Foster Wheeler Awarded EPC Contract for Expansion of Italian Waste-to-Energy Plant

Foster Wheeler Limited - 10.24.2005

Foster Wheeler Ltd. (Nasdaq: FWLT) announced today that its Milan-based subsidiary Foster Wheeler Italiana S.p.A. has been awarded an engineering, procurement and construction (EPC) contract for the addition of a second processing line at Lomellina Energia's existing waste-to-energy plant at Parona, Italy. Foster Wheeler Italiana S.p.A. owns 39 percent of Lomellina Energia S.r.l.

Foster Wheeler will undertake basic design, detailed engineering, materials supply, construction and erection works, commissioning and start-up on a lump-sum turnkey basis. The contract value exceeds US$130 million (110 million Euros), and will be included in Foster Wheeler's third-quarter 2005 bookings.

"This new investment will be primarily financed through a limited-recourse project financing by Lomellina Energia, with the balance of the investment being provided by the shareholders of Lomellina Energia," said Gianfranco Brustia, director, Power Division, and vice president, Foster Wheeler Italiana S.p.A. "Foster Wheeler also designed, built, started up and operates, with partners, the original plant, which has been in commercial operation since October 1, 2000. This was the first waste-to-energy project in Italy developed by a private company with project financing."

The existing plant, the first installation of its kind in Europe, is an integrated facility for recyclable materials recovery and refuse derived fuel (RDF) production, composting and electricity generation. It processes 200,000 tons per year of municipal solid waste (MSW), converting approximately 60 percent of the MSW into RDF, which is then combusted, generating 15 MWe of electric power.

This expansion project will allow the plant to process an additional 180,000 tons per year of RDF, producing an additional 19 MWe of power, which will be sold to the Italian national grid under a long-term power purchase agreement with GRTN (the Italian National Grid operator).

As part of its scope, Foster Wheeler will also design and supply a circulating fluidized-bed (CFB) boiler, based on its proprietary "Compact" technology developed by its Global Power Group. This CFB technology was selected to burn RDF and to produce steam for the generation of electricity because of its excellent environmental performance.

Foster Wheeler's overall scope also includes a steam turbine and generator, a steam condenser, flue gas treatment, upgrading of the existing waste pre-treatment system and auxiliary facilities.

Early activities on the project started in February 2005. Commercial operation is scheduled for September 2007.


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