Chicago Bridge & Iron (CBI - Free Report) recently signed a memorandum of understanding (MOU) with China National Nuclear Corporation (CNNC) in order to enhance cooperation and collaboration between the companies in the development of nuclear power plants.
The primary objective of this collaboration is to provide operation and maintenance support services to CNNC's nuclear power plants in China. Apart from this, the scope of the agreement also involves engineering, procurement, and construction management (EPCM) of the AP1000® nuclear power plants planned and owned by CNNC in China; international nuclear power market development and nuclear power training programs and management personnel exchange in the U.S. and China.
Going forward, this collaboration should support China’s plans to expand its nuclear power generation capacity to 58 GWe by 2020. Notably, the nation currently has 28 nuclear power units under construction. Chicago Bridge & Iron already provides EPCM services to four AP1000 nuclear power units presently under construction in China, including two CNNC units in the Sanmen, Zhejiang province.
With this collaboration, Chicago Bridge & Iron currently has two cooperative agreements with three state-owned corporations authorized by the State Council of China. Further, in 2013, Chicago Bridge & Iron had announced a joint venture with China Power Investment Corporation (CPI) to build nuclear power plants in China.
In a separate development, Chicago Bridge & Iron received additional technology contracts from Oman Oil Refineries and Petroleum Industries Company (Orpic) for the Liwa Plastics Project in the Sultanate of Oman.
Per the contract, Chicago Bridge & Iron is entailed to license and engineer design for three units in addition to the previous contract for its ethylene technology and front end engineering and design (FEED) services. For this present deal, Chicago Bridge & Iron will deploy its CDMtbe technology to a new 90,000 metric ton per annum (MTA) high conversion MTBE unit and a 41,000 MTA butene-1 recovery plant, and the NGL-MAXSM gas processing technology for a new 18 million standard cubic meter per day natural gas liquids (NGL) extraction plant. Notably, the NGL plant will be the largest single train gas plant designed by Chicago Bridge & Iron.
Chicago Bridge & Iron primarily engages in the design, building, repair and modification of steel tanks and other steel plate structures. In addition, the company has expertise in the designing and building petroleum terminals, refinery pressure vessels, low temperature and cryogenic storage facilities, and elevated water storage tanks for clients internationally.
Chicago Bridge & Iron currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the sector include Hutchison Whampoa Ltd. , CLARCOR Inc. (CLC - Free Report) and United Technologies Corp. (UTX - Free Report) . All three carry a Zacks Rank #2 (Buy).