FROM: Robert Thompson, General Manager
Originator: Riaz Moinuddin, Director of Operations & Maintenance
SUBJECT:
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LIQUID OXYGEN (LOX) PURCHASE, SPECIFICATION NO. C-2023-1398BD
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GENERAL MANAGER'S RECOMMENDATION
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RECOMMENDATION:
A. Approve a Chemical Supplier Agreement to Airgas USA, LLC for the purchase of liquid oxygen, Specification No. C-2023-1398BD for the period beginning August 21, 2023 through August 20, 2024, for a unit price of $0.53 per centum cubic feet (ccf) delivered, plus applicable sales tax, for a total estimated annual amount of $912,000; with four one-year renewal options; and
B. Authorize unit price adjustment of up to 15% annually using mutually acceptable price indices for subsequent agreement renewal periods.
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BACKGROUND
Orange County Sanitation District's (OC San) Plant No. 2 facility requires liquid oxygen for the secondary treatment process. OC San purchases liquid oxygen to reduce shipping volume and lower overall costs. The liquid oxygen is vaporized on site and feeds as a gas to the activated sludge plant to remove biodegradable organic matter and suspended solids.
RELEVANT STANDARDS
* Comply with environmental permit requirements
* Maintain a culture of improving efficiency to reduce the cost to provide the current service level or standard
PROBLEM
The current liquid oxygen agreement will expire on August 20, 2023.
PROPOSED SOLUTION
Approve an agreement with Airgas USA, LLC for the purchase of liquid oxygen.
TIMING CONCERNS
OC San requires a new agreement to be in place before the existing agreement expires on August 20, 2023.
RAMIFICATIONS OF NOT TAKING ACTION
If the new vendor is not in place before the expiration of the existing contract, OC San would not be able to provide effective secondary treatment for Plant No. 2's non-reclaimable flow.
PRIOR COMMITTEE/BOARD ACTIONS
N/A
ADDITIONAL INFORMATION
A Notice Inviting Bids was issued on March 24, 2023 via Pl...
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