Foster Wheeler AG (FWLT - Analyst Report) has further strengthened its position in the Middle East after subsidiaries of Foster Wheeler’s Global Engineering and Construction Group (Global E&C) received a contract from Saudi Aramco, on Dec 20. Following this announcement, share prices of Foster Wheeler hiked 2.9%.
Although financial terms of the deal were not disclosed the company included the contract in its third quarter bookings. As per the contract, Foster Wheeler will provide Front Engineering and Design (FEED) services for the development of the Fadhili Gas Program in the Eastern Province of Saudi Arabia. The new Fadhili Gas Plant will be built approximately 30 kilometers southwest of the existing Khursaniyah Gas Plant.
Foster Wheeler will perform the FEED for the grassroots Fadhili Gas Plant. The plant has a total processing capacity of 1.5 billion standard cubic feet per day (BSCFD) of non-associated gas. This apart the FEED will extend to the onshore Khursaniyah upstream facilities, the Fadhili downstream pipelines, a residential camp and industrial support facilities at the new gas plant.
In addition to FEED services, Foster Wheeler’s Global E&C’s subsidiary will also prepare cost estimates, carry out the procurement of long-lead equipment, start basic engineering design and prepare the invitation to bid packages for the engineering, procurement and construction (EPC) contracts. After the project enters the EPC phase and EPC contractors are appointed, Foster Wheeler will also provide project management services for EPC.
Earlier, in Oct 22, subsidiaries of Foster Wheeler’s Global E&C had received a FEED contract from Saudi Arabia-based Saudi Aramco’s Khurais Arabian Light Crude Increment Program.
Foster Wheeler’s Global E&C Group provides technical and economic analyses and study/feasibility reports to owners, investors, developers, operators and governments. These services include concept and feasibility studies, market studies, asset assessments, environmental assessments, energy and emissions management, product demand and supply modeling and technology evaluations.
Foster Wheeler currently has a Zacks Rank #3 (Hold). Other better-ranked players in the engineering and heavy industry worth a look include VSE Corp. (VSEC - Snapshot Report), Quanta Services, Inc. (PWR - Analyst Report) and Rexnord Corp. (RXN - Analyst Report). While VSE carries a Zacks Rank #1 (Strong Buy), Quanta and Rexnord have a Zacks Rank # 2 (Buy).