Amec Foster Wheeler: Challenges, Benefits and Examples Report

This report provides an in-depth analysis of Amec Foster Wheeler, a prominent British multinational company specializing in engineering and project management within the oil, gas, and chemicals, power, mining and process, environment, and infrastructure markets. The report begins with an...Read More

Running head: AMEC FOSTER WHEELER
Amec Foster Wheeler
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Table of Contents
1.0 Introduction................................................................................................................................2
1.1 Justification................................................................................................................................2
1.2 Challenges and Benefits............................................................................................................4
1.3 Examples....................................................................................................................................6
1.4 Recommendation.......................................................................................................................8
1.5 Conclusion.................................................................................................................................9
Bibliography..................................................................................................................................11

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1.0 Introduction
Amec Foster Wheeler is a public limited company with its headquarters in London,
United Kingdom. It is a British multinational company along with engineering and project
management. It deals with oil, gas and chemicals, power, mining and process, environment and
infrastructure markets. The company is spread in around 55 countries all over the world. One-
third of the company’s turnover is gained from Europe, another half from North America and
12% from the rest of the world. In the year 2014, Amec agreed to take over its Swiss rival Foster
Wheeler with 1.9 billion pound. Again, in the year 2017, Wood Group decided to take hold of
the company with 2.2 billion pound which was completed on 9th October (Babic, et al., 2016).
The number of employees in the company is approximately 40000 employed in the countries of
Australia, Brazil, Canada, India, US and many more. The company at present has entered into an
agreement of selling its major part of UK North Sea operations to the Worley Parsons Europe
Limited with an exchange of 228 million pound. The part of business which is going to be sold
includes a large part of the UK upstream oil and gas business which serves the customers of UK.
The business had earned revenue of 740 million pound in the previous year with a profit of 43
million pound. The report will look into the details of this oilfield service provider and the
various challenges and benefits that they experience.
1.1 Justification
The reason behind choosing Amec Foster Wheeler is that there are hardly any companies
which has revenue of 5.5 billion pound and employs 40000 people in 50 countries (Baird, et al.,
2015). They are responsible for operating in the entire industry of oil and gas involving all the
stages from production to refining, processing and the distribution of derived products which are

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used in mining, environment, and clean energy and infrastructure markets. From 2015, they have
successfully structured their business into four sub- units, Americas, Northern Europe and CIS,
AMEA and Southern Europe and Global power Group, for smooth operational activities. The
new design of the company structure will enable future collaboration to promote better growth
opportunities (BBC - Strategy - BBC Trust, 2017). They intend to provide safe and sustainable
project solution for their customers. There are other reasons too why this particular company was
chosen to make this report. They are able to deliver difficult and complicated upstream projects
of oil and gas and also the pre- distinguished provider of services to the specific industry. They
are also responsible for shaping the future of clean energy. The list is a bit too long for choosing
Amec Foster Wheeler as the oilfield service provider. They are also accountable for providing
transportation for the midstream oil and gas industry. The services of the company combine
expertise with delivery starting from concept to the closure. The experiences that they have
gathered all these years have enabled the support of the contemporary renewable energy. Their
complete engineering services made way for innovative and high value added solutions
(Blackburn, 2017).
Amec Foster Wheeler takes pride in possessing an extremely proficient board which
performs really well. All the board members of the company are indulged actively in the
particular meetings to contribute their opinions on the future strategy and direction of the
company. Their priorities include the monitoring of the implementation of the strategies that
were discussed in the meeting to make the goals achievable. The board members always take
care of the fact that the expansion and changes in the company is identified along with the
combination of challenging markets in the specific sector (Das & Lancaster, 2017). There are
very few companies in the oilfield service sector who are able to create sustainable and steady

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growth for delivering the potential as Amec Foster Wheeler do. They have been able to achieve
this result because of their positive attitude towards the challenging backdrop of financial
insecurity. With the making of successful and creative teams the company has gathered the most
precious asset and this will help them to pay attention to the progress, mobility and new
employer brand. Amec has the most significant target of being the company for which others will
like to work and this thought has kept them ahead of other oilfield service providers. Customers
are considered to be significant in their services which have established a strong customer
relationship and with other clients. The company believes that the success is not only dependent
on the number of share or profit gained but also need to be customer- friendly, meeting up the
market challenges and should be flexible to change (David, 2011).
1.2 Challenges and Benefits
Amec Foster Wheeler has had to face a lot of challenges before they could experience
success. Fall in oil prices with the strong pound the business environment for the oil and gas
service providers companies tend to get worse than being better. Amec also had to experience the
same. When they used to get a primary full year earnings previously but recently they had to
prepare for a tough year in 2015 as most of the projects were cancelled in the specific sector (Oil
& Gas, 2017)Anon, 2017. The popular oil and gas operators had cut off their capital
disbursement budget in the same year when the basic price sank to more than 50pc over the last
year, as per the research done by RBC Capital Markets. These kinds of severe cuts had hit the
services of the Amec oilfield and the engineering side of the industry very hard which had
brought their strategy into a stiff focus. As the trading circumstances get tougher it is believed
that the companies who wish to take risk should look out for strong order book that has the
ability to endure the downturn and it is seen that Amec can also be categorized into it (Gill, et al.,

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2017).The company has also been warned that it is not immune to the declining activities at the
investment levels have been enhanced by the economic environment. Investors need to be
cautious until the oil prices are extremely high and there is no worry of any cost cutting in the
industry. Another matter of concern for the company is the heading of cash flow to the financial
year. In 2015 it was assumed that the company will face a reduction of 10 pc in the sale of oil
and gas and 5 pc in the mining business (Harrigan, 1983).
Apart from the challenges, the company also has ample benefits. It is said that excellence
cannot be achieved easily but that is demanded by the customers. The challenges faced are
mainly due to the attainment of success. The benefits provided vary according to the departments
that include total reward package, voluntary benefits, flexible benefits and professional
development. Total reward package includes competitive salary, 25 days holiday each year,
bonus and pension scheme, life insurance and accident insurance. The voluntary benefits include
cycle to work scheme, childcare vouchers, employee discount scheme and the employee
assistance program. Buying and selling of extra five annual holidays by negotiation and flexible
working where operationally feasible are counted as flexible benefits (How the Natural
Resources Business Is Turning into a Technology Industry, 2017). Gaining qualifications and
accreditations form a part of professional development and also payment of fees in professional
institute. Structured performance reviews for the duration of the scheme and a structured
development program with the specific mentor and buddy are the benefits in professional
development. The other minor benefits include paid holidays and two floating holidays which are
added to PTO. The employees are happy to work within a varied scope and friendly atmosphere.
They are provided with location based work and the newcomers are given proper training.
AMEC had made its shareholders aware that they might be asked to provide information about

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the UNAOIL consultancy probe which might lead to an investigation. Both AMEC and Wood
shareholders voted for the unexpected investigation. AMEC had mentioned that it will carry on
its business in an ethical way by maintaining a code of conduct and strictly adhering to the
corruption policies.
1.3 Examples
A striking example of oil and gas in Amec Foster Wheeler is the decommissioning in
action. The action of decommissioning at the Ignalina Nuclear Power Plant in Lithuania has gone
up to a remarkable position (Inkpen & Moffett, 2011). Extremely high radioactive spent fuel has
been shifted to a new storage facility for which Amec is supporting with projects, engineering
and contracts. Along with Vattenfall and Tractebel Engie, Amec operates the client- side Project
management for main decommissioning infrastructure at Ignalina which also includes the
Interim Spent Fuel Storage Facility. In Canada, the company has worked on almost all the
mineable lease from the development of the oil sand industry in the 1950s and their
contemporary alternative expertise includes shale gas and coal seam methane. They have also
operated for more than forty years in the challenging North Sea which throws light on the fact
that there are experts in the area of consultancy, operational readiness, construction and
commissioning, asset support, complex projects and maintenance integration (Johnson, et al.,
2013). The oil companies including AMEC started putting limitations and forced the service
companies to reduce their prices. Jon Lewis, the Chief Executive of AMEC, forced the outcome
of a transition plan which he started a year back for decreasing their dependence on oil and gas
markets for improving their efficiency proved to be worthy.

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The examples of gas monetization projects of Amec include gas treatment and
processing, LNG liquefaction plants, LNG regasification terminals, Floating LNG, gas to liquids,
chemicals and power. The midstream expertise of the company looks after the full production
and processing lifecycle. Their range of services includes field development and conceptual
studies by means of Front End Engineering Design, engineering in detail, supply chain
management, construction and installation. The example of expertise include onshore and off-
shore pipelines and related pumping, metering, compression (Joyce, et al., 2014).Then there is
gas monetization, which involves gas liquefaction and others. Amec Foster Wheeler has a
remarkable history in the execution of refining projects, major expansions and petrochemical
integration such as clean fuel projects for meeting with the new legislation to produce high value
products.
The company is involved in almost every part of the project delivery phase in the oil, gas
and chemicals value chain. The experts in the company covers consultancy by project delivery
and commissioning to effective smart asset support (Kelland, 2014).Other extraordinary
examples of the Amec Foster Wheeler Company include the changing of skyline with the
grassroots Paradip Refinery project; Pluto LNG where 3 million cubic meters of rock was
removed before the building of LNG plant; asset support works for improving the production of
Shell One gas; delivery of deepwater Gulf of Mexico production to market; world- wide
assessment of environmental impact for Mackenzie Valley Pipeline; innovative design for
SAGD Tamarak facility; providing solution for clean fuel technologies; project management
support for KOC; project management support to one of the biggest coal producers in China;
delivering an EPCM contract for one of the largest Greenfield uranium projects in the world;
managing the PetroChina Guangxi Refinery project; incorporation of resin ion exchange

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technology in Namibia; completing the first major Greenfield project in DRC; introducing a
number of prime innovations to the Cloudbreak Wet Front End project in Western Australia;
((Management Today | Not just business as usual, 2017) providing support to the regulatory
review of a new reactor in South Africa; premium safety and project control standards attained at
the petrochemical complex in China, so forth and so on.
1.4 Recommendation
It can be recommended to Amec Foster Wheeler that they should consult with their
customers to determine what is required from their assets. They should also conceptualize and
design their capital projects for better operational activities. They have to look after the
installation and commissioning of the assets that are provided (Shuen, et al., 2014).Their asset
support should provide services and consultancy to operate, maintain and boost up the assets.
Their decommissioning and remediation should help the customers to decommission assets at the
end of financial use. To improve their strategic direction the company has to continue its
evolution into customer- based, multi- sector consulting, engineering and construction which will
make resource allocation decisions easy in the business lines for the benefit of growth in the
company. They should also look forward to enhance their value- based engineering offering and
help the customers to assure that their projects are economically viable. With the help of their
lead operating model and leveraging on the operations they will have to make sure of cost
competitiveness to be able to bid better and win. They need to invest more in excellence in terms
of technical and business functions which will drive standardization and follow the common
policies and norms in the overall company (Torres & Augusto, 2017).

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It can be recommended that the company should invest in information technologies for
distinguishing in project delivery capabilities so that they can help in encouraging the
management of the assets of the customers. They need to improve on the involvement cash
generation of the people and start focusing on the attraction, development and retaining of the
best talent all over the world. They also need to highlight the fact of cash generation by removing
the unnecessary expenditure and increasing the effectiveness and measurability of the important
costs. For making the balance sheet stronger, a stable financial platform needs to be established
for providing support to the business. They need to make sure that a safe and sustainable work
environment is provided to the population both inside and outside the company (Yusuf, et al.,
2014). Their strategies of sustainability and commitments must be aligned to the principles of
UN Global Compact which will provide support to their strategic priorities by specific provision
of a safe and sustainable environment and by means of engaging, attracting, developing and
retaining people.
1.5 Conclusion
It can be concluded from this assignment that Amec Foster Wheeler has a vision to solve
the upcoming challenges of natural resources by working in cooperation and collaboration. As it
can be summed up from recommendation that their resilient world strategy will provide with the
objective to attain the specific vision. It can be ensured that as a progressive business a balance
can be maintained by risk management and unlocking the opportunities which offer a long term
value not only to the company but also to the employees and to the customers as well. They plan
to invest in the future by developing a diverse workforce including talent to showcase the values
and behaviors for driving sustainability. It is explained in the report that they will resource for

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the diversified and talented workforce who will introduce new individuals in the pool of
resources for creating genuine business thought.
With their innovative technologies, services and solutions to the complex projects,
business value will be added to the customers and at the same time the environmental effects will
also be reduced. A long term growth will be driven for the company Amec Foster Wheeler which
will be developed and encouraged by an increasing portfolio of modern and innovative
environmental technologies. As they are a trusted partner in business therefore there will be a
consistent sustainability standard in all their projects. The potential customers of the company
will ask for superior standards and sustainability will be a basic part of it. They have to promise
constant approach to the sustainability which embedded in the root of the projects. They will also
implement value added sustainability framework which will be utilized by the clients with the
objectives of advanced and premium sustainability.

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