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Shell (RDS.A) JV to Evaluate Catalyst Recycling Unit in China

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Royal Dutch Shell plc’s  joint venture with specialty metals and minerals producer AMG Advanced Metallurgical Group N.V. signed a Memorandum of Understanding (MoU) with Shandong Yulong Petrochemical Co., Ltd. to assess the construction and operational prospective of a leading spent-catalyst recycling facility in Yantai, China. The joint venture — Shell & AMG Recycling B.V — was formed in 2019 and is designed to expand AMG’s clean recycling technology globally.

The MoU will enable Shell & AMG Recycling B.V. to analyse the usefulness of developing a facility that retrieves valuable metals by the recycling of spent residue-upgrading catalysts, produced by refineries in China. The catalyst enhances the upgradation of the oil barrel bottoms into valued products, namely nickel, molybdenum and petrochemicals feedstocks.

The opted method extracts toxic substances such as vanadium in the form of ferrovanadium, an alloy primarily used in infrastructure applications. Further, the facility will utilize China’s natural resources to the fullest extent and address the need to provide eco-friendly management of spent residue-upgrading catalysts to significantly reduce CO2 emissions.

Shell & AMG’s combined technological proficiency and integrated resources will provide benefits to the refineries by lowering risks along with reduction in transportation as well as disposing cost of spent-catalysts and eliminating the practise to landfill. Besides, the monetization of the valuable metals present in the wastes will grant extended benefits.

Per Andy Gosse, president, Shell Catalysts & Technologies, the rise in the number of operational residue-upgrading units reflects the increased focus on direct conversion of crude oil to high-value chemical products in our industry. The collaboration will provide a long-term feasible solution for catalyst reclamation and help deliver refiners the option of a truly circular solution, turning wastes into resources through recycling and reusing.

Company Profile & Price Performance

Shell is one of the primary oil supermajors — a group of U.S. and Europe-based big energy multinationals — with global operations. The company is fully integrated, as it participates in every aspect related to energy — from oil production to refining and marketing. Its shares have outperformed the industry in the past month. Its shares have gained 4.8% against the industry’s 1.1% decline.

Zacks Rank & Key Picks

Shell currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include DCP Midstream Partners LP , sporting a Zacks Rank #1 (Strong Buy) and Matador Resources Company (MTDR - Free Report) and Suburban Propane Partners, L.P. (SPH - Free Report) , carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

DCP Midstream is expected to see an earnings growth of 169.1% in 2021. Suburban Propane Partners is likely to see earnings growth of 36.5% next year.

In the past six months, the Zacks Consensus Estimate for Matador Resources’ 2020 earnings has been raised by 400%.

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