Wood Group agrees to pay £98m to Enterprise to settle litigation case
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Energy services giant Wood Group agrees to pay £98 million to US pipeline company to settle long-running lawsuit
- The oil and gas giant will pay the amount in one go over the next week
- The settlement ends a case that started in 2016
- The case revolved around alleged cost increases and delays in a project won by Wood Group in 2013 to build a propane dehydrogenation plant in Texas.
Wood Group has agreed to pay $115 million, or about 98 million pounds, to US oil and gas pipeline company Enterprise to settle a long-running lawsuit.
The FTSE 250 energy services giant, whose customers are BP and Shell, said it will pay the sum in one lump sum over the next week.
The settlement ends a case that began in 2016, when Enterprise filed a lawsuit against Amec Foster Wheeler, a company Wood acquired in 2017.
Settlement: Wood Group to pay $115 million to Enterprise next week
The case revolved around alleged cost increases and delays in a project won by Wood Group in 2013 to build and construct a propane dehydrogenation plant in Mont Belvieu, Texas.
Wood inherited the lawsuit when it bought Amec Foster Wheeler in October 2017 for £2.2 billion.
Last year, Amec Foster Wheeler was ordered by the UK’s Serious Fraud Office to pay £103 million for using corrupt cops in the oil and gas sector ‘to cut spending and secure contracts’.
The violations ran from 1996 to 2014 – before Wood took over the company – and took place around the world, in Nigeria, Saudi Arabia, Malaysia, India and Brazil.
Wood said today it will hold a Capital Markets Day on Nov. 29 to map out its updated strategy following the completion of the $1.9 billion sale of his built environment consulting firm in September.
Wood Group shares fell 2.9 percent to 154.35 pence in morning trading on Monday.
They have lost about 23 percent of their value in the past year.
The company returned to profit in the first half, thanks to strong demand for its services and the sale of its built environment division.
The business model has traditionally relied on high oil prices, as demand for its services tends to expand when the oil and gas industry has a lot of money to spend on projects.
In recent years, it has shifted its exposure from the petroleum sector to a greater focus on renewable energy, with wind and solar playing an increasingly prominent role.