NYAB has entered into an Early Works Agreement (EWA) with SSAB regarding preparatory works for a pump station project in Luleå. While the initial value of this phase is likely relatively small, we believe it positions NYAB well for subsequent, more valuable project phases. The project is a natural fit for NYAB’s industrial infrastructure expertise and its strong market position in Northern Sweden. However, given the lack of financial details in the press release, we will not adjust our estimates at this stage.

Gateway to subsequent execution phases

The EWA agreement covers design, engineering, project management, procurement, and preparatory groundworks. Negotiations are already ongoing regarding additional commitments for the subsequent phases of development and execution. The EWA structure follows a familiar pattern from NYAB's recent strategic wins, where securing early-stage involvement serves as both a de-risking step for the customer and an advantage for being awarded larger construction phases later. We believe that by engaging in the early project phases, NYAB can leverage its engineering and project management capabilities to influence project execution, consistent with its asset-light and selective business model. However, we note that this EWA is more comprehensive than a typical phase 1 contract, given the breadth of scope, which we believe should position NYAB more favorably for the subsequent, more valuable phases.

Well-positioned for a larger role in SSAB's Luleå transformation

The pump station forms part of the industrial infrastructure required for SSAB's 4.5 BEUR mini-mill transformation in Luleå. NYAB and SSAB have a longstanding relationship, and NYAB is already active with several projects in the Luleå Industrial Park area. With SSAB targeting operational start-up by the end of 2029 and full capacity in 2030, we believe the timeline suggests that the main execution phases of the pump station would likely need to commence within the next 12-18 months to align with the overall project schedule. While it's too early to draw conclusions, we believe NYAB's early involvement and established local presence could position it favorably for the full pump station scope and potentially for additional infrastructure work as SSAB's Luleå investment progresses. However, this remains speculative, and we await further details before revisiting our estimates.