TechnipFMC plc (FTI - Free Report) recently secured a contract in Vietnam from Long Son Petrochemicals Co., Ltd. for constructing and commissioning of the first plant in the nation, which will process molecules called olefins, a synthetic fiber. Olefins are primarily used to create plastics.
TechnipFMC plans to carry out licensing, engineering, construction and commissioning of the Long Son Island-based plant with its South Korean partner, SK Engineering & Construction Co., Ltd. The contract is expected to be worth in the range of $500 million to $1 billion. TechnipFMC considers a contract in the said range to be a large one.
Notably, the deal further solidifies TechnipFMC’s position in Vietnam as a leading oilfield equipment provider for onshore projects. The company has been involved in the development of the Dung Quat Refinery – the country’s first oil refinery – apart from the Phu My Fertilizer Complex.
TechnipFMC will use its low-cost and energy efficient proprietary ethylene technology for the project, which incorporates Ultra Selective Conversion (USC®) furnaces and Heat-Integrated Rectifier System®. The company intends to execute the project with the help of its offices in Houston, Rome and Kuala Lumpur. The construction work for the project is expected to last for 53 months.
The plant — which will be constructed in Ba Ria-Vung Tau province of Vietnam — will be able to switch between liquefied petroleum gas and naphtha to create up to 1.6 million tons of olefins a year. It will address the increasing demand of petrochemical products in the country and reduce its dependency on imports.
London, U.K.-based TechnipFMC has gained 20.2% in the past year against the 3.1% decline of its industry.
Zacks Rank and Stocks to Consider
Currently, TechnipFMC has a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks like McDermott International, Inc. (MDR - Free Report) , Subsea 7 S.A. (SUBCY - Free Report) and Helix Energy Solutions Group, Inc. (HLX - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Houston, TX-based McDermott is an equipment provider for energy companies. The company’s top line for 2018 is likely to improve 145% year over year. In the last four reported quarters, the company delivered an average positive earnings surprise of 101.7%.
Luxembourg-based Subsea is an oilfield service providing company. In the last four reported quarters, the company delivered an average positive earnings surprise of 318.6%.
Houston, TX-based Helix Energy’s bottom line surpassed the consensus mark in three of the last four quarters, with the average positive earnings surprise being 66.7%.
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