Amec wins £460m US deal as it switches focus from North Sea

AMEC Foster Wheeler, which is being taken over by Wood Group, has won a $600 million (£460m) contract to help build a giant chemicals plant in the USA.
The company will provide engineering and construction services on a $1.8bn methanol production plant that is being developed by China’s Yuhuang Chemical Inc in Louisiana state.
Chief executive Jon Lewis said Amec Foster Wheeler was delighted to support YCI on what he called the largest grassroots foreign direct investment by a Chinese company on the US Gulf .
The win provides some vindication for Aberdeen-based Wood Group’s decision to make its recommended £2.2bn offer for the rival Amec Foster Wheeler business.
The oil services giant made the move to help reduce its reliance on the North Sea market, which has been hit hard by the sharp fall in crude prices since 2014.
In its interim results announcement last month Wood highlighted particularly challenging conditions in the North Sea, where firms have slashed spending on new facilities in response to the price fall.
London-based Amec Foster Wheeler is active in markets ranging from environmental to nuclear engineering.
The company has put the bulk of its North Sea oil services operation up for sale to address competition concerns about the planned takeover by Wood Group. Shareholders in both groups have backed the deal.
Amec Foster Wheeler noted it had been trying to grow its chemicals business. The sector has benefited from falls in the prices of oil and gases used as feedstocks.
Separately, Wood Group has received a boost in its efforts to grow in overseas markets after winning a contract to provide subsea engineering services on the giant Ichthys liquefied natural gas development off Western Australia.
The value of the five year deal was not disclosed. Wood has been working on the INPEX-operated Icthys development for 12 years and has been involved since the early planning stages of the project.
Meanwhile Petrofac, which has a big North Sea business, has won a $700m contract to provide engineering and construction services at a processing terminal on Sakhalin island off eastern Russia for a consortium that includes Royal Dutch Shell
It sustained heavy losses on a contract to build a gas processing terminal on Shetland for Total.
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