Fluor's Puerto Rico Power Contract Likely to Grow as Hurricane Recovery Continues

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Researched by Industrial Info Resources (Sugar Land, Texas)--Fluor Corporation (NYSE:FLR) (Irving, Texas) could receive up to $840 million in contract work to help restore power to storm-stricken Puerto Rico, but the U.S. Army Corps of Engineers (USACE) cautions the money isn't in the bank yet. Puerto Rico continues on its very long road to recovery in the wake of hurricanes Maria and Irma, which knocked out virtually all power on the island in September.

Engineering, construction and procurement (EPC) firm Fluor announced on October 19 it was awarded a $240 million contract by the USACE to help restore electric power to Puerto Rico. Earlier this week, the USACE gave notice of its intent to award a sole-source modification to increase the contract ceiling by $600 million, saying the move "ensures continued execution of the critical repair and restoration of the electric power grid in Puerto Rico, necessitated by a catastrophic hurricane event."

However, the USACE cautioned that the notice is only one of intent, and that it was looking at "several acquisition strategies to speed up grid restoration efforts. This is one of them."

The raising of the contract ceiling is pending available funds, the USACE said.

The notice came after Puerto Rico cancelled a controversial $300 million power restoration contract with Whitefish Energy Holdings LLC (Whitefish, Montana), after the Federal Emergency Management Agency said it has significant concerns over the contract procurement and the proposed charges by Whitefish.

At least three-fourths of the island's electrical infrastructure was lost to the storms. This included more than 2,400 miles of transmission lines and 31,000 miles of distribution lines that delivered power to homes and businesses. For more information, see September 28, 2017, article - Puerto Rico's Hurricane-Stricken Power Industry Faces Long Road to Recovery.

Well over a month after the hurricane laid waste to the Island, most of Puerto Rico's residents still do not have electric power.

The USACE reported Wednesday that its Albuquerque District had installed 366 temporary generators as of October 28. The generators were providing more than 122 megawatts of power to 48 hospitals, 44 wastewater facilities, 190 water pumps, 30 emergency services facilities, 10 airports and other critical facilities, the USACE said.

Two mobile turbine generators were connected last week to provide 50 megawatts to the partially idled Palo Seco plant west of San Juan, according to Bloomberg.

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