ExxonMobil Corporation (XOM - Free Report) recently contracted Tokyo-based Mitsubishi Heavy Industries Ltd., the parent company of Houston-based Mitsubishi Heavy Industries America, for its new Beaumont expansion. The financial details of the deal remained undisclosed. ExxonMobil’s price chart reveals that it has outpaced the Zacks-categorised Zacks Sub Industry – Oil & Gas – International Integrated Market, year to date. While ExxonMobil has risen by 12%, the broader market has increased by 9.2%. The impact of the aforesaid announcement on the stock price remains to be seen.
The contract pertains to the construction of a large-scale polyethylene production train in Beaumont. Mitsubishi Heavy Industries has been entrusted with the task to construct a large-scale polyethylene production train, supplying the reaction, finishing and shipping equipment for the plant. The Japanese firm will also be responsible for utility facilities for water, air and steam.
Early in November, ExxonMobil announced its plans to commence construction of a new production unit at its polyethylene plant in Beaumont, which is located about 80 miles east of downtown Houston. The new unit will be part of a multibillion-dollar investment by the company along the Gulf Coast. The cost of the project has not been disclosed.
Soon after, ExxonMobil chose San Antonio-based Zachry Group as the general contractor for the expansion project. The new unit, which is scheduled to come online in 2019, will expand capacity by about 65% or about 650,000 tons per year. ExxonMobil is also adding two similar polyethylene units at its Mont Belvieu Plastics Plant, about 30 miles east of downtown Houston.
Collectively, the projects will augment the company’s U.S. polyethylene production by 40% or about 2 million tons per year. It will also make Texas the largest polyethylene supply point for ExxonMobil.
ExxonMobil currently has a Zacks Rank #3 (Hold). Some better-ranked players in the same sector include SunCoke Energy Inc. (SXC - Free Report) , Suncor Energy, Inc. (SU - Free Report) and Futurefuel Corp. . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
SunCoke Energy posted a positive earnings surprise of 177.78% in the last reported quarter. It reported a positive earnings surprise in three of the four preceding quarters.
Suncor Energy posted a positive earnings surprise of 300.00% in the preceding quarter. It reported an average earnings surprise of 40.55% for the four preceding quarters.
Futurefuel Corp. posted a positive earnings surprise of 20.83% in the last reported quarter. It reported a positive earnings surprise in all of the four preceding quarters.
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