CH2M Adds Shell to Roster of EPC Services for LNG, Pipeline and Other Energy Projects

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Researched by Industrial Info Resources (Sugar Land, Texas)--CH2M Hill (Denver, Colorado) announced it has signed a framework agreement with Royal Dutch Shell plc (NYSE:RDS.A) (The Hague, Netherlands) to provide engineering, procurement, construction and project management (EPCM) services to Shell's global operating sites and business units. The deal adds to a long list of projects CH2M is developing for major companies, including ConocoPhillips (NYSE:COP) (Houston, Texas), Williams Partners LP (NYSE:WPZ) (Tulsa, Oklahoma) and Pembina Pipeline Corporation (NYSE:PBA) (Calgary, Alberta). Industrial Info is tracking more than $73 billion in active projects involving CH2M.

CH2M already has its hands in numerous big-ticket projects on across North America, including ConocoPhillips' massive Alaska LNG Project, which would include a $15 billion production and export terminal and a $7.5 billion gas-treatment plant. The project would produce 18 million tonnes per year of liquefied natural gas (LNG) to be shipped across the Pacific to markets in Asia; however, it has been deemed less cost-effective when compared with competing LNG projects that would supply the same region, according to a study last year from global consultancy firm Wood Mackenzie Limited (Edinburgh, Scotland). For more information, see Industrial Info's project reports on the terminal and gas-treatment plant.

But there may be hope yet. According to Alaska Daily News, Alaska's Gov. Bill Walker (R) asked President Donald Trump, in a February 7 letter, to lend his support to Alaska LNG, which he called an "ideal" megaproject, as part of Trump's proposed $1 trillion plan to rebuild domestic infrastructure. Walker requested a federal tax exemption; reduced federal oversight, giving the state more control; and a $40 billion federal loan guarantee, according to Alaska Daily News. With many other high-value energy proposals competing for Trump's support (and a Congress likely to have a more restrained view on infrastructure spending than the White House), it's difficult to predict if Walker's wish will be granted.

A smaller, but just as significant, Alaskan project involving CH2M is Alaska Gasline Development Corporation's (AGDC) Alaska Stand Alone Gas Pipeline Project, which includes a $4 billion, 733-mile line from Prudhoe Bay to Cook Inlet, a $350 million compressor station in Prudhoe Bay and a $140 million compressor station in Wiseman. According to the Alaska Journal of Commerce, AGDC is closing in on federal permits, with final regulatory approval roughly a year away, which is sooner than what had been projected. The U.S. Army Corps of Engineers is expected to have a draft supplemental environmental impact statement out for public review by mid-May, one official told the Journal. For more information, see Industrial Info's project reports on the pipeline and the Prudhoe Bay and Wiseman compressor stations.

Further south is one of the largest projects involving CH2M to be under construction: Williams Partners LP's $260 million Dalton Expansion project for the Transcontinental Gas Pipeline in Georgia, which includes a $25 million segment running from Coweta County to Carroll County, a $75 million segment from Carroll County to Bartow County, and an $80 million segment from Bartow County to Whitfield County. The pipeline will have a capacity of 448 million standard cubic feet per day. For more information, see Industrial Info's project reports on the segments originating in Coweta County, Carroll County and Bartow County.

CH2M's highest-valued project under construction in Canada is Pembina Pipeline Corporation's $1.5 billion, third-phase expansion, which includes an $800 million segment running from Fox Creek to Edmonton in Alberta, and a $100 million segment from Taylor, British Columbia, to Gordondale, Alberta. The new segments are expected to transport 420,000 barrels per day (BBL/d) of crude oil and condensate, with the potential to expand to 680,000 BBL/d. For more information, see Industrial Info's project reports on the segments originating in Fox Creek and Taylor.

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