In a project that addresses one of the Energy Department’s biggest security concerns, the National Nuclear Security Administration (NNSA) said Tuesday that it has completed construction a new storage facility for highly enriched uranium at its Y-12 site, where the weapons-usable material is now stored in multiple aging buildings that are hard to protect against terrorist threats.

NNSA, the semi-autonomous DoE agency that runs the department’s nuclear weapons complex, said the Highly Enriched Uranium Materials Facility (HEUMF) will play a key role in the agency’s long-range plan to modernize the Y-12 site near Oak Ridge, Tenn., and in the overall consolidation of DoE’s warhead production operations at fewer sites.

The construction of HEUMF, which began in 2004, was marked by considerably delays and cost overruns due to failure of contractors to follow design requirements in building the facility; the cost of the project, originally estimated at $313 million, ended up at $549 million.

The DoE inspector general and other critics also questioned NNSA’s decision to build the facility above ground, saying a competing design for a partially underground facility would have been easier and cheaper to protect.

The HEUMF has been one of NNSA’s top priorities because Y-12 holds the nation’s biggest inventory of HEU and much of it is stored in outdated buildings that are located uncomfortably close to the site’s boundaries. The buildings’ vulnerabilities are so great that NNSA has been forced to waive the stringent security standards that it would otherwise apply to the highly sensitive storage facilities.

In addition to solving that security headache, completion of the HEUMF would appear to strengthen DoE’s plan to build a modernized uranium processing facility at Y-12 to replace old production facilities at the site–a proposal that has drawn questions from some quarters.

Senate appropriators recently revealed that Bush administration has been pressing NNSA to close some of its weapons sites to save money, with the White House Office of Management and Budget forcing NNSA to convene an independent Cost Analysis Improvement Group to look at ways to increase consolidation. That independent review panels suggested Y- 12, with its many older facilities, might be a good candidate for closure.

And in a July 14 report accompanying its fiscal year 2009 energy and water spending bill, the Senate Appropriations Committee said it “does not believe the department has provided adequate justification to support the Uranium Processing Facility (UPF) at Y-12.

“The committee notes that the Cost Analysis Improvement Group has identified long-term cost-savings by constructing the UPF facility at another existing NNSA complex site. The committee is concerned that NNSA is not giving this issue vigorous consideration.”

NNSA officials say closing Y-12 would be impracticable and costly because it would be very hard to hire and train workers at another site to match the skilled workforce at Y- 12.

And with the HEUMF built, NNSA said there would be many additional HEU storage and transportation costs if the UPF was located at another site.

NNSA is currently proceeding with preliminary design of the UPF, with Jacobs Engineering and URS Corp.‘s Washington Division getting a contract to design the facility’s utility systems and CH2M Hill getting a contract for structural design.

NNSA said the HEUMF was expected to begin operations in 2010 following installation and testing of various systems in the facility by B&W Y-12 Technical Services, which operates Y-12 for the government.