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Fluor Corporation (NYSE:FLR) announced today that its Power Group was awarded a contract by Toshiba International Corporation, a U.S. business unit of the Toshiba Corporation (TSE:6502), for engineering, procurement and construction-related services for two new nuclear reactors planned for the South Texas Project (STP) Nuclear Generating Station in Bay City, Texas.
Later this year, STP's 44-percent owner, NRG Energy, Inc. (NYSE:NRG) plans to apply to the U.S. Nuclear Regulatory Commission (NRC) for a combined construction and operating license (COL) to build two Advanced Boiling Water Reactors (ABWRs), known as STP Units 3 & 4, which will be adjacent to the two existing reactors (STP Units 1 & 2). NRG announced on Aug. 9, 2007, that it had contracted with Toshiba to provide key reactor components as well as early engineering, procurement and construction-related services for these planned reactors.
"These two new reactor units for the South Texas Project could very well be the first new nuclear power plants built in the United States in more than two decades," said Alan Boeckmann, Fluor Corporation's Chairman and Chief Executive Officer. "Not only will these new units address the growing electricity demand in the nation, but they will do so in a safe, reliable and emissions-free manner."
"As the first wave of the nuclear build-out starts to unfold in the United States, we are pleased to be partnered with Toshiba, as its engineering and construction provider, for this important work. We look forward to helping Toshiba and NRG successfully realize this project and to delivering clean energy that is needed in Texas," said David Constable, president of Fluor's Power Group.
NRG has stated it intends to utilize a three-step, decision-making and contracting approach to move this planned project forward. Fluor will support Toshiba in the first developmental phase of the project by providing project planning, estimating, engineering, procurement and construction-related services. The second phase - design, procurement and construction planning - is expected to begin in late 2007 and will conclude when the NRC issues the combined construction and operating license (COL), currently expected in late 2010. The third phase - construction - is intended to begin immediately upon NRC's issuance of the COL.
The value of this first phase will be booked in the third quarter 2007. Future awards for the second and third phases will be booked as they are awarded.
The project will be managed in Fluor's Greenville office and supported by other Fluor offices including Houston. Early estimates are that there will be approximately 90 engineers and professional staff working on Fluor's effort by the end of 2007. Earlier this year, Fluor's Power Group announced the formation of a dedicated nuclear power business, headquartered in Greenville, S.C., to address the next generation nuclear power market.
"We have been extremely impressed with Toshiba's experience, capabilities and track record of helping develop, and then successfully deliver ABWRs in Japan," said Ron Pitts, senior vice president of Fluor's Nuclear Power business line. "We have worked closely with Toshiba for some time and believe that our companies have the right safety cultures, skillsets and commitments to excellence that will be required to successfully deliver the STP Units 3 & 4."
Fluor Corporation (NYSE:FLR) provides services on a global basis in the fields of project management, engineering, procurement, construction, operations and maintenance and project management. Headquartered in Irving, Texas, Fluor is a FORTUNE 500 company with revenues of $14.1 billion in 2006. For more information, visit www.fluor.com.