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Fluor awarded early works contract for Gladstone LNG project

LNG Industry,

Fluor Corporation announced today that Santos has chosen Fluor Australia as the preferred contractor for engineering, procurement and construction (EPC) work on the upstream facilities component of the Gladstone Liquefied Natural Gas (GLNG) project. In anticipation of awarding a full EPC contract, Santos, in the interim, has extended Fluor's current engineering design contract to include early works activities. Fluor will book approximately US$ 45 million in the second quarter of 2010 with a full EPC contract award expected later in 2010.

"Fluor is honored to be chosen to continue to help Santos with this pioneering energy project to convert coal seam gas from the Surat and Bowen basins in Queensland into LNG," said Peter Oosterveer, president of Fluor's Energy & Chemicals Group. "We anticipate using our depth of local resources and global talent and expertise to help our client deliver a cleaner energy source for Australia."

Rick Wilkinson, Santos president, GLNG and Queensland, said, "The selection of Fluor Australia - a tier-one EPC company with long-term experience in major project engineering, procurement and construction both in Australia and internationally, marks a major project milestone."

Fluor will work closely with Santos to engage with industry stakeholders especially local businesses, the Industry Capability Network and local interest groups to ensure maximum opportunities for Australian industry as preparation for the project execution progresses.

There had been fears that the recently announced super resource tax in Australia would mean that the project would be significantly delayed, as there are concerns that the tax could make some coal seam gas projects economically unviable.

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