Fluor Corporation (FLR) disclosed that ICA Fluor, its industrial engineering-construction joint venture with Empresas ICA, S.A.B. de C.V. (ICA), penned a contract with Pemex Refinación for building the delayed coker unit in Mexico. In particular, this facility will be set up at the Miguel Hidalgo Refinery in Tula, Hidalgo. The project’s mechanical completion is expected in the second quarter of 2018.
This $1.3 billion worth contract is the Phase II of the ongoing Residue Recovery Project for the Miguel Hidalgo Refinery. This comprises of providing comprehensive engineering, procurement and construction (EPC) services for the 86,000 barrels/day capacity plant. Phase II is the first package to be transformed to the EPC stage under the open book incepted in the Phase I contract, which ICA Fluor had bagged in 2013.
We view the Phase II contract as a strategic fit for Fluor and expect it to pave the way for top line strengthening in the future. Moreover, this project is a key step in reviving oil processing facilities in Mexico.
Fluor is one of the leading professional services provider firms and engages in engineering, procurement, construction, maintenance services as well as project management services on a global basis. Signifying the commitment to its projects, on Dec 2, Fluor declared the delivery of the first four train cars for the Regional Transportation District’s (RTD) commuter rail network in Denver, CO. The delivery was a part of the Eagle P3 Project that Fluor had taken in 2010.
Fluor currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks worth considering in the same sector include Willdan Group, Inc. (WLDN) and AECOM Technology Corporation (ACM). Both stocks carry a Zacks Rank #1 (Strong Buy).
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