\u3000\u3 China Vanke Co.Ltd(000002) 221 Oriental Energy Co.Ltd(002221) )
Event: on February 25, 2022, the company signed a strategic cooperation agreement with Honeywell UOP global oil products Co., Ltd. the company will establish a green energy resources comprehensive utilization Industrial Park in Maoming City, Guangdong Province and build two sets of ecofining process units with an annual output of 500000 tons. The project is planned to be constructed in two phases, of which the first unit is planned to be put into operation in 2023.
Comments:
Sign a strategic cooperation agreement with Honeywell UOP to build an industrial park for comprehensive utilization of green energy and resources. Honeywell UOP is a leading supplier in the field of oil and natural gas. It will provide the company with patent authorization, process package, training, services, catalysts, adsorbents and special equipment of ecofining process technology to support the company to build and operate ecofining process units. Ecofining process technology is the first technology for large-scale production of sustainable aviation fuel for commercial aviation. This process uses Honeywell green aviation fuel produced by the conversion of gutter oil, fat and grease. It can be mixed with petroleum based aviation fuel in a ratio of 1:1 for commercial use without technical changes to the aircraft and meet the requirements of all key flight specifications. The signing of this agreement expresses the willingness of both parties to cooperate in the sustainable renewable green energy ecofining process technology project, and strive to jointly complete the commercial application of Honeywell UOP's ecofining sustainable renewable green energy technology in China.
Layout sustainable aviation fuel projects to realize efficient utilization of hydrogen energy. In 2019, the Oriental Energy Co.Ltd(002221) alkane comprehensive utilization project using Honeywell UOP new generation Propane Dehydrogenation Technology settled in Maoming. The first phase of the project is planned to be completed and put into operation in October 22. The sustainable aviation fuel project adopts ecofining process and uses PDH by-product hydrogen to convert kitchen waste oil, gutter oil and other biomass resources into green aviation fuel, so as to change the current situation that PDH by-product hydrogen can only be used as fuel combustion and become a powerful extension of PDH project. At the same time, the project also produces green naphtha, carbon three carbon four and other products by-products to help the company's Green Petrochemical production. This will further promote Maoming's green chemical industry to extend, supplement and strengthen the chain, and inject new momentum into building a 100 billion level green chemical industry cluster. After the completion of Maoming sustainable aviation fuel industry base, it will be the world's largest sustainable aviation coal production base with kitchen waste oil as the main raw material. It is expected to solve the huge gap in the global sustainable aviation fuel supply side and realize the landing and mass production of sustainable aviation fuel in China. After the completion of the project, the annual carbon emission reduction will reach 2.4 million tons, reducing about 83% of carbon dioxide emissions, helping China's aviation industry to reduce emissions and promote the goal of "double carbon" and promote green development.
Profit forecast, valuation and rating: considering that the LPG price remains high and the pressure on PDH cost leads to the decline of the company's profitability, we reduce the company's profit forecast for 21-23 years. It is estimated that the company's net profit for 21-23 years will be 12.19 (down 34%) / 17.28 (down 24%) / 2396 (down 13%) billion yuan respectively, and the corresponding EPS will be 0.74/1.05/1.45 yuan respectively. Under the background of carbon neutralization, the development prospect of light hydrocarbon cracking field is broad. The company is a leading PDH enterprise in China. There are sufficient projects to be put into operation in the future and still has high growth, so it maintains the "buy" rating.
Risk warning: the project is not put into operation as expected; Product prices fell sharply; Industry overcapacity; Strategic cooperation termination risk.
