(FTI - Free Report
) recently received an integrated engineering, procurement, construction and installation (iEPCI) contract from British oil giant BP plc (BP - Free Report
) for the development of the Atlantis Phase 3 project in the Gulf of Mexico (GoM).
Just a couple of days back, BP greenlighted the Atlantis Phase 3 development, which has an estimated cost of $1.3 billion. This move was in sync with its strategy of growing advantaged oil production through existing production facilities in the GoM. Atlantis Phase 3, estimated to be commissioned in 2020, will comprise the construction of a new subsea production system from eight new wells that will be tied into the current platform, 150 miles south of New Orleans. At its peak, the project is anticipated to enhance production at the platform by 38,000 barrels of oil equivalent a day.
Per the contract, TechnipFTI will construct, deliver and install subsea equipment including subsea tree systems, umbilicals and subsea tree jumpers, manifolds, flowline, pipeline end terminations, subsea distribution as well as topside control machinery. Markedly, the estimated value of the contract is likely to be in the band of $75-$250 million.
Notably, TechnipFMC witnessed a major uptick in inbound orders during the last reported quarter, indicating promising prospects. The strong backlog of the company, which stands at $15.2 billion, brightens prospects for revenue growth. On a further encouraging note, the company expects overall 2019 revenues to increase from the 2018 level.
Zacks Rank and Key Picks
TechnipFMC currently carries a Zacks Rank #3 (Hold).
TechnipFMC plc Price
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