Leading construction major
) recently announced that it had won a front-end engineering and
design (FEED) contract for a crude oil refinery revamp project
from an undisclosed client. The refinery to be refurbished is
situated in the Midwest U.S. and is one of the oldest operating
refineries in the country.
The project will begin with a feasibility study, during which
KBR will establish the optimum economic configuration required to
increase heavy crude processing capacity and flexibility. The
refinery currently processes light sweet crude oil.
With the proposed revamp, the refinery intends to take
advantage of the price fluctuations in the crude oil market and
gain access to process heavier sour crude oils.
Of late, KBR has been receiving a series of FEED contracts. A
few weeks back, it won a FEED deal from multinational chemicals
company INEOS Olefins & Polymers USA (INEOS) to construct a
high-density polyethylene (HDPE) plant in the Americas. Though
the financial details of the deal were not disclosed, the
facility is expected to produce 470 kilotons per annum of bimodal
The company's order pipeline primarily comprises FEED analysis
of key projects including Chevron-operated Gorgon LNG 4 project
and two Canadian LNG projects, among others.
KBR is an industrial construction and engineering facility
provider, offering services to the hydrocarbon, chemical and
petrochemical industries. Going forward, as the demand for shale
gas continues to grow, we expect the company to secure more
contracts in the long run.
Currently, KBR carries a Zacks Rank #3 (Hold). Better-placed
stocks in the same sector that are worth a look include
Meritage Homes Corp.
). All of these stocks carry a Zacks Rank #2 (Buy)
KBR INC (KBR): Free Stock Analysis Report
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