Recently, Fluor Corporation (FLR) was awarded a $1.3 billion contract by Canada-based Fort Hills Energy L.P. Per the contract, Fluor is required to provide engineering, procurement, fabrication and construction services to an oil sands mining project of Fort Hills. Fluor intends to offer a unique modular design comprising its proprietary 3rd Gen Modular ExecutionSM technology. However, the contract failed to cheer investors as the stock witnessed a 2.1% drop from Sep 23 to Sep 25.
Based in Alberta, Canada, the Fort Hills project is expected to generate 180,000 barrels of bitumen daily, at its full capacity. The project – a partnership between Suncor Energy (SU), Total E&P Canada Ltd. and Teck Resources Limited (TCK) – is scheduled to commence operation by the beginning of the fourth quarter of 2017.
Fluor has included the contract in its third-quarter bookings. In the second quarter of 2014, the company reported new awards valued at about $1.2 billion, which include an engineering, procurement and construction management contract from a U.S.-based manufacturing facility. Meanwhile, backlog for the quarter stood at $9.2 billion, down 43.0% year over year owing to substantially lower new awards for mining and metals in the last year.
Separately, on Sep 2, 2014, Fluor announced the completion of its engineering, procurement, construction and commissioning services for LS Power’s Centinela Solar Energy Facility.
Fluor Corporation is one of the largest professional service firms providing engineering, procurement, construction and maintenance services. The company currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the sector include Willdan Group (WLDN), VSE Corp (VSEC) and ITT Corp. (ITT). While Willdan sports a Zacks Rank #1 (Strong Buy), VSE and ITT carry a Zacks Rank #2 (Buy).
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