Acquisition completes Kvaerner's LNG capabilities

Press release 29/05/2000 00:00 CET

Kvaerner Construction has today announced that it has acquired Whessoe International Ltd, the Liquid Natural Gas technology subsidiary of German group, Babcock Borsig. Also included in the purchase are some of the assets of Whessoe LGA Gas Technology Ltd.

This move completes Kvaerner’s LNG skills base giving it a total capability for the design and construction of Liquid Natural Gas (LNG) facilities for the world energy market. Kvaerner now has a 10% share of the expanding $1 bn per annum LNG market and the combined strengthens and capabilities of Whessoe’s existing skill base with Kvaerner’s lump sum turnkey contracting capability places Kvaerner in an enviable position to go for market leadership.

It is Kvaerner Construction’s first acquisition since the Kvaerner Group’s major restructuring in 1998 and follows good first quarter results announced earlier this month in which Kvaerner Construction showed continued steady improvement with turnover of £1.3 billion and a return on sales of 3%.

Chief executive for Kvaerner Construction, Keith Clarke, said: “This affirms our continuing strategy to expand our skills base by selective acquisition where it will give us added value. We are extremely patient as we believe in waiting for the right opportunities. In 1997 we acquired Andrews Weatherfoil and merged it with our existing M&E company. Today Kvaerner Rashleigh Weatherfoil ranks among the top five mechanical, electrical and facilities services companies in the UK.

“The Whessoe acquisition makes us a market leader in another specialist field with a buoyant market and one which is set to expand. To succeed in the LNG market one has to have both credibility and track record. Combining Whessoe’s skills base with our existing capabilities gives us an expertise that few in this field can match.”

Whessoe International is a company committed to high integrity engineering with expertise in procurement, project management and specialist engineering including the design of pressurised low temperature (minus 160 degrees C) cryogenic storage and handling facilities particularly for LNG and LPG terminals for which it is world renowned.

Its acquisition completes the range of LNG expertise in the Kvaerner group giving Kvaerner a total capability in the LNG market with all the core skills to take a project through from process, tank and civils design to procurement, construction, process installation and commissioning.

Both companies are already well established in the LNG market place. Kvaerner and Whessoe are currently working together on a major LNG project in Dabhol, India. This $300m turnkey project, to design and build an LNG supply facility for a new power station on the west coast of India, has already set new records in tank construction having successfully lifted the 85 metre roofs on two 160,000 cubic metre tanks several weeks ahead of programme. Kvaerner Construction is the main turnkey contractor with Whessoe handling the design engineering and procurement of the tanks. The client is Lingtec, a subsidiary of Enron.

Other current projects include the recently awarded Distry Gas project, a cold recovery study for an LNG import terminal in Boston, USA, and a major technology transfer to Korea Gas based on the design and construction of three new storage tanks.