SAWPIPE Wall Street is banking on a boom but with staying power
Jan 01, 2008 | 10:51 AM
The near-term prospects look bright for producers of large-diameter line pipe, but overcapacity in the spiral-weld section of the market could cloud the horizon, several analysts say.
That might at first seem counterintuitive because spiral submerged arc-welded (SAW) pipe appears to be gaining acceptance for overland energy transmission projects, such as the Rockies Express Pipeline. The estimated 1,700-mile pipeline will eventually carry natural gas from deposits in the West to markets on the East Coast.
The two types of SAW pipe—helically submerged arc-welded (HSAW), which is made from hot-rolled coil, and longitudinally submerged arc-welded (LSAW) pipe, which is made from plate—appear to be in somewhat of a face-off. At about $800 a ton, plate is far more expensive than coil, which sells for roughly $540 a ton. Long lead times for LSAW and cheaper prices for HSAW have made the latter attractive for big pipeline projects, although LSAW pipe remains the preferred material for transmission lines that run under water or through other difficult or corrosive environments, according to analysts.....
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