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NewsNew Contracts & SafetyWelcome to CB&I WorldWelcome Message by Gerald GlennTechnology & InnovationsEnhancing SRUs with Oxygen-Enriched AirSpecial FeaturesInterview with World EnergyWorld FocusCurrent ProjectsIssue 3, December 2005

In this issueNewsNew Contracts & SafetyWelcome to CB&I WorldWelcome Message by Gerald GlennTechnology & InnovationsEnhancing SRUs with Oxygen-Enriched AirSpecial FeaturesInterview with World EnergyWorld FocusCurrent ProjectsProduced byCB&I Global MarketingEditor:Katerina McGregor MA MIPRCB&I20 Eastbourne Terrace,London W2 6LE, UKTel: 44 (0) 207 957 3532Fax: 44 (0) 207 957 3895e-mail: kmcgregor@CBI.comwww.CBI.comEditorial Advisory Panel:Chip Ray, Bruce Steimle,Suzanne GatesDesign:Mark WestTel: 44 (0) 207 957 3694Issue 3, December 2005Welcome3News4-5 NEWS & CONTRACTS6 SAFETYWorld Focus :Current Projects7 EUROPELNG Terminal Expansion in UK8 FSULargest Pipeline Project in the WorldBegins Operations910 AFRICABonny Island: Successful Completion11WELCOME TO CB&I WORLDWelcome Message by Gerald GlennMIDDLE EASTShoaiba Project in Saudi ArabiaBioko Island Project in Equatorial GuineaSpecial Features14-15 REGIONAL FOCUSAsia-Pacific16-17 CB&I DIFFERENCEHelping the Energy Industry Bring ItsProducts to MarketTechnology & Innovations18Marketing News19Enhancing Sulfur Recovery withOxygen-Enriched AirCB&I Website UpdateTradeshowsNew BrochuresHot Off the PressPrint:AOK Printers1213NORTH AMERICAWaste Treatment PlantSOUTH AMERICAGasmar Projectwww.CBI.comp r o d u c t i o n p r o c e s s i n g s t o r a g e d i s t r i b u t i o n2This document is intended for general information purposes only and does not in any way constitute an offer to provide specific services. Some services may not be available incertain countries or political subdivisions thereof. All the quotations in this document have been reproduced with the kind permission of our customers.Any inquiries about content from this publication should be directed to the Editor (email: kmcgregor@CBI.com)©Copyright 2005 by Chicago Bridge & Iron Company. All rights reserved. Printed in UK. CW05-03

Welcome to CB&I World"I am pleased to welcome you to the latest editionof CB&I World, our periodic publication about CB&Iactivities worldwide."Gerald M. GlennChairman,President and Chief Executive OfficerCB&I is one of the world's leading engineering, procurement and constructioncompanies, serving customers that produce, process, store and distribute the world'snatural resources. We were recognized in Engineering News-Record's 2005 AnnualSurvey and were ranked fourth in the category of Top Design-Build Firms, fourth in thecategory of Top 25 Petroleum Contractors, and seventh in the category of Top 50Contractors Working Abroad. These results testify to CB&I's ability to successfully bid andexecute projects across the world for our customers. About 80% of our work is energyrelated, and for the last several years we have experienced strong growth in two keymarkets: liquefied natural gas (LNG) and oil refining.According to the latest forecast from the U.S. Energy Information Administration,worldwide demand for natural gas is expected to grow by 2.3% annually from now until2025, making it the fastest growing primary energy source. On a regional basis, thelargest increases in natural gas consumption worldwide are expected in Eastern Europeand the Former Soviet Union, and in emerging Asia. In addition, natural gas is expectedto be the fastest growing energy source in Western Europe, and in the United States, theshare of total natural gas consumption met by net imports of LNG is expected to growfrom about 1% in 2002 to 21% in 2025.With more than 45 years of global experience in the LNG industry, CB&I's LNG projectshave included the turnkey engineering and construction of LNG import terminals andpeak shaving plants, as well as the mechanical erection of LNG liquefaction trains andthe design and construction of storage tanks for LNG export terminals. This issue of CB&IWorld contains articles describing LNG projects by CB&I in the United Kingdom,Equatorial Guinea and Nigeria.Meanwhile, demand for oil will also continue to grow worldwide, with expected annualgrowth of 1.9% in oil consumption. Much of the new oil that will be produced will beheavier crude, containing a higher sulfur content. Refiners around the world are not onlyexpanding capacity to meet the higher demand for refined products, but also upgradingtheir plants to handle the heavier crude slates they will be running.CB&I has more than 40 years of experience in engineering and building refinery processunits, with particular expertise in heavy crude processing technology, includinghydrodesulfurization, catalytic reforming, acid gas removal and hydrogen generation.This issue of CB&I World contains an article highlighting our technology for improvingthe efficiency of oxygen-enhanced sulfur recovery units.In addition to those mentioned above, this edition features several other current projectsaround the world, as well as our latest marketing initiatives. We hope you will enjoy it.3

News & Contracts4CB&I Wins Award for LNG Terminal in ChinaDec. 13, 2005 - CB&I has been awarded a lump-sum turnkey contract forthe design and construction of the terminal system works at a newliquefied natural gas (LNG) import terminal in Fujian Province, PeoplesRepublic of China. This award follows the Company's announcement inApril 2005 of a contract to build two 160,000 cubic meter fullcontainment LNG storage tanks at the facility.The terminal will be owned and operated by CNOOC Fujian LNG Co. Ltd.,a co-investment of China National Offshore Oil Corporation (CNOOC)and Fujian Investment and Development Corporation.Located in the city of Xiuyu, Fujian Province, in southeast China, the LNGregasification terminal has Phase I capacity of 2.6 million tonnes of LNGper year with Phase II expansion under planning. The natural gas fromthe terminal will be provided to gas-fired power plants that will be builtduring the project's first phase and to household users in five cities inthe province.CB&I's work scope for this latest award includes the turnkeyengineering, procurement, construction and commissioning of theterminal system works, which encompasses civil, mechanical, piping,structural, buildings, and electrical and instrumentation work, andincludes the marine loading arms and regasification system. Theterminal is scheduled for commercial operation in early 2008."We are pleased that the owners of the Fujian LNG Terminal haveexpressed their confidence in CB&I by selecting us to design and buildthe balance of China's second major LNG import terminal," said GeraldM. Glenn, CB&I's Chairman, President and CEO. "By having responsibilityfor all elements of the project, we are confident we can meet theaggressive schedule and the owners' goals for safety, reliability andvalue."CB&I to Supply Gas Processing Plant for CamiseaExpansion Project in PeruNov. 30, 2005 - CB&I has been awarded a lump-sum contract to supply anatural gas processing plant in Malvinas, Peru, as part of an expansionof the Camisea gas project.CB&I's contract is with Pluspetrol Peru Corporation S.A. as operator andcontract administrator acting on behalf of the licensees Pluspetrol PeruCorporation S.A.; Hunt Oil Company of Peru LLC, Sucursal del Peru; SKCorporation, Sucursal Peruana; Tecpetrol del Peru S.A.C. and SonatrachPeru Corporation S.A.C.CB&I will be responsible for the engineering, procurement, modularfabrication and FAS supply of two cryogenic trains each designed toproduce 360 million standard cubic feet per day of gas. The units willtreat gas extracted from the Pagoreni field to remove water and thenseparate the heavier hydrocarbons (natural gas liquids) out of the gasstream. The fast track project schedule calls for delivery of the twocryogenic units one year from contract award.CB&I has been involved in the Camisea project since its inception,having supplied the initial cryogenic plant at Malvinas, as well as afractionation and topping plant at Pisco and the associated refrigeratedand atmospheric storage tanks."We are pleased to work once again with Pluspetrol and its partners onthis critical expansion of the Camisea project," said Gerald M. Glenn,CB&I's Chairman, President and CEO. "Providing a clean-burning fuelsupply to meet growing domestic demand and a valuable exportcommodity, the expansion of the Camisea development will generatesubstantial benefits for Peru."CB&I to Supply Sulfur Processing Unit for MajorU.S. RefinerOct. 18, 2005 - CB&I has been awarded a contract by a major U.S. refinerto design and build an amine regeneration unit to assist in sulfurremoval at one of the customer's U.S. refineries.CB&I's work scope includes engineering, procurement and modularfabrication of an amine regeneration unit consisting of two sectionswith a combined design capacity of approximately 1,800 gallons perminute of amine regeneration capability. The unit is part of therefinery's amine treating system which uses an amine-based solvent toremove acid gases (sulfur dioxide and carbon dioxide) from the flue gasstreams from the coker and fluid catalytic cracking unit. The project isscheduled for completion in third quarter 2006.Gerald M. Glenn, CB&I's Chairman, President and CEO, stated, "Drawingupon our extensive experience in sulfur control and oil and gasprocessing, we offer refiners cost-effective and reliable solutions forclean fuels production. We are pleased to continue our association withthis valued customer as a key supplier for their clean fuels projects."CB&I Wins Petrochemical Storage Project in SaudiArabiaSept. 13, 2005 - CB&I has been awarded a lump-sum turnkey contract todesign and build storage tanks and pressure vessels for apetrochemical project in Al-Jubail, Saudi Arabia. CB&I's contract is withEastern Petrochemical Company (SHARQ), an affiliate of Saudi BasicIndustries Corporation (SABIC). To meet growing demand from Asia,SHARQ is adding 2.8 million metric tons per year of capacity for theproduction of ethylene, ethylene glycol and polyethylene at its plant inAl-Jubail.CB&I will be responsible for the engineering, procurement, fabricationand construction of eight vessels, including two double-wall tanks forthe storage of ethylene and propylene, and two stainless steel tanks forthe storage of monoethylene glycol. Completion of the project isscheduled for fall 2007.CB&I Wins Award for Gas Processing Project inU.A.E.Aug. 30, 2005 - CB&I has been awarded a lump-sum turnkey contract todesign and build liquefied petroleum gas (LPG) storage tanks and apentane tank for a natural gas processing expansion project in Ruwais,Abu Dhabi, United Arab Emirates.CB&I's contract is with Snamprogetti S.p.A., prime EPC contractor forthe owner, Abu Dhabi Gas Industries Ltd. (GASCO), which is a subsidiaryof Abu Dhabi National Oil Company (ADNOC). GASCO is expanding itsexisting facility at Ruwais that processes associated and nonassociatedgas from onshore oil production into marketable naturalgas liquids for export.CB&I will be responsible for the engineering, procurement, fabricationand construction of four 83,600 cubic meter nominal capacity concretefull containment LPG tanks, including foundations and piping to grade.Two tanks will store propane and two will store butane. Additionally,CB&I will supply a 76,000 cubic meter nominal capacity atmosphericstorage tank for Pentane Plus. Completion of the project is scheduledfor mid-2008.

CB&I Wins Turnkey Contract for LNG StorageProject in CanadaAug. 23, 2005 - CB&I has been awarded a lump-sum turnkey contract forthe design and construction of storage tanks for a new liquefied naturalgas (LNG) import terminal near Port Hawkesbury on Cape Breton, NovaScotia, Canada. The facility will be owned and operated by Bear HeadLNG Corporation, a subsidiary of Anadarko Petroleum Corporation(NYSE: APC) of The Woodlands, Texas.The Bear Head LNG project is designed to meet the growing demand fornatural gas in markets in eastern Canada and the U.S. Northeast. Theproject involves the construction and operation of an approximately7.5 million tons per annum capacity LNG terminal with a sendoutcapacity of 1 billion standard cubic feet per day. First gas deliveriesthrough the Bear Head terminal are targeted for late 2008.CB&I's work scope for the project includes the turnkey engineering,procurement and construction of two 180,000 cubic meter LNG storagetanks, including foundations, insulation, paint and piping to grade.Engineering and procurement activity for the project is under way. "Weare very pleased to partner with Anadarko on this significantdevelopment," said Gerald M. Glenn, CB&I's Chairman, President andCEO. "The Bear Head project will be Canada's first LNG import terminaland will provide an important new source of clean energy."Major U.S. Refiner Awards Clean Fuels Projects toCB&IMay 12, 2005 - CB&I has been awarded lump-sum turnkey EPC contractsby a major U.S. refiner to engineer and construct hydrotreating andsulfur removal and recovery facilities at one of its refineries and agasoline desulfurization unit at a second refinery.At the first location, CB&I's work scope includes the design, fabricationand installation of a 57,000 BPSD hydrocracker/hydrotreater,incorporating a light ends recovery unit; a 260 long tons per day sulfurremoval/tail gas treating unit; a 2,100 gallons per minute (GPM) aminetreating unit; and a 500 GPM sour water stripping unit. The facilities willhelp enable the refinery to meet U.S. Environmental Protection Agency(EPA) specifications for ultra-low sulfur diesel fuel and also improve therefinery's ability to process heavier crude feedstocks.At the second location, CB&I's work scope includes the design,fabrication and installation of an 18,000 BDP hydrotreater. Once inproduction, the unit will enable the refinery to meet U.S. EPAspecifications for ultra-low sulfur gasoline.Gerald M. Glenn, CB&I's Chairman, President and CEO, stated: "We arepleased to continue our association with this valued customer as a keysupplier for their clean fuels programs. CB&I offers a comprehensiveslate of technology and resources to meet the needs of refinersworldwide."CB&I Wins Turnkey Contract for LNG StorageTerminal in ChinaApril 12, 2005 - CB&I has been awarded a lump-sum turnkey contract forthe design and construction of storage tanks at a new liquefied naturalgas (LNG) import terminal in Fujian Province, Peoples Republic of China.The facility will be owned and operated by CNOOC Fujian LNG Co. Ltd., aco-investment of China National Offshore Oil Corporation (CNOOC) andFujian Investment and Development Corporation.Located in the city of Xiuyu, Fujian Province, in southeast China, the LNGregasification terminal has Phase 1 capacity of 2.6 million tonnes of LNGper year with Phase II expansion under planning. The natural gas fromthe terminal will be provided to gas-fired power plants that will be builtduring the project's first phase and to household users in five cities inthe province.CB&I's work scope includes the turnkey engineering, procurement andconstruction of two 160,000 cubic meter full containment LNG storagetanks, including deep foundations, tank topsides, and electrical,instrumentation, equipment and piping to grade. The project isscheduled for completion in late 2007."We are excited to announce our first LNG project in China," said GeraldM. Glenn, CB&I's Chairman, President and CEO. "It is estimated that alarge percentage of China's future energy needs will be met by LNGimports. We are proud to be able to help satisfy this growing demandwith what will be China's second major LNG import terminal." CB&I isworking with a leading Chinese design institute, Chengda EngineeringCorporation, and other strategic local partners on the project.CB&I Wins EPC Contract for LNG TerminalExpansion in U.K.March 31, 2005 - CB&I has been awarded a lump-sum turnkey contractfor the expansion of a liquefied natural gas (LNG) import terminal at theIsle of Grain, Kent, U.K. The facility will be owned and operated by GrainLNG Ltd., a subsidiary of National Grid Transco plc.Located on the River Medway about 20 miles east of central London, theIsle of Grain facility was originally commissioned in 1982 as an LNG peakshaving plant. In the first phase of the project, the facility is beingconverted to an LNG import terminal with an initial capacity of 3.3million tonnes of LNG per year.The second phase of the project, for which CB&I has completeengineering, procurement and construction (EPC) responsibility, willincrease the terminal's capacity to 9.8 million tonnes per year, whichequates to some 12 percent of the United Kingdom's annual natural gasdemand. CB&I's work scope includes an increase in the regasificationand sendout capacity to 1 billion cubic feet per day, increased boil-offgas handling capacity, three full containment 190,000 cubic meter LNGstorage tanks, a new control and administration facility, and associatedsystems. The project is scheduled to be completed in mid-2008."We are pleased to have been selected by Grain LNG for this project,"said Gerald M. Glenn, CB&I's Chairman, President and CEO. "Ourengineering excellence, coupled with value-added concepts and anexperienced EPC team, helped secure this work. We are proud tocontinue our role in helping to meet the future energy needs of theUnited Kingdom."CB&I Wins Phase II Award for U.K. LNG ImportTerminalMarch 2, 2005 - South Hook LNG Terminal Company has awarded CB&I alump-sum turnkey contract for Phase II of a new liquefied natural gas(LNG) import terminal to be built near Milford Haven, Wales, U.K.CB&I's work scope for Phase II of the project includes completeengineering, procurement and construction (EPC) responsibility for adoubling of the facility's regasification and sendout capacity,refurbishment of a second loading berth on the existing jetty, twoadditional 155,000 cubic meter full containment LNG storage tanks,and expansion of the associated facilities. The second phase will beconcurrent with Phase I, with construction beginning in mid-2005. Theproject is being executed through the CB&I John Brown office inLondon.As previously announced in November 2004, CB&I's scope for Phase I ofthe project includes a ship unloading system, three full containment155,000 cubic meter LNG storage tanks, and a regasification andsendout system. Marine works include major refurbishment of anexisting jetty to allow berthing of LNG tankers. Completion of Phase I isexpected in late 2007.The facility will be owned and operated by South Hook LNG TerminalCompany, a U.K. company owned by Qatar Petroleum LNG Services QGII Ltd. and ExxonMobil Qatargas (II) Terminal Company Limited. LNG forSouth Hook will be supplied from the Qatar Liquefied Gas CompanyLimited (II) ("Qatargas II") LNG plant being built at Ras Laffan IndustrialCity in Qatar, which will feature the world's largest LNG productiontrains."We are pleased that South Hook LNG has awarded CB&I the secondphase work," said Gerald M. Glenn, CB&I's Chairman, President and CEO."With a combined value now in excess of US$1 billion, we believe theseawards are a testament of the customer's confidence in our experienceand ability to engineer and deliver this landmark project."5

SafetyHEALTH, SAFETY & ENVIRONMENTEnsuring the safety and health of our employees, our customers and thepublic, as well as protecting the environment, is a fundamental value forCB&I. As an integrated services company, we uphold this value in thesame way that we ensure the quality of our work by implementingrigorous controls through every phase of our projects.Training is the key to preventing accidents and incidents. Ouremployees receive extensive training on how to perform their jobssafely, properly and in compliance with environmental regulations.Our health, safety and environment (HSE) program, built uponcorporate values and employee education, has resulted in one of thebest safety records in the industry. We've executed thousands ofprojects without a single lost workday or recordable incident. Ourprojects have garnered numerous safety awards from customers,industry associations and safety organizations.We make safety our top priority because it is the right thing to do. Inaddition we also recognize that our health, safety and environmentalprogram:Reduces costs - Our commitment reduces our customers' labor costsand the expenses of supervising and auditing the HSE practices of thecontractor.Lessens risk - Safer work practices lessen the probability of an incidentoccurring at the customer's facility and the potential for liability.Minimizes impacts - Our global Crisis Management Team can respondquickly in the event of a natural disaster, operational upset or unlikelyconstruction event. Their knowledge and preparedness is key tominimizing the impact of an incident.Improves compliance - Our rigorous safety program helps customerscomply with OSHA's Process Safety Management standards and othercompliance standards.Ensures peace of mind - Our customers can be confident that theyhave a capable, HSE-focused contractor with well-trained andcommitted personnel on the job.Safety is the responsibility of every employee at CB&I, and zero injuriesis our foremost goal. Globally, our trained personnel work to ensure thesafety of themselves, their co-workers, the customer and the public.SAFETY NEWSGold Standard: CB&I has Struck Gold AgainCB&I John Brown has struck gold again, being presented a Gold Awardfor Occupational Safety in 2005 from the Royal Society for thePrevention of Accidents (RoSPA). CB&I John Brown also received theRoSPA Gold Award in 2004, 2003 and 2002. The awards are made toorganizations that demonstrate an ongoing commitment tooccupational health and safety, and that are able to prove that theyhave implemented the guidance contained in the Health and SafetyExecutive's publication “Successful Health and Safety Management”.Award from Syncrude in CanadaSyncrude recently held its President's Award Ceremony forEnvironment, Health and Safety Excellence, at which CB&I's office inCanada (Horton CBI) was presented with the award for "Most ImprovedEnvironment, Health and Safety Program."Safety Milestone for CB&I Team in ChinaIn June 2005, the CB&I project team achieved 1 million work-hourswithout a recordable injury while working on a liquid butane storagefacility at the Shanghai Chemical Industrial Park in Caojing, Shanghai,for Vopak Shanghai Logistics Co.CB&I Receives Several Safety Awards in USAIn May 2005, CB&I received the Award for Meritorious SafetyPerformance at the National Petrochemical & Refiners Association(NPRA) National Safety Conference in New Orleans, La. The conferencerecognizes the individual facilities and contractors that support thepetrochemical refining and manufacturing industries through theirexcellent records of safe operations. CB&I was recognized for achievinga total recordable rate of 0.00 out of the 712,936 hours worked at thePremcor refinery in Memphis, Tenn., during 2004. Additionally CB&Ireceived the Contractor Safety Excellence Award for having achieved100,000 work-hours without a recordable injury at the Valero refinery inSt. Charles, La., in 2004.Safety Awards for Sakhalin II Project Team inRussiaIn May 2005, two CB&I Sakhalin II LNG Project Superintendents andtheir crews were presented with safety plaques for achieving 1.5 millionand 350,000 work-hours, respectively, without a lost-time accident. TheSakhalin II LNG Project is located in Russia where CB&I is currentlyconstructing two 100,000 cubic meter full containment LNG tanks andtwo 1,640 cubic meter 9% nickel spheres.Safety Recognition in South America fromInelectraCB&I was recently presented with a plaque from our customer,Inelectra, for achieving 500,000 work-hours without a lost-timeaccident at the Jose, Venezuela, project site where CB&I is building 11cone and dome roof tanks with heating coils and insulation.CB&I Safety Managers Achievements RecognizedIn March 2005, CB&I HSE managers from around the world convened inThe Woodlands, Texas, to participate in the 2005 Worldwide HSEManagers Meeting. The purpose of this annual weeklong meeting wasto give managers the opportunity to discuss current HSE issues, attendtraining courses and share best practices. In addition to the discussionsand training, coordinators took time out of the meeting's busy scheduleto present several safety awards. Overall, 30 CB&I HSE managersreceived 45 Health & Safety Awards of Excellence and Achievement fortheir performance.Safety Recognition in South America fromPetrolera AmerivenAt the beginning of 2005, CB&I was recognized by Petrolera Amerivenas one of the contractors working on the Hamaca upgrade project toachieve 4 million work-hours without a recordable injury. CB&Icontributed more than 750,000 work-hours to this project, whichincluded the original construction of the plant, as well as the additionalfloating roof tank that is now being built.6

World Focus: Current ProjectsEUROPELNG Terminal Expansion in UKIn March 2005 CB&I announced the award of a lump-sum turnkeycontract with a value estimated between US$470 - $500 million for theexpansion of a liquefied natural gas (LNG) import terminal at the Isle ofGrain, Kent, U.K. The facility will be owned and operated by Grain LNGLtd., a subsidiary of National Grid plc.Located on the River Medway about 20 miles east of central London, theIsle of Grain facility was originally commissioned in 1982 as an LNG peakshaving plant. In the recently completed first phase of the project, thefacility was converted to an LNG import terminal with an initial capacityof 3.3 million tonnes of LNG per year.The second phase of the project, for which CB&I has completeengineering, procurement and construction (EPC) responsibility, willincrease the terminal's capacity to 9.8 million tonnes per year, whichequates to some 12 percent of the United Kingdom's annual natural gasdemand. CB&I's work scope includes an increase in the regasificationand sendout capacity to 1 billion cubic feet per day, increased boil-offgas handling capacity, three full containment 190,000 cubic meter LNGstorage tanks, a new control and administration facility, and associatedsystems. The project is scheduled to be completed in mid-2008."We are pleased to have been selected by Grain LNG for this project," saidGerald M. Glenn, CB&I's Chairman, President and CEO. "Our engineeringexcellence, coupled with value-added concepts and an experienced EPCteam, helped secure this work. We are proud to continue our role inhelping to meet the future energy needs of the United Kingdom."Following the award the CB&I team mobilized in the CB&I LondonPaddington office with supporting teams in Plainfield and Dubai.The project team is growing rapidly and currently more than 100 peopleare working on the project. Major commitments for materials, supportservices and civil construction have already been made. The temporarysite facilities have been put in place and completion of the more than1565 piles for the first tank was achieved on schedule.The Grain LNG and CB&I project team have developed a close workingrelationship with both located in the Paddington engineering office forthe engineering and initial procurement phase. The combined projectteam is looking forward to further enhancing this relationship and thesuccessful safe, high quality and on time execution of this project.Peter Rano & Paul Emson7

FSUThe Largest Pipeline Project in the WorldBegins OperationCB&I is participating in one of the largest projects being undertakenin the world today: the Azerbaijan-Georgia-Turkey (AGT) pipelinesproject. In November 2005 the project reached a milestone when thefirst barrels of oil flowing through the Baku-Tbilisi-Ceyhan (BTC)pipeline reached the Turkey-Georgia border and entered the Turkeysection.This follows the filling of the 694-kilometer Azerbaijan and Georgiasections of the pipeline with about 4 million barrels of Azeri-Chirag-Gunashli (ACG) oil, which has now been received at the Turkey PumpStation 1. The event represented a significant achievement forAzerbaijan, Georgia and Turkey; for the investors in the BTC pipeline;for BP, an operator of the pipeline; and, of course, for CB&I.The AGT pipelines project includes the construction of two majorpipelines, the Baku-Tbilisi-Ceyhan (BTC) oil pipeline and the SouthCaucasus gas pipeline (SCP), as well as the associated above groundfacilities.CB&I Representatives Charles Stanhopeand Rees Brislin during the BTC First OilCelebration, Georgia, October 12th 2005.This event marks a major step towardsco m p l e t i o n o f t h i s s t ra tegica l l yimportant energy project, which willdeliver a major new oil resource to globalmarkets.The official ceremony marking thetransit of oil through Georgia was hostedby President of Georgia MikheilSaakashvili at the BTC pumping stationnear Gardabani.It was attended by President Ilham Aliyevof Azerbaijan, President Ahmet NecdetSezer of Turkey, BP Group managingdirector Iain Conn and a large group ofgovernment officials, senior executivesof BTC owner companies and businessrepresentatives.The BTC pipeline is 1,768 kilometers in length and will send oil from theSangachal terminal near Baku on the Caspian Sea coast in Azerbaijan,past Tbilisi in Georgia, to the Mediterranean port of Ceyhan in Turkey.CB&I John Brown is responsible for corridor and pipeline engineeringfor the 42-inch diameter Azeri and 46-inch diameter Georgian sectionsof the BTC pipeline and for the construction engineering of the BTCpump stations in Turkey.The SCP, with a diameter of 42 in. and 692 kilometers in length, willtransport natural gas from the Shah Deniz field in the Caspian (alongthe same route as the BTC pipeline), through Azerbaijan and Georgia tothe Turkish border, and into the Turkish distribution system. CB&I JohnBrown is the engineering and procurement services contractor for theSCP from Azerbaijan to Turkey.Our personnel have also been actively involved during the constructionphase in all three countries and have a significant role in the BP-ledIntegrated Project Management Team (IPMT), overseeing theengineering and construction work performed by the contractors. InBaku, we are providing project and pipeline engineering andinspection services.In Georgia, our staff members are key players in the technical groupand, on site along the pipeline route, they are providing constructionmanagement, field engineering, logistics and construction inspectionservices.In Turkey, we provided pipeline construction management support andassisted one of the BOTAS contractors with project managementsupport and construction engineering services for the constructionand installation of the pump stations.All three counties are supported by the UK IPMT, based in CB&I's Londonoffice, which provides engineering and procurement of long lead items,reviews the contractors' detailed design and constructionmethodology, and helps resolve any technical queries as they arise inthis important and challenging project.By the end of the decade, the BTC pipeline should be flowing 1 millionbarrels of oil per day.Construction on the SCP will follow completion of the BTC pipeline. Itwill commence operation in 2006 and have an initial capacity of 7.4billion cubic meters (BCM) of gas per year, with a future expansioncapacity of up to 20 BCM.We are proud to be associated with such a world class project for the BPledconsortia. Our current performance confirms our capability toprovide a full range of high quality services in the pipeline industry.Rees Brislin and Charles Stanhope8SCP pipeline installation - GeorgiaReinstated and SCP pipelines - GeorgiaPump Station in Georgia

MIDDLE EASTShoaiba Project :Heavy Fuel Oil Tanks for Power Plant in Saudi ArabiaCB&I is currently participating in a power plant expansion project,providing the Heavy Fuel Oil/Crude Oil (HFO/CO) storage tanks for theShoaiba Power Plant in Shoaiba, Saudi Arabia. The Shoaiba projectrepresents a major development in Saudi Arabia's water and powersector to help satisfy the increasing national demand for power andwater. The project is located adjacent to the existing Shoaiba power anddesalination complex 120 km south of Jeddah, on the western coast ofSaudi Arabia's Red Sea. A consortium of Alstom Power of France andSaudi Archirodon is the main contractor for the project, which is beingconstructed in two phases.The Saudi Electricity Company Western Region (SEC-WR), a majority stateowned corporation, owns the Shoaiba Power Plant. The company isresponsible for providing power to the Western Province of Saudi Arabiaincluding metropolitan Jeddah, Makkah, Madinah and the industrial cityof Yanbu.The plant will burn crude oil that will be sourced from Saudi Aramco.Crude oil will be supplied by tanker shipments to an existing unloadingjetty where it will be unloaded into the on-site storage tanks.CB&I received a lump-sum contract for Phase 1 of the project in March 2004. The Company's work scope includes engineering, procurement,fabrication, erection, testing and external painting of four 86 meter diameter by 21.95 meter high cone roof tanks with internal floating roofs and afurther six miscellaneous flat bottom tanks. Phase 1 of the project is nearly complete and CB&I's project team is currently finishing up the erection ofthe last HFO/CO tank.In June 2005 CB&I received an award for Phase 2 of the project. CB&I's work scope includes engineering, procurement, fabrication, erection, andtesting of an additional four 86 meter diameter by 21.95 meter high cone roof tanks with internal floating roofs and one 33 meter diameter stainlesssteel cone roof tank. The project is just getting under way and we are currently planning to begin field erection activities on the first HFO/CO tank inearly 2006.The CB&I project team has established an excellent working relationship with the client's team and is looking forward to meeting the challengesahead in completing the second phase of this project.Greg CookPhase 1 Phase 1 Phase 29

AFRICABonny Island:Successful completion of one of the largest construction projects in Africa10The Bonny Island LNG facility, situated inFinima at the southern edge of Rivers Statein the Niger Delta of Nigeria, Africa, is beingdeveloped by Nigeria LNG Limited (NLNG).NLNG is a joint venture company whoseshareholders are the Nigerian NationalPetroleum Corporation (NNPC) 49%, ShellGas BV (Shell) 25.6%, Ceag Limited (Elf)15% and Agip International BV (Agip)10.4%. NLNG is one of the world's majorexporters of liquefied natural gas. In 1999NLNG commenced an Expansion Project toincrease liquefaction capacity by 50% withthe addition of a third LNG productiontrain producing 2.95 million metric tonsper year. The expansion also added processunits to produce more than 1 million tonnes per year of liquefiedpetroleum gas (LPG). CB&I was selected todesign and build one full-containmentLNG storage tank, two double-wall LPGstorage tanks, two smaller tanks andassociated foundations and civil works. Wecompleted the work in early 2003,achieving a world-class safety record in theprocess on one of the largest constructionprojects in Africa.During 2002 NLNG announced the PlusProject; this would further increaseliquefaction capacity by 90% with theaddition of LNG Trains 4 and 5, each trainbeing capable of producing 4 millionmetric tons of LNG per year.Building on our proven performance during the Expansion Projectcoupled with our exemplary safety record, CB&I in consortium withBilfinger Berger AG of Germany was awarded a contract by the TSKJgroup of companies - EPC contractor for the NLNG Expansion and PlusProjects - to provide civil and mechanical erection services for the PlusProject. This November 2002 award demonstrated TSKJ's continuingconfidence in our ability to execute complex technical projects andfurther solidified CB&I's position as one of the world's leading providersof LNG liquefaction and storage facilities.CB&I was the mechanical erection contractor for the construction of thefourth LNG production train and associated offsites with a designcapacity of 4.0 million tonnes per year,one of the largest capacity units in theworld. CB&I's excellent worldwide safetyrecord and our well proven QA/QCManagement Systems, our ISO 9001Quality Management Program andEnvironmental Procedures, which areestablished in accordance with ISO14001 guidelines, were instrumental inreceiving the award.Bilfinger Berger AG performed the civilwork for Train 4. The CB&I team mobilizedon site in late 2002 and completed theproject in the spring of 2005.CB&I's scope included the construction of the structural, piping andmechanical equipment for Train 4 and the mechanical works for newareas offsite, including the new 510 ft. tall flare and the new LNG loadingjetty trestle and jetty head topsides.The scope included pipe shop prefabrication of approx. 21,000 spools,more than 315,000 diameter inches of welding on three different typesof steel, and fabrication of 650 metric tons of pipe supports.Field work included managing the consortium's civil contractor,erecting more than 12,000 metric tons of structural steel, erecting the77 kilometers of pipework, and setting 247 pieces of taggedequipment. This incorporated the installation of 2 66MW Frame 7 gasturbine generators, which drive the refrigerant compressors.I n a d d i t i o n t o a l lstructural, piping andmechanical works offsiteand on the new LNG jettyhead, which containedfive new loading arms,we were also responsiblefor the erection of a 510ft. high flare derrick withfour risers.CB&I was additionallyresponsible for the heavyl i f t p r o g r a m w h i c hincluded lifts up to 350 metric tons. Forty cranes were mobilized to site,with the largest being the Demag CC2800, having a boom length of552 ft. and a capacity of 600MT, which was supplemented with CB&I'sAmerican 11320 Skyhorse with a capacity of 400MT.To perform the work required a large task force with a dedicated focuson safety - CB&I's number one priority. CB&I expended approximately10,000,000 work-hours without a single lost time incident. Thisexcellent performance was accomplished with a peak work force of2,932 CB&I employees from 21 different nationalities working on theproject, with the overwhelming majority being local Nigerians.This performance exemplifies one of CB&I's strengths: working safely inremote locations and utilizing and enhancing the local communitythrough employment, training and education.In addition to safety, quality is another important performancemeasure for CB&I. Once again weperformed in accordance with worldbest standards. With a total of more than500,000 diameter inches of welding, ourX-ray acceptance average was 99.48%.CB&I completed the project on schedule,delivering Train 4 and the new offsitearea mechanical work to our customeron time and ready for start up.Peter Rano

Bioko Island:LNG Storage Facility on Bioko Island in Equatorial GuineaIn March of 2004 CB&I wasawarded a lump-sum turnkeycontract valued in excess ofUS$60 million to design andconstruct a liquefied natural gas(LNG) storage facility on BiokoIsland in Equatorial Guinea for EGLNG, a partnership which includesMarathon Oil Company andG E Pe t ro l, t h e n ational o i lcompany. Bioko Island is locatedabout 20 miles (32 kilometers) off the coast of Cameroon in west centralAfrica.The facility will store LNG produced by a new liquefaction plant that EGLNG is having built on the island. The plant is designed to produce 3.4million metric tons of LNG per year, with a projected start-up in late2007. Bechtel Corporation is the prime contractor for the overallproject.CB&I's work for the project encompasses the engineering, procurementand construction of LNG tankage with a total capacity of 272,000 cubicmeters. Scope includes civil foundation work, tank insulation, painting,in-tank pumps, piping, electrical and instrumentation to grade within 5meters of tanks, and the design and construction of nine smaller tanksfor facility storage and processing.CB&I has had a presence on Bioko for the last three years performingwork for Marathon's Alba Phase II expansion project. This work has beencompleted and included the engineering, procurement andconstruction of three low temperature tanks, three condensate bulkstorage tanks and the retrofitting of existing tanks for conversion toalternate service. As part of the Alba phase II expansion project, CB&Idesigned and fabricated a modular cryogenic gas processing plant thatwas delivered to the island with a capacity of 870 million standard cubicfeet per day (MMSCFD).It is the largest plant of its type ever built by the company.Following the award of the EGLNG project in March of 2004,engineering started immediatelywith LNG tank design work inCB&I's Plainfield office and API650 tank work in CB&I's Houstonoffice. In September of 2004CB&I's project team mobilized onsite and civil work was started.The LNG outer tanks are nowbuilt with air raises executed inJuly and August of this year. The inner tanks are currently underconstruction and pipe spooling for the piping to grade is under way.Completion is scheduled for November 2006.CB&I is fully mobilized and has ateam of 160 personnel workingon Bioko Island. Major purchaseo r d e r s f o r m a t e r i a l s a n dsubcontracts for services havebeen made. Fabricated materialsfor the outer tanks and API 650tanks were shipped from CB&I'sfabrication facility in South Africa,inner tank materials from Europeand piping from the USA.Procurement is being coordinated through the CB&I Dubai office withassistance from our purchasing offices in South Africa and theNetherlands. Operations support, QA/QC, painting, accounting, andequipment is also being coordinated through our Dubai Office.CB&I work is progressing well. Construction is nearly half complete andahead of schedule. The CB&I project team has established an excellentworking relationship with our customer and client and we are ready tomeet the remaining challenges ahead on this project.Peter MurphyLNG Storage Facility11

NORTH AMERICAProcess Vessels for World's Largest RadioactiveWaste Treatment PlantIn June 2002, CB&I was awarded a contract valued at approximatelyUS$40 million by Bechtel National, Inc. (BNI) to supply specializedvessels and other components for the River Protection Project - WasteTreatment Plant at the U.S. Department of Energy's Hanford Site nearRichland, Washington. Plutonium was produced for national defense atthe Hanford Site from the mid 1940's to the late 1980's. More than 53million gallons of chemical and radioactive waste from the plutoniummanufacturing process are stored in 177 underground tanks at the site.CB&I prepares torig and lift one offour vessels forinstallation insidethe building shownto the right of thecrane.In December 2000, the Department of Energy awarded BNI a 10-year,multi-billion dollar contract to design, construct and start-up theworld's largest radioactive waste vitrification plant to treat the waste atthe Hanford Site. Vitrification is a process that immobilizes radioactivewaste by blending it into molten glass, which is encased in stainlesssteel canisters. The glassified waste will remain stable and imperviousto the environment for the hundreds to thousands of years it takes forthe radioactivity to decay. Construction of the Waste Treatment Plantbegan in 2002.CB&I previously worked with BNI and the Department of Energy toprovide process vessels for the Defense Waste Processing Facility, anoperating vitrification plant located at the Savannah River Site nearAiken, South Carolina.CB&I is responsible for the engineering, procurement, fabrication andfield installation of four skirt-supported 47' diameter x 44'-6” overallheight stainless steel ASME Section VIII Waste Feed Receipt (WFR)vessels. In addition, each WFR vessel contains an internal “Pulse Jet Mix”(PJM) system made up of twelve 4'-6” diameter x 15'-1” long ASMESection VIII stainless steel vessels suspended from the WFR vessel tophead. All material procurement and fabrication for the four WFR vesselsand 48 (total) PJM's were completed at CB&I's Provo, Utah fabricationfacility. The work is being executed under the provisions of a nuclearlevel quality assurance program. The WFR vessels will be located in thePretreatment Facility, which will separate high-level radioactive wastefrom low-activity waste pumped from the underground tanks.In addition, CB&I's scope includes the installation of more than2178,000 ft of stainless steel plate that will serve as a secondarycontainment liner in several of the buildings where the vitrificationprocess will take place.CB&I's team began the design work on the vessels in the summer of2002, with site mobilization in late 2002. Though the WFR vessels werecompleted in December 2004, BNI only recently completed the reviewof more than 11,000 pages of QA documentation prior to finalacceptance of the vessels. The completion of the stainless steel linerplate is currently scheduled for February 2007.To facilitate the client's overall schedule, CB&I and BNI site personneldecided to erect the WFR vessels at an on-site lay-down area locatedabout 1,000 feet from the final installed location inside the facility'sPretreatment building. This allowed BNI to erect the Pretreatmentbuilding concurrent with CB&I's activities related to vessel erection.CB&I's efforts peaked when CB&I employed the support of a heavy hauland transport company to assist with the moving of these vessels fromthe lay-down area to a staging area adjacent to the Pretreatmentbuilding. With the support of BNI's crane, CB&I rigging crews and sitesupervision successfully lifted each of the four 535,000 lb vessels overthe 56' high Pretreatment building walls to their final location inside thebuilding.To date, CB&I has installed approximately 62,000 square feet of 1/8”thick stainless steel liner plate in various locations in each of the LowActivity Waste, High Level Waste, Laboratory and Pretreatmentbuildings. CB&I is using a low heat input automated pulse arc MIGwelding process to minimize distortion of the thin plate material tomeet strict flatness tolerances.The support from Boilermaker Local 242 and the NTL has beenexceptional. The skill level of the craftsmen and their commitment tosafety have been a big plus for us at the jobsite. In the nearly 3 yearssince mobilization to site, CB&I has worked in excess of 300,000 laborhourswith no lost time accidents and just two recordable incidents.Local 242 has been awarded top honors nationally for their safetyrecord two years in a row by the National Association of ContractorBoilermaker Employers (NACBE). In addition, BNI has also recognizedCB&I's commitment to safety.John Baer12Tank transportation

SOUTH AMERICAGasmar ProjectChile has been key to CB&I's work in South America since thecompany initiated operations in the region in 1924. By mobilizingresources and by using local labor and contacts that have beendeveloped over the years, CB&I is able to execute projects efficientlythroughout the country.Following the award of a lump-sum contract in late April 2005, CB&Ibegan participating in a terminal expansion project for Gasmar S.A.involving the addition of an LPG storage tank. The project, which isscheduled to reach mechanical completion in 14 months, is located atQuintero, approximately 150 km northwest of Santiago, Chile.For this project, CB&I is performing the engineering, procurement andconstruction of a fourth 35,000 m³ tank for storing imported LPG at theexisting terminal. CB&I's ability to deliver this project on a turnkey basis,combined with our experience and knowledge in the area, provided anattractive package in terms of both cost and schedule. Engineering andprocurement was performed in CB&I's Woodlands office in Texas.Material supply of the main steel components was handled through asupply/fabrication order with Ratarrukki Oy. The supply andmanufacturing of the roof structuring, framing, platforms, stair towerand other accessories are being provided through CB&I's Houston,Texas facility. Project management and logistics are also being handledin The Woodlands, Texas, by our CSA (Central and South America) team.The main steel and roof structural, which has recently been delivered tothe job site, is currently in the pre-assembly process. The client-suppliedfoundation has been completed and tank erection, which began inNovember 2005, is scheduled for completion in June 2006. Currentlythe project is proceeding according to the original plan. The CB&Iproject team has established an excellent working relationship with theclient's team and is looking forward to meeting the challenges ahead.CB&I's other current projects in Chile:CB&I's CSA group has several other construction projects underway inChile. CB&I has recently completed two 75' diameter LPG spheres forAbastible, near the city of Concepcion. We are also nearing thecompletion of three large Bleach Stock Towers near Nuevo Aldea, northof Concepcion, for Arauco under a subcontract with Salfa a large Chileanconstruction contractor. Additionally, CB&I is in the early stages ofanother project erecting 23 miscellaneous towers, vessels and tanks forCMPC Celulosa under a subcontract with Sigdo Koppers. Drivers for bothof these contracts, which involve the expansionion of existingpulp/paper mill plants, include Chile's current strong economy andbooming export market.In addition, we are in the final stages of the erection of a gasoline storagetank for ENAP, a state-owned company in Chile with which CB&I hasestablished a long-term relationship. We will shortly begin EPC supply fora new crude storage facility for COPEC, a privately-owned petroleumcompany. This new facility will be located in the north, near the Gasmarterminal.Mike Sheesley13

Special Features: Regional FocusOil and Gas Projects Flourishin Asia-PacificBy Gerald M. Glenn, Chairman, President and CEO, CB&IWith an unparalleled range of geographies, economicconditions, religions and political systems, the countries of Asiaand the Pacific region offer some of the most diverse markets inthe world. For international contractors serving the energyindustry, Asia-Pacific is a region that presents enormousopportunities, but the risks associated with these opportunitiesare substantial.Success in the area often depends on reducing these risks tomanageable levels by maintaining a local presence and bydrawing upon the technical and financial resources of a globalorganization.Gerald M. Glenn14Regional Growth Spurs ActivityThe Asia-Pacific region encompasses a few countries with welldevelopedindustrialized economies - Japan, Australia and NewZealand - and many countries with emerging or developing economies.Much of world's economic growth over the next two decades isexpected to occur in the developing nations of Asia, where the U.S.Energy Information Administration (EIA) projects annual growth of 5.1percent in gross domestic product (GDP), compared with 3.0 percentper year for the world as a whole. China is expected to have one of thehighest growth rates among the world's economies, averaging 6percent per year between 2001 and 2025, which should position it asthe world's third-largest economy after the United States and Japan.While there are considerable oil and natural gas reserves in the Asia-Pacific region, most notably in India, Indonesia, Malaysia, China andoffshore western Australian, long-term energy demand growth for theregion is expected to surpass its own production capacity. Eventually,the countries in the region are expected to be the dominant consumersof the world's energy supplies. Coal is the primary energy source inChina and India due to Asia's large coal reserves; however, crude oil isthe energy source of choice throughout the remainder of the Asia-Pacific region.Energy demand in the emerging economies of developing Asia,including China and India, is projected to more than double between2001 and 2025. Net electricity consumption in the developing nationsof Asia is projected to rise by 3.7 percent annually during the sameperiod. Population growth and urbanization in China and India areexpected to produce large increases in demand for residentialelectricity, while rising incomes and rural electrification efforts willfurther boost demand.In the industrial sector, energy consumption in developing countries isprojected to increase from 40 percent to nearly 50 percent of worldwideindustrial sector consumption by 2025, with China's industrial sectorleading this growth.During the next two decades, oil is expected to retain its position as theworld's foremost source of primary energy consumption. Whileindustrialized countries continue to consume more oil than developingcountries, the gap is narrowing. By 2025, developing nations areexpected to consume 94 percent of the total amount of oil consumedby industrialized countries. Petroleum-based fuels used fortransportation are poised for strong growth in developing Asia. Onceagain, China is the key market that will drive growth in regionalconsumption, followed by India, Thailand and Indonesia. Energy use fortransportation in China is expected to increase by 5.3 percent annuallybetween 2001 and 2025, while demand in Asia's other developingcountries will also experience strong growth as rising standards ofliving result in increased automobile ownership. Energy demand fortransportation in the industrialized countries of Asia-Pacific will alsoincrease, but at a slower pace. Natural gas consumption is expected toincrease throughout Asia-Pacific in the coming years as well. In theindustrialized countries of Japan, Australia and New Zealand, annualgas consumption is projected to grow from 3.9 trillion cubic feet (TCF)to 6.0 TCF between 2001 and 2025, an average annual increase of 1.8percent. In developing Asia, natural gas consumption is expected toincrease by an average of 3.5 percent per year during the same period.China and India will be setting the pace as the region's fastest growingenergy consumers, with projected average annual increases in naturalgas use of 6.9 percent and 4.8 percent, respectively.

Demand for petrochemicals is also growing rapidly in the developingcountries of Asia, since the petrochemical market tends to emulate GDPgrowth. For instance, consumer demand for plastics in China and India,driven by rising incomes and increased consumer purchasing power,has led to a rise in petrochemical imports and the development ofpetrochemical processing facilities. China's GDP, which grew 9.5percent in 2004, is expected to continue strong growth.E&C Firms Rise to the ChallengeResponding to the growing demand for energy in Asia-Pacific,international and state-owned energy companies have invested in thedevelopment of technically complex, world-scale facilities in theregion. Liquefied natural gas (LNG) import terminals are beingdeveloped in China, India, Japan, South Korea and Taiwan, while LNGproducers in Australia, Malaysia and Indonesia have recentlycompleted or are contemplating expansion of their capacity with newliquefaction trains.Several of the LNG import terminals have associated gas-firedelectricity generating plants under development. Massivepetrochemical plants are in the engineering phase or underconstruction near Shanghai and in China's Fujian, Guangdong andZhejiang provinces, and well as in Singapore and Taiwan. Grassroots oilrefineries are under development in China, India, Indonesia, Taiwan andVietnam, while numerous existing refineries are expanding capacity.Meanwhile, refinery owners in Australia are facing governmentmandatedrequirements to lower the sulfur content of transportationfuels, similar to clean fuels regulations in other parts of the world. Theseregulations require capital expenditures for the construction ofhydrotreating and sulfur recovery facilities.Given the technical complexity and financing requirements of theseprojects, energy companies have engaged international engineeringand construction (E&C) firms for design and execution. Developers useinternational contractors because of the technical expertise andexperience, management capabilities, financial strength and globalsupplier relationships they bring to the table. With billions of dollars onthe line in many of these projects, an E&C company's proven trackrecord of past success is an essential selection criterion. Globalresources and experience are highly valued in this market. CB&I, forexample, has been working in the Asia-Pacific region for more than 80years, and the company established an Australian subsidiary in the early1960s.Southeast Asia/ChinaMost of the developers of hydrocarbon processing and storage projectsin Southeast Asia and China, whether international, regional or local,are interested in maximizing local content. Driving this interest is thedesire to boost the local economy and develop local resources.Otherconsiderations include an awareness that local suppliers are more pricecompetitive; they have a better understanding of their region'senvironment, practices, codes and standards; and they can more easilyobtain the necessary licenses and qualification certificates. A finalconsideration is more long-term in nature, as developing countries seektechnology transfers that will perpetuate economic growth and localresource development in the future.Successful regional contracting, therefore, requires understanding thestrengths and weaknesses of these local resources, and then utilizingtheir strengths and managing their weaknesses to reduce project risksto acceptable levels. Most international contractors find thatestablishing a local presence in the region will enhance their prospectsfor success.A local base of operations helps the contractor:? understand the markets and customers;? understand the local resources and suppliers;? understand local regulatory requirements (such as permits,taxes, registrations and banking); andIndeed, in many locations in Southeast Asia and China, local partnersare required. In some cases, developers seek to lower the project's riskprofiles and costs, while in other situations they must comply withregulatory mandates. Local partners can help foreign contractorsnegotiate the landscape and the often complex relationships amongcity, provincial and national authorities. In working with a local partner,it is important that the contractor's project team members possess theappropriate cultural sensitivities to ensure a smooth workingrelationship and promote maximum safety, productivity and quality. Itis critical for both parties to align their values and interests from thestart and to manage their relationship over the course of the project.AustraliaIn Australia, a local presence is as much a key success factor forinternational contractors as it is elsewhere in the Asia-Pacific region.Since many projects require detailed knowledge of Australian codes,maintaining a local engineering group helps keep the firm abreast oflocal code requirements. And a local presence obviously facilitatesrelationships with repeat clients.Australia differs from other Asia-Pacific nations, however, because thecountry is highly unionized. With unions holding significant economicand political power, project success is often dependent on successfullymanaging local industrial relations.Labor agreements are typically negotiated on a job-by-job basis, socurrent knowledge of the market and other agreements is essential.Established relationships with union officials are necessary both duringnegotiations and during project execution. Additional elements forsuccessful industrial relations include implementing and managingagreements fairly, screening personnel for hire, maintaining goodemployee relations between supervisory staff and tradesmen, andproactively managing safety and other workplace issues.The current active market in Australia is making it harder to attract andhire good labor, so contacts are important. CB&I, for example, is able toretain key people by placing them in assignments outside Australiawhen workloads decline in the country. CB&I recently had as many as 70Australians working on a major LNG expansion project in Nigeria. Thisability to offer overseas assignments is a differentiator to prospectiveemployees and helps attract and retain the best people.Another key factor for success in the Australian market is a contractor'sability to work at remote sites, since many of the country's mineral andnatural gas processing projects are in very sparsely populatedlocations. Handling the logistics of remote sites for both labor andmaterials is essential, and this ability has enabled CB&I to completeprojects successfully, whether in the deserts of Western Australia or inthe jungles of Papua New Guinea.Strong Growth ForecastWith strong economic growth forecasted for the next couple ofdecades, rising demand for energy and petrochemical products shouldlead to abundant opportunities in Asia-Pacific for internationalengineering and construction firms in the oil and gas sector.Successful project execution in the region requires the technicalexpertise and financial strength of global contractors. Just as importantis the need to combine this global capability with local knowledge ofthe region, knowledge that has been gained through the developmentof relationships and the commitment to maintain a local presence inthe region.Source: World Energy, Volume 8, Number 2 - 2005. Reprinted with permission from WORLDENERGY, all rights and copyrights reserved.? develop competitive approaches to the local marketplacethat are compatible with the contractor's guidelines andpractices for doing business.15

Special Features: CB&I DifferenceHelping the Energy Industry bringIts Products to MarketWorld Energy interviews Philip Asherman, Executive Vice Presidentof CB&I.CB&I is one of the world's leading engineering, procurement and construction (EPC)companies, specializing in lump-sum turnkey projects for customers that produce,process, store and distribute the world's natural resources. CB&I is a fully integratedEPC service provider, offering a complete package of conceptual design,engineering, procurement, fabrication, field construction, mechanical installationand commissioning.CB&I serves customers in a number of key industries including oil and gas;petrochemical and chemical; power; water and wastewater; and metals and mining.Its projects include hydrocarbon processing plants, LNG terminals and peak shavingplants, bulk liquid terminals, pipelines, water storage and treatment facilities, andother steel structures and their associated systems. CB&I has more than 11,000employees and operates from more than 60 locations worldwide.Philip Asherman16World Energy: What capabilities and experience does CB&I have in thedistribution segment of the oil and gas industry?Asherman: At CB&I, we've been in the business of designing andconstructing facilities used to distribute oil and gas products fordecades. We have designed and built export terminals that handle awide variety of liquid products, including crude oil, refined products,liquefied gases, petrochemicals and bulk fuels. We have also designedand managed some of the world's largest onshore and offshorepipeline projects for transporting crude oil, natural gas, refinedpetroleum products, liquefied gases and condensates, in both singleand multiphase.CB&I has executed terminal projects in some of the mostgeographically and logistically challenging places in the world.Providing single-point responsibility and self-performing all aspects ofboth greenfield and expansion projects, we have the capability ofstarting with feasibility studies and going all the way through toconstruction, startup and commissioning.Similarly, CB&I's comprehensive services for pipeline projects includeconceptual and field development studies, project site and costevaluations, complete engineering from front-end engineering anddesign through detailed design, procurement, constructionmanagement and commissioning.World Energy: Can you cite examples of some of the more challengingprojects you've taken on?Asherman: Certainly. CB&I designed and constructed one of thelargest petroleum terminals in Southeast Asia at Pulau Busing inSingapore. Situated on a reclaimed island in Singapore Harbor, thisterminal includes 59 product storage tanks with a combined capacityof more than 5 million barrels, has four operational berths capable ofhandling large vessels, can load/unload four ships simultaneously andhas a self-contained power generation system.Another world-class terminal project involved the expansion of anexisting crude oil trans-shipment terminal on the island of St. Eustatiusin the Netherlands Antilles. For this project, CB&I constructed a singlepoint mooring system, an onshore pumping station, and eight 625,000-barrel (100,000-cubic-meter) floating roof tanks along with associatedsubsea and aboveground piping systems. The remote location, difficulttopography and plant operability requirements made this one of ourmore challenging projects.Currently, we are performing an integral role in one of the world'slargest pipeline projects, the Azerbaijan-Georgia-Turkey pipelines thatwill bring oil and gas to market from the Caspian Region. CB&I isproviding engineering and construction management for twocomponents of this massive project: the Baku-Tbilisi-Ceyhan (BTC) oilpipeline, which is 1,768 km long and will transport oil from Azerbaijanto Turkey; and the South Caucasus (SCP) pipeline, which at 692 km willtransport natural gas from the Shah Deniz field in the Caspian to Turkey.World Energy: Where do you see an increase in the demand for crudeoil export terminals, and what types of products are driving thisdemand?Asherman: Today's sustained high oil prices are prompting some of themajor oil companies and exporting countries' governments to moveforward with terminal projects that were not economical a few yearsago. We are currently pursuing turnkey projects for both tanks andcrude oil terminals in a number of locations worldwide.In addition, there is a developing trend among some major oilproducers, particularly in the Middle East, to move their operationsfurther downstream to include the manufacture of higher-valuepetrochemicals. CB&I has considerable expertise in low-temperatureterminals for products such as ethylene, styrene and propylene, makingthis an attractive market for us.

World Energy: Are you also seeing greater demand for pipelines? If so,where?Asherman: We see growing demand for pipelines to bring oil and gassupplies to Europe and Asia, as well as to provide additional exportcapacity from the Middle East, Russia and other countries of the formerSoviet Union. China is actively building pipelines to fuel its growingeconomy. There is a critical need to bring natural gas to Europe out ofgas-producing areas in the former Soviet Union and the Middle East.Within the next several years, Europe likely will be in a gas-deficitposition as regional demand outpaces production, and new gassupplies will be needed. In addition to the large reservoirs in Qatar andother Middle Eastern countries, big fields will be developed inKazakhstan and Azerbaijan. Infrastructure will be needed to deliver gasfrom these new fields to markets in Europe. Russia also is seeking topipe gas from east to west and has additional plans to develop exportpipelines to move oil out of the country.World Energy: What technological innovations are driving pipelineconstruction projects?Asherman: New information management technology hassignificantly assisted the pipeline routing process. As an example, forthe Caspian pipeline projects in which CB&I is currently involved, weused a customized state-of-the-art geographical information system(GIS) in conjunction with a traditional CAD package to improve thedesign process. GIS was used to manage, interrogate and interpret anextensive range of available data, allowing the project team to developdetailed routing and constraint maps to avoid known sensitive ordensely populated areas, cultural monuments and archaeological sites,and known geo-hazards. It was also used to maximize the safe,uninterrupted construction and operation of the pipelines, and tominimize the risk of spills and the amount of land required for pipelineconstruction. As a result of the meticulous route selection process, not asingle person has been required to move from his or her home becauseof the BTC and SCP projects, and no permanent disruption to thelivelihood of the local communities has been experienced.World Energy: In addition to pipeline delivery, gas producers arebringing natural gas to market in the form of liquefied natural gas. HasCB&I been involved in the distribution of that product?Asherman: Yes, we have designed and built numerous LNG terminals.Right now we're working on two major LNG import terminals in theUnited Kingdom: the South Hook project in Milford Haven, Wales, andthe Isle of Grain project near London. Both projects are being managedout of our London office, and CB&I has complete turnkey design-buildresponsibility for these terminals, which will provide approximately 30percent of the United Kingdom's annual demand for natural gas uponcompletion. The South Hook terminal will have five storage tanks, alongwith the associated regasification and sendout facilities. Three storagetanks and associated facilities will be constructed at the Isle of Grainproject.World Energy: Any final thoughts?Asherman: Getting product to market in a timely manner is critical forany business, from a customer standpoint and for competitive reasons.In our case, not only are we helping mature international energyproviders maintain and expand their distribution channels, but we'realso helping developing countries bring their natural resources tomarket and earn much-needed hard currency to improve the quality oflife for their citizens. It's a responsibility we take seriously, and we arepleased that our customers have recognized our abilities across thehydrocarbon value chain from production to distribution.Source: This article appeared originally in World Energy, Volume 8, Number 3 - 2005. Reprintedwith permission from WORLD ENERGY, all rights and copyrights reserved.17

Enhancing SRUs with Oxygen-Enriched AirBy Mukesh Mehta and Aaron Stryk, CB&IMost refiners have now moved toward a higher standard of sulfurrecoveryefficiency to comply with clean fuels regulations that impose areduction of sulfur in refined products. While refiners have chosenvarious avenues and process solutions to address these sulfur caprequirements, reliance on the refinery's previously installed sulfurcomplex has presented one of the most effective and cost-efficientsolutions. Comprised of a Claus sulfur-recovery unit (SRU) and a tailgas-treating unit (TGTU), the sulfur complex processes both lean andrich hydrogen sulfide (H2S) bearing acid gas streams and ammoniabearingsour water stripper off-gas streams to recover elemental sulfur.The existing sulfur complex in many refineries may not provide enoughprocess capacity to meet the current regulatory requirements. Currenttrends indicate that as crudes become heavier and contain higherconcentrations of sulfur, many refineries will need at least two or moreClaus units - also referred to as trains - to meet current environmentalregulations. This has increased the throughput of many SRUs, whichmay lead to the SRU reaching its hydraulic limitation (maximum air) andmore frequent shutdowns for maintenance. This can force the refineryto shut down its upstream operations unless there is another way toremove sulfur from the acid gas and off-gas streams.To prevent unscheduled shutdowns of this nature, many refinerieshave a parallel Claus unit. If one of the trains needs to be taken offstreamfor maintenance, the other can handle at least some of theadditional throughput. However, in instances where the remainingSRU is unable to provide adequate sulfur recovery capacity, the refinerymay be forced to reduce its upstream operations substantially.To ensure that a plant's Claus unit complex can meet the demands forincreased throughput, even in instances where one of the trains is notin service, a refiner can do one of two things: either install another SRUor retrofit a unit to provide oxygen enhancement to the Claus process.Since investment in any kind of sulfur-reduction technology isregulatory-driven rather than revenue and profit driven, solutions thatget the job done effectively for the least amount of money are generallypreferred. Oxygen enhancement has become one of the most viable,cost-effective alternatives to installing a new SRU.Technology & InnovationsThis ensures that not only the necessary amount of H S is burned to2keep the plant compliant with environmental regulations, but also thatthe ammonia gas contained in the feed is properly destroyed. As moreair is fed into the Claus unit, the amount of inerts (nitrogen and water)added to the system increases even more rapidly, leading to thehydraulic limitation of the unit and, eventually, to a need to increase thesize of the unit or invest in another SRU.The best way a refiner can avoid this situation is to use an oxygenenrichedair supply, which not only replaces the nitrogen in the ambientair, but also provides enough oxygen to destroy the contaminants in thefeed while maintaining adequate oxidization levels. In fact, bysubstituting pure oxygen for most or all of the ambient air, space ismade available to increase the throughput of the acid gas feeds to theSRU, which, in turn, gives the system greater sulfur-recovery capacity.Oxygen Levels in the SRUThere are various levels of oxygen enhancement that can be applied toincrease the capacity of the SRU. Most technologies, however, aregrouped into three different categories. The first level of oxygenenrichment encapsulates those technologies that increase the oxygenlevel from 21-28 per cent (low-level oxygen combustion). The secondlevel includes the technologies that raise the oxygen level up to 40 percent (medium-level oxygen combustion), while the third level ofoxygen combustion encompasses those technologies that increase theoxygen concentration to levels in excess of 40 per cent in some cases,even 100 per cent. It is important to note that for every level increase inthe oxygen concentration, certain plant modifications must be madefor both retrofitted SRUs and newly installed units.Low-level oxygen combustion, the simplest and most cost effectivemeans of increasing the oxygen concentration of the combustion air, isoften referred to simply as oxygen enrichment. Low-level oxygenenrichment involves the injection of pure oxygen into the combustionair piping system of the SRU, upstream of the burner. This method willtypically raise oxygen levels up to 28 per cent and increase SRU capacityby 25 per cent. With a rise in the oxygen concentration levels, asubstantial portion of nitrogen is eliminated from the Claus reaction.18Claus Combustion ProcessThe classic Claus process has been the most common method forprocessing H S-rich streams and recovering sulfur from both amine2acid gas and sour water stripper gas. The Claus process can be brokendown into two steps. In the first step, which is called the oxidationprocess, about one-third of the H S contained in the feed is oxidized2with oxygen from ambient air to create sulfur dioxide. The oxidationtakes place in the burner/thermal reactor of the SRU. In the second step,which is the actual Claus reaction, the remaining H S is reacted with the2sulfur dioxide to form elemental sulfur. This step takes place in thethermal and catalytic reactor of the SRU.To obtain the oxygen needed for the combustion process, ambient air issupplied to the SRU burner via an air blower. Ambient air usuallycontains about 21 per cent oxygen; the balance is primarily nitrogenand some water vapor, both of which are inert in the combustionprocess. Since these inert components comprise nearly four times asmuch volume as the oxygen, the unit reaches its hydraulic limitationquickly once these components are introduced, which limits the sulfurrecoverycapacity of the SRU.Sulfur-recovery capacity becomes further constrained by othercontaminants in the acid gas feeds, such as ammonia, hydrocarbons,cyanides and carbon-sulfur compounds. Since sour water stripper gasfeeds contain more ammonia gas than ever before, it is now necessaryfor refiners to increase the amount of ambient air supplied to the SRU.While virtually every sulfur recovery unit can, in concept and inpractice, achieve low-level oxygen enrichment, the system itself hasseveral limitations. For instance, the oxygen level is generally limited to28 per cent because anything higher would require special pipingsystem materials and cleaning procedures.Generally, the existing SRU equipment (including the metallurgy andrefractory) can be used without modification, as the combustiontemperature should not exceed 2600ºF (Figure 1). However, additionalsafeguards for the oxygen system must be taken into account, and thecontrol system required should be designed to minimize theconsumption of pure oxygen to protect the equipment in place.For newly installed Claus SRUs that are designed for the futureinstallation of oxygen enhancement, safeguards will include arefractory system in the front of the thermal zone, as well as a waste heatboiler tubesheet-protection system, lines/equipment that aredesigned to withstand the high temperature and an adequate quenchsystem in the TGTU. For retrofit applications, it is likely that thisequipment, after inspection, will require upgrades to handle theincrease in oxygen concentration.Medium-level oxygen combustion can be considered when the desiredcapacity increase exceeds that made available by simple enrichment.Technologies are available that inject oxygen directly into the thermalreactor rather than into the piping system upstream of the burner(Figure 2).

MODIFIED CLAUS SRUWITH LOW LEVEL OXYGEN ENRICHMENTAAG 1481 MSCFDSWS AG 291 MSCFDAAG 1852 MSCFDSWSAG 291 MSCFDCOMBUSTION AIR2295 MSCFDMODIFIED CLAUS SRUWITH OXYGEN INJECTIONMarketing NewsOXYGEN220 MSCFD48 LTPD SRUOXYGEN506 MSCFD9 PSIG60 LTPDMulti-language CB&I WebsiteFigure 1Oxygen-injection systems, which are regarded as medium-level oxygenenrichmenttools, were developed to maximize the amount of acid gasprocessed in the SRU by replacing the diluent nitrogen in the air withreactants (oxygen and acid gas) to overcome the hydraulic limitations of theexisting unit.Oxygen-injection systems typically are licensed technologies that not onlyeliminate the metallurgical limitations of low-level oxygen enrichment, butalso produce SRU capacity increases of up to 70 per cent for refinery acid gasfeeds. This capacity increase further removes nitrogen from the Clausreaction.Because the oxygen concentration is increased from 28 per cent to 40 percent, combustion temperatures are likely to reach at least 2800ºF. Carefulconsideration must therefore be given to the design of the refractory systemand the protection of the waste heat boiler tubesheet. In addition, thetechnology must include a proprietary burner that features an oxygeninjectionport separate from the combustion air inlet. The waste heat boilerand the sulfur condensers need to be evaluated to ensure they haveadequate heat-transfer capabilities. If the SRU is followed with a TGTU, thenthe quench and amine systems need to be evaluated for the increase incapacity.To ensure that the thermal reactor of the SRU is using the proper amount ofpure oxygen and not exceeding temperatures of 2800-2900ºF, which cancause refractory damage, it is important that refiners install an automatedcontrol system. This system should act to minimize oxygen consumptionand maximize combustion air consumption, as well as to ensure a smoothtransition from air regime to oxygen-enhanced regime and back to air. Thethermal reactor combustion chamber temperature controller will limitoxygen feed to the SRU if the temperature gets higher than 2800ºF toprevent damage to the refractory system.Once the necessary adjustments and modifications are made tocompensate for the introduction of a medium-level injection system to theSRU, including a new burner configuration, adequate refractory system,proper heat transfer equipment, and acid gas and other piping that canhandle the pressure drops and added capacity, a medium-level system canincrease capacity up to 50-70 per cent and can be retrofitted to most Clausdesigns.When is high-level oxygen combustion feasible? If low-level oxygenenrichment can increase capacity by 25 per cent and medium-level injectionsystems can increase capacity by up to 70 per cent, what are the implicationsfor refiners that want to increase their capacity to more than 100 per cent? Toachieve such capacity levels, it is necessary to increase the oxygenconcentration to levels in excess of 40 per cent and, in many instances,approaching 100 per cent. When the oxygen concentration reaches theselevels, the ambient air is almost completely eliminated from the combustionprocess.It is important to note that any oxygen injected into a thermal reactor in theabsence of ambient air will quickly cause combustion temperatures toexceed the limits of the refractory system. To prevent this, severalproprietary technologies are available that can handle 100 per cent oxygen.Meeting Future NeedsAs refiners continue to meet clean fuels regulations for diesel and installmore SRU trains for redundancy purposes, SRUs designed for the futureinstallation of oxygen injection may provide a sound capital investment.Whether this capability is installed in a new unit or a retrofit, oxygen hasbecome a cost-effective and efficient solution for the inevitable capacityincrease required in SRU throughput.Figure 2One of the easiest ways to learn more about CB&I is to visit ourwebsite at www.CBI.comRussian, Chinese, Spanish and Arabic versions of www.CBI.comare coming soon.TradeshowsWe will demonstrate our experience, technology and track-recordat a number of forthcoming global trade shows:? NPRA 23-26 May 2006, San Antonio, Texas, USA,? ARTC 6 - 7 March 2006, Refining & Petrochemical,Kuala Lumpur, Malaysia? ERTC, 13-15 November 2006, ERTC 11th Annual Meeting,Paris, France? Global Petroleum Show 2006, 13-16 June 2006,Calgary, Alberta, Canada? OTC, 30 April - 3 May 2006, Houston, Texas, USA? GASTECH 2006, 4-6 Dec 2006, Abu Dhabi, UAENew BrochuresHot Off the Press…..“Bridging the Gap” LNG Industry, Autumn 2005, published thisprofile of the Elba Island LNG import terminal expansion project, aproject that is bridging the infrastructure gap to facilitateincreasing LNG imports into North America.“Oil and Gas Projects” World Energy, August 2005, publishedthis article discussing the prospective forecast of growth in theAsia-Pacific region and the keys for a global contractor's success inexecuting projects in the very different environments of bothSoutheast Asia/China and Australia.“Maintaining Alloy Corrosion Resistance” HydrocarbonEngineering, June 2005, published this article describing theprocess of developing weld procedures for Alloy 59, used in thefield construction of Syncrude Canada Ltd.'s flue gasdesulfurization (FGD) scrubber unit.“Enhancing SRUs with Oxygen-Enriched Air“ PTQ, Q2 2005,published this article describing ways oxygen-enrichmenttechnologies can help refiners meet clean fuel regulations.Required modifications to the oxygen-enriched SRU are alsoprovided.Source: Extracted from article of same title published in the Q2 2005 issue of PTQ19

A World of EPC SolutionsEngineeringProcurementConstructionCB&I executes on average more than 700 projects each yearand is one of the world's leading engineering, procurementand construction (EPC) companies, specializing in lump-sumturnkey projects for customers that produce, process, store anddistribute the world's natural resources.With more than 60 locations and approximately 11,000employees throughout the world, CB&I capitalizes on its globalexpertise and local knowledge to safely and reliably deliverprojects virtually anywhere. Information about CB&I isavailable at www.CBI.comFocused . Competitive . LocalResults Second to Nonewww.CBI.comproduction processing storage distribution