TechnipFMC plc (FTI Quick QuoteFTI - Free Report) , a global leader in energy projects and technologies, announced a significant 20-year framework agreement with Chevron Australia Pty Ltd., a subsidiary of Chevron Corporation (CVX Quick QuoteCVX - Free Report) . This agreement marks a strategic partnership between the two companies in providing Subsea 2.0 configure-to-order subsea production systems for gas field developments off the coast of northwest Australia.

The collaboration aims to enhance Chevron's gas production needs by leveraging TechnipFMC's field-proven technology and expertise in subsea engineering. This blog will delve into the details of this agreement and its potential impact on the energy industry.

Agreement Highlights

Per the aforementioned deal, TechnipFMC will supply various components that are crucial for subsea production systems, including wellheads, tree systems, manifolds, controls, flexible jumpers and flying leads. This comprehensive supply coverage ensures the seamless integration of these essential elements in Chevron's gas field developments.

Benefits of Subsea 2.0

TechnipFMC's Subsea 2.0 technology is a field-proven solution that simplifies engineering complexity and reduces lead times. By implementing this configure-to-order system, Chevron can expect improved efficiency and enhanced overall performance in its gas production operations.

Long-Term Collaboration

The 20-year duration of this framework agreement highlights the commitment of both TechnipFMC and Chevron Australia toward a long-term collaboration. This extended partnership allows FTI to lend consistent support to Chevron's gas production needs, fostering stability and reliability in the latter’s gas field developments over the coming years.

Global Expertise and Manufacturing

TechnipFMC will leverage its worldwide expertise and knowledge base to deliver high-quality subsea production systems under this framework agreement. These production systems will be manufactured at its dedicated Subsea 2.0 facility in Nusajaya, Malaysia. This showcases FTI's commitment to delivering efficient and innovative solutions to its clients.

Impact on the Energy Industry

The partnership between TechnipFMC and Chevron Australia is poised to make a significant impact on the energy industry, particularly in the subsea sector. By incorporating Subsea 2.0 technology, the collaboration aims to drive sustainable change and transform gas field developments from concept to delivery and beyond.

This agreement reinforces FTI's position as a leader in subsea engineering while providing Chevron Australia with the necessary tools and expertise to enhance its gas production capabilities.

Conclusion

TechnipFMC's 20-year agreement with Chevron Australia represents a milestone in the subsea industry. With a focus on providing configure-to-order subsea production systems, this partnership aims to revolutionize gas field developments off the coast of northwest Australia. As the collaboration progresses, it will be interesting to witness the positive impact on the energy industry.

Zacks Rank and Key Picks

Currently, both FTI and CVX carry a Zacks Rank #3 (Hold).

Some better-ranked stocks for investors interested in the energy sector are Evolution Petroleum (EPM Quick QuoteEPM - Free Report) and Eni (E Quick QuoteE - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Evolution Petroleum: EPM is worth approximately $280.79 million. EPM currently pays a dividend of 48 cents per share, or 5.69% on an annual basis.

The company currently has a forward P/E ratio of 7.64. In comparison, its industry has an average forward P/E of 19.90, which means EPM is trading at a discount to the group.

Eni: E is valued at around $50.77 billion. In the past year, its shares have risen 18.5%.

E currently pays dividends of $1.29 per share, or 4.52%, on an annual basis. E's payout ratio currently sits at 21% of earnings.