Over the past decade, most construction markets tracked by ENR have seen growth, or at least, relative stability for Top 400 firms. The notable exception is the petroleum market, which has shrunk from a high of $59 billion in 2013 overall firm revenue to just over $23 billion for reporting year 2020—a 59% drop over that time period.
The 2021 Top 400 list does not include McDermott International, last year’s top sector contractor with $6.8 billion in revenue. The return of Fluor Corp. and Worley to the list after their absence last year provides $4.6 billion in missing revenue. But even if McDermott's revenue from last year’s ranking was added to the 2021 results, petroleum revenue still would have fallen by almost $3 billion between 2019 and 2020.
The push for renewable energy appears to be driving much of petroleum’s decline. Revenue grew 185% between 2015 and 2019 among firms ranked on the ENR Sourcebook wind submarket list. The pandemic may have accelerated the trend.
“We’re starting to see owner companies use renewables and sustainability projects as one way to spend their capital wisely and for future investment,” says Dave Nispel, managing director of refining at Burns & McDonnell. Nispel sees long-term financial incentives of developing under-explored technologies such as green hydrogen. Much of the investment in clean energy has been coming from the oil and gas industry. “I think that will play a vital role in commercializing the technology,” he says.
Democratic lawmakers plan to introduce a bill creating a tax credit for sustainable aviation fuel. “The lower the carbon intensity score, the more credits the fuel receives,” says Nispel. “These incentives and market drivers are really opening the doors to further exploration of first-of-a-kind technologies.”