Houston-based KBR (NYSE:KBR) is "going green," and it's going to Canada to do it.

On Tuesday, the oilfield services firm announced that Royal Dutch Shell (NYSE:RDS-A) subsidiary Shell Canada Energy has contracted KBR to perform "off-site modularization and pipe fabrication" for Shell's new Athabasca Oil Sands operations. KBR's task will be to employ Shell's own "Shell Quest Carbon Capture and Storage" technologies to build equipment that will reduce CO2 emissions at the oil sands site. According to the companies, this equipment, when finished, will enable Shell to reduce greenhouse gas emissions from the site by capturing more than 1 million metric tons of CO2 per year.

Financial terms of the contract were not disclosed.

Contract win notwithstanding, KBR shares closed Tuesday trading down 3.2% at $30.14.