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Researched by Industrial Info Resources (Sugar Land, Texas)--SNC-Lavalin Constructors Incorporated (TSX:SNC) (Montreal, Quebec), a leading engineering, procurement and construction (EPC) firm, is enjoying a record backlog and a growing role in some of the West's most anticipated energy projects, despite the challenges of the collapse in oil prices. Industrial Info's project database is tracking 101 projects worth $120.10 billion that involve SNC-Lavalin in some role. More than half of the total investment value is attributed to the 10 highest-valued projects, and more than 90% can be found in just three industries: Power, Metals & Minerals and Oil & Gas Production.
In the first quarter, SNC-Lavalin reported a $3.4 billion increase in its backlog, bringing the total to a record $13.4 billion. Consistent with the company's biggest industries, $1.8 billion was attributed to the Oil & Gas Industry and $1.1 billion to the Power Industry. The latter group includes a major role in nuclear power developments; earlier this week, SNC-Lavalin was awarded two contracts from Ontario Power Generation, totaling almost $400 million, for nuclear services at the Darlington Nuclear Generating Station in Ontario.
By far, the largest and most closely watched project to involve SNC-Lavalin is one of the world's most important (and expensive) experimental projects: The $22.12 billion ITER (International Thermonuclear Experimental Reactor) nuclear fusion power station in Cadarache, France. The 500-megawatt (MW) multi-phase project involves constructing the tokamak facility (which includes a containment building, reactor, steam turbine and generator), installing the resulting plasma and then installing deuterium tritium operations. (Whereas nuclear plants traditionally generate energy by breaking apart atoms, the tokamak fusion process smashes atoms together at high speeds, creating plasma that burns hotter than the sun.) For more information, see Industrial Info's project report.
The ITER project has faced extensive delays and is far over its budget; ITER's director-general recently said that the fusion reactor will take an additional five years and 4.6 billion euros ($5.2 billion) before it begins testing. According to Science Magazine, when the ITER partners--the European Union, China, India, Japan, Russia, South Korea and the U.S.--signed on to build the project in 2006, it was expected to cost $12 billion and to begin "first plasma" runs this year. The U.S. initially agreed to pay for $1.1 billion of the project, but its share has since ballooned to $3.9 billion and could go as high as $5 billion; the U.S. Department of Energy has been struggling to convince Congress to continue to provide funding for the massive project. European and other funding sources also have become wary.
Along with Cap-Ingelec (Saint Jean d'Illac, France), SNC-Lavalin prepared the detailed project report for the pilot station. Earlier this week, ITER signed a 10-year, 174 million-euro ($193 million) contract with the Momentum joint venture, which includes AMEC Foster Wheeler plc (NYSE:AMFW) (London, England), Assystem AS (Paris, France) and Kepco Engineering & Construction (Seoul, South Korea). Momentum will manage and coordinate the assembly and installation of more than 1 million components for the tokamak and related plant systems, according to World Nuclear News, a media outlet for the World Nuclear Association (London, England). There is an option for a three-year extension to the contract.
SNC-Lavalin is providing engineering services for one of North America's most expensive renewable-energy projects: BC Hydro & Power Authority's (Vancouver, British Columbia) 8.5 billion Site C Clean Energy Project in Fort Saint John, British Columbia. The 1,100-megawatt project, which will be a third dam and hydroelectric generating station on the Peace River, will comprise a 196-foot-high, earth-fill dam for a 23,000-acre reservoir; and a powerhouse with six hydroelectric turbine generators, each with a capacity of 183.3 MW. For more information, see Industrial Info's project report.
The main civil works construction for the project began earlier this month. BC Hydro estimates British Columbia will see a 40% increase in power demand over the next two decades, and expects the project to help meet that demand. It also expects to see about 1,500 workers employed at the peak of civil construction.
The highest-valued projects involving SNC-Lavalin in the Oil & Gas Production Industry looks much less likely to start up anytime in the next few years: Statoil ASA's (NYSE:STO) (Stavangar, Norway) $6 billion jacket construction at the Bressay Oil Field development, offshore Scotland in the North Sea. SNC-Lavalin is slated to perform front-end engineering design for a four-leg, 19,000-tonne steel structure jacket. The Bressay Platform was expected to have a processing capacity of 55,000 barrels per day (BBL/d). But like several other projects in the North Sea, the Bressay development has been put on hold indefinitely, due to low oil prices and is unlikely to kick off until 2018 at the earliest. For more information, see Industrial Info's project report.
The largest Metals & Minerals Industry project involving SNC-Lavalin is Wuhan Iron & Steel Group Corporation (Wuhan, China) and Adriana Resources Incorporated's (TSX:ADI) (Toronto, Ontario) $5.7 billion Lac Otelnuk Iron Ore Mine and Pellet Plant in Riviere-Koksoak, Quebec, on which the company is serving as a design consultant. It is the first phase of a $14.2 billion, two-phase project to develop 212 million-ton-per-year open pit mining operation and processing plant that will produce 50 million tons per year of pellet feed iron ore concentrate over a 30-year mine life. Construction will include a 92 million-ton-per-year open pit mine and concentrator, with three 10 million-ton-per year process trains. For more information, see Industrial Info's project report.
The six other highest-valued projects involving SNC-Lavalin are:
In the first quarter, SNC-Lavalin reported a $3.4 billion increase in its backlog, bringing the total to a record $13.4 billion. Consistent with the company's biggest industries, $1.8 billion was attributed to the Oil & Gas Industry and $1.1 billion to the Power Industry. The latter group includes a major role in nuclear power developments; earlier this week, SNC-Lavalin was awarded two contracts from Ontario Power Generation, totaling almost $400 million, for nuclear services at the Darlington Nuclear Generating Station in Ontario.
By far, the largest and most closely watched project to involve SNC-Lavalin is one of the world's most important (and expensive) experimental projects: The $22.12 billion ITER (International Thermonuclear Experimental Reactor) nuclear fusion power station in Cadarache, France. The 500-megawatt (MW) multi-phase project involves constructing the tokamak facility (which includes a containment building, reactor, steam turbine and generator), installing the resulting plasma and then installing deuterium tritium operations. (Whereas nuclear plants traditionally generate energy by breaking apart atoms, the tokamak fusion process smashes atoms together at high speeds, creating plasma that burns hotter than the sun.) For more information, see Industrial Info's project report.
The ITER project has faced extensive delays and is far over its budget; ITER's director-general recently said that the fusion reactor will take an additional five years and 4.6 billion euros ($5.2 billion) before it begins testing. According to Science Magazine, when the ITER partners--the European Union, China, India, Japan, Russia, South Korea and the U.S.--signed on to build the project in 2006, it was expected to cost $12 billion and to begin "first plasma" runs this year. The U.S. initially agreed to pay for $1.1 billion of the project, but its share has since ballooned to $3.9 billion and could go as high as $5 billion; the U.S. Department of Energy has been struggling to convince Congress to continue to provide funding for the massive project. European and other funding sources also have become wary.
Along with Cap-Ingelec (Saint Jean d'Illac, France), SNC-Lavalin prepared the detailed project report for the pilot station. Earlier this week, ITER signed a 10-year, 174 million-euro ($193 million) contract with the Momentum joint venture, which includes AMEC Foster Wheeler plc (NYSE:AMFW) (London, England), Assystem AS (Paris, France) and Kepco Engineering & Construction (Seoul, South Korea). Momentum will manage and coordinate the assembly and installation of more than 1 million components for the tokamak and related plant systems, according to World Nuclear News, a media outlet for the World Nuclear Association (London, England). There is an option for a three-year extension to the contract.
SNC-Lavalin is providing engineering services for one of North America's most expensive renewable-energy projects: BC Hydro & Power Authority's (Vancouver, British Columbia) 8.5 billion Site C Clean Energy Project in Fort Saint John, British Columbia. The 1,100-megawatt project, which will be a third dam and hydroelectric generating station on the Peace River, will comprise a 196-foot-high, earth-fill dam for a 23,000-acre reservoir; and a powerhouse with six hydroelectric turbine generators, each with a capacity of 183.3 MW. For more information, see Industrial Info's project report.
The main civil works construction for the project began earlier this month. BC Hydro estimates British Columbia will see a 40% increase in power demand over the next two decades, and expects the project to help meet that demand. It also expects to see about 1,500 workers employed at the peak of civil construction.
The highest-valued projects involving SNC-Lavalin in the Oil & Gas Production Industry looks much less likely to start up anytime in the next few years: Statoil ASA's (NYSE:STO) (Stavangar, Norway) $6 billion jacket construction at the Bressay Oil Field development, offshore Scotland in the North Sea. SNC-Lavalin is slated to perform front-end engineering design for a four-leg, 19,000-tonne steel structure jacket. The Bressay Platform was expected to have a processing capacity of 55,000 barrels per day (BBL/d). But like several other projects in the North Sea, the Bressay development has been put on hold indefinitely, due to low oil prices and is unlikely to kick off until 2018 at the earliest. For more information, see Industrial Info's project report.
The largest Metals & Minerals Industry project involving SNC-Lavalin is Wuhan Iron & Steel Group Corporation (Wuhan, China) and Adriana Resources Incorporated's (TSX:ADI) (Toronto, Ontario) $5.7 billion Lac Otelnuk Iron Ore Mine and Pellet Plant in Riviere-Koksoak, Quebec, on which the company is serving as a design consultant. It is the first phase of a $14.2 billion, two-phase project to develop 212 million-ton-per-year open pit mining operation and processing plant that will produce 50 million tons per year of pellet feed iron ore concentrate over a 30-year mine life. Construction will include a 92 million-ton-per-year open pit mine and concentrator, with three 10 million-ton-per year process trains. For more information, see Industrial Info's project report.
The six other highest-valued projects involving SNC-Lavalin are:
- $7 billion: Nalcor Energy's Muskrat Falls Hydro Station in Churchill Falls, Newfoundland
For more information, see Industrial Info's project report. - $4.24 billion: New Millennium Iron Corporation's Taconite KeMag Iron Ore Mine in Schefferville, Quebec
For more information, see Industrial Info's project report. - $4.2 billion: Unit 2 extension at Ontario Power Generation Incorporated's Darlington Nuclear Power Station in Bowmanville, Ontario
For more information, see Industrial Info's project report. - $2.9 billion: Phase I of Wuhan Iron & Steel Group Corporation and Adriana Resources Incorporated's iron slurry pipeline transport system at Lac Otelnuk Iron Ore Mine and Pellet Plant in Riviere-Koksoak, Quebec
For more information, see Industrial Info's project report. - $2.9 billion: FGE Power LLC's Eagles Pines Natural Gas-Fired Combined-Cycle Plant in New Summerfield, Texas
For more information, see Industrial Info's project report. - $2.61 billion: Encanto Potash Corporation's Muskowekwan Potash Solution Mine and Mill in Lestock, Saskatchewan
For more information, see Industrial Info's project report.
