APLNG deal to boost Jacobs' global growth

NEW YORK-listed technical services provider Jacobs’ recent multi-year contract from ConocoPhillips to support Australia Pacific LNG’s capital program is set to augment its “tangible and intangible” resource base globally, Zacks Equity Research says.

Anthony Barich

The deal for Jacobs, which has a $US5.32 billion market capitalisation, can be extended for four more years.

“Although the value of the contract was not disclosed, it is expected to aid Jacobs’ organic growth in the long run,” Zacks said.

“As per the agreement, Jacobs will extend its non-imitable engineering services to the Queensland-based LNG facility and hence sustain efficient execution of ConocoPhillips’s supporting capital program.”

The APLNG facility comprises two LNG trains equipped to produce 4.5 million tonnes per annum of LNG each.

For all the mid-cap and sustaining capital projects of the Australia Pacific LNG facility, Jacobs will provide designing services related to commission, construction and procurement over four years. Further, under the contract, the company will offer its specialised front-end engineering design services to the facility projects.

“Jacobs is one of the most popular technical services providers in the global forum,” Zacks said.

“It offers professional, technical and construction services to diversified public, industrial and commercial clients.

“The new contract is expected to augment the tangible and intangible resource base of Jacobs globally. However, such positive outcomes can be offset by uncertain currency or exchange rate volatilities in the future.”

The Curtis Island-based project also has arrangements to supply gas to the Santos-led GLNG project from its upstream CSG fields.