Praxair (PX) Extends Hydrogen Supply Contract With Motiva
Zacks Investment Research | Jan 16, 2018 08:24PM ET
Industrial gas producer and supplier, Praxair Inc. (NYSE:PX) yesterday announced the expansion of its hydrogen supply contract with Motiva Enterprises LLC. Financial terms of the deal have been kept under wraps.
Motiva Enterprises — formerly a joint venture between Saudi Refining Inc. and Shell (LON:RDSa) Oil Company — started operating as a fully owned subsidiary of Saudi Refining from May 2017. It is the owner of Texas-based Port Arthur Refinery, currently recognized as the largest refinery in North America with 600,000 barrels per day of refining capacity. It currently supplies petroleum products like gasoline, diesel, aviation fuel, liquefied petroleum gas and lubricants.
Inside the Headlines
Per the long-term agreement, Praxair will be supplying more hydrogen to Motiva for meeting the additional demand created from the expansion of a hydrocracker unit and diesel hydrotreater in the Port Arthur Refinery in 2016. Moreover, the additional hydrogen supplied will assist in other operations of the refinery as well.
Demand for hydrogen in refineries has grown manifold, especially driven by the growing need for clean transportation fuels as air quality standards become strict. This industrial gas is primarily used for producing refined fuels from crude oil. It is also used as an agent in lowering the sulfur-content in diesel.
Our Take
We believe that increasing application of industrial gases in manufacturing, transportation, healthcare, food and beverages, and metal fabrication industries is an advantage for Praxair. This, along with the company’s initiatives for improving its products and services, has helped it win many contracts over time. Exiting third-quarter 2017, the company had a solid backlog of $1.5 billion.
The company currently carries a Zacks Rank #2 (Buy) and has approximately $46.4 billion market capitalization. In the last three months, shares of Praxair have yielded 15.8% return, outperforming 9% gain of the Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.