Summary
Enterprise Products Partners L.P. (EPD) has announced the settlement of its long-standing litigation concerning the construction of its PDH 1 facility. The company received a cash payment of $115 million from its former contractor, Amec Foster Wheeler USA Corporation (AFW), and its affiliates. This settlement resolves claims stemming from a contract dispute initiated in 2016, where EPD alleged various breaches of contract and negligence related to the engineering, procurement, construction, and installation of the PDH 1 facility. The resolution of this litigation is a positive development for EPD, as it brings a significant legal overhang to a close and results in a substantial cash inflow. Investors can view this as a positive event, removing uncertainty and providing a financial boost that can be utilized for strategic initiatives or returned to unitholders.
Key Highlights
- 1EPD received a $115 million cash settlement payment from Amec Foster Wheeler USA Corporation (AFW).
- 2The settlement resolves litigation related to the construction of EPD's PDH 1 facility.
- 3The lawsuit was initially filed in September 2016, alleging breach of contract, fraud, and negligence.
- 4The trial for the case had recently concluded its closing arguments in July 2022.
- 5The settlement effectively ends a protracted legal dispute for Enterprise Products Partners.
- 6The cash received from the settlement will contribute to EPD's financial resources.