CH2M: The Legacy of a Global Environmental Engineering Giant
For over seven decades, CH2M (originally known as CH2M HILL, Inc.) stood as a titan in the American engineering landscape. Specializing in environmental engineering, the firm provided a comprehensive suite of consulting, design, construction, and operations services to both corporate clients and government entities worldwide. From its humble beginnings in Oregon to its eventual acquisition by the Jacobs Engineering Group, CH2M left an indelible mark on global infrastructure.
Key Facts
- Founded: 1946 in Corvallis, Oregon.
- Founders: Fred Merryfield, Holly Cornell, James Howland, and Thomas Burke Hayes.
- Peak Revenue: US$5.24 billion (2016).
- Workforce: Approximately 20,000 employees as of 2016.
- Major Acquisition: Acquired by Jacobs Engineering Group on December 18, 2017, for US$3.3 billion.
- Specialization: Environmental engineering and large-scale infrastructure project management.
Foundations and Growth
The company was established in 1946 by Fred Merryfield, a civil engineering professor at Oregon State University, and three of his graduates: Holly Cornell, James Howland, and Thomas Burke Hayes. The firm's name was derived from the initials of these four founders. In 1971, the company expanded its reach through a merger with Clair A. Hill & Associates, becoming CH2M Hill.
While the company remained rooted in Oregon for its first few decades, it relocated its headquarters to Englewood, Colorado, in 1980 to support its growing operations.
The CH2M HILL Project Delivery System
Beyond physical construction, the firm was recognized for its intellectual contributions to the industry. The company developed and published the CH2M HILL Project Delivery System, a proprietary methodology for managing complex client projects to ensure benchmark performance.
Global Impact and Major Projects
CH2M was frequently selected for high-stakes, multi-billion dollar projects that required extreme technical precision and large-scale coordination.
International Infrastructure
- Panama Canal Expansion: In 2007, the Panama Canal Authority selected CH2M to manage the $5.25 billion expansion project. This critical work added new locks to the Atlantic and Pacific ends, allowing "New Panamax" ships to transit the canal for the first time.
- Singapore Deep Tunnel System: In 2000, the firm joined a venture to replace Singapore's sanitary services infrastructure, improving the reliability and economy of the city's waterfront operations.
- London Transit and Olympics: CH2M served as a program partner for the Crossrail project to expand London's transit system and acted as a supplier for the London 2012 Olympics.
Environmental Remediation and Energy
The firm specialized in remediation—the process of removing pollutants or contaminants from environmental media such as soil and groundwater. Notable efforts included the decommissioning of the Rocky Flats nuclear weapons facility and the massive cleanup of the Central Plateau at the Hanford Site in Washington. The Hanford project was one of the world's largest environmental cleanups, reducing the site's environmental footprint from 586 square miles to 75 square miles.
In the energy sector, CH2M partnered with General Electric to build a $660 million gas-fired power plant in Queensland, Australia, and provided consultancy for the Iraq Common Seawater Supply Project.
Strategic Acquisitions and Evolution
CH2M grew aggressively through the acquisition of specialized firms to broaden its technical capabilities. Key acquisitions included:
- Marine and Coastal: Gee & Jensen (2002) and Goldston Engineering (2008).
- Environmental and Consulting: BBS Corporation (2005), TERA Environmental Consultants (2014), and the transportation unit of Booz Allen Hamilton (2011).
- International Expansion: The UK-based Halcrow Group (2011).
- Industry Specific: VECO, an Alaska-based petroleum services firm (2007).
In April 2015, the company modernized its image by removing "Hill" from its branding and unveiling a new logo, simply becoming CH2M.
Financial Performance and Final Transition
By 2016, CH2M was a financial powerhouse with US$5.24 billion in revenue and total assets of US$2.67 billion. However, the company faced significant financial headwinds due to two specific projects in 2014: a combined-cycle power project in the Ichthys gas field and a toll lane project in Austin, Texas. These projects resulted in losses of $140 million and $121.3 million, respectively.
These challenges contributed to the company's eventual sale. On December 18, 2017, the Jacobs Engineering Group acquired CH2M in a deal valued at US$3.3 billion in cash and stock.
| Metric | Value |
|---|---|
| Annual Revenue | US$5.24 Billion |
| Net Income | US$139.2 Million |
| Total Assets | US$2.67 Billion |
| Total Equity | US$546.7 Million |
| Employee Count | 20,000 |
Frequently Asked Questions
Who founded CH2M?
The company was founded in 1946 in Corvallis, Oregon, by Fred Merryfield, a professor at Oregon State University, and three of his students: Holly Cornell, James Howland, and Thomas Burke Hayes.
What was CH2M's role in the Panama Canal?
CH2M was selected by the Panama Canal Authority to manage the $5.25 billion expansion project, which involved constructing new locks to accommodate larger New Panamax ships.
Why was the company acquired by Jacobs Engineering Group?
While CH2M was a global leader, significant losses in 2014—specifically from a power project in the Ichthys gas field and a toll lane project in Austin, Texas—contributed to the decision for a buyout.
What is the CH2M HILL Project Delivery System?
It is a proprietary project management method developed, maintained, and published by the company to ensure high-performance delivery of services for their clients.
What environmental cleanup projects did CH2M lead?
The company was heavily involved in the decommissioning of the Rocky Flats nuclear weapons facility and the remediation of the Central Plateau at the Hanford Site in Washington.