Emerson Electric Co. EMR, on Nov 25, announced that it has clinched a deal from Total E&P Denmark A/S to offer wellhead pressure monitoring technology for the latter’s Tyra gas field redevelopment project. Following the announcement, its share price increased 1% to close at $74.43 on Tuesday.
Emerson’s technology will help in boosting the security during the multi-year redevelopment project, designed to expand the life of the largest gas field of Denmark. It will assist Total E&P Denmark in replacing the current wellhead platforms by installing new and elevated topsides, which will guarantee continuous production from the gas field. Total E&P Denmark is committed to invest about $3.3 billion in the redevelopment project, the largest of its kind in the Danish North Sea.
Emerson will be responsible for offering in excess of 200 Rosemount wireless pressure transmitters for installation on the four riser platforms. These devices will help in transmitting data to two Emerson DeltaV PK controllers, which will be installed on the accommodation platforms. Upon completion, the redevelopment project will facilitate Tyra in producing more than 200 million barrels of oil.
Emerson is experiencing persistent softness in the global discrete manufacturing market due to soft automotive, semiconductor, packaging and textiles end markets. For fiscal 2020 (ending Sep 30, 2020), it predicts sales to be in the range of 3% decline to 1% increase year over year compared with 6% rise predicted earlier.
Also, rising costs and expenses have been an issue for Emerson over the past few quarters. The company recorded year-over-year increase of 6.7% and 0.5% in the cost of sales in the third quarter of fiscal 2019 (ended Jun 30, 2019) and fourth quarter of fiscal 2019 (ended Sep 30, 2019), respectively.
The Zacks Rank #5 (Strong Sell) stock has gained 9.3% over the past year compared with the industry’s rally of 8%.
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