Primoris Services Corp. on Friday announced that it has been made aware that a California state judge has granted an order that may halt construction on a new hydrogen facility at Chevron Corp's Richmond Refinery located in Contra Costa, Calif. The Company also understands that Chevron intends to appeal the judge's decision.
Primoris' wholly owned subsidiary, ARB, Inc., was hired by Praxair, Inc. (which contracted with Chevron to build the project) to build the hydrogen facility. ARB has been performing this work at the Richmond site since September 2008. Primoris is awaiting additional information from Praxair, Inc. regarding the status of this project, however, as of this date, Company personnel remain on the project. The possibility exists that the court ruling could cause the project to be delayed or cancelled, which could negatively impact Primoris' financial results for the second half of 2009 and the first quarter of 2010. At June 30, 2009, Primoris estimates that the backlog associated with the Richmond contract was approximately $50-60 million. The Company will continue to keep investors apprised of material developments related to this matter.
Primoris, through various subsidiaries, is one of the largest specialty contractors and engineering companies in the United States, primarily serving the growing power and energy sectors. Primoris provides a wide range of construction, fabrication, maintenance and replacement services, as well as engineering services to major public utilities, petrochemical companies, energy companies, municipalities and other customers. Primoris is also a leading water and wastewater contractor in the state of Florida, and a specialist in designing and constructing complex commercial and industrial concrete structures in California.