ABB Ltd. (ABB) has received a $42 million contract to build three new substations and upgrade four existing ones in the northern region of Algeria. The contract has been awarded by the national utility of the country, Sonelgaz (Socièté Nationale de l'Electricité et du Gaz) for the design, engineering, supply, build-up and commissioning of the substations, including civil works.
A solar panel factory near the capital city, Algiers, will be powered by one of the substations, which will be built soon. Further, power capacity of the factory will be doubled by replacing two power transformers at an existing substation. The completion of the project is scheduled in 2013.
The demand for electricity for both industrial and residential purpose is rising substantially in Algeria. Installation of the new substation as well as upgrade of the existing ones will greatly enhance the distribution capacity of the power stations and will also strengthen the dependability of grid and boost the power stability in the area.
Air- and gas-insulated substations from ABB lead the worldwide market and have capacity to cover voltage levels as high as 1,100 kilovolt. ABB Ltd.’s power and automation technologies offer solution for sustainable development, thus helping to shield the world's resources.
The company has a number of technologies for the solar power industry with a growing installed base. ABB Ltd. has witnessed improving signs in late-cycle power, with some recent large contracts.
However, ABB's results are likely to be adversely affected by macroeconomic weakness as more than 80% of the company's orders are derived from outside the US. A major competitor of ABB Ltd. is Siemens AG (SI).
ABB Ltd. is a Zurich (Switzerland) based power and automation technology company. The company operates in approximately 100 countries, structuring its global organization into five regions: Europe, Americas, Asia, the Middle East and Africa.
We maintain a Zacks #2 Rank (short-term Buy recommendation) on ABB Ltd.
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