Amec Foster Wheeler PLC Enterprise PDH litigation (7062J)

TIDMAMFW

RNS Number : 7062J

Amec Foster Wheeler PLC

13 September 2016

Enterprise PDH litigation

Further to the update in our half-year results, Enterprise Products has filed a lawsuit in the Harris County Court, Texas alleging Amec Foster Wheeler is responsible for cost overruns and delays on Enterprise's propane dehydrogenation ("PDH") unit in Mont Belvieu.

Amec Foster Wheeler signed a contract with Enterprise in July 2013, covering engineering, procurement and construction activities. The principal terms are for payment of hourly rates and costs on a reimbursable basis with an estimate for the date of completion. For the avoidance of doubt, this was not a fixed-price contract.

As disclosed in the 2015 report and accounts, we have taken a provision of GBP33m on this project against disallowed costs and warranties as part of the adjustment to fair values of Foster Wheeler AG's assets and liabilities post acquisition.

The contract we signed with Enterprise allocated risk on timing and cost to them and this legal process appears to be an attempt to avoid the terms they signed up to in 2013. We consider these proceedings to be misconceived and we intend to vigorously defend these claims.

Enquiries to:

 
 Media: 
  Achilleas Georgiou (UK)      + 44 (0)20 7429 7500 
  Lauren Gallagher (US)        [phone] 
 
  Investors: 
  Rupert Green                 [phone] 
 

Notes to editors:

Amec Foster Wheeler (www.amecfw.com) designs, delivers and maintains strategic and complex assets for its customers across the global energy and related sectors.

Employing around 36,000 people in more than 55 countries and with 2015 revenues of GBP5.5 billion, the company operates across the oil and gas industry - from production through to refining, processing and distribution of derivative products - and in the mining, clean energy, power generation, pharma, environment and infrastructure markets.

Amec Foster Wheeler offers full life-cycle services to offshore and onshore oil and gas projects (conventional and unconventional, upstream, midstream and downstream) for greenfield, brownfield and asset support projects, plus leading refining technology.

Amec Foster Wheeler shares are publicly traded on the London Stock Exchange and its American Depositary Shares are traded on the New York Stock Exchange. Both trade under the ticker AMFW.

Forward-Looking Statements

This announcement contains statements which constitute "forward-looking statements". Forward-looking statements include any statements related to the timing, results and success of contracts, and are generally identified by words such as "believe," "expect," "anticipate," "intend," "estimate," "will," "may," "continue," "should" and other similar expressions. Forward-looking statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Amec Foster Wheeler, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking statements. Amec Foster Wheeler does not undertake to update any of the forward-looking statements after this date to conform such statements to actual results, to reflect the occurrence of anticipated results or otherwise.

This information is provided by RNS

The company news service from the London Stock Exchange

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September 13, 2016 07:30 ET (11:30 GMT)