Babcock & Wilcox Secures $246 Million Deal for Coal-to-Gas Project

Babcock & Wilcox has recently entered into a significant agreement valued at around $246 million for a coal-to-natural gas conversion initiative at a power plant located in North America, the specific location of which remains undisclosed.

As part of this agreement, B&W has been granted a limited notice to proceed (LNTP) for the project. The company anticipates receiving the full notice to proceed for the entire contract by the fourth quarter of 2024.

B&W's primary objective within this project is to convert the existing coal-fired boilers at the undisclosed plant, totaling more than 1,000 MW, to operate on natural gas fuel. The comprehensive scope of B&W's involvement encompasses the design and installation of new burners, air systems, fans, and other essential equipment required for the successful implementation of the fuel transition.

Amidst the backdrop of utilities across North America and globally evaluating strategies to prolong the lifespan of their thermal power generation assets, the substitution of coal or oil with cleaner-burning alternatives like natural gas, biofuels, or hydrogen has emerged as a cost-effective approach for plant owners to simultaneously reduce emissions and uphold reliable power generation capacity.

B&W's wealth of experience in field construction coupled with its cutting-edge technologies, including specialized combustion equipment provided by Babcock & Wilcox FPS, Inc. (FPS) subsidiary, position the company ideally for the execution of large-scale fuel-switching initiatives.

This project serves as a testament to the robustness of B&W's Thermal business as it capitalizes on its expansive capabilities to aid utilities in ensuring adequate energy supply for their consumers amidst a sustained surge in power demand.

This substantial agreement underscores the prowess and efficacy of B&W's technology, further solidifying their leadership role in advancing the energy transition on multiple fronts. With B&W's acquisition of FPS, company are uniquely positioned to offer turn-key solutions for gas conversion endeavors. B&W is actively implementing its growth strategy, driven by strong demand and a substantial pipeline across its operations. B&W expects the upcoming year to be a robust period for the company, characterized by solid bookings and enhanced financial performance across all segments.

Moving forward, The Babcock & Wilcox Company will commence engineering and design tasks under the limited notice to proceed (LNTP) promptly, with support from its affiliate, FPS. The construction component of the project will be undertaken by Babcock & Wilcox Construction Co., LLC, pursuant to an intercompany agreement upon receipt of the full notice to proceed.