Foster Wheeler AG‘s (FWLT) Global Engineering and Construction Group received a contract from JSC LUKOIL’s subsidiary. As per the deal, the company will provide a waste heat boiler for LUKOIL Nizhegorodnefteorgsyntez Refinery in the Nizhny Novgorod region of Russia.
The contract value for Foster Wheeler is undisclosed. The fourth-quarter 2011 bookings of the company are inclusive of this contract.
Downstream of a fluid catalytic cracking unit will have the waste heat boiler from Foster Wheeler. The boiler will help in the production of gasoline, which will comply with the European Union Euro-5 standards. A same type of unit was supplied to the refinery by Foster Wheeler, which is being used satisfactorily by Likoil since 2010.
By March 2013, Foster wheeler is expected to be through with its scope of work.
Recently, Foster Wheeler came out with its fourth-quarter 2011 earnings result. The company’s Global Engineering and Construction Group revenue increased by $54.3 million year over year to $453.1 million in fourth quarter 2011. The company expects Global E&C Group revenue to increase in 2012 versus 2011. Global E&C Group EBITDA margin on scope revenue in 2012 is expected to be in the range of 12%-14%.
Foster Wheeler AG is based in Zug Switzerland, but its operational headquarters are in Clinton NJ USA. The majority of Foster’s revenues and new businesses originate from outside the United States. The company serves the following industries: Oil and Gas; Oil Refining; Chemical & Petrochemical; Pharmaceutical; Environmental; Power Generation; and Power Plant Operation and Maintenance. Major competitors of Foster Wheeler are Fluor Corporation (FLR) and Jacobs Engineering Group Inc. (JEC).
We maintain a Zacks #3 Rank (Hold recommendation) over the next one-to-three months on Foster Wheeler.
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