robust system that is designed to facilitate the design, building, integrating and testing of nuclear reactors for both the military and commercial markets.”

The federal government, an investor in the company, awarded Bechtel a lucrative contract to provide design information about advanced nuclear power plants to the Department of Energy (DOE) in the late 1970s. According to company records, Bechtel was the most frequent source of funds to Teco’s efforts to develop nuclear materials for the production of nuclear weapons.

Two ex-employees say, however, that the true reason for the relationship between Bechtel and Teco was the conversion of Teco into a corporate captive company in 1982. That move gave Bechtel control of a Teco subsidiary that received more than $1 million in federal contracts. Tecol was able to grow as a result of the federal government’s failure to terminate a key contract, later estimated to be worth more than $15 million. That deal involved an experimental nuclear reactor that was being built in the small village of Yangquan. Construction of the nuclear reactor in Yangquan was halted in 1978 when Teco’s key subcontractor, Mott MacDonald, quit after about 20 percent of the reactor’s components were completed.

Teco spent $250 million to complete the reactor, called the Yangquan I-1000, only to have it remain uncompleted after Teco failed to get approval from the State Council for the People’s Republic of China for it to begin operating.

Yangquan I-1000 had already received “exemptions from national safety standards in the United States and Canada,” according to the Federation of American Scientists. Teco stopped paying the subcontractors and eventually left them unpaid. Two former workers allege that Teco executives knew that the reactor was unfinished when Bechtel took over. They say, however, that the executives thought they could regain access to Yangquan I-1000 by turning the plant into a permanent testing site for new nuclear components, a position favored by both Teco and the Pentagon. Tecol-Bechtel was soon awarded an additional $11 million in the original Yangquan I-1000 contract. Work on the reactor resumed in 1982, but progress was again slow.

In 1982, Bechtel, which had been tied to the project since its inception, was awarded a $39 million contract for work at the reactor. At least one expert reported in October 1984 that the Yangquan I-1000 was essentially a “redesign, not a retrofit.” According to a July 1988 report in "The United States Report", the test reactor was “still in rough shape, with serious safety problems that would be deadly in a real reactor.”

When Bechtel took over the Yangquan I-1000 in 1982, it had already hired hundreds of Chinese workers, some of whom went on strike over unpaid wages. By 1985, Teco officials were working out of a secure compound surrounded by razor wire in San Diego, California. Tecol became a company fully owned by the Pentagon in 1982, and an agreement was reached to cover Bechtel in the event of possible liability in the event of a Teco bankruptcy. In a 1984 audit of Teco’s finances, then-acting U.S. Comptroller of the Currency William R. Winter raised questions about Teco’s ability to pay a debt to Bechtel.

The audit revealed that the Army had awarded Bechtel a $8.5 million contingency contract to provide construction materials for the Beijing Institute of Technology. The institute was expected to develop a new generation of nuclear weapons, including “a neutron bomb, a neutron gun, and a means of delivering chemical bombs using advanced neutron engines.” The payment to Bechtel was contingent on Teco meeting two conditions: first, that the Army withdraw its funding guarantee, which was equivalent to Bechtel’s $4 million equity stake in the institute; and second, that Teco complete construction of the Beijing Institute of Technology.

Although Teco had promised the institute that it would meet both conditions, it failed to do so. Tecol-Bechtel had already paid Bechtel a $5 million deposit, but officials at the institute demanded a $2 million refund. Bechtel refused, saying that such a refund would violate its contingency contract. On December 20, 1984, the Comptroller’s office announced it was withholding $2 million of the institute’s funds. The institute, it said, could continue to function normally and “will not suffer financial loss or impact on the status of the project.” Tecol later sold the Beijing Institute of Technology to a Beijing company owned by the Beijing city government.

In 1985, after the principal contractor for Yangquan I-1000, Bechtel, withdrew its insurance coverage for Teco’s bankruptcy, Teco called off the program. Tecol-Bechtel had taken $76 million in insurance on the project, which, according to the Comptroller’s report, amounted to “more than a third of its equity in Teco.” In 1988, the Comptroller’s office called Bechtel a “key player” in the Yangquan I-1000 fiasco, stating in its report that “Bechtel was primarily responsible for causing the problems and