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TechnipFMC Gets iEPCI Contract From Eni in Indonesia

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TechnipFMC plc (FTI - Free Report) recently received an integrated Engineering, Procurement, Construction, Transportation and Installation (iEPCI) contract from Eni S.p.A. (E - Free Report) for a project located in Indonesia. The Merakes project is located offshore Balikpapan at a water depth of around 1,500 meters.

TechnipFMC expects the contract value in the range of $500 million to $1 billion. The deal includes five deep-water wells as well as a 50-kilometer tie back that connects to the existing Jangkrik Floating Production Unit (FPU). Per the contract, TechnipFMC is required to carry out engineering, procurement, installation and pre-commissioning works for subsea equipment, which include a manifold, subsea trees, umbilical and distribution hardware, flexible risers, large bore deep water high pressure flexible lines, flowlines, and jumpers.

Last April, Eni announced the Plan of Development (POD) for the Merakes field. The project is expected to come online in the second half of 2020. The Italian energy giant has 85% stake in the field, which is estimated to hold around 2 trillion cubic feet of lean gas. Initial production at Merakes is expected to reach 155 million cubic feet of natural gas per day (mmcfd), which is projected to subsequently attain peak level of 391 mmcfd.

The contract further highlights the demand for TechnipFMC’s simplifying field architecture, long tiebacks and accelerating time to market for its clients’ output. It also increases TechnipFMC’s footprint in Indonesia, where hydrocarbon production is on the rise.

Price Performance

TechnipFMC has lost 19.6% in the past year compared with 13.9% collective decline of the industry it belongs to.

Zacks Rank and Stocks to Consider

TechnipFMC presently carries a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks as given below:

Midland, TX-based ProPetro Holding Corp. (PUMP - Free Report) is an oil and gas equipment providing company. In 2019, its bottom line is expected to grow 19.5% year over year. The company currently holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Archrock, Inc. (AROC - Free Report) is a Houston, TX-based energy infrastructure company. Its bottom line in 2019 is expected to increase 39.6% year over year. It currently has a Zacks Rank #2.

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