URS Corporation (URS) added to its newly formed Oil & Gas division a nearly $130 million contract. The new division was formed with the completion of the acquisition of Flint Energy Services Ltd. With this acquisition, the URS expanded its presence in the oil and gas sector.
As per the contract, the company will act as a pipeline construction contractor for an important Steam Assisted Gravity Drainage (SAGD) oil sands project in the Wood Buffalo Region near Fort McMurray, Alberta. URS Corp. will begin its work in the second quarter of 2012 and will continue until mid-2013.
The company will build pipelines both below and above the ground and will provide access platforms and valve stations. In this project, gas, oil, water and steam pipelines of about 8 to 24 inches in diameter will be laid down over 70 kilometers.
The company announced the completion of Flint Energy acquisition on May 14, 2012. The North American unconventional oil and gas segments have been growing and with this acquisition URS will derive significant benefit in these segments.
The company will now be able to provide a comprehensive set of engineering, procurement and construction services to its energy sector clients. Investments in energy sector have increased substantially, especially in developing countries, providing good prospect for the companies operating in the sector.
URS Corp. provides engineering, construction and technical services. The company offers a broad range of program management, planning, design, engineering, construction and construction management, operations and maintenance, and decommissioning and closure services to public agencies and private sector clients globally. Major competitors of URS are AECOM Technology Corporation (ACM), Fluor Corporation (FLR) and KBR Inc. (KBR).
We currently maintain our Neutral rating on URS Corp. with a Zacks #3 Rank (short-term Neutral recommendation) over the next one-to-three months.
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