A subsidiary of Global Engineering and Construction Group of Foster Wheeler AG (FWLT) along with its associative partners A. Al-Saihati, A. Fattani & O. Al-Othman Consulting Engineering Co., (SOFCON) and Saudi Consolidated Engineering Company – Khatib & Alami (SCEC K&A) has entered into a five-year agreement to provide services for General Engineering Services Plus (GES+) initiative of Saudi Aramco. The contract has an option to be extended beyond five year. The companies did not disclose the conditions of the deal.
The group will be responsible for executing pre-front-end engineering design (pre-FEED), front-end engineering design (FEED), thorough design and procurement services for onshore/offshore oil and gas, refining, petrochemicals, and related infrastructure projects in Saudi Arabia. The office of the association of the three companies is located in the city of Al-Khobar in the Kingdom of Saudi Arabia and work of the project will be carried out from there.
The contract is an add on to a number of projects carried out by Foster Wheeler in Saudi Arabia, thus strengthening scope in the country through provision of good services and expertise.
We believe that world demand for energy will continue to grow over the long term and that clients will continue to invest in new and upgraded capacity to meet that demand. In that regard, Foster Wheelerwas successful in booking contracts for front-end engineering work, which is frequently the precursor to significant work for engineering, procurement and construction. Major competitors of Foster Wheeler are Fluor Corporation (FLR) and Jacobs Engineering Group Inc. (JEC).
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.
We continue to maintain a Neutral rating on Foster Wheeler, with a Zacks #3 Rank (Hold recommendation) over the next one-to-three months.
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