To: Dennis Roth who wrote (382 ) 5/12/2005 11:20:43 AM From: Dennis Roth Respond to of 919 Contractors express interest in ExxonMobil's LNG terminal project news.tradingcharts.com May 10, 2005 (The Beaumont Enterprise - Knight Ridder/Tribune Business News via COMTEX) -- Vendors, contractors and labor representatives stood in long lines Monday to introduce themselves to the three candidates who could start building ExxonMobil Corp.'s liquefied natural gas terminal near Sabine Pass later this year. Several hundred people from small and larger contracting companies, suppliers and union and open-shop labor organizations got to meet the prime bidders on the potential billion-dollar project. "To my knowledge, this has never been done before," said Olan Wise, business manager of Local No. 479 of the International Brotherhood of Electrical Workers. "We're charting new ground with this introduction to these contractors," he said. The contractors include Aker Kvaerner/IHI; CB&I; and Technip/Zachry/Technigaz. Aker Kvaerner/IHI is a consortium of a Norwegian and Japanese company with experience in building liquefied gas terminals, claiming about one-third of the 300 active terminals worldwide, said Greg Pepper, vice president of Aker Kvaerner's business development group in Houston. CB&I, formerly known as Chicago Bridge & Iron, has owned a local contractor, CB&I Matrix, for the past couple of years, said Rick Nieland, vice president of projects. He said ExxonMobil recently awarded CB&I the contract to build a terminal in Wales. Technip is a French company and is paired for this project with San Antonio-based H.B. Zachry, which built the BASF-Fina steam cracker in Port Arthur and also a portion of ExxonMobil's electrical cogenerating plant at its Beaumont refinery, said Zachry's Chet Lloyd. W.L. "Tex" Carter, Technip's commercial vice president, said he has known Southeast Texas for a long time. "This area is rich in people who do good construction work. We know they're here. Everyone shows a lot of enthusiasm in this community," Carter said. The three companies all are bidding for ExxonMobil's engineering, procurement and construction contract, even though ExxonMobil has not yet determined it will build the terminal near Sabine Pass. The Federal Energy Regulatory Commission must issue a permit first, and then ExxonMobil must secure a construction permit from the commission before the company awards a contract to one of the three bidders. Pepper said no one has built a terminal in the United States like the one ExxonMobil proposes. The storage tanks for the super-cooled natural gas would be stainless steel, which would have to be imported because no domestic mills make that kind of steel. The tanks would be encased in 3-foot-thick concrete with an 18-inch-thick concrete roof -- all steel reinforced. "The tanks are two-thirds of the size of the Astrodome," Pepper said. And most of the fabrication would be done on-site or in local fabricating shops. "Virtually, every piece of it would need a local subcontractor and local labor," Pepper said. Anthony Volentine, business manager for Local No. 195 of the Pipefitters, said he is encouraged by the access to the main bidders. It hasn't always been the case for local labor, he said. "They have agreed to sit down and discuss it," Volentine said. Wise and Volentine said that access is not a guarantee that local labor will get work. "At least we're getting to the table now," Volentine said. "They know we're here and what we have to offer," Wise said. "They don't have to look outside this area for qualified craftsmen." The bidders describe themselves as merit shop, which refers to nonunion contractors, but all are experienced in "double-gated projects" which use a combination of union and nonunion contractors and laborers. The event in Ford Park Arena was an exercise in speedy introductions. Michelle Hughes and Robin Barclay of American Personnel & Temps waited their turn to make a brief sales pitch to each bidder. They won't depend on the meet-and-greet to win a contract, and they plan to follow with telephone calls. Vendors used the time to network not only with the bidders but to swap business cards with other people competing for work. Jerry Sparks, a sales representative with industrial supply company Flow-Tech Industries found a potential client by striking up a conversation with another vendor in the parking lot. He said the event was a rare chance to grow contacts in the industry. Jim Rich, president of the Greater Beaumont Chamber of Commerce, said the event was a way to open up access. "You've got people in this room that thought the process wasn't open, wasn't fair," Rich said. "This is an opportunity for people to get a bid on the table. Not everybody is going to walk away with something, but at least they they've had the chance." Bob Davis, a spokesman for ExxonMobil's liquefied natural gas division, said construction could begin by autumn. The Irving-based oil giant also is looking at a site in Corpus Christi. Davis said no plans have been made to hold a similar event for contractors there. By Angela Macias and Dan Wallach