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KBR's ROSE SDA Technology to Upgrade Uruguay's Refinery

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KBR, Inc. (KBR - Free Report) recently announced that its market-leading technology — ROSE solvent de-asphalting (“SDA”) process — has won a strategic upgrade project from ANCAP for Uruguay's integrated refinery complex.

KBR will offer technology licensing, basic engineering design and proprietary equipment for a 6,000-BPSD ROSE unit that will help ANCAP in operational flexibility. ANCAP will be able to supply higher grade cleaner products in this ever changing market condition, while reducing environmental footprint.

KBR's Integrated & Innovative IT Solutions Bode Well

KBR has been delivering innovative and reliable process technologies to help refinery and petrochemical plants offer optimum production and lower operating costs over the past several years. Its ROSE technology has gained more than 90% of the world's installed SDA capacity and continues to see strong demand.

The K-SAAT is a next generation solid acid alkylation technology that provides high alkylate yield and feed flexibility. Moreover, the K-COT is a catalytic olefins technology that converts low-value olefinic, paraffinic or mixed streams into high-value propylene, ethylene and aromatics.

At first quarter-end, the segment booked $527-million contract backlog. KBR expects thriving global technology opportunities — led by ammonia, refining and olefins projects — to persist.

It is the only license holder of the polycarbonate technology, which positions it pretty well for future expansion. The segment continues to perform well in recent times, driven by refining and petrochemicals projects in China, India and Africa, as well as strong technologies demand. Additionally, the company acquired RRT Global’s isomerization technologies in August 2019 in order to offer more octane and clean fuel technology solutions to customers.

Notably, the company now plans to exit most of the liquefied natural gas (LNG) construction and other energy projects. Per Reuters, KBR has notified investors and employees that it will refocus on government and technology businesses, and no more engage in fixed-contract energy projects.

A Look at KBR’s Performance & Prospects

The company’s backlog of $13.92 billion (as of Mar 31, 2020) highlights underlying strength. It believes that the solid project execution strategy will ultimately help the company in margin expansion.

Shares of KBR have broadly outperformed the industry in the past year. Its shares have performed pretty well owing to ongoing contract wins, acquisitions and robust organic growth. We believe that the recent move will further boost the company’s performance.

KBR — which shares space with Fluor Corporation (FLR - Free Report) , Jacobs Engineering Group Inc. (J - Free Report) and AECOM (ACM - Free Report) in the same industry — currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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