Premium heavy construction company Fluor CorporationFLR recently revealed that the U.S. Department of Energy ('DOE') has decided to extend its decommissioning and decontamination work on the Piketon, OH-based Portsmouth Gaseous Diffusion Plant by another 30 months.
Work on the contract will be done by Fluor-BWXT Portsmouth, a partnership between Fluor Corporation and certain subcontractors such as Pro2Serve, CH2M, Wastren Advantage Inc. and Innovative Solutions. The value of the option is estimated to be $750 million.
Work on decommissioning and decontamination of the Portsmouth Gaseous Diffusion Plant had been initiated by Fluor-BWXT on Mar 28, 2011, under a five-year contract. Per the contract, the partnership had to complete deactivating the X-326 uranium enrichment plant. It also had to undertake responsibilities such as designing the On-Site Waste Disposal Facility, continuation of the uranium barter program and preparing the first cells for receiving demolition debris and contaminated plant soils under the deal. With the latest agreement, the partnership has agreed to continue providing these services for an additional 30 months.
Fluor Corporation delivers engineering, procurement, construction, maintenance and project management services to governments as well as other clients in diverse global industries. This Zacks Rank #4 (Sell) company caters to the oil & gas, chemical and petrochemicals, transportation, mining and metals, power, life sciences and manufacturing industries, among others. Exercising the option to extend the tenure of the deal stands proof of the DOE's confidence on Fluor's expertise in deactivation.
But Why a Rank #4?
Fluor Corporation's business is being adversely affected by several major headwinds in the recent times. A strong U.S. dollar and dismal pricing conditions prevailing in the mining and energy markets are particularly weighing over the company's top and bottom lines at present.
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