The Worley Ltd (ASX: WOR) share price is climbing higher today after the company reported winning two contract awards. We take a closer look.
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Worley Ltd (ASX: WOR) shares are climbing higher today following the announcement of two contract awards for the company. During the opening minutes of trade, the Worley share price catapulted to an intraday high of $11.90. However, some quick profit taking has led Worley shares to retreat back to $11.77 at the time of writing, up 3.79%.
For this month alone, the global engineering company has won a total of five lucrative deals within the energy, chemicals and resources sectors.
Extended strategic partnership
The Worley share price is on the move today after the company released two positive updates to the market.
The first of these announcements related to a signed strategic partnership between Worley and Avantium Renewable Polymers. Under the agreement, Worley will assist in the development of a renewable plastic feedstock plant located in Delfzijl, the Netherlands. This follows the company’s completed work conducted over the last two years in the concept development phase and front-end engineering design of the facility.
The first-of-its-kind renewable plastic feedstock plant will produce plant-based furandicarboxylic acid (FDCA). This is a key component in making chemicals and plastics such as polyethylene furanoate (PEF). The latter is used for a variety of applications that include safe and recyclable packaging for food, drinks, shampoo, window cleaner, and even tennis balls.
Worley stated that it will be issued Avantium shares in return for a 10 million euro equity investment. This will allow both parties to share the risk associated with the engineering, procurement and construction phase of the facility.
The project will be implemented by Worley’s team in the Netherlands and Belgium.
Worley CEO Mr Chris Ashton welcomed the extended collaboration, saying:
We are excited to have entered into a strategic partnership with Avantium which is a leader in advancing the circular economy. This award reflects our strategic pivot to sustainability and delivering a more sustainable world. We look forward to growing our relationship with Avantium and transforming the global use of plastics.
Offshore oil contact award
In the second release driving the Worley share price higher today, the company revealed it won a contract from CNOOC Petroleum Europe Limited. The 2-year deal will see Worley provide engineering, procurement and construction services to three platforms within the North Sea. They include the Buzzard, Golden Eagle, and Scott offshore oil platforms.
The contract, which includes feasibility to the commissioning, will be undertaken by Worley’s United Kingdom office in Aberdeen. Additionally, the company’s global integrated delivery team will provide support where needed.
Mr Ashton, touched on the partnership, adding:
We are pleased that CNOOC Europe has selected Worley to continue supporting its North Sea assets. With our strategic focus on sustainability and delivering a more sustainable world, we’re delighted this work includes evaluation of alternative energy sources, building further on Worley’s relationship with CNOOC and our off-shore capabilities in the North Sea.
Worley share price performance
The Worley share price has accelerated since its multi-year low of $4.63 reached in March last year. Since then, Worley shares have jumped by more than 150%, reflecting positive investor sentiment.
Based on the current Worley share price, the company commands a market capitalisation of roughly $6 billion.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.