October 7, 2011 / 4:59 AM / 6 years ago

UPDATE 1-Bechtel says Australian LNG projects on schedule

* Queensland LNG projects will need imported labour

* Bechtel says 2011 revenue outlook unclear

* Bechtel says growing well outside US, US flat

MELBOURNE, Oct 7 (Reuters) - Bechtel Corp, the largest U.S. engineering firm, said all three liquefied natural gas projects it was involved with in Australia’s Queensland state were currently running on schedule.

“All the projects are currently making their plans -- not without their challenges, lots of risks,” Bechtel President, Mining and Metals, Andrew Greig said in Melbourne on Friday.

The privately owned company is working on 14 resources projects in Australia, including three LNG projects in Queensland: the $16 billion Gladstone project, BG Group’s $15 billion Curtis Island project and ConocoPhillips and Origin Energy’s $20 billion Asia Pacific LNG project.

The three LNG projects are on different timelines, so the company plans to shift workers from one project to the next along the way, in the face of a construction boom in the resources sector which has led to skills shortages.

However, Bechtel Chief Executive Riley Bechtel said the company was likely to need to import workers like pipe fitters, electricians and welders.

“We foresee we will be challenged for the supply of labour in Australia,” Bechtel told reporters following a rare public speech.

The company has locked in workers’ wages typically with escalators of 2.5 percent every six months built into their contracts, so it is not worried about potential wage blowouts on its Australian resources projects.

“We think we’ve mitigated that risk to the extent possible,” Greig said.

Other challenges included protecting dugong and sea turtle populations on and around Curtis Island and protecting the local community from “a surge of ill-behaved construction workers” on their days off, Bechtel said.

Bechtel said it was unclear whether the group’s revenue would grow in 2011, following a 9 percent decline to $27.9 billion in 2010.

“So far our business has held up quite well. We are growing well in most markets outside the United States,” he said.

“We have been relatively flat and were declining in the U.S. because that economy is particularly challenged right now,” he said.

He added that regulatory hurdles for contractors in the United States were higher than elsewhere in the world, a factor discouraging the company’s customers from pursuing projects in the world’s largest economy.

Bechtel, which manages projects from building nuclear reactors to bridges, competes with companies such as Fluor Corp , Jacobs Engineering Group Inc and URS Corp .

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