FWLT Wins Hyundai Contract - Analyst Blog
January 05 2012 - 3:15AM
Zacks
Foster Wheeler
AG’s (FWLT) Global Power Group received a design and
supply contract for 4 x 250 MWe (net megawatt electric) circulating
fluidized-bed (CFB) steam generators, which will be employed in the
Mong Duong 1 Thermal Power Plant for Vietnam Electricity (EVN). The
contract has been received from the owner and developer of the
project, Hyundai Engineering and Construction. Asian Development
Bank (ADB) and Korean Exim Bank is the financier of the
project.
A full notice to proceed on this
contract has been received by Foster Wheeler. The contract value
will be included in the company’s fourth-quarter 2011 bookings.
However, the terms of the deal were not disclosed. The new steam
generators are expected to start operating commercially in the
second quarter of 2015.
Apart from the design and supply of
the 4 x 250 MWe clean burning CFB steam generators, Foster Wheeler
will also provide site advisory services for the project.
Vietnamese anthracite coal will be burned by these CFB steam
generators while fulfilling the required environmental regulatory
requirements.
Longer term, Foster Wheeler
believes that the global demand for electrical energy will continue
to grow and solid-fuel-fired steam generators will fill a
significant portion of this incremental generating capacity. The
fuel-flexibility of CFB steam generators will 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 (FLR) and
Jacobs Engineering Group Inc. (JEC).
Currently, we are maintaining a
Zacks #5 Rank (short-term Strong-Sell recommendation) on Foster
Wheeler.
FLUOR CORP-NEW (FLR): Free Stock Analysis Report
FOSTER WHELR AG (FWLT): Free Stock Analysis Report
JACOBS ENGIN GR (JEC): Free Stock Analysis Report
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