news update
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FW N e w s
Foster Wheeler Secures
New Credit Facilities
O
n August 16, Foster Wheeler
announced that it has
entered into new credit
facilities, which will extend into
2005. The new facilities will provide
$82 million in increased liquidity
to the company. As a result of
securing the new credit facilities,
$904 million of the company’s
$1.1 billion in outstanding debt,
previously classified as current, has
been reclassified as long-term. In
addition, the company reported cash
balances worldwide of $344 million
as of June 28, 2002.
The new credit arrangements
include a $290 million senior
secured term loan and revolving
credit facility that matures in
April 2005, and has no scheduled
principal payments prior to
maturity. The company has
also entered into a $40 million
receivables sale agreement that
matures in August 2005, and has
replaced its previous lease financing
facility associated with its Clinton,
N.J., headquarters complex.
“I am extremely pleased
that we have completed these
transactions, which provide
greater financial flexibility and
enable us to be more competitive
in the markets we serve,” said
Raymond J. Milchovich, FW
chairman, president and CEO.
“We now have the ability to
continue with our performance
improvement initiatives, which
include a plan to generate more
than $150 million in cash over the
next six months by monetizing
assets, resolving project claims and
collecting overdue receivables.” ❏
2 FOSTER WHEELER REVIEW
Project News
and Updates
Foster Wheeler Completes FPL
Energy Power Plant in Long Island
oster Wheeler Power Group, Inc.
F has performed its design,
construction and start-up of FPL
Energy’s Bayswater Energy Center on
schedule, and achieved commercial oper-
ation of the facility on June 27, 2002.
This project is located in Far
Rockaway, Queens, New York City,
adjacent to Keyspan’s existing Far
Rockaway Generating Plant. Foster
Wheeler’s work on the project is valued
at more than $30 million, and was
released to begin in December 2001.
The project provides peaking
power through an environmentally
clean natural gas-fired turbine genera-
tion system. The project can generate
54 megawatts of power (enough to
supply about 50,000 homes) during
times of peak power demand, when
power generation capacity is most
needed. The Bayswater facility is
owned and operated by FPL Energy,
a subsidiary of FPL Group, Inc.
This is the only power facility to be
completed ahead of schedule for power
generation in the Long Island area,
and it has become operational in time
for the peak power demand periods
this summer. Foster Wheeler Power
Group, Inc. worked closely with local
construction labor and contractors to
accomplish this.
Kim Hornbuckle, project manager,
Foster Wheeler, stated, “Achieving
commercial operation ahead of sched-
ule, in time for New York’s hot-weather
peak-load demands, resulted from
a dedicated and focused team effort
to meet our customer’s needs. Our
project-execution and construction
teams did an excellent job in achieving
this important result.” ❏
BOC-Foster Wheeler Celebrate
Launch of England’s Biggest
Hydrogen Plant on Teesside
he largest hydrogen production
T
plant in England built by
Foster Wheeler, and owned and
operated by BOC, has come onstream
at Huntsman’s manufacturing opera-
tions on Teesside, UK.
The project, which was completed
in early 2002, was built on time and
on budget, with no safety incidents in
more than 400,000 man-hours worked.
The $43.7 million hydrogen plant
at Huntsman’s North Tees site near
Seal Sands will supply up to 32,000
tonnes a year of high-purity hydrogen
by pipeline to Huntsman’s production
facilities at North Tees and Wilton.
Under a 15-year supply agreement
with Huntsman, the plant will also
supply 100 tonnes an hour of high-
pressure steam to the North Tees site.
Design and construction of the
plant, which included the building of a
new pipeline infrastructure under the
River Tees, was undertaken and man-
aged by Foster Wheeler Energy Limited
under the business alliance with BOC.
The plant utilizes Foster Wheeler’s
proprietary TERRACE-WALL™ Steam
Methane Reforming Furnace. Operation
of the new plant will be managed as
part of BOC’s existing Teesside facility,
one of the largest industrial gases
complexes in Europe. ❏
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 Navy Awards $100 Million Contract
he U.S. Navy, Engineering Field
T
Activity Northwest (EFANW)
Naval Facilities Engineering Field
Command granted Foster Wheeler
Environmental Corporation a remedial
action contract (RAC) with a value
of up to $100 million – the third
consecutive RAC award the company
has received from EFANW.
Under this contract, Foster Wheeler
Environmental will perform remedial
actions at environmental contaminated
sites predominantly located at Navy
and U.S. Marine Corps installations and
other government agencies. The sites
will consist of those ranked on the
Superfund National Priority List (NPL),
as well as non-NPL sites regulated
under the Comprehensive Environmental
Response, Compensation, and Liability
Act (CERCLA); Resource Conservation
and Recovery Act (RCRA); Underground
Storage Tanks (UST), and state environ-
mental regulatory programs; as well
as other sites which might require
remedial action.
As part of its team, Foster Wheeler
Environmental will use several subcon-
tractors with whom Foster Wheeler
has worked on EFANW RAC II: TekStar,
an Alaska native small disadvantaged
business (SDB) and protégé of Foster
Wheeler Environmental; Cherokee
General, a Native American SDB; and
Earthworks Environmental, a woman-
owned SDB. ❏
Foster Wheeler Receives Special
Recognition from the Province
Of Batangas, Philippines
oster Wheeler Energy Limited
F
received special recognition for
its involvement in completing the
Malampaya Onshore Gas Plant by the
province of Batangas, Philippines. The
award was given for Foster Wheeler’s
participation in the Malampaya Deep
Water Gas-to-Power Project, which
helps the province not only in terms of
employment and economic advancement,
but also in transferring technology.
The award was presented to Foster
Wheeler by Hermilando I. Mandanas,
governor of the province, in special
recognition of the company’s commit-
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ment to environmental protection
and social responsibilities, which will
advance the status of Batangas’ rural
communities.
The award is given for services
to the local community that are above
and beyond what is contractually
required. During its contract at the
Malampaya Onshore Gas Plant, Foster
Wheeler supported the province’s
local initiatives. ❏
$275 Million Delayed Coker
Contract by Valero Refining
alero Refining Company awarded
V an engineering, procurement
and construction contract, valued
at $275 million, to Foster Wheeler
USA Corporation for a delayed coker
and associated facilities.
The coker will be built to modify
Valero’s existing refinery located in Texas
City, Texas, and will enable the facility to
process heavy, sour Maya crude.
The company’s scope of work will
consist of designing and constructing
the 45,000 barrels per stream day
(bpsd) delayed coker, a new sour-water
stripper, miscellaneous offsites and
utilities to support the new units, and
associated process-unit revamps.
The project will use Foster Wheeler’s
proprietary SYDECSM delayed-coking
technology, and process a combined
feedstock of Maya vacuum-tower
bottoms and pitch from Middle Eastern
crude. The project is expected to lower
Texas City Refinery’s feedstock costs
by over $1 per barrel, and should
raise the refinery’s return on capital
employed by 3 percent.
Engineering on the delayed-coker
project has already commenced, and
the project is scheduled for mechanical
completion in fourth quarter 2003. ❏
Foster Wheeler Secures Major
Power Plant Contract in the UK
mmingham CHP LLP (ICHP)
I
awarded Foster Wheeler Energy
Limited an engineering, procure-
ment and construction management
contract for a 730-megawatt combined
heat and power (CHP) plant, the largest
ever built in the UK, with a total invest-
ment cost of more than $300 million.
The Immingham CHP plant, one of
the largest, cleanest and most efficient
CHP plants in Europe, will be built
alongside Conoco’s Humber Refinery at
South Killingholme, North Lincolnshire.
The facility will supply steam and elec-
tricity to the Humber Refinery, steam
to the neighboring Lindsey Oil Refinery,
and electricity to the national grid.
Foster Wheeler is responsible for
the detailed engineering design, pro-
curement, construction management,
commissioning, start-up, performance
testing and turnover of the completed
plant. Foster Wheeler will also provide
training services, and operational and
maintenance manuals and materials. ❏
Foster Wheeler Wins Three
Biomass-Based Power Plants
in Germany
innish-based subsidiary Foster
F Wheeler Energia Oy was awarded
three power plant projects in
Germany in the wake of the country’s
modified bioenergy legislation, intro-
duced in May 2001.
The value of the projects is approx-
imately $70 million, and each will use
Foster Wheeler’s advanced circulating
fluidized-bed (CFB) boiler technology
applied to biomass-based power
generation.
A 20 MWe turnkey biomass-fired
power plant has been awarded by
German-based MVV Energie AG.
The plant will be located at Konigs
Wusterhausen, near Berlin, and is
scheduled for completion in mid-2003.
Prokon Nord Energiesysteme GmbH
also awarded Foster Wheeler a contract
for a 63 MWt CFB unit at Papenburg.
The plant, which is scheduled for
completion in fall 2003, will primarily
supply industrial customers, and will
also generate 20 MWe of electricity.
In addition, Heizkraftwerk Kehl
GmbH, majority-owned by a subsidiary
of Germany’s second-largest utility,
RWE, selected Foster Wheeler to supply
a turnkey 44 MWt CFB boiler plant.
This unit, scheduled for completion in
early 2003, will be part of a plant
supplying electricity to the national
grid, and process steam to the Kohler
paper mill in Kehl. ❏
FOSTER WHEELER REVIEW 3
Project News and Updates
Double Win at Lindsey
Oil Refinery, UK
otalFinaElf selected Foster
T
Wheeler to provide engineering
and procurement services
associated with clean-fuels investment
projects totaling $36.4 million at its
Lindsey Oil Refinery, Immingham, UK.
Foster Wheeler’s Teesside operation
will execute the projects, which involve
the revamp of Lindsey Oil Refinery’s
hydro-desulfurization (HDS) and
unifiner units at Immingham. These
revamps will allow Lindsey Oil Refinery
to produce diesel and gasoline fuels to
meet the latest clean-fuel specifica-
tions. The revamp projects, which
include specification of a new HDS
reactor, are located in an existing plot
area of the refinery, and governed by
a fast-track schedule. The front-end
engineering design for the HDS revamp
was also carried out by Foster Wheeler.
In addition, Foster Wheeler has
also signed a term services agreement
with Lindsey Oil Refinery. Under this
agreement, Foster Wheeler’s scope will
include miscellaneous capital project
work to support refinery operations
and turnarounds. Foster Wheeler will
also provide technical personnel to
the refinery. ❏
EPC Manager Selected for
Mozambique’s First Major
Upstream Development
asol Petroleum Temane Limitada
S
granted a $130 million engineer-
ing, procurement and construc-
tion management (EPCm) contract
for an upstream gas facility to Foster
Wheeler’s subsidiary, Foster Wheeler
South Africa (Pty) Limited. The project
is based in Temane, Republic of
Mozambique, and is the first major
upstream and petrochemical develop-
ment in that country.
Foster Wheeler will be responsible
for developing a facility at the Temane
gas field that produces sales-quality
gas for transmission to South Africa.
Development will include infield flow
lines from 11 well sites and central-
processing facilities. With a natural-
gas feedstock, the facility will produce
120 million gigajoules per year of
sales-quality gas. ❏
4 FOSTER WHEELER REVIEW
Enagas Awards Two LNG Terminal
Expansion Projects in Spain
nagas, the leading Spanish natural
E
gas supplier, awarded a contract
for two liquefied natural gas
(LNG) terminal expansions, in Cartagena
and Huelva, to Foster Wheeler’s
subsidiary, Foster Wheeler Iberia.
Foster Wheeler is responsible for
detailed engineering, equipment and
material procurement, and construction
supervision for both projects, which
have an overall estimated investment
value of $122 million.
The Cartagena terminal project will
expand its capacity from 450,000 to
600,000 Nm3/h (normal cubic meters
per hour), and includes installation of
new vaporization lines, send-out pumps,
a seawater system, and utilities.
The Huelva terminal is being
expanded from a capacity of 450,000
to 900,000 Nm3/h. This expansion
involves installing open racks of seawa-
ter vaporizers, submerged combustion
vaporizers, primary pumps, send-out
pumps, boil-off compressors, and
corresponding auxiliary equipment.
Also, installation of a new tank will
increase storage capacity from 160,000
to 310,000 m3 (cubic meters). ❏
FEED Contract for Turkmenistan
Refinery Revamp
basic and front-end engineering
A
design (FEED) contract was
awarded to Foster Wheeler Ltd.’s
subsidiary, Foster Wheeler Italiana
S.p.A., by Emerol Ltd. to revamp a
delayed-coker unit at its refinery in
Turkmenbashi, Republic of Turkmenistan.
The total value of the project is
approximately $43 million, and the FEED
is expected to be completed by early 2003.
The contract calls for modernization
and debottlenecking of the present
Russian-designed delayed-coker unit.
Revamp of this conversion unit will
include Foster Wheeler’s proprietary
delayed-coking technology. ❏
$84 Million Contract for Goldeneye
Onshore Gas Plant
hell U.K. Limited and its co-ventur-
S
ers awarded Foster Wheeler an
$84 million contract for engineer-
ing, procurement and construction
(EPC) of the Goldeneye gas condensate
onshore processing facility at the
Shell/Esso St. Fergus gas plant,
Aberdeenshire, Scotland.
This facility is part of an innovative
development concept. From a small,
unmanned platform offshore, multi-
phase wellhead products will be trans-
ported via a 105-kilometer pipeline
to a new processing facility onshore.
The onshore gas plant will process
300 million standard cubic feet per
day (mmscfd) of wet gas, and 10,000
barrels per day of condensate. At the
planned plateau production rate, the
facility will meet about 3 percent of
the UK’s current daily demand. ❏
Project Management Contract
in Saudi Arabia
ulf Farabi Petrochemicals
G
Company Limited – a company
promoted by the Al-Rajhi Group
of Companies, Al-Rajhi International
Contracting – appointed Foster Wheeler
Energy Limited as project management
contractor (PMC) for its linear paraffin
(n-paraffin) series and linear alkyl
benzene (LAB) project.
The $250 million grassroots plant
will produce 120,000 metric tonnes
per year of n-paraffin and 70,000 metric
tonnes per year of LAB. It will be locat-
ed in Al-Jubail, Saudi Arabia, adjacent
to the Saudi Aramco Shell Refinery
Company (SASREF) refinery that will
supply the kerosene feedstock, signify-
ing a collaboration between Gulf Farabi
Petrochemicals and SASREF.
Phase 1 (definition) is scheduled
for completion at the end of 2002.
During this phase, Foster Wheeler will
develop the project specification from
UOP design packages, prepare the
environmental-impact-assessment
report, issue invitations to bid for the
engineering, procurement and construc-
tion (EPC) contract, and make the EPC
award recommendation to an interna-
tional contractor.
Additionally, in conjunction with
its in-kingdom partner, Radicon Gulf
Consult, Foster Wheeler will prepare
the design specification for the utilities
and services. Radicon Gulf Consult
will also process local approvals and
permits for Foster Wheeler.
During Phase 2 (engineering and
construction), Foster Wheeler will
manage the project through the EPC
phase, and will further provide con-
struction management services and
commissioning assistance through to
the successful production of n-paraffin
and LAB. Plant completion will be in
fourth quarter 2004, with commercial
production also planned at that time. ❏
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