Fluor Is Expanding Its Nuclear Energy Projects in Europe. Is Now the Time to Buy?

Nuclear energy is experiencing a resurgence worldwide, with many countries looking to enhance their nuclear capabilities. This form of clean energy not only complements renewables but also provides the reliable baseload power necessary for data centers to thrive. One company that is capitalizing on this trend is Fluor (NYSE: FLR), an engineering, procurement, and construction management (EPCM) firm.

Fluor is expanding its presence in Europe, particularly in Romania, where it is focusing on developing next-generation small modular reactors and upgrading traditional plants. The company recently opened a new office in Bucharest, Romania, to oversee nuclear energy projects in the region. Fluor is playing a crucial role in Romania’s nuclear energy development by providing engineering, design, licensing, and project management services for two key initiatives: the small modular reactor project in Doicești and the expansion of the Cernavodă Nuclear Power Plant.

The flagship project, RoPower, involves deploying NuScale Power’s small modular reactor technology at a decommissioned power plant in Romania. Fluor is the lead engineering, procurement, and construction partner for this project, which aims to deploy six 77-megawatt NuScale Power Modules, providing 462 megawatts of carbon-free, baseload power. The project is a joint venture between Nuclearelectrica and Nova Power & Gas, with the shareholders recently approving the final investment decision.

In addition to the RoPower project, Fluor is also involved in the expansion and refurbishment of the Cernavodă Nuclear Power Plant, a multibillion-dollar program that includes refurbishing Unit 1 and constructing Units 3 and 4. Fluor leads the joint venture awarded the EPCM contract for this project, valued at approximately $3.4 billion over nearly a decade. The project is expected to generate stable, fee-based earnings for Fluor, with Unit 1 refurbishment scheduled for completion in 2029 and Units 3 and 4 expected to be operational by 2032.

Fluor is strategically positioning itself in the nuclear energy sector while fortifying its business for resilience. The company is divesting its stake in NuScale Power to capitalize on the stock’s growth and fund share buybacks and other investments. Fluor is also transitioning towards reimbursable contracts to mitigate project cost overruns, a common challenge in the industry.

Investing in Fluor provides exposure to the nuclear energy expansion without the risks associated with uranium mining. The company’s involvement in SMRs, large-scale plant expansions, and uranium enrichment positions it well for growth in the evolving nuclear energy landscape.

Before considering investing in Fluor, it’s essential to evaluate the company’s financial health and growth prospects. While Fluor is expanding its nuclear energy projects, it’s crucial to conduct thorough due diligence before making any investment decisions.