Airgas Plans to Build Liquid Hydrogen Plant in Kentucky
In an attempt to bring innovative hydrogen solutions to customers, Airgas, Inc. (ARG) announced its plan to build a liquid hydrogen plant in Calvert City, KY. The new facility is expected to be operative in the summer of 2016 with the capacity to produce ten tons per day of liquid hydrogen.
Although Airgas has several hydrogen customers, this latest liquid hydrogen facility being unique, is expected to provide an opportunity for growth. Customers in a variety of industries across much of the Southern U.S. and well into the Midwest will be able to utilize this in order to meet their growing needs of liquid hydrogen in a wide range of applications, including electrical power generation; the production of metals, glass, chemicals, and food products; and emerging applications for hydrogen-powered fuel cells.
The liquid hydrogen plant will be adjacent to Airgas’ new air separation unit (:ASU). In May 2014, Airgas signed a long-term agreement to build an ASU which will be functional in the spring of 2016. The ASU will supply tonnage oxygen and nitrogen via pipeline to Westlake Chemical Corporation, as well as produce liquid oxygen, nitrogen, and argon for the region’s merchant bulk gas market.
Both the liquid hydrogen plant and ASU in Calvert City will be operated by Airgas Merchant Gases, which has an outstanding track record of optimally managing Airgas’ network of ASUs, sourcing for all major gases, and bulk gas distribution logistics.
Airgas currently owns and operates 16 ASUs and is the fifth-largest producer of atmospheric gases in the U.S. Airgas’ investments in expanding gas production and distribution capabilities in underserved markets reflect its commitment toward meeting the growing needs of customers as effectively and efficiently as possible.
Airgas expects earnings per share in the range of $1.20 to $1.25 for the third quarter of fiscal 2015. The company expects organic sales growth in the mid-single digits for the quarter. For fiscal 2015, Airgas anticipates earnings per share in the range of $5.00 to $5.10, representing a 6% to 8% year-over-year rise. Airgas expects its refrigerants business to make a slightly favorable contribution to its year-over-year earnings per share in fiscal 2015.
Radnor, PA-based Airgas, through its subsidiaries, distributes industrial, medical and specialty gases as well as hardgoods in the U.S. The company also markets its products and services through e-Business, catalog and telesales channels.
Airgas currently carries a Zacks Rank #3 (Hold).
Other chemical-diversified stocks worth a look include Innospec Inc. (IOSP), Valhi, Inc. (VHI) and Kronos Worldwide, Inc. (KRO). While Innospec and Valhi carry a Zacks Rank #1 (Strong Buy), Kronos holds a Zacks Rank #2 (Buy).
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