Foster Wheeler Upstream, a division of Foster Wheeler AG’s (NasdaqGS:FWLT - News) Global Engineering and Construction Group, will be providing its project management support to the 35 billion-cubic-foot Ryckman Creek natural gas capacity storage facility. The contract has been received from Ryckman Creek Resources, LLC, a subsidiary of Peregrine Midstream Partners, LLC. The natural gas markets at the Opal Hub in Wyoming will be served by the new gas storage facility.
The third-quarter 2011 bookings of Foster Wheeler will incorporate the contract value. Foster Wheeler will help Ryckman Creek Resources to start the project successfully. The work on the project will be carried on by Foster Wheeler Upstream through the third quarter of 2012.
Foster Wheeler has been working on gas storage projects in Matagorda County, Texas, Evangeline Parish, Louisiana and in Europe. The current project is an add on to the company'sexperience in gas storage.
Longer term, Foster Wheeler believes that global demand for electrical energy will continue to grow and that solid-fuel-fired steam generators will fill a significant portion of this incremental generating capacity. The fuel-flexibility of CFB steam generators enable them to burn a variety of fuels other than coal and produce carbon-neutral electricity when fired by biomass. In addition, the company’s steam generators can be designed to incorporate supercritical technology, which significantly improves efficiency while reducing emissions.
However, the company is subject to various environmental laws and regulations in the countries in which it operates. If it fails to comply with these laws and regulations, it may incur significant costs and penalties that could materially affect its business, financial condition, results of operations and cash flows. Its business may be adversely impacted by regional, national and/or global requirements to significantly limit or reduce greenhouse gas emissions in the future.
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. The major competitors of Foster Wheeler are Fluor Corporation (NYSE:FLR - News) and Jacobs Engineering Group Inc. (NYSE:JEC - News).
Currently, we are maintaining a Zacks #5 Rank (short-term Strong-Sell recommendation) on Foster Wheeler.
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