Chicago Bridge & Iron Company

CB&I was a large engineering, procurement and construction (EPC) company with its administrative headquarters in The Woodlands, Texas. CB&I specialized in projects for oil and gas companies.[4] CB&I employed more than 32,000 people worldwide.[5] In May 2018 the company merged into McDermott International.[6][7] McDermott struggled to integrate its acquisition of Chicago Bridge & Iron Co.[8] On January 21, 2020, McDermott announced that it had filed for Chapter 11 bankruptcy.[9]

CB&I
Public
Traded asNYSE: CBI
ISINUS1672501095 
Industry
Founded1889
FounderHorace E. Horton
HeadquartersThe Hague, Netherlands
Area served
Worldwide
Key people
Michael L. Underwood
(Chairman of the Audit Committee)
L. Richard Flury
(Non Executive Chairman of the Board of Supervisory Directors)
Patrick K. Mullen
(President & CEO)
Revenue $ 6.7 billion (2017)[1][2]
$ -425.1 million (2015)[2]
$ -504.4 million (2015)[2]
Total assets $ 5.97 billion (2017)[1][2]
Total equity $ 2.164 billion (2015)[2]
Number of employees
>40,000 (June 2017)[3]
Websitewww.cbi.com
CB&I administrative headquarters
Chicago Bridge & Iron Works, 1912 catalog

History

CB&I was founded in 1889 by Horace E. Horton in Chicago, Illinois, USA. While initially involved in bridge design and construction, CB&I turned its focus to bulk liquid storage in the late 19th and early 20th centuries, coinciding with the western expansion of railroads across the United States and the discovery of oil in the Southwest. CB&I quickly became known for design engineering and field construction of elevated water storage tanks, above-ground tanks for storage of petroleum and refined products, refinery process vessels and other steel plate structures.[10] As such, CB&I supported the expansion of oil exploration outside the US, starting operations in South America in 1924, in Asia two years later and in the Middle East in 1939.[11]

According to one of the founder's heirs, "The old joke is that Chicago Bridge & Iron isn't in Chicago, doesn't build bridges and doesn't use iron."[4]

During World War II, CB&I was selected to build Landing Ship Tanks (LSTs), which carried troops and supplies to American and Allied troops fighting in Europe and the Pacific theater. CB&I was chosen because of their reputation and skills, particularly welding. Since the coastal shipyards were busy building large vessels for the war effort, such as aircraft carriers, battleships, cruisers and destroyers, there was no alternative but to use the inland waterways and shipyards for the production of smaller ships.[12] As a result of these and other wartime production activities, CB&I ranked 92nd among US corporations in the value of World War II military production contracts.[13]

CB&I has been involved in a number of changes during the past two decades. It was acquired by Praxair in 1996; Praxair kept a chemical subsidiary and spun off CB&I as a Dutch-incorporated company the next year.[4] CB&I headquarters moved from Chicago to Houston, Texas in 2001 and then to the Hague, Netherlands when Texas enacted a franchise tax.

Since 2000, it acquired a number of companies. In 2003 it bought John Brown Hydrocarbons, renaming it at first CB&I John Brown, and later CB&I UK Limited.[14]

In 2012, CB&I agreed to buy The Shaw Group for about US$3 billion,[15][16][17] completing the acquisition in February 2013.[18] The subsidiary that was formed as a result, CB&I Stone Webster—a result of The Shaw Group's earlier acquisition of Stone & Webster during its bankruptcy—was again sold, in January 2016, to Westinghouse Electric Co., for US$229M.[19]

In May 2018 the company was acquired by McDermott International for US$6 billion.[20][21] McDermott struggled to integrate its acquisition of Chicago Bridge & Iron Co, and in January 2020 was facing bankruptcy.[8] On January 21, 2020, McDermott announced that it had filed for Chapter 11 bankruptcy.[9]

Corporate headquarters and leadership

Corporate headquarters were located in The Hague, Netherlands. The administrative headquarters were located in The Woodlands, Texas.[22] In 2018 McDermott announced that it would sell the headquarters facility in The Woodlands to Howard Hughes Corporation.[23]

Historic structures

The company built bridges and other works of historic importance, including some listed on the National Register of Historic Places.[24] These works include (with varying attribution):

CB&I, 2000-present

In late 2000, CB&I embarked on acquisitions that have expanded its services to the entire hydrocarbon industry: conceptual design, technology licensing; engineering and construction; final commissioning and technical services. The firm acquired Lummus Global from ABB on November 19, 2007, adding approximately 3,000 employees.[41][42] CB&I acquired The Shaw Group in 2013, adding pipe, steel and module fabrication services and engineering and construction capabilities in the power generation industry—both fossil and nuclear construction. .Company Press Release In 2015, CB&I sold their Nuclear Construction division to Westinghouse Electric Company, a subsidiary of Toshiba, for $229 million.[43] For 2017, revenue for CBI was $6.7 billion, down from the year before.[1]

As of July 2017, CB&I's global business groups were:

  • Technology: licensed process technologies, catalysts, specialized equipment and engineered products for use in petrochemical facilities, oil refineries and gas processing plants;
  • Engineering & Construction: engineering, procurement, fabrication and construction of major energy infrastructure facilities;
  • Fabrication Services: fabrication capabilities for piping, structural steel, module prefabrication and assembly, as well as storage tanks and vessels for the oil and gas, water and wastewater, mining and power generation industries

After being acquired by McDermott, CB&I's stock ceased being listed on the NYSE on May 11, 2018. Gary P. Luquette was the chairman of the combined company.[44]

Recent major projects

Examples of recent major projects around the world include:

  • Natural gas processing and treating complex in Cabinda Province, Angola;
  • Crude vacuum and decoking unit expansion project for a refinery in Kansas, US;
  • Golden Pass LNG import terminal near Sabine Pass, Texas, US;
  • Large tankage facility at Shell Pearl GTL, Qatar;
  • Hydrotreating and sulfur removal/recovery facilities for several major US refiners;
  • LNG re-gasification terminal at Quintero Bay, Chile;[46]
  • Cat gas hydrotreater (CGHT) in El Paso, Texas, US;
  • Hydrogen generation plant in Benecia, California, US;
  • Propane dehydrogenation unit in Houston, Texas, US;
  • Multiple Middle East storage facilities; and
  • Oil sands storage tanks in Alberta, Canada.

In November 2004, CB&I was awarded a contract by one of the world's largest suppliers of wind turbines to fabricate 150 tubular steel support towers for wind turbines that were installed in wind farms in the western United States. The towers support 1.5-megawatt wind turbines, which are the largest wind turbines assembled in the United States and the most widely sold and tested megawatt-class wind turbines in the world. In April 2012, CB&I was awarded a contract for a petrochemicals expansion project in Geismar, Louisiana, including the license and basic engineering for the ethylene technology.[47]

In 2012, CB&I Technology (formerly Lummus Technology) was awarded a contract by Indian Petrochemicals major,[48] Reliance Industries to design to provide paraxylene (PX) technology for an aromatics complex in India. The complex is one of the largest of its kind, has capacity to make 2.2 million tonnes per year of Paraxylene. The complex was started up in April 2017.[49] With the start-up of this complex, Reliance is now the 2nd largest world producer of Paraxylene.[49]

Controversy

CB&I was revealed as a subscriber to the UK's Consulting Association, exposed in 2009 for operating an illegal construction industry blacklist; CB&I was one of 14 companies issued with enforcement notices by the UK Information Commissioner's Office.[50] A CB&I employee consulted the blacklist more than 900 times in 2007 alone, a 2010 employment tribunal was told.[51]

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References
  1. https://www.prnewswire.com/news-releases/cbi-reports-fourth-quarter-and-full-year-2017-financial-results-300601349.html
  2. "Chicago Bridge Iron, Form 10-K, Annual Report". secdatabase.com. Retrieved June 9, 2016.
  3. "Chicago Bridge Iron, Who We Are". Archived from the original on June 8, 2017. Retrieved Jun 7, 2017.
  4. Young, David (6 March 1997). "Chicago Bridge & Iron Set For Spinoff". Chicago Tribune. Retrieved 15 February 2017.
  5. "Veritas Capital Acquires Capital Services Business from CB&I for $755 Million". www.businesswire.com. Retrieved 2017-04-11.
  6. "McDermott Inks $6B Merger Deal With Chicago Bridge & Iron". December 19, 2017.
  7. "McDermott and CB&I Stockholders Approve Proposed Combination". McDermott International. 2018-05-02. Retrieved 2018-05-15.
  8. "McDermott Is Said to Prepare for Bankruptcy as Soon as Next Week". www.bloomberg.com. 18 January 2020. Retrieved 18 January 2020.
  9. Chapa, Sergio (January 21, 2020). "Houston-based McDermott confirms oilfield service company will file for bankruptcy". The Houston Chronicle. Hearst Corporation. Retrieved January 21, 2020.
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  12. Forgy-Schock, Babara (30 August 2007). "The Prairie Shipyard". Galesburg, Illinois: The Zephyr. Retrieved 10 December 2018.
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  15. Polson, Jim & Black, Thomas (30 July 2012). "CB&I to Buy Shaw Group for $3 Billion to Add Nuclear Unit". Bloomberg News. Retrieved 30 July 2012 – via SFGate.com.CS1 maint: multiple names: authors list (link)
  16. CB&I Staff (30 July 2012). "Current Report, Chicago Bridge & Iron Company N.V., The Netherlands". Form 8-K. Washington, DC: United States Securities and Exchange Commission. Retrieved 15 February 2017 – via secdatabase.com.
  17. Chaudhuri, Saabira (30 July 2012). "Shaw Group Agrees to CB&I's $3.04B Takeover Bid". MarketWatch.
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  46. This is an approximately $775 million project.
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  49. India, Press Trust of (2017-04-20). "RIL commissions final phase of Jamnagar paraxylene project". Business Standard India. Retrieved 2017-06-07.
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