New large outside-diameter spiral-weld pipe mills are trucking right along with big plans to add new tons—market downturn and concerns about overcapacity be damned. Although delays have bogged down some projects, executives remain generally bullish, at least for 2009.
At the same time, at least one spiral-weld pipe mill executive is keeping one eye on imports with the other on a possible trade case. He also acknowledges that competition could be fierce when all the new spiral-weld mills come on-line, even if the market does rebound.
Potential new U.S. capacity adds up to a whopping 1.84 million tons. Here's where things stand in large OD U.S. pipe mill land
•?Berg Spiral Pipe, a subsidiary of Berg Steel Pipe Corp., is in the final phase of commissioning its mill in Mobile, Ala., according to David Delie, Berg Steel Pipe's president and chief executive officer.
The mill's equipment is installed, and Berg Spiral Pipe should begin commercial production and shipping by the end of March, Delie said. "Things are going good. We're moving right along. But it's always slower than you want trying to commission the equipment," he said. "We're running the equipment now. We've got some pipe made. And when we run into a little problem, we fix it and move on."
Berg Spiral Pipe is on schedule to deliver 175,000 tons of 42-inch X70 pipe for El Paso Corp.'s Ruby Pipeline, Delie said, and that means the mill, which will eventually have an annual capacity of 200,000 tons per year, is booked into 2010.
The main suppliers of flat-rolled for the project is Svenskt Stal AB's operation in Mobile, Ala., although the company also is doing trial runs with material from ArcelorMittal SA, Luxembourg, and U.S. Steel Corp., Pittsburgh.
Adding his voice to the likes of U.S. Steel chairman and chief executive officer John Surma, Delie said he is keeping his eye on import volumes and might consider a trade case on large OD line pipe.
•?Stupp Corp's new spiral-weld pipe mill in Baton Rouge, La., began receiving German-designed and -manufactured helical two-stage equipment Feb. 1, according to the company's Internet site. (The same German experts that disassembled it are on site to reassemble it, Stupp noted.)
The Feb. 1 date was two weeks ahead of schedule, according to Donald Bohach, Stupp's vice president of marketing. The mill should start test production in the second quarter and commercial production in the third quarter, he said.
The Baton Rouge facility is ahead of the game because Stupp had good control of operations and logistics and didn't experience any damage to the equipment, Bohach said. The mill could take orders if it wanted to but hasn't to date, he said.
Besides good equipment, Bohach thinks having an electric-resistance weld facility, a spiral-weld pipe mill and coating operations grouped on a single, 125-acre campus will give Stupp a big advantage over competitors who might have those operations scattered across several locations.
•?Welspun Tubular LLC, part of India's Welspun Gujarat Stahl Rohren Ltd., could begin commercial production any day at its $150-million Little Rock, Ark., mill, assistant manager of corporate affairs Subir Sen said in early February. The mill just has to pass American Petroleum Institute audits and a few test runs, Sen said.
The company already has an impressive list of clients, including TransCanada Corp., Calgary, Alberta; Exxon Mobil Corp., Irving, Texas; and El Paso Corp., Houston. "All major orders from the U.S. and neighboring markets can be catered by the Little Rock mill," Sen said.
Welspun is "optimistic" about oil and natural gas exploration around the United States and "the huge replacement demands (that) are yet to be tapped," Sen said. Even if the U.S. doesn't recover by the second half of 2009, as many hope, the Little Rock facility should be able to stay busy with projects in Latin America, Canada and other nearby markets, he said.
•?Few specifics are available on United Spiral Pipe, a Pittsburg, Calif., joint venture between U.S. Steel and South Korea's Posco Ltd. and SeAH Steel Corp. Earlier reports indicated the mill was slated to begin production in May 2009.
•?There appears to be little new to report at Evraz Inc. NA's new large OD mill in Regina, Saskatchewan. Layoffs may be plaguing Regina's 2-inch mill and its 24-inch mill may not have orders after March, but the large OD spiral-weld line pipe mill remains booked through the end of the year.
•?PSL-North America LLC, a subsidiary of India's PSL Ltd., said in December it had bagged a big order that would gobble up capacity at its new Bay St. Louis, Miss., mill through 2009. PSL-NA's chief executive officer, Brian Vaill, declined to disclose who placed the order.
Vaill said at the time that he expected the Bay St. Louis mill to be up and running in January 2009, but the startup of the facility could not be confirmed. MICHAEL COWDEN
|New North American Spiral-Weld Line Pipe Capacity |
|(in thousands of short tons)|
|Evraz Inc. NA||Regina, Saskatchewan||200||30-60”||February ’08||Q1 ’08|
|Berg Spiral Pipe||Mobile, Ala.||200||24-56”||March ’09||Q4 ’08|
|PSL-North America LLC||Bay St. Louis, Miss.||300||24-60”||January ’09||Q4 ’08|
|Man Industries (India) Ltd.||Little Rock, Ark.||330||20-100”||June ’09||Q1 ’09|
|United Spiral Pipe LLC||Pittsburg, Calif.||300||24-64”||May ’09||Q2 ’09|
|Stupp Corp.||Baton Rouge, La.||150-180||24-60”||Q3 ’09||Q2 ’09|
|Welspun Tubular LLC||Little Rock, Ark.||330||24-60”||February ’09||Spring ’08|
|Total additional capacity||1,840|| || || || |