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Babcock & Wilcox in Supply Pact

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Engineering firm The Babcock & Wilcox Company (BWC) – through its affiliate Babcock & Wilcox Power Generation Group Inc. – has won a contract to deliver, erect and commission a dry flue gas desulfurization system. The contract was awarded by Interstate Power and Light Company – subsidiary of Alliant Energy Corporation (LNT) for its 270 megawatt coal-fired Lansing Generating Station in Lansing, Iowa.

Per the deal, Babcock & Wilcox will deliver and erect a circulating dry scrubber (:CDS) system for the reduction of sulfur dioxide emission. The supply pact also includes new bags for the plant's existing pulse jet fabric filter.

The CDS technology (also known as Circulating Fluid Bed Flue Gas Desulfurization), will help in reducing emissions from several units. The technology involves low capital and operating expenses, and does not produce waste water.

This environmental equipment will be put up by Babcock & Wilcox Construction Co., which is another affiliate of Babcock & Wilcox.

Construction work on the project is expected to commence in 2014 and be over in 2015. Commissioning and start-up is also slated for 2015.

Earlier this month, Babcock & Wilcox Power Generation Group Inc. also entered into an agreement with FutureGen Industrial Alliance to begin work on the U.S. Department of Energy’s FutureGen 2.0 carbon capture and storage (:CCS) project. The agreement is for the initial engineering and preparation of the full front-end engineering and design work of the CCS project.

Babcock & Wilcox currently carries a Zacks Rank #1 (Strong Buy), implying that it is expected to outperform the broader U.S. equity market over the next 1 to 3 months.

In addition to B&W, there are other engineering firms in the energy sector like Altra Holdings Inc. (AIMC) and EnPro Industries Inc. (NPO) that offer value and are worth considering. Both these stocks sport a Zacks Rank #1 (Strong Buy).

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Read the Full Research Report on AIMC

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Read the Full Research Report on LNT

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