LNG

Chart Industries Inc., the US equipment-maker for the liquefied natural gas and other clean energy and industrial gas markets, said it and recently received a series of LNG orders from the US and overseas.

The orders include one for Chart’s Integrated Pre-Cooled Single Mixed Refrigerant (IPSMR)® liquefaction technology for two modular Trains of a multi-Train international project not previously mentioned in the order list of the Atlanta-based company.

A second order was awarded for IPSMR liquefaction technology for a mid-scale plant in the Asia-Pacific region and a third was for a North American small-scale LNG venture including nitrogen-cycle technology and associated equipment.

Fuel stations

“There were various other LNG infrastructure-related orders, including tanks, fuelling stations in Europe and for Morocco’s first LNG regasification units,” Chart explained.

The company was additionally awarded repair and service work at a Middle East LNG project.

“As anticipated, we continue to see strong market and award activity across the four pillars of our LNG strategy, including ‘Big LNG’, small-scale and floating LNG, infrastructure and service & repair,” stated Jill Evanko, Chart’s Chief Executive and President.

“Not only do our recent orders cover all four LNG categories, but they include commercial synergy wins with both Chart and Howden content,” said the Chart CEO in reference to its UK acquisition completed in 2022.

“Further, our LNG commercial pipeline remains strong as we see a clear shift in customers’ preference for our modular solution which drives multiple awards across many years as projects are developed,” Evanko added.

Chart recently posted solid third-quarter results including record operating income and backlog of orders.

The company’s earnings performance was also helped by its acquisition of UK engineering group Howden for cash and shares at a purchase price of $4.4 billion a year ago.

After buying Howden there were complementary additions to the offering including highly engineered fans, compressors, rotary heat exchangers, steam turbines and other air and gas-handling products.

Chart’s LNG processing technology is a market leader and adds to its highly engineered equipment for small to industrial-scale LNG and other plants such as air-cooled heat exchangers, brazed aluminum heat exchangers and ethylene storage tanks.

Chart Industries Inc., the liquefied natural gas equipment-maker and industrial gas technology company, has sold a low-pressure compression and vacuum technologies company for $300 million in cash to the US group Ingersoll Rand.

Chart said the transaction, which is subject to customary closing conditions, was expected to be completed in the third quarter.

As part of the transaction, Ingersoll Rand will assume ownership of the Roots manufacturing facility in Connersville, Indiana, which is dedicated to Roots products and will retain the 300 employees at Roots.

“We are excited to have executed a definitive agreement in the second quarter 2023 to sell Roots, which is another key step in accelerating our deleveraging plan while simultaneously allowing us to focus on our core strategic solution offering and integration efforts,” stated Jill Evanko, Chart’s Chief Executive and President.

“We also are thrilled that the business will be owned by Ingersoll Rand, a proven strategic partner and a company that will care for the Roots’ team members,” added Evanko.

Vicente Reynal, Chairman and Chief Executive of Ingersoll Rand, said he was pleased with the acquisition.

Benefits

“We have long admired Roots and are thrilled to add this iconic brand to our portfolio. This complementary acquisition expands our low-pressure compression and vacuum product offerings and is a great example of our partnership with Chart, where the acquisition was a win-win for both companies,” added Reynal.

Chart is also reiterating its full year 2023 anticipated outlook for revenue, adjusted gross earnings, adjusted earnings per share, free cash flow and operational cash flow available for debt paydown.

The company reported in May that first-quarter results were helped by LNG orders and additions from Chart’s acquisition of UK group Howden.

Chart’s first-quarter included strong starts for Chart and Howden with orders amounting to $747.7m, contributing to a record $3.9 billion backlog.

Additionally, Chart booked a “Big LNG” order from leading global liquefaction plant builder Bechtel for air-cooled heat exchangers, brazed aluminum heat exchangers and ethylene storage tanks for Sempra Infrastructure’s Port Arthur LNG project.

The company also listed an order for $115M for the IPSMR® liquefaction systems from the Chinese shipyard Wison Heavy Industry Co. for small-scale LNG projects all driven by Chart’s IPSMR® technology, including one for Italian oil and gas major and LNG project developer ENI.

A separate order was also made for brazed aluminum heat exchangers for a floating LNG application for $19.5M.

Chart said quarterly small-scale and floating LNG orders totalled $139M, which was a 263 percent increase for these types of orders when compared to the first quarter of 2022. 

Chart Industries Inc., the LNG equipment-maker and industrial gas technology company, has received a first-quarter 2023 boost as orders increased following its $4.4 billion acquisition of UK engineering firm Howden with both new branches of the company contributing and synergies already emerging.

Chart Industries, the US LNG equipment-maker and industrial gases and clean energy company, reported a record backlog for an eighth consecutive quarter, surpassing $2 billion for the first time in its history.

US LNG and industrial gases equipment-maker Chart Industries, has booked an order for a helium liquefaction large-scale plant for one of the largest independent oil and gas producers in Russia.

Chart Industries, the US LNG and industrial gases equipment-maker, said it had competed an investment in a US company called Transform Materials.

Transform Materials is a sustainable chemical technology company that uses microwave plasma to convert natural gas into acetylene and hydrogen.

“Its highly selective, cost-effective, net-carbon-negative process converts the methane in natural gas into high-value products suitable for direct use or downstream reactions,” said Chart.

Chart has purchased 5 percent of Riviera Beach, Florida-based Transform Materials’ equity for $25 million.

“We transform methane into acetylene and hydrogen, critical precursors for the synthesis of high-value chemical end products, without using traditional techniques that form carbon dioxide,” explained David Soane, Chairman of Transform Materials.

“That means we can meet important future needs of the petrochemical industry without creating harmful greenhouse gases,” added Soane.

In conjunction with the strategic investment, Chart and Transform also signed a binding commercial memorandum of understanding.

The MOU establishes the commercial collaboration and equipment supply arrangements for Chart to supply Transform projects.

Transform Materials’ process has already been adopted via a global licensing agreement with DSM Nutritional Products Ltd.

“This investment in and commercial agreement with Transform Materials is yet another step toward expanding our customers’ options in our high-growth clean-energy markets, in particular hydrogen,” stated Jill Evanko, Chart’s Chief Executive and President.

“Perhaps most impactful about Transform’s patented process technology is that there is no oxygen involved in the reaction, so therefore no carbon-dioxide is generated, the very definition of clean,” added Evanko.

US LNG-equipment maker and industrial gases company Chart Industries reported increases in quarterly and annual net profits and logged a record number of new customers.

Chart booked orders with 65 new customers in the final three months of 2020, resulting in record full-year 2020 new customers of 472, of which 109 were in Specialty division.

The company also completed four acquisitions outside the LNG sector related to carbon capture, water treatment and hydrogen as well as making a $15 million investment in carbon-capture company Svante on February 2021.

It additionally acquired Cryo Technologies on February 16, 2021 adding proven hydrogen and helium liquefaction to its portfolio, expanding into specialty markets of $5.75 billion potential.

Chart reported fourth-quarter net income of $269.8M compared with $12.5M in the prior-year quarter.

Chart’s annual profits amounted to $320.1M versus $46.4M in 2019.

“While hydrogen, biogas and carbon capture are the hottest topics right now, LNG is still extremely active, particularly as the cost fundamentals are competitive and infrastructure continues to be built worldwide,” stated Chart.

The Atlanta, Georgia-based company noted that at the end of December 2020, the Government of India stated that there were plans to create a gas infrastructure in India with an investment of $60Bln over the next four years, inclusive of LNG terminals.

“India is just one region where LNG continues to be a good answer for a cost competitive, scalable step in the energy transition,” stated Chart.

The company expects fueling stations and HLNG vehicle tanks for onboard heavy duty trucks to continue around or above 2020 levels throughout 2021, and also expects two small-scale LNG terminals and mid-scale LNG projects to move ahead with final investment decision in 2021.

Chart recorded a full-year record for fueling station orders of 71 stations, up 18.3 percent over 2019.

“The fourth quarter of 2020 capped a strong year in unprecedented times, thanks to the entire Chart team,” said Jill Evanko, Chart’s Chief Executive and President.

“In 2020, we made significant progress in penetrating the global high growth markets of clean energy, specialty and repair and service as evidenced by 472 new customers and 33 long-term agreements,” added Evanko.

“The combination of strong free cash flow, strategic investments, record backlog and operational execution resulted in multiple full year 2020 and fourth quarter 2020 records,” stated the CEO.

“More importantly, the performance puts us in position to make 2021 a breakthrough year for our business as we serve our global energy and industrial gas customers’ growing and changing needs,” said Evanko.

Chart generated $60.2 of net cash provided by operating activities, resulting in $49.6M of free cash flow, the second highest cash flow quarter in the company’s history.

“Hydrogen continues to be our hottest specialty market, with record orders ($38M) and backlog ($39M) in 2020,” said Chart.

“We expect over 70 percent in hydrogen sales growth in 2021 when compared to 2020,” it added.

“We have completed a memorandum of understanding with Matrix Service Company for standardized small-scale hydrogen offerings and a joint development agreement with Ballard Power Systems to jointly develop integrated system solutions,” explained Chart.

“This includes a fuel cell engine with onboard liquid hydrogen storage and vaporization for the transportation industry, with a focus on heavy-duty applications including buses, trucks, rail and marine vessels,” the company stated.

Chart Industries, the US LNG equipment maker, has reported mid-second quarter business activities, including new contracts and expenditure and cash flow details at its four divisions.

Chart said that net cash provided by operating activities for continuing operations amounted to $15.5 million and corresponding free cash flow included capital expenditures of $12.6M, driven by strong earnings, cash collections and supplier terms extensions.

The Atlanta-based company, listed on the Nasdaq global exchange, also completed a five-year long-term agreement with a major industrial gas customer for field services and repairs.

Chart said it signed an agreement with Risco Energy Solutions to provide LNG equipment to support the rapidly growing gas-to-power infrastructure in the Asian nation of Indonesia.

“April earnings per share and adjusted earnings per share after adding back severance costs were very strong, as our non-energy related businesses have continued to perform,” stated Jill Evanko, Chart’s President and Chief Executive.

“While the pandemic has altered 2020 for everyone, we are focused on shaping our business to deliver good results in 2020 and position Chart to take advantage of the strong fundamentals of the clean energy transition,” she added.

It also booked orders with 67 new customers in April and May and executed $11.9M of additional cost reductions on May 29, 2020, bringing year-to-date total annualized cost reductions to $60.7M.

“While the current economic situation continues to be challenging for our oil-related product lines, we continue to see demand for our equipment and solutions related to the transition to clean energy infrastructure and our specialty markets,” said Chart.

“With over $60M of cost reductions taken year-to-date, we continue to expect margin expansion throughout 2020 and strong free cash flow for the year, with debt paydown a priority,” it added.

Company free cash flow in April 2020 amounted to $12.6M.

“In the past two months, we have achieved payment term extensions with 311 suppliers with an average payment term extension of 38 days (new payment terms for those suppliers average 89 days)’” stated Chart.

The company second quarter orders through May 29 totaled about $135M, with orders in-house that will be booked in the first days of June totaling an additional $14M.

“In April and May, we received orders from 67 new customers, including 20 in China, where quarter-to-date orders and sales have exceeded our original 2020 plan,” stated the company.

Chart additionally reported demand for oxygen-related critical care products was strong in the month of April and in the first two weeks of May, while activity for traditional industrial gas applications has increased in the second half of May as the hyper-focus on oxygen delivery has subsided to pre-COVID-19 levels.

“We continue to see consistent and strong quoting and order levels for fueling stations, repair and service, small-scale LNG infrastructure and specialty markets, including the receipt of a $2.3M order for a European country’s Armed Forces,” the company revealed.

“We also expect to receive a small-scale terminal order in North America in June 2020,” it added.

In the E&C Cryogenics division, demand for quick turn refurbishment, repair and service-related product and services has increased over the past eight weeks, with orders of $7.2M associated with this type of work.

“Venture Global’s Calcasieu Pass big LNG project continues on schedule, and in May, we booked an additional $1M order related to the project,” said the company.

Chart said that areas that softened in the first two months of the second quarter 2020 included HLNG vehicle tanks, beverage tanks, and air-cooled heat exchangers.

“Air cooled heat exchanger orders quarter-to-date total $12.1M while the fans business continues to book and ship consistent with first quarter levels,” said the company.

Chart noted that the support of governments for the transition to clean energy fuels has heightened, with India extending excise duties on diesel, and Germany expected to extend the toll exemption for LNG heavy duty trucks on German highways in early June which will continue to incentivize companies to build infrastructure, including LNG fueling stations and additional over-the-road LNG trucks.

The company has also previously announced a letter of intent from Shell for 7 fueling stations in Germany and in May 2020, received the first purchase order for 2 of the 7 stations plus a surprise four station order that has not yet been booked from another customer.

Chart said that other regions, in particular Southeast Asia, continue to address their need for power infrastructure.

“One such country is Indonesia, and early in the second quarter 2020, we signed an agreement with Risco Energy Solutions, a private investment company, to provide LNG equipment such as Storage Tanks, ISO containers, Trailers, Mobile Equipment, and Fueling Stations, to support the rapidly growing Indonesian gas-to-power infrastructure needs,” it said.
Risco is an active gas infrastructure provider to PT Perta Gas Niaga, a subsidiary of the oil and gas company Pertamina.

“Given the weak demand for air-cooled heat exchangers and the continued optimization of our cost structure, we took further reductions on May 29, 2020,” said Chart.

The total cost reductions taken equaled $11.9M in annualized cost savings, bringing the year-to-date total to $60.7M of annualized cost savings.

“Of the $60.7M, approximately $51M are structural changes that can be maintained at volume levels above $1.6 billion,” the company stated.

President Donald Trump concluded his two-day visit to India by issuing a joint statement with Indian Prime Minister Narendra Modi on a variety of issues, including future cooperation on liquefied natural gas as both leaders noted that the US-Indian energy relationship over the last four years had been worth $20 billion.

They said they welcomed growing links between the United States and India in trade and investment in hydrocarbons. 

“Through their Strategic Energy Partnership, the United States and India are seeking to enhance energy security, expand energy and innovation linkages across respective energy sectors, bolster strategic alignment, and facilitate increased engagement between industry and other stakeholders,” they said.

Trump and Modi noted the potential for the US to meet India’s goal to diversify its import base for coking and metallurgical coal and natural gas.

“We welcome recent commercial arrangements intended to accelerate access to LNG in the Indian market,” they added, in reference to the accord between US company Tellurian and state-owned Petronet LNG, the nation’s largest importer.

They also referenced moves by ExxonMobil and others to advance with the provision of more LNG fuel use for transportation and small-scale distribution.

“The US has indeed become a very important oil and gas source for India,” they said.

“Over the last four years, our total energy trade volume is about $20 billion,” added the statement.

They also noted that they encouraged the Nuclear Power Corporation of India Limited and US company Westinghouse Electric to finalize the techno-commercial offer for the construction of six civil nuclear reactors in India at the earliest date.

Westinghouse and the Indian nuclear power operator plan to build the 1,100 megawatts reactors in the southeast Indian state of Andhra Pradesh. 

However, there was no statement on the firming up of Petronet’s  supply agreement with Driftwood LNG developer Tellurian, nor on its accord on a possible equity stake.

The initial agreement between Tellurian and Petronet for up to 5 million tonnes per annum of US LNG was signed during a visit to Houston in September 2019 by Modi, who also held a Texas rally for Indians living in the US.

Petronet and Tellurian will continue their talks on the Indians investing $2.5 billion in the Driftwood plans proposed for the west bank of the Calcasieu River, south of Lake Charles in Louisiana.

Petronet currently operates India’s busiest regasification facility at Dahej, north of Mumbai, with 15 million tonnes per annum of capacity and six storage tanks. The terminal is being expanded to handle 17.5 MTPA.

The company was formed by the Government of India in 1998 specifically to import LNG and will be expanding its interests in the years ahead into LNG fuel distribution.

Shareholders in Petronet, which began operations in 2004, include the other big Indian energy players, Gas Authority of India, Indian Oil Corp., Oil and Natural Gas Corp. and Bharat Petroleum Corp.

Chart Industries, the US liquefied natural gas and industrial gases equipment supplier, has signed a letter of cooperation with ExxonMobil India LNG Ltd, an affiliate of the US  major, and Indian Oil Corp. to focus on delivering LNG by Indian roads, railroads and waterways to spread gas use in the absence of physical pipelines.