RE:RE:RE:RE:RE:Pieridae Engages EPCC Contractor BechtelKBR was getting progress payments for their work. It shows in the quarterly financials. My guess is that they were doing it at a bit of a loss- partial payment for their real costs. They might even have been getting full cost reimbursement. Then they decided they didnt want to be in this game at all. Walked away and presumably did not collect payment due in return for not being sued over breach of contract.
I bet you anything that Bechtel is being paid FULL costs. Period. So that they don't lose a dime on doing this. Then if they feel like it, they will put in a real bid.... one that is not so high that it invites refusal.
This is the absolute opposite of the way the negotiating is supposed to work- where you have a project owner that NEEDS construction costs to be as low as possible, negotiating with a builder that is hungry for the job.
Before the industry was shrinking back, PEA was already not in a position to get concessions out of builders. Now, it's just a joke. As always, Sorenson and Co keeps going through the motions- no matter how deperate things are- just keep those plates spiining and hope the miracle comes.
What else are they going to do? This isnt Shell where you cut your losses and go do something else.
BigFanLNG2018 wrote: Bechtel is doing the same thing everyone else did. They've agreed to look at the project, evaluate the engineering and then decide if they'll bid the job. They're not "doing it". They haven't agreed to build it. No one is going to enter into a lump sum contract worth $10B with a company that has a zero net worth. Just bidding on a $10 billion project will cost a compant $5-20 million. This is not like bidding to build a $2,000 deck on a house. KBR spent almost a year evaluating the project before bowing out gracefully. KBR was supposed to get paid around $10 million just to evaluate the project. I'm guessing Bechtel is asking for a similar amount. Pieridae is broke. All these announcements are just deals contigent on other deals. It's a house of cards.