Contrary to its name, Chicago Bridge & Iron Company (CB&I) doesn't build iron bridges in the Windy City. It is a global specialty engineering and construction company that designs and constructs energy infrastructure projects such as liquefied natural gas storage, petrochemical and gas processing plants, and heat transfer equipment. In addition to providing the technology used inside such facilities, the company also specializes in constructing storage tanks and other vessels. Major customers include CNOOC, Valero, Chevron, and SABIC. The company also serves other large corporations in the hydrocarbon, energy, power generation, and petrochemical industries.
The company operates in three business segments, which complete around 700 projects each year. Its largest division, project engineering and construction, which accounts for about half of sales, builds upstream and downstream oil and gas infrastructure facilities such as refineries and petrochemical plants. Another division, Steel Plate Structures, builds storage tanks and other containment devises used in the oil and gas, water and wastewater, mining and nuclear industries.
CB&I's Lummus Technology segment provides licensed process technologies and specialty equipment used in its facilities. In 2011 CB&I acquired the 50% of CDTECH (Catalytic Distillation Technologies) that it already didn't own. The acquisition enabled the company to increase its base of prospective clients. The deal also helped expand CB&I's research and development capabilities. CDTECH was integrated into Lummus Technology.
Over the years CB&I has broadened its geographic reach and expanded its capabilities through organic growth and through strategic acquisitions. In 2012 it announced one of its largest to date, the approximately $3 billon purchase of US-based Shaw Group, which focuses on the power generation and government services sectors.
About 80% of CB&I's revenue comes from outside the US. Revenue mix shifts as global energy demand changes and the company wins contracts in various countries. CB&I's geographic diversity has helped the company remain on solid footing even during the global economic crisis.
There has been strong demand in the liquefied natural gas (LNG) market across the globe. CB&I's global position in the LNG market was enhanced after it completed a multi-billion dollar LNG plant in Peru in 2010. Other liquefaction plants are under development in Australia and Russia. Petrochemical activity in developing countries also began to pick up in 2010, while the sluggish refining activity began showing signs of improvement.
CB&I's flexibility has helped it enjoy the benefits of economic recovery and growth in some parts of the world. Both sales and net income increased by some 25% in 2011. The results were driven mostly by an increase in construction activity in the company's large steel plate structure and project engineering and construction segments.
Moving forward the company is mainly focused on the LNG, gas processing, refining, petrochemicals, oil sand, offshore, and nuclear power markets. These growth industries have been identified as a way for CB&I to achieve sustained growth even if markets slow, technologies change, or customer appetites shift.
Recent CB&I projects include the design and construct of a LNG terminal in for Southern LNG in Georgia. GNL Quintero SA also chose CB&I for a similar terminal in Chile. The company also was awarded a contract to build a $1 billion gas plant in Papua New Guinea. – less