International infrastructure group Balfour Beatty has been awarded two eight-year contracts with National Grid to upgrade the UK's gas distribution network.
The contracts, valued at £1.2bn, involve the design and installation of modern polyethylene gas distribution mains to replace aging metal pipes, as part of a programme of work agreed between National Grid and the Health and Safety Executive.
The new Gas Distribution Strategic Partnership contracts cover the North West and West Midlands and will replace Balfour Beatty's current gas contract in the North West.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Balfour Beatty will invest £55m of working capital in the contracts.
The contracts build on Balfour Beatty's existing electricity alliance contract with National Grid which involves the ongoing upgrade and refurbishment of the high voltage transmission network owned by National Grid across England and Wales.
Commenting on the announcement, Balfour Beatty Chief Executive, Ian Tyler, said: "National Grid is one of our longest held relationships and we are delighted to continue this partnership.
"The award of these new contracts builds on our ongoing strategic focus in the power market and is an excellent example of partnership with our clients to deliver continuing value as well as ongoing certainty to a core element of the UK's infrastructure."
Trading terms: The Santa Rally
Glossary Will the Santa Rally result in its traditional December effect on global markets?
By Dr Matthew Partridge Published
Lock in high yields on savings, before they disappear
As interest rates peak, time to lock in high yields on your savings, while they are still available.
By Ruth Jackson-Kirby Published