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LyondellBasell's Hostalen ACP and Spheripol Selected by DRPIC

LyondellBasell Industries N.V.’s LYB polypropylene (“PP”) and high-density polyethylene (“HDPE”) technologies has been selected by Duqm Refinery and Petrochemical Industries Company LLC (“DRPIC”) for a new facility to be built in Al Duqm, Oman.

Further, the new 280 KTA PP facility will employ LyondellBasell’s Spheripol PP process technology while a 480 KTA HDPE facility will use Hostalen ACP process technology. Higher global demand for petrochemical products will enable DRPIC Petrochemical Project to be a major player in the region. The project will benefit from strategic location on the Oman eastern sea board having direct access to international markets.

The Spheripol technology is the leading process technology for PP. It has more than 30 million tons of licensed capacity. Spheripol’s latest fifth-generation technology includes process improvements that enhance operational efficiency.

The Spheripol plant will start operations using the Avant ZN catalyst. The Hostalen ACP process technology produces high performance, multi-modal HDPE resins. The Hostalen plant will start operations using Avant Z509-1 and Avant Z501 catalysts for producing a complete range of multi-modal HDPE products.

By optionally joining the Technical Service program of LyondellBasell, new licensees can enjoy the benefits of its in-house expertise of catalyst know-how, ongoing production improvement and sustainable product development.

Other than the Spheripol and Hostalen ACP process technology, LyondellBasell’s range of licensed polyolefin processes and catalysts include Spherizone, Lupotech, Spherilene, Metocene PP and Avant.

Shares of LyondellBasell have inched up 0.1% in the past year compared with the industry’s 6.8% rise.

In second-quarter earnings call, LyondellBasell stated that demand for its products is improving with increased economic activity. In response to increased demand, the company raised operating rates and prices for North American polyethylene exports to Asia.

The company expects Refining and Oxyfuels & Related Products businesses demand to improve with increased mobility and reductions in fuel inventories. Also, the Advanced Polymer Solutions unit is gaining from rebounding demand for its plastics used in automotive manufacturing.

Zacks Rank & Key Picks

LyondellBasell currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space include Kinross Gold Corporation KGC, Eldorado Gold Corporation EGO and Yamana Gold Inc. AUY, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Kinross has an expected earnings growth rate of 100% for 2020. The company’s shares have surged 70.4% in the past year.

Eldorado Gold has an expected earnings growth rate of 2,325% for 2020. Its shares have returned 18.1% in the past year.

Yamana has an expected earnings growth rate of 76.9% for 2020. The company’s shares have soared 65.8% in the past year.

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