Each month The Engineer picks 10 of the most notable contract news stories from our Business Briefs archive. March saw several contracts signed in the energy sector, including one, perhaps spurred by the Fukushima crisis in Japan, concerning the monitoring of nuclear plants. As the world watched Western military forces enter the Libyan conflict, major contracts were signed in the defence sector. The rail and marine industries have also seen their share of activity.
The most popular business story this month concerned a sale agreement reached between US energy company Chevron and oil refiner Valero Energy, in which the UK-based Chevron Limited was sold. This company holds the 220,000-barrels-per-day Pembroke Refinery, as well as other downstream assets in the UK and Ireland.
Priced at $730m (£453.8m), with an additional payment estimated to be $1bn for Chevron Limited’s inventory and other items, the sale is expected to be completed during the second half of 2011.
Another energy-sector sale agreement was made by E.ON, which agreed to sell its UK power-distribution business, Central Networks, to Pennsylvania-based energy company PPL for £4bn. The deal, which is expected to close in early April, includes an assumption of £500m of existing debt.
Central Networks operates the regional grid that covers the Midlands area of the UK, and, through its network of 133,000km of overhead and underground cables, the business delivers power to more than five million customers. E.ON purchased Central Networks East as part of its takeover of Powergen in 2002.
In the nuclear power sector, engineering support services company Babcock secured a three-year contract to supply environmental monitoring services to the Harwell and Winfrith nuclear-licensed sites in the UK. Under this contract,Babcock’s Nuclear Environmental Laboratory will provide services to ensure that Research Sites Restoration complies with the requirements laid down by the Environment Agency for the operation of the sites.
Babcock will be responsible for the sample types from the environment on and around the Harwell and Winfrith sites, as well as their transportation to the company’s environmental laboratory, where the samples will be analysed for the presence of radionuclides. Sample types will include soil, vegetation, milk, fish, rainwater, river water, low-level liquid effluents and high-volume air samples.
The UK’s Royal Navy (RN) handed out several contracts this month, the most prominent being won by BAE Systems. The Hampshire-based security, aerospace and defence company was awarded a £22.5m Training Systems support contract by the Ministry of Defence (MoD) that will provide for the RN’s overall Submarine and Mine Warfare Command Team training while ensuring the operational readiness and effectiveness of its operational training systems.
Under the seven-year contract, BAE Systems engineers will work alongside the RN training team at the Clyde, Devonport and HMS Collingwood naval bases to ensure the Submarine and Mine Warfare Training Systems are readily available. As well as providing core service levels of technical support and preventative maintenance, as time goes on the BAE Systems team will progressively incorporate additional training elements to the system to meet emerging training requirements.
Overseas, the Swedish Defence Material Administration (FMV) awarded defence and security company Saab an order for the continuous upkeep of its Gripen, which is a lightweight, single-engine multi-role fighter aircraft.
Worth SEK120m (£11.6m), the order includes technical support, product maintenance, flight tests and simulators to ensure the operative capability of the Gripen system. The work will be done during the second quarter of 2011, mainly at Saab facilities in Linköping, Arboga, Gothenburg and Järfälla.
Other technologically advanced vehicles were showcased at The Geneva Motor Show, held in Germany from 3-13 March, at which many automotive companies presented their latest concept cars. One of these was the Tata Pixel concept car produced by India-based Tata Motors, for which technology developer Torotrak supplied a prototype transmission.
The Torotrak infinitely variable transmission (IVT) was designed to provide responsive performance, good fuel economy and manoeuvrability to the Tata Pixel. When parking and during tight manoeuvring, the transmission’s ability to control each rear wheel independently is used to enable rotation of these wheels in opposing directions. By linking the vehicle’s steering system with the control mechanism for the IVT, the car is able to pivot around its rear axle, boosting manoeuvrability and enabling parking in tight spaces.
Not to be outdone, locomotives have been in the spotlight too. The Beijing MTR Construction Administration, which is responsible for the Beijing metro transport network, awarded two contracts in March for the procurement of advanced traction and signalling systems for the new Line 6.
The contracts, totalling €140m (£118m), were awarded to French power and transport company Alstom and its two Chinese joint ventures. At 42km long, with 27 stations, Beijing Line 6 represents the longest metro line in construction in Beijing and runs through the city, starting from Wuluju in the West to Tongzhou New Town in the East. It adopts eight-car train sets and travels at 100km/h with a three-minute headway. The line’s entry into commercial service is scheduled for 2012.
Within the UK’s rail industry, the Crossrail project was seen to make further progress. Network Rail contracted Atkins, a provider of technologically based consultancy and support, to design the bulk of works planned on the north-east section of the Crossrail route, between Stratford in east London and Shenfield in Essex.
The contract includes the design of station improvements along the 25km route at Romford, Ilford, Goodmayes, Forest Gate, Harold Wood, Gidea Park, Chadwell Heath and Brentwood. These improvements will include platform extensions, to allow longer, higher-capacity trains to run, as well as step-free access, provided at the majority of stations on the route. Other works will include infrastructure improvements such as extra train-stabling capacity and turn-back facilities, to improve the reliability of passenger services.
Another leading story saw Manchester Airport preparing for improvements. US military contractor Raytheon was selected to supply a radar system to replace legacy equipment at the airport, under an extension to the Radar Site Services (RSS) programme of the National Air Traffic Services (NATS).
Delivery and installation of the system will provide NATS with commonality across its en-route surveillance infrastructure and, in this case, provide the same equipment being supplied to other major airports at which NATS provides engineering support and systems.
With road, rail and air transport covered, our last selected story turns to a major contract win in the marine sector. Earlier in the month, marine engine manufacturer Wärtsilä was awarded a contract by shipbuilding company STX Finland Oy to supply additional equipment for a large LNG-fuelled passenger ferry.
The ship is to be built for Finnish owner Viking Line and the extension contract covers on-board liquefied natural gas (LNG) and supply systems (LNGPac), as well as an advanced Compact Silencer System (CSS). Earlier in 2011, Wärtsilä received an order to deliver four gas-fuelled main engines and propulsion machinery for the same vessel, which will sail the Baltic Sea between Turku, Finland and Stockholm, Sweden. The ship will be built at the STX Turku shipyard in Finland and is scheduled to enter service in 2013.