Chicago Bridge & Iron Company N.V.
) recently won a contract from Occidental Chemical Corporation,
wherein it will provide technology license, basic engineering and
front end engineering and design (FEED) services for a proposed new
An ethane cracker is a process that creates ethylene, a
compound used in the manufacture of plastic. As per the terms
of the contract, Chicago Bridge will be responsible for the basic
engineering for the ethylene technology and five short residence
time (SRT) heaters from Chicago Bridge's Lummus Technology business
The primary feedstock for the planned cracker is ethane, which
will likely be derived from shale gas. Further, this proposed
cracker is expected to have a capacity of producing 1.2 billion
pounds of ethylene per year.
Earlier, in September 2012, the company won an offshore
engineering contract in Europe. The contract is worth more than $80
million and is expected to be completed in fiscal 2013.
As per the terms of the contract, Chicago Bridge & Iron will
be responsible for complete engineering design and will also
provide procurement services for the project.
In addition to this, in the month of June 2012, the company
announced the winning of a front end engineering and design (FEED)
contract from Nizhnekamskneftekhim OAO, valued at more than $40
Chicago Bridge & Iron Company is one of the few engineering,
procurement and construction (EPC) and process technology
contractors with in-house fabrication facilities. These facilities
allow the company to offer customers a wide range of options in
modular construction, wherever feasible.
Going forward, Chicago Bridge & Iron is expected to benefit
from the strong and growing energy infrastructure market,
especially for liquefied natural gas (LNG). LNG is the company's
strongest market, supported by its ability to participate in
multiple stages of development and strong base for investments.
However, the company's revenue and earnings may be adversely
affected by a reduced level of activity in the hydrocarbon
industry, especially in light of the global financial and economic
crisis. A major competitor of CBI is
Matrix Service Co
Chicago Bridge & Iron Company N.V. is among the world's
leading integrated engineering, procurement and construction
service providers and major process technology licensors, providing
comprehensive solutions to customers, primarily in the energy and
natural resource industries. The company currently holds a Zacks #3
Rank, which implies a short term Hold rating on the stock.
CHICAGO BRIDGE (CBI): Free Stock Analysis
MATRIX SERVICE (MTRX): Free Stock Analysis
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