Air Products: Confident in Stability, Looking to Growth Projects

Researched by Industrial Info Resources (Sugar Land, Texas)--Industrial Info is tracking almost $10 billion in projects belonging to Air Products (NYSE:APD) (Allentown, Pennsylvania) worldwide, about $1 billion of which is in the U.S., despite challenging market conditions due to COVID-19.

Click on the image at right for a graph showing Air Products' project activity, by world region.

The global supplier of industrial gases and liquefied natural gas (LNG) technology reported adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the third quarter of 2020 that were down 1% from the same period in 2019.

Air Products' sales of $2.1 billion for the fiscal third quarter fell 7% from the same quarter in 2019, due to lower energy pass-through, lower volumes and unfavorable currency. COVID-19 had a direct effect on volume, considering merchant businesses in the Americas and Europe were impacted. Despite tumultuous market conditions during the pandemic, Air Products remains confident in its present standing due to onsite business while preparing for the future.

On its third-quarter earnings call, Seifi Ghasemi, chairman, president and chief executive officer, said: "Our onsite business - which represents more than half of our sales - remains stable, and we continued to execute on our growth strategy, announcing two new megaprojects in Saudi Arabia and Indonesia."

In Tabuk, Saudi Arabia, Air Products, in partnership with NEOM Energy and ACWA Power International (Riyadh, Saudi Arabia), is planning a $5 billion power-to-gas plant, to convert four gigawatts (GW) of solar and wind energy into carbon-free (green) hydrogen and ammonia for global industries and consumers. With a medium probability (70-80%) of moving forward, according to Industrial Info's project database, construction is scheduled for October 2022, with completion in December 2025. For more information, see Industrial Info's project report.

Another major growth project, under its subsidiary PT Air Products Indonesia, is a $2 million Bengalon methanol plant in Indonesia that is scheduled to kick off in June 2024 -- also with a medium probability of moving forward as scheduled. The new facility would produce 2 million metric tons per year of methanol from coal to be used as auto fuel. Completion is expected November 2026. For more information, see Industrial Info's project report.

Air Products is a global leader in LNG technology and equipment, and as such announced on September 9 it will be providing four Main Cryogenic Heat Exchangers (MCHEs) for Sonatrach's (Algiers, Algeria) GL1Z LNG production plant in Arzew, Algeria. The four heat exchangers will each have 1.3 million-ton-per-year production capacity and will replace the existing ones that were also built by Air Products in 1977. This is a significant development for Air Products, as the new MCHEs feature the company's technological advances since that time. For more information on Sonatrach's GL1Z facility, see Industrial Info's plant report.

Air Products' project activity is not limited to overseas. The company's presence in the U.S. is strong as well. The company is planning a $100 million helium extraction and liquefaction plant in Colorado. The medium-probability project's kickoff is tentatively scheduled for May 2024. The plant will extract helium from Kinder Morgan CO2 wells in the area, for transport through the Cortez Pipeline to the Permian Basin. For more information, see Industrial Info's project report.

In Minnesota, a $60 million grassroot air separation plant in the southwest area of the Twin Cities is set for completion in October. Meanwhile, in Kansas, 2020 capital upgrades at its helium plant in Liberal are set to kick off in October; upgrades include rebuilding a cooling tower. For more information, see Industrial Info's reports on the Twin Cities and Liberal projects.

For more information, see January, 27, 2020, article - Air Products' $2.8 Billion in Projects Point to Growth in China, U.S. Gulf Coast.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.