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Fluor (FLR) Signs a License Agreement for Econamine FG Plus

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Fluor Corporation’s (FLR - Free Report) proprietary Econamine FG Plus carbon capture technology has been selected by Chevron New Energies to reduce carbon dioxide (CO2) emissions at its Eastridge Cogeneration facility in Kern County, CA.

Fluor has recognized the value of this undisclosed license contract in the fourth quarter.

When installed, Econamine FG Plus is expected to reduce the Eastridge facility’s carbon emissions by approximately 95%. This apart, Fluor will develop a process design package, supply proprietary equipment and provide technical support services throughout the various stages of the project.

Jim Breuer, group president of Fluor’s Energy Solutions business segment, said, “We are seeing significant activity across the globe in carbon capture and are pleased to employ our Econamine FG Plus technology to this important project.”

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Shares of this Zacks Rank #3 (Hold) company grew 14% in the past six months compared with the Zacks Engineering - R and D Services industry’s growth of 4%.

Fluor’s Initiatives to Drive Growth

The company has been focusing on a new strategy, "Building a Better Future," with four key priorities. It aims to drive portfolio growth by expanding into non-traditional sectors like energy transition, technology, life sciences, metals, infrastructure and mission solutions. Fluor plans to pursue contracts with fair terms, avoiding competitive fixed-priced EPC in Energy & Chemicals and being more selective in Infrastructure. This marks a shift from the prior high-risk, high-margin strategy.

The company emphasizes reinforcing financial discipline and maintaining a solid balance sheet through predictable cash flow and earnings. Lastly, Fluor is dedicated to fostering a high-performance culture by advancing diversity, equity and inclusion efforts and promoting social progress and sustainability.

The demand for Fluor's services is clearly demonstrated by its robust prospect pipeline. In the third quarter of 2023, the company successfully secured consolidated new awards amounting to $5 billion, aligning with its full-year plan to achieve a book-to-burn ratio exceeding 1. Notably, 94% of these new awards are reimbursable.

The total backlog for FLR is $26 billion, with 70% of it being reimbursable. This substantial backlog underscores the continued strong demand for Fluor's services and the recognized value it brings to its clients.

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