Chicago Bridge & Iron Company N.V. (CBI - Analyst Report) announced that its joint venture (JV) with Chiyoda International Corporation has received a Liquefied natural gas (LNG) contract. Louisiana-based Cameron LNG, LLC, a subsidiary of Sempra Energy (SRE - Analyst Report), has awarded the $6 billion contract for the construction of its Cameron Liquefaction Project in Hackberry.
Cameron LNG is an LNG receipt terminal that processes natural gas for various industries and electricity plants. Apart from Sempra Energy, other stakeholders in the company are GDF SUEZ S.A., a unit of Mitsubishi Corporation and Mitsui & Co. Ltd. (MITSY - Snapshot Report), each having a 16.6% stake.
Per the contract, the JV will be required to provide core services including engineering, procurement and construction (EPC). It will be responsible for the inclusion of additional facilities for liquefying and exporting natural gas at the existing LNG regasification facility.
The project will create about 3,000 jobs at the facility. CBI will also be required to scale up employment at its fabrication and construction facilities. The company’s strong presence in the Gulf Coast along with its expertise in engineering and construction projects will significantly benefit this project. Moreover, CBI is one of the few engineering, procurement and construction and process technology contractors with in-house fabrication facilities, allowing it to offer modular construction, wherever feasible.
The project is designed to have a troika of liquefaction trains, having an installed capacity of as much as 13.5 million tons LNG per annum. In Feb 2014, Cameron received an authorization from the U.S. Department of Energy (DOE) to extend its LNG export to a number of new countries, even those not having a free trade agreement with the U.S. The development of this project will allow the company to meet increased processed natural gas requirements.
Chicago Bridge & Iron Company currently holds a Zacks Rank #3 (Hold). Investors interested in this sector could also consider better–ranked MasTec, Inc. (MTZ - Analyst Report), which carries a Zacks Rank #2 (Buy).