AUDIT REPORT IG-03-018

Report Recipients: 

SSC/AA00/Director, 

 John C. Stennis Space 

 Center

WEAKNESSES IN STENNIS SPACE CENTER’S 

PROCUREMENT OF 

HIGH-PRESSURE VALVES 

June 27, 2003

cc: 

H/Assistant Administrator 

 for Procurement 

M/Associate 

 Administrator for 

 Space Flight 

Q/Associate 

 Administrator for 

 Safety and Mission 

 Assurance 

JM/Director, 

 Management

 Assessment Division 

 JM/Team Lead (Audit)

 National Aeronautics and 

Space Administration

OFFICE OF INSPECTOR GENERAL 

Released by: __[Alan J. Lamoreaux DAIGA] for_____

David M. Cushing, Assistant Inspector General for Auditing 
IG-03-018 June 27, 2003 

 A-02-020-00 

Weaknesses in Stennis Space Center’s 

Procurement of 

High-Pressure Valves

We found serious weaknesses with Stennis Space Center’s (Stennis) management of a 

$2.5 million contract with Dresser Equipment Group (Dresser) for 26 high-pressure 

valves. These valves are used to control flammable and explosive fuels at the Center’s 

component test facility. Stennis’ ineffective contract management resulted in late 

deliveries, increased costs, and defective valves that jeopardized test schedules for 

critical test articles, such as engines for the joint NASA/Air Force Integrated Powerhead 

Demonstrator project and NASA’s 2nd Generation Reusable Launch Vehicle Program. 

Stennis mismanaged this contract by allowing Stennis engineers to direct design changes 

to the valve specifications without Contracting Officer approval and by not requiring 

Dresser to submit a subcontractor plan. Additionally, Stennis did not perform required 

technical, safety, or quality assurance reviews. Consequently, Dresser delivered only 1 

valve on time and 24 valves from 4 to 26 months late. One other valve has not yet been 

delivered. As of January 2003, Stennis has incurred about $229,000 in additional costs to 

rework 12 valves that were accepted with known defects. Propulsion Test Directorate 

(PTD) personnel believed accepting and reworking the defective valves would be faster 

and cheaper than allowing Dresser to correct the problems. Ultimately, engine testing 

was delayed 2-1/2 months for the Integrated Powerhead Demonstrator project and 1 

month for the 2nd Generation Reusable Launch Vehicle Program engine. 

We have indications that similar problems could occur with Stennis’ five other pressure 

system contracts (totaling $6.2 million). Management needs to ensure that each of its 

pressure vessel and pressurized systems contracts are effectively managed to minimize 

potential safety hazards at the Center. 

High-Pressure Valve Acquisition and Management Weaknesses 

Unauthorized Design Changes Resulted in Additional Costs. In May 2002, the 

Contracting Officer’s Technical Representative (COTR) notified the Contracting Officer 

that engineering personnel inappropriately authorized Dresser to make several changes to 

liquid oxygen valves that were not part of the original contract specifications. The 

COTR estimated that the changes would cost $85,850. For example, after collaborating 

with Stennis engineers, Dresser machined concentric grooves into the valve bodies to 

solve fluid delivery problems during low-flow and low-pressure situations. Stennis 
subsequently found that the grooves increased fluid ignition hazards in liquid oxygen 

systems during high-flow and high-pressure situations. The design changes contributed 

to delays that ultimately led Stennis to accept three valves that were incomplete or leaked 

excessively. 

The Center accepted the three valves in an attempt to meet test schedules for the joint 

NASA/Air Force Integrated Powerhead Demonstrator project. Stennis then directed its 

facility support contractor to rework the valves, to include removing the concentric 

grooves, at NASA’s expense. Even after being reworked, one valve continued to leak 

flammable liquid oxygen and was undergoing its third repair at the time of our field 

work. 

Subcontractor Performance Resulted in Defective Valves. Dresser initially advised 

the Contracting Officer that it did not plan to use subcontractors except for the valve 

actuators and hub ends and that it had sufficient in-house capability to perform all other 

manufacturing work on the valves. Thus, the Contracting Officer exempted Dresser from

submitting a subcontracting plan. Subsequently, Dresser used subcontractors for 

manufacturing work not related to the valve actuators and hub ends. However, the 

Contracting Officer never required Dresser to submit a subcontracting plan. 

Dresser’s use of additional subcontractors resulted in defective welding, improper 

attachment of valve vacuum jackets, and valve contamination. For example, in June 

2000, Dresser notified the COTR that it planned to use a subcontractor to weld valve 

bodies for 6-inch and larger valves. In January 2001, Dresser notified the COTR that 

upper and lower valve body sections welded by that subcontractor did not meet 

specifications. In May 2001, Dresser notified PTD personnel, the Contracting Officer, 

and the COTR that it had been negotiating with a subcontractor regarding cost overruns 

on vacuum jackets. Appendix D, Figure 2 shows a 10-inch liquid oxygen valve being 

disassembled at the cleaning subcontractor’s facility after tests indicated the valve was 

contaminated. Dresser used these subcontractors despite the early assurances to the 

Contracting Officer that no additional subcontracting opportunities existed. Had the 

Contracting Officer required a subcontracting plan, Stennis may have performed the 

oversight needed to ensure quality and timeliness and avoid increased costs. 

Technical Specification Reviews and Approvals Not Performed. The Center’s 

pressure systems experts and Safety and Mission Assurance officials did not review or 

approve the contract’s technical specifications. NASA and Stennis guidance require such 

reviews to ensure the structural integrity of pressure system components and to minimize 

potential mishaps. Instead, PTD personnel developed, reviewed, and approved the 

specifications and Dresser’s valve designs. Further, PTD personnel indicated that 

additional technical or safety specification reviews were unnecessary and would delay 

the award and manufacturing process. Completing the reviews may have identified and 

addressed problems with valve designs. For example, Stennis may have identified the 

potential hazards from using Monel versus stainless steel valve stem materials and an 

unacceptable method to attach vacuum jackets. Performing required reviews for future 

 

2 
technical specifications may save Stennis time and money if the reviews identify design 

problems prior to the manufacture of pressure system components. 

Safety and Quality Assurance Oversight Not Performed. The Contracting Officer did 

not require surveillance of Dresser’s performance as prescribed by the Federal 

Acquisition Regulation. Specifically, Stennis did not perform quality oversight or 

inspections of the valves during manufacture or prior to acceptance. Stennis engineers 

visited Dresser’s manufacturing plant and two of Dresser’s subcontractors, but did not 

inform the Contracting Officer or quality and safety personnel of the manufacturing 

problems observed or the resolutions agreed to with Dresser and its subcontractors. 

Consequently, the Contracting Officer had no basis to support adverse action against 

Dresser when it did not meet contract requirements. 

Recommendations, Management’s Response, and Evaluation of Management’s 

Response 

To correct management and acquisition control weaknesses, ensure effective 

management and surveillance of pressure vessel and pressurized systems contracts, 

and minimize potential safety hazards at Stennis, the Center Director should: 

1. Establish a technical focal point to ensure existing and future pressure 

system contracts include specifications that are reviewed and approved by 

appropriate quality, safety, and technical experts prior to contract award.

Management’s Response. Concur. Stennis has both a Pressure Vessel/Systems

Committee and a Components Working Group that is developing action plans to address 

how these issues will be handled in the future. In addition, the Safety and Mission 

Assurance Office now reviews procurements in accordance with “S&MA [Safety and 

Mission Assurance] Procurement Assurance Review Policy” and Stennis Purchasing 

Guidance. The complete text of management’s response is in Appendix H. 

Evaluation of Management’s Response. Management’s planned actions are responsive 

to the intent of the recommendation. The recommendation is resolved, but will remain 

undispositioned and open for reporting purposes until corrective actions are completed. 

2. Direct the PTD to coordinate with Contracting Officers regarding all 

changes to contract terms and conditions. 

Management’s Response. Concur. The Procurement Officer, in conjunction with the 

Propulsion Test Directorate, has initiated a series of “Procurement Roadshows” at 

Stennis to emphasize the appropriate procedures for effecting contractual changes. In 

addition, contractors must acknowledge that only the Contracting Officer can approve 

changes to contract terms and conditions through the issuance of a formal contract 

modification. 

 

3 
Finally, the Director, Propulsion Test Directorate will formally emphasize the importance 

of processing required changes through the Stennis Acquisition Management Office (see 

Appendix H). 

Evaluation of Management’s Response. The actions taken by management are 

responsive to the recommendation. We consider the actions sufficient to disposition the 

recommendation, which will be closed for reporting purposes. 

3. Consider Dresser’s performance on this contract before awarding the 

company any future contracts. 

Management’s Response. Concur. Documented evidence of past performance 

problems is included in contract records and will be used prior to the award of future 

contract actions. A final past performance rating will be input into the Past Performance 

Database System. The contractor has been notified that Stennis will conduct a meeting to 

address “lessons learned” associated with the conduct and performance of the contractor 

upon contract completion (see Appendix H). 

Evaluation of Management’s Response. Management’s planned actions are responsive 

to the intent of the recommendation. The recommendation is resolved, but will remain 

undispositioned and open for reporting purposes until corrective actions are completed. 

Stennis’ General Comments on Findings. Stennis is highly conscious of the potential 

effects of defective hardware on safety, schedule, and cost on test project activities. To 

preclude safety issues, Stennis has long-standing institutionalized, rigorous procedures 

and processes for safe test system design, safe test operations, independent safety 

reviews, and comprehensive test readiness reviews. These procedures are formalized in 

International Organization for Standardization (ISO) 9000 certified work instructions. 

Stennis is confident that its end-to-end processes will continue to realize successful 

propulsion test work, as they have in the past. 

Evaluation of Stennis’ General Comments. We reviewed a number of Stennis’ ISO 

9000 procedures pertaining to acquisition and support for the Center’s propulsion test 

mission. These procedures should ensure that pressure system components are safe and 

reliable for use in propulsion testing. However, Stennis did not apply many of the 

procedures to the Dresser acquisition. For example, Stennis did not apply System Level 

Procedure 13, “Control of Nonconforming Product,” and System Level Procedure 1280-

0010, “Inspection and Testing,” until Center personnel had accepted the valves, noted 

serious manufacturing defects, and began rework efforts. After our audit, Propulsion 

Test Directorate personnel informed us that they are applying the ISO 9000 procedures to 

ongoing pressure systems (valve) acquisitions to avoid the problems encountered on the 

Dresser contract. 

 

4 
Appendices 

Details related to the disposition and closure of the recommendations are in Appendix A. 

Among the other appendices, note that Appendix D shows examples of high-pressure 

valves; Appendix E summarizes the NASA and Stennis guidance for acquisition of 

pressure vessels and pressurized systems; Appendix F contains the status of the valve 

deliveries; and Appendix G summarizes the valve contract modifications. 

 

5 
List of Appendices 

Appendix A – Status of Recommendations 

Appendix B – Background 

Appendix C – Objectives, Scope, and Methodology 

Appendix D – Examples of High-Pressure Valves and Components 

Appendix E – NASA and Stennis Guidance for Pressure Vessel 

 and Pressurized Systems Acquisitions 

Appendix F – Status of Valve Deliveries 

Appendix G – Summary of Contract Modifications 

Appendix H – Management’s Response 

Appendix I – Report Distribution 

Acronyms Used in the Report 

COTR Contracting Officer’s Technical Representative 

ISO International Organization for Standardization 

PTD Propulsion Test Directorate 

PV/S Pressure Vessel and Pressurized Systems 

 

6 
Appendix A. Status of Recommendations 

Recommendation No. Resolved Unresolved Open/ECD* Closed 

1 X 8/15/2003 

2 X X 

3 X 8/15/2003 

* ECD – Estimated Completion Date 

 

7 
Appendix B. Background 

In August 1999, Stennis Space Center (Stennis) awarded contract NAS13-99035 to 

Dresser Equipment Group to acquire high-pressure valves for use at its component test 

facility. The valves are critical components of pressure systems that control liquid 

hydrogen, liquid oxygen, gaseous hydrogen, and gaseous nitrogen used in testing rocket 

engines at Stennis. The combination of system pressure, volume, and volatile fluids can 

create potential safety hazards, such as spills, explosions, flying debris, fires, and 

asphyxiation that can harm personnel and the surrounding environment. The primary 

NASA customer for the valves was the Stennis Propulsion Test Directorate (PTD). The 

PTD acquired the valves for a joint Air Force/NASA experimental engine project (the 

Integrated Powerhead Demonstrator) and the 2nd Generation Reusable Launch Vehicle 

Program. 

The PTD’s mission is to provide safe, efficient, and responsive rocket propulsion test 

services to NASA, other Government agencies, and the commercial propulsion 

development community. These services include testing and flight certifying rocket 

propulsion systems for the Space Shuttle and future generation space vehicles at the 

Center’s three major test complexes. The PTD is responsible for managing Stennis’ 

pressurized vessel and pressurized systems program assets. The PTD relies on a team

consisting of a Pressure Systems Manager, a Pressure Systems Committee, and other 

experts to ensure proper management, control, and oversight of the pressurized systems 

program. 

 

8 
Appendix C. Objectives, Scope, and Methodology 

Objectives

The overall audit objective was to evaluate Stennis Space Center (Stennis) controls over 

pressure vessels and pressurized systems (PV/S). The specific objective related to this 

report was to assess the Center’s controls for PV/S acquisitions. The remaining 

objectives related to the audit were to evaluate the: 

• controls for certifying and maintaining PV/S and 

• oversight of contractor safety programs for PV/S. 

We will address those objectives in a subsequent report. 

Scope and Methodology 

We reviewed Federal, NASA, and Stennis regulations, policies, and guidance related to 

the acquisition of PV/S. We interviewed representatives from the Propulsion Test 

Directorate, Center Operations, Procurement Directorate, Safety and Mission Assurance 

Office, Defense Contract Management Agency, and the Stennis facilities operations 

support contractor. We reviewed contract NAS13-99035 and related files and 

correspondence. We did not rely on computer-processed data during the audit.

Management Controls Reviewed 

We identified and assessed the controls for reviewing, approving, acquiring, and 

accepting PV/S. The controls are outlined in the Federal Acquisition Regulation, the 

NASA Safety Policy and Requirements Document (replaced by the NASA Safety 

Manual1

), the NASA Safety Policy for PV/S, and the Stennis Guide for Certifying PV/S. 

We considered the lack of oversight and the noncompliance with procurement and safety 

requirements for the valve acquisition to be management control weaknesses. By 

ensuring that PV/S acquisitions receive required review and approval, all changes to 

contract specifications are approved by the Contracting Officer, and appropriate contract 

surveillance and quality assurance is assigned to future contracts, Stennis can mitigate 

many of the problems we found with this acquisition. 

Audit Field Work 

We performed audit field work at Stennis from March 2002 through February 2003 in 

accordance with generally accepted Government auditing standards. 

 1 The Agency issued NASA Procedures and Guidelines 8715.3, the NASA Safety Manual, on January 24, 

2000.

 

9 
Appendix D. Examples of High-Pressure Valves and Components 

Figures 1 and 2 show two of the valves Stennis procured and their major components. 

Valve 

Actuator Valve Stem 

Plug 

 Valve Body 

Figure 1. A 3-inch valve installed at the 

Stennis component test facility.

 

Valve Bonnet 

Valve Body 

Valve 

Stem Plug

 Figure 2. A 10-inch liquid oxygen valve being 

 disassembled after tests indicated the valve was 

 contaminated. The photograph shows the 

 removal of the valve stem plug from the valve 

 body. 

 

10 
Appendix E. NASA and Stennis Guidance for Pressure Vessel and 

Pressurized Systems Acquisitions

The Federal Acquisition Regulation establishes policy and procedures for acquisitions by 

NASA and other executive agencies. Additionally, NASA and Stennis Space Center 

(Stennis) have policies for the acquisition of pressure vessels and pressurized systems 

(PV/S). NASA Handbook 1700.1, “NASA Safety Policy and Requirements Document,” 

June 1, 1993, and NASA Policy Directive 8710.5, “NASA Safety Policy for PV/S,” 

March 17, 1998, establish the safety requirements for PV/S acquisitions. 

Federal Acquisition Regulation

Part 46 of the Federal Acquisition Regulation establishes the contract quality 

requirements for Government contracts. Specifically, Section 46.105 establishes quality 

criteria for contractors and subcontractors, while 46.203 provides criteria for determining 

the extent of required contractor inspections. The technical description, complexity, and 

criticality of the purchased item determine which inspections are required. Section 

46.203 of the Regulation defines complexity and criticality as follows: 

• Complexity. Complex items have quality characteristics, not wholly visible in the 

end item, for which contractual conformance must be established progressively 

through precise measurements, tests, and controls applied during purchase, 

manufacture, performance, assembly, and functional operation either as an 

individual item or in conjunction with other items. 

• Criticality. A critical application of an item is one in which the failure of the item

could injure personnel or jeopardize a vital agency mission. 

The high-pressure valves that Stennis ordered were complex and critical. 

NASA Guidance 

NASA Handbook 1700.1, “NASA Safety Policy and Requirements Document.” The 

Handbook preceded the NASA Safety Manual2

 and established safety requirements for 

support operations contracts. The Handbook further established roles and responsibilities 

for program and project managers, Contracting Officers, and safety and mission 

assurance personnel. 

• Program and project officials were required to (1) review procurement 

documentation for safety requirements, (2) coordinate with the cognizant safety 

 2

 See footnote 1. 

 

11 
Appendix E 

officials to determine and approve safety requirements and objectives under 

which 

the contract would be performed, and (3) perform required checks and inspections 

of contractor compliance.

• Contracting Officers were required to consider using contract administration 

services personnel to monitor contractor safety operations. 

• Safety and mission assurance officials were required to (1) conduct safety 

program reviews of the contractor’s operation or product; (2) ensure safety 

participation in critical reviews, such as hardware design reviews and design 

certification reviews; and (3) coordinate safety surveillance requirements of

contractor operations with the Defense Contract Management Command (when 

delegated). 

NASA Safety Policy for PV/S. The Safety Policy for PV/S provides the requirements 

for ensuring the structural integrity of PV/S and minimizing potential mishaps. The 

policy outlines PV/S-related responsibilities for Pressure Systems Committees and 

Pressure Systems Managers. 

• Pressure Systems Committees, when required by management, may be appointed 

by Center Directors to, among other assignments, conduct reviews, provide 

guidance, and recommend requirements. The Committee shall be cognizant of 

PV/S design, fabrication, repair, and construction activities. 

• The Pressure Systems Manager is responsible for approving PV/S designs and 

providing technical expertise for all matters involving PV/S.

Stennis Guidance 

The Stennis Guide for Certifying PV/S, February 2002, identifies the following 

responsibilities. 

• The Pressure Systems Manager is responsible for procurement of new pressure 

vessels and approval of all new designs of pressure vessels including designs 

performed by the Pressure Systems Design Engineer. 

• The Pressure Systems Design Engineer is responsible for designing or approving 

the design of new PV/S and determining that all PV/S are of the correct design for

operating service.

 

12 
Appendix E 

• The Pressure Systems Material Engineer is responsible for assisting the Pressure 

Systems Manager in reviewing procurement, design, and modification of pressure 

vessels.

• The Pressure Systems Committee’s responsibilities include assisting the Pressure 

Systems Manager in reviewing procurement, design, and modification of pressure 

vessels. 

 

13 
Appendix F. Status of Valve Deliveries

Valve 

Number 

Original 

Scheduled 

Delivery 

Date 

Date 

Received Valve Status as of January 24, 2003 

Base Contract 

(19 valves)

PCV-10G13-GH 8/12/00 9/30/02 Dresser delivered valve to Stennis 25 months late. 

PCV-10G26-GN 8/12/00 Installed at test

stand E-2 of the 

Component Test

Facility 1/15/02

Dresser delivered the valve 17 months late, and it did 

not require Stennis rework. 

PCV-10G27-GN 8/12/00 6/24/02 Dresser delivered the valve 22 months late, and it did 

not require Stennis rework. 

VPV-10F11-LH 8/12/00 12/14/01 Dresser delivered the valve 4 months late, and it was 

1 of 12 requiring Stennis rework. 

VPV-10F12-LH 8/12/00 9/10/01 Dresser delivered the valve 12 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F13-LH 8/12/00 9/10/01 Dresser delivered the valve 12 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F14-LO 8/12/00 3/29/01 Dresser delivered the valve 7 months late, and it was 

1 of 12 requiring Stennis rework. 

VPV-10F15-LO 8/12/00 3/28/01 Dresser delivered the valve 7 months late, and it did 

not require Stennis rework. 

VPV-10F17-LO 8/12/00 5/17/02 Dresser delivered the valve 20 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F18-LO 8/12/00 Returned to

Stennis 1/31/02 

Dresser delivered the valve 17 months late, and it

was 1 of 12 requiring Stennis rework. The valve is

undergoing a third rework at Stennis. 

VPV-10F20-LO 8/12/00 6/18/01 Dresser delivered the valve 10 months late, and it did 

not require Stennis rework. 

VPV-10F21-LH 8/12/00 10/18/02 Dresser delivered the valve 26 months late. 

VPV-10F22-LO 8/12/00 6/12/01 Dresser delivered the valve 10 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F23-LH 8/12/00 2/17/02 Dresser delivered the valve 17 months late, and it did 

not require Stennis rework. 

VPV-10F24-LH 8/12/00 9/10/01 Dresser delivered the valve 12 months late, and it did 

not require Stennis rework. 

VPV-10F25-LH 8/12/00 9/10/01 Dresser delivered the valve 12 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F26-LO 8/12/00 6/12/01 Dresser delivered the valve 10 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F28-LH 8/12/00 2/17/02 Dresser delivered the valve 17 months late, and it

was 1 of 12 requiring Stennis rework. 

 

14 
Appendix F 

Valve 

Number 

Original 

Scheduled 

Delivery 

Date 

Date 

Received Valve Status as of January 24, 2003 

VPV-10F29-LO 8/12/00 2/17/02 Dresser delivered the valve 17 months late, and it

was 1 of 12 requiring Stennis rework. 

Option One 

(4 valves)

VPV-10F16-LO 8/12/00 3/28/01 Dresser delivered the valve 7 months late, and it did 

not require Stennis rework. 

VPV-10F19-LH 8/26/01 3/20/02 Dresser delivered the valve 7 months late, and it did 

not require Stennis rework. 

VPV-10F27-LO 8/26/01 6/10/02 Dresser delivered the valve 10 months late, and it

was 1 of 12 requiring Stennis rework. 

VPV-10F30-LO 8/26/01 8/23/01 Dresser delivered the valve on time, and it did not

require Stennis rework. 

Option Two 

(3 valves)

VPV-10F31-LO 8/26/01 Not Received Dresser is in the process of cleaning and testing the 

valve. 

VPV-10F32-LO 12/4/01 10/24/01 Dresser delivered the valve 10 months late, and it did 

not require Stennis rework. 

VPV-10F33-LO 8/26/01 3/28/01 Dresser delivered the valve 5 months late, and it did 

not require Stennis rework. 

 

15 
Appendix G. Summary of Contract Modifications 

Number Date Value Summary

1 12/8/99 +$491,770 The modification provided incremental funding of 

$491,770 and fully funded the contract (total of 

$1,726,770). 

2 12/20/99 -$5,329 The modification decreased the price of a 2-inch liquid 

oxygen valve shown under Option 1 by $5,329. The 

modification had no impact on the funded value of the 

contract. 

3 1/7/00 +$54,603 Stennis purchased the 2-inch liquid oxygen valve identified 

in modification 2 (Option 1) for $54,603, increasing the 

total contract price to $1,781,373. 

4 2/16/00 +$670,065 Stennis exercised Option 2 of the contract and purchased an 

additional six valves, bringing the total contract value to

$2,451,438. Delivery of five of the valves was scheduled 

for 190 days after the receipt of order, and delivery of the 

sixth valve was scheduled for 270 days after receipt of 

order. 

5 9/5/00 $0 The modification extended delivery dates for valves 

ordered on the original award and Option 1 to November 

30, 2000. The modification extended the delivery date for 

items purchased under Option 2 to January 31, 2001. The 

modification stated that the extensions were “ . . . due to 

material changes in the Contract Specifications.” 

6 12/13/00 $0 The modification changed the valve stem/plug material

from Monel K500 to stainless steel for 6-, 8-, and 10-inch 

valves and required the installation of a specific actuator in

the additional valves purchased under Options 1 and 2. 

7 1/31/01 +$74,354 The modification changed two 3-inch valves from “fail in

place” to “fail closed” and changed the valve stem material 

on liquid hydrogen and liquid oxygen valves from Monel

K500 to 316L stainless steel. The modification also 

increased the total contract price to $2,525,792 and 

extended the delivery date for the valves to May 23, 2001. 

8 5/22/01 $0 The modification extended the delivery dates of various 

valves. The dates ranged from June 30 to

October 31, 2001. 

9 6/12/01 +$8,105 The modification required Dresser to provide a stainless 

steel close-out ring on the vacuum jacket and to provide a 

vacuum seal on nine of the valves. The modification also 

extended the delivery date for a 2-inch and 1-inch valve to

July 27, 2001, and increased the contract price to

$2,533,897. 

10 10/19/01 $0 The modification deleted the cryogenic seat leakage test in

exchange for Dresser’s performing ambient testing on each 

valve and formalizing and providing the finite element

analyses to NASA. 

11 12/10/01 $0 The modification extended the delivery date for nine valves 

to February 8, 2002. 

 

16 
Appendix G 

Number Date Value Summary

12 12/18/01 $0 The modification allowed for valves of differing physical

configurations (the contract required identical valves) as 

long as they met technical specifications. 

13 1/25/02 $0 The modification provided for acceptance of a 6-inch valve 

that did not comply with contract specifications. The valve, 

shipped at Dresser’s expense to Stennis, was used for final

piping installation and initial liquid nitrogen cold flows for 

8 weeks at test stand E-1 of the component test facility. 

The valve was then to be returned to Dresser, at its 

expense, to be reworked and to undergo final testing. Once 

the valve complied with contract specifications, it was to be

reshipped to Stennis, and Stennis was to pay the original

invoice price for the valve. The original warranty period 

was not to go into effect until Stennis received a valve that 

complied with contract specifications. The modification 

also extended the contract until May 10, 2002. 

14 2/15/02 -$9,966 The modification specified credit terms and conditions for 

NASA’s acceptance of three 6-inch valves for Stennis’ onsite repair. Dresser was to ship the valves to Stennis in an

“as is” condition for repair and cleaning. Although the 

valves did not meet seat leakage standards and were not

cleanliness certified, NASA accepted them with the 

stipulation that Dresser provide, at no cost to NASA, 

critical dimension drawings showing tolerances and detail

of critical parts, loan a stud tensioning device and assembly

fixture as needed, provide new soft goods, and provide a 

serviceman and engineer to assist in reassembling the 

valves. One of the valves was not shipped back to the 

contractor for rework as stated in modification 13, but

remained at Stennis for rework in exchange for a credit of 

$3,322 per valve ($9,966) total. The contract value was 

reduced to $2,523,931. 

15 2/27/02/02 -$5,256 The modification provided for shipment, at Dresser’s 

expense, of a 3-inch liquid hydrogen valve to Stennis in an 

“as is” condition for repair and cleaning. The vacuum

jacket and cleaning requirements for the valve were 

waived. The modification also provided for Dresser to ship

an additional set of soft goods for use in reassembly and 

issue a credit invoice to NASA for $5,256. The contract

value was reduced to $2,518,675. 

 

17 
Appendix G 

Number Date Value Summary

16 5/10/02 -$5,811 The modification provided credit terms for accepting a 

10-inch liquid oxygen valve for Stennis’ on-site repair and 

extended the period of performance. Dresser, at its

expense, was to ship the valve to Stennis in an “as is” 

condition for repair and cleaning. The valve body, 

actuator, stem plug, and soft goods were then to be shipped 

to Stennis as soon as possible, but not later than 

May 15, 2002. Dresser was also to loan a test plug for 

proof testing. The period of the contract was extended to

July 26, 2002, and Dresser was to issue NASA a credit for 

$5,811 and provide tools valued at $42,404. The contract

value was reduced to $2,512,864. 

 

18 
Appendix H. Management’s Response 

 

19 
Appendix H 

 

20 
Appendix H 

 

21 
Appendix H 

 

22 
Appendix I. Report Distribution 

National Aeronautics and Space Administration Headquarters 

A/Administrator 

ADI/Associate Deputy Administrator for Institutions and Asset Management 

ADT/Associate Deputy Administrator for Technical Programs 

AA/Chief of Staff 

AB/Associate Deputy Administrator 

B/Deputy Chief Financial Officer for Financial Management 

B/Deputy Chief Financial Officer for Resources (Comptroller) 

BF/Director, Financial Management Division 

G/General Counsel 

H/Assistant Administrator for Procurement 

HK/Director, Contract Management Division 

HS/Director, Program Operations Division 

J/Assistant Administrator for Management Systems 

JM/Director, Management Assessment Division 

L/Assistant Administrator for Legislative Affairs 

M/Associate Administrator for Space Flight 

Q/Associate Administrator for Safety and Mission Assurance 

NASA Advisory Officials 

Chair, NASA Aerospace Safety Advisory Panel 

NASA Centers 

ARC/D/Director, Ames Research Center 

DFRC/X/Director, Dryden Flight Research Center 

GRC/0100/Director, John. H. Glenn Research Center at Lewis Field 

GSFC/100/Director, Goddard Space Flight Center 

JPL/Director, NASA Management Office 

JSC/AA/Director, Johnson Space Center 

KSC/AA/Director, John F. Kennedy Space Center 

LaRC/106/Acting Director, Langley Research Center 

MSFC/DA01/Director, George C. Marshall Space Flight Center 

SSC/AA00/Director, John C. Stennis Space Center 

 

23 
Appendix H 

Non-NASA Federal Organizations and Individuals 

Assistant to the President for Science and Technology Policy 

Deputy Associate Director, Energy and Science Division, Office of Management and 

 Budget 

Branch Chief, Science and Space Programs Branch, Energy and Science Division, Office 

 of Management and Budget 

Managing Director, Acquisition and Sourcing Management Team, General Accounting 

 Office 

Senior Professional Assistant, Senate Subcommittee on Science, Technology, and Space 

Chairman and Ranking Minority Member – Congressional Committees and 

Subcommittees 

Senate Committee on Appropriations 

Senate Subcommittee on VA, HUD, and Independent Agencies 

Senate Committee on Commerce, Science, and Transportation 

Senate Subcommittee on Science, Technology, and Space 

Senate Committee on Governmental Affairs 

House Committee on Appropriations 

House Subcommittee on VA, HUD, and Independent Agencies 

House Committee on Government Reform

House Subcommittee on Government Efficiency and Financial Management 

House Subcommittee on Technology, Information Policy, Intergovernmental Relations, 

 and the Census 

House Committee on Science 

House Subcommittee on Space and Aeronautics, Committee on Science 

Congressional Member 

Honorable Pete Sessions, U.S. House of Representatives 

 

24 
NASA Assistant Inspector General for Auditing 

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