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PBF Energy to Resurrect Idle Units With Offering Proceeds
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PBF Energy Inc. (PBF - Free Report) recently expressed its intention of restarting a hydro-cracking unit and a coker, which has been idled for nearly a decade now. The idle units are located at the company’s Chalmette, LA refinery that has a capacity of 190,000 barrels per day (Bbls/d). The company is also viewing a possibility of building a hydrogen plant facility at its 182,000 Bbls/d refinery in Delaware.
Using hydrogen and a catalyst with gas oil, under heat and high pressure, hydrocrackers produce primary diesels and fuels for motors. Cokers, on the other hand, are an efficient processing unit used for converting residuals from crudes to petroleum cokes, which can substitute coal.
Notably, the 23,000 Bbls/d hydro-cracking unit and 10,000 Bbls/d coker facility in Chalmette were idled in 2010 by Exxon Mobil Corporation (XOM - Free Report) and Petróleos de Venezuela, S.A. or PDVSA after the market was struck by the recession of 2007-09. PBF bought the refinery from ExxonMobil and PDVSA in 2015.
The projects are expected to be funded by the company’s public offering of 6 million shares of its Class A common stock, which will close on Aug 14. The company expects to generate around $291 million from the offering that will primarily be used to produce clean refined products using heavy sour crude.
The resurrection plan of the idle units fits well with the IMO (International Marine Organization) 2020 regulation, which will reduce the limit of sulfur content in marine fuels from 3.5% to 0.5% starting from 2020. The recommencement of the hydro-cracking and coker units is expected to enable PBF Energy to record high profit level, even in the short run, once the IMO 2020 hits the market. The new hydrogen facility to be constructed in Delaware is expected to optimize the company’s ability to process heavy sour feedstocks. It will also enhance its clean-product output as well as improve operational reliability.
Price Performance
PBF Energy has gained 127.3% in the past year compared with 52.9% growth of its industry.
Calgary, Canada-based Canadian Natural Resources is an upstream energy company. The company’s top line for 2018 is anticipated to improve 41.3% year over year, while its bottom line is expected to increase more than 200%.
Houston, TX-based Cheniere Energy mainly focuses on liquefied natural gas-related businesses. The company’s top line for 2018 is anticipated to improve 26% year over year, while its bottom line is expected to increase more than 225%.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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PBF Energy to Resurrect Idle Units With Offering Proceeds
PBF Energy Inc. (PBF - Free Report) recently expressed its intention of restarting a hydro-cracking unit and a coker, which has been idled for nearly a decade now. The idle units are located at the company’s Chalmette, LA refinery that has a capacity of 190,000 barrels per day (Bbls/d). The company is also viewing a possibility of building a hydrogen plant facility at its 182,000 Bbls/d refinery in Delaware.
Using hydrogen and a catalyst with gas oil, under heat and high pressure, hydrocrackers produce primary diesels and fuels for motors. Cokers, on the other hand, are an efficient processing unit used for converting residuals from crudes to petroleum cokes, which can substitute coal.
Notably, the 23,000 Bbls/d hydro-cracking unit and 10,000 Bbls/d coker facility in Chalmette were idled in 2010 by Exxon Mobil Corporation (XOM - Free Report) and Petróleos de Venezuela, S.A. or PDVSA after the market was struck by the recession of 2007-09. PBF bought the refinery from ExxonMobil and PDVSA in 2015.
The projects are expected to be funded by the company’s public offering of 6 million shares of its Class A common stock, which will close on Aug 14. The company expects to generate around $291 million from the offering that will primarily be used to produce clean refined products using heavy sour crude.
The resurrection plan of the idle units fits well with the IMO (International Marine Organization) 2020 regulation, which will reduce the limit of sulfur content in marine fuels from 3.5% to 0.5% starting from 2020. The recommencement of the hydro-cracking and coker units is expected to enable PBF Energy to record high profit level, even in the short run, once the IMO 2020 hits the market. The new hydrogen facility to be constructed in Delaware is expected to optimize the company’s ability to process heavy sour feedstocks. It will also enhance its clean-product output as well as improve operational reliability.
Price Performance
PBF Energy has gained 127.3% in the past year compared with 52.9% growth of its industry.
Zacks Rank & Key Picks
Currently, Parsippany, NJ-based PBF Energy has a Zacks Rank #3 (Hold). Investors interested in the Energy sector can opt for some better-ranked stocks like Canadian Natural Resources Limited (CNQ - Free Report) and Cheniere Energy, Inc. (LNG - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Calgary, Canada-based Canadian Natural Resources is an upstream energy company. The company’s top line for 2018 is anticipated to improve 41.3% year over year, while its bottom line is expected to increase more than 200%.
Houston, TX-based Cheniere Energy mainly focuses on liquefied natural gas-related businesses. The company’s top line for 2018 is anticipated to improve 26% year over year, while its bottom line is expected to increase more than 225%.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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