Drill just below the surface of the everyday issues that
steelmakers face, and youll find people and companies
that are implementing business improvements that are delivering
real change to the industry. This is just as true of the steel
tube and pipe sector. Earlier this year, AMM presented
the first-ever Awards for Steel Tube and Pipe Excellence during
its fifth annual Steel Tube and Pipe Conference in Houston,
recognizing advancements rooted in technology, customer
service, logistics and other practices. AMM
congratulates the winners and salutes the best-in-class
initiatives that a panel of independent industry experts
decided set the winners apart from their peers.
Best Mergers & Acquisitions:
Reliance Steel & Aluminum
Reliance Steel & Aluminum Co. chairman and chief
executive officer David H. Hannah believes his company is
the acquirer of choice in the metals service center
industry. He is proud of the Los Angeles-based
companys track record of not just acquiring companies but
of helping those companiesincluding some in the tube and
pipe industrybecome bigger and better.
Reliance, which captured AMMs Best Mergers
& Acquisitions award, is the largest North American metals
service center, having grown its sales revenue to $8.1 billion
in 2011 from $447 million in 1994, the year that it became a
publicly traded company. A significant part of that growth has
come from its 48 acquisitions during that timeframe, including
the purchase of several companies that distribute specialty
tubing to complement its Tube Service Co. division, which has
been in the specialty tubing business for 30-plus years.
The most recent such acquisition was that of Continental
Alloys & Services Inc., an energy tubulars distributor
based in Houston. But the largest was of specialty tube and bar
distributor Earle M. Jorgensen Co. (EMJ) in 2006, an
acquisition that was supplemented with the purchase of two
Canadian tubular distributorsEncore Metals and Team Tube
Our strategy is just to be nimble and to look for
companies as they become available that fit with our culture
and our reputation in the marketplace, Hannah said,
adding that Reliances acquisition strategy focuses on
profitable growth, not just top-line growth. We are very
disciplined. We are very focused on doing the right
acquisitions for Reliance and not just any old
Best Innovation: NOV Grant
Synergy is a much-overused word in business and industry.
But in some cases, it perfectly describes the mutual benefits
to customers, suppliers and industries.
Houston-based NOV Grant Pridecoa subsidiary of
National Oilwell Varco Inc., one of the largest oil and gas
equipment and supply companies in the worldis a top
producer of drill pipe and drill stems, the steel segments that
are threaded together to turn the bit and carry fluids down to
bring cuttings to the surface. NOV Grant Prideco, which
captured AMMs Best Innovation award, makes a
significant amount of its own pipe at the Voestalpine Tubulars
mill Austria, in which it has a majority ownership, and buys
the rest from other pipe mills. For most applications, the pipe
is made from a chrome-molybdenum low-alloy carbon steel.
When Brazilian oil and gas company Petrobras needed
specialized drill string and risersthe pipe that connects
an offshore platform to the wellhead on the sea floorit
contacted NOV Grant Prideco. The planned well would produce
sour gas, which is high in corrosive hydrogen sulfide, and
Petrobras needed not only the drill string and pipe but also
the welds to be fully sulfide-stress-cracking
We were actually already considering such a
system, Michael Jellison, senior vice president of
engineering at NOV Grant Prideco, said. We have had our
pipe in sour-gas service worldwide for a decade and never seen
any failure, so we never needed to make the welds
resistant. However, there was internal interest in doing
so. The advantage of such a configuration is that it is
very rugged and can be deployed in more harsh
environments, Jellison said. Still, it was a
significant investment for us, so we were happy to have a
client to work with.
Best New Project: Vallourec & Mannesmann USA
In his 2012 State of the Union address, Barack Obama talked
about an America built to last. The President might
well have been thinking about the pending completion of
Vallourec & Mannesmann USA Corp.s Fine Quality Mill
(FQM) in the rustbelt community of Youngstown, Ohio, winner of
AMMs Award for Steel Excellence for Best New
The small-diameter pipe mill is already undergoing hot
completion, with industrial start-up expected sometime in the
second quarter. The $650-million facility will produce
small-diameter pipe in sizes from 2⅜ to 7 inches,
complementing an existing pipe mill on the site that has an
annual capacity of about 500,000 tonnes of larger-diameter pipe
from 5 to 10¾ inches. The facility will include a
200,000-tonne heat-treatment facility that will allow V&M
USA to supply pipe for the most demanding horizontal drilling
applications. The Youngstown complex also will include new
on-site storage facilities.
Skip Herald, V&Ms North American managing director
for oil country tubular goods (OCTG), said the Houston-based
subsidiary of Vallourec SA was taking a calculated gamble in
its significant North American investment. Despite
current macroeconomic uncertainties, we believe that the energy
market shows great promise and validates our investment
plans, he said.
Youngstown, given up for all but dead in the wake of the
2008-09 recession, sits at ground zero of some of the biggest
energy plays on the North American continent. The Marcellus and
Utica shales, which stretch across much of eastern Ohio,
Pennsylvania and upstate New York, contain volumes of natural
gas considered unthinkable just 10 years ago, but geologists
have learned to unlock shale gas with hydraulic fracturing
drilling techniques, which will require hundreds of thousands
of tons of small- and large-diameter drilling pipe.
Best Operational Improvements: Leavitt Tube
When Maruichi Steel Tube Ltd. purchased a majority interest
in Chicago-based Leavitt Tube Co. in 2008, the acquisition gave
it a pair of U.S. mills. Japans largest steel tube
producer had acquired a mill in California in 1980, but the
company wanted to expand its reach across the United States.
Leavitt Tube fit the Japanese companys geographic
diversification goals but the Chicago producer, which first
began making mechanical steel tubing in 1956, was saddled with
Maruichi wanted to focus on producing the highest-quality
tubing in the industry for the U.S. market, so the company
embarked on a strategic plan to upgrade and modernize
Leavitts recently upgraded 1-million-square-foot
production facility in Chicago produces structural tubing,
mechanical tubing and Hi-Y 50 pipe tubing. Known in the
industry as The Tube People, the companys
employees pride themselves on providing quality tubing and
outstanding customer service.
For its upgrade of the Chicago plant, Leavitt Tube is the
winner of AMMs award for Best Operational
The first major mill upgrade project at Leavitt got under
way in late 2010, when engineers and construction teams began
installing a quick-change cassette system on the plants
W-80 mill, which produces Leavitts larger hollow
structural sections (HSS) and more. First commissioned in 1981,
the W-80 mill had received only minor upgrades in nearly 30
years of operation, with the exception of a state-of-the-art
milling saw installation in 2006. The $12-million installation
of the quick-change cassette system has allowed Leavitt to
achieve tighter tolerances, reduce downtime and increase
Best Environmental Responsibility/Stewardship:
Deep in the jungle of Peru, near the Urubamba River, is the
Kinteroni gas fielda veritable treasure trove of natural
resources. Discovered in 1988 by Royal Dutch Shell Plc, the
field holds an estimated 13.4 trillion cubic feet of natural
gas and another 482 million barrels of natural gas liquids
(NGLs), which can translate into billions of dollars of revenue
for companies that are able to access the gas and transport it
via thousands of miles of pipeline.
Unfortunately, the process of well exploration and drilling
can be immensely disruptive to sensitive ecosystems. In
particular, the use of thread lubricant and chemical
sealantcommonly known as pipe dopecan lead to toxic
seepage and has the potential to inflict lasting damage on
surrounding wildlife, waterways and indigenous communities.
Enter Tenaris SA, a Luxembourg-based steel tube and pipe
manufacturer. While working on a new Kinteroni well with
Spanish oil and gas company Repsol YPF SA, Tenaris supplied an
innovative and environmentally friendly technology called
Dopeless drilling, the first time the method had been used
successfully in a jungle environment. In doing so, Tenaris
picked up AMMs award for Best Environmental
According to a recent Tenaris release, Dopeless technology
is a viable and environmentally friendly alternative to
traditional pipe dope. When the technology is used properly,
pipe handling and cleaning operations relating to the use
of dope in the field are rendered superfluous, with consequent
benefits to operating efficiency, safety and the environment.
Instead, a dry, multi-functional coating is applied to the
connection by the pipe manufacturer in the controlled,
industrial environment of the mill, ensuring consistent quality
and operational reliability.
Industry Ambassador/Advocate of the Year:
While TMK Ipsco chairman Piotr Galitzine never set out to be
an industry ambassador or advocate, throughout much of his
36-year career in the pipe and tube industry he has spoken up
for things that he feels beg to be noticed, including the push
for oil and natural gas drilling in the shale plays and the
value of international trade and cooperation.
It is his commitment to these and other industry issues that
earned him AMMs Industry Ambassador/Advocate of
the Year award.
I am far from being the only industry advocate,
Galitzine said. I think that all of us in the business
are advocates, bringing to others attention the
technologies that have been developed and the ways they are
improving the lives of others, both domestically and globally.
If I am an industry ambassador, then all of my colleagues
at TMK and throughout the industry are the general counsels and
we all should keep up the good work.
Galitzine, the son of Russian exiles displaced by the
revolution, graduated from the Massachusetts Institute of
Technology with a degree in mechanical engineering,
specializing in design, materials and analysis. He said he has
always thought of engineers as being a force for good and that
engineering was all about producing solutions for
Upon receiving the Woodrow Wilson Award for Corporate
Citizenship from the Kennan Institute division of the Woodrow
Wilson International Center for Scholars in 2010, Galitzine
said he believes that tradethe more, the betteris
the sanest and most sensible way of ensuring good relations and
lasting world peace.
I believe that robust trade and trade flows are the
best guarantee that nations will continue to talk to each other
civilly, he said. I think that time and again when
business has flourished, so have diplomatic relations in
what he terms a positive spiral.
Best Logistics/Transportation Provider:
Union Pacific Corp.
Shipping line pipe by rail is a tricky business. Its
often difficult for customers to properly identify suitable
locations equipped to handle the unloading of pipe, and
project-based cargohigh volumes of pipe shipped to
specific geographic marketscan cause major delays in rail
service, which in turn can create problems for project managers
in need of timely deliveries.
Seeking to fix these issues, Union Pacific Corp. and
subsidiary Union Pacific Distribution Services (UPDS) developed
Pipeline Express, a unique tracking and management system
designed to modernize the shipment of line pipe by rail. In
doing so, they captured AMMs award for Best
Steel and pipe manufacturers, recognizing the added benefits
of shipping with Omaha, Neb.-based Union Pacific, have more
than doubled order sizes since 2009 to 35,000 carloads from
15,000 carloads. With that increase in shipments, Union Pacific
management quickly realized that a state-of-the-art tracking
and logistics system was needed to properly maintain a high
level of service and efficiency.
When we launched Pipeline Express, it allowed us to go
out with customers and identify unloading sites, said
Greg Shimonek, Union Pacifics senior business director
for metal and ores. Traditionally, what the industry
would do is determine where pipeline would be, and then go out
and find unloading sites. Pipeline Express was designed to
integrate logistics on the front end. By having us involved, we
were able to identify sites that would make sense, as opposed
to customers going out and finding sites on their
By identifying these sites, Shimonek said, Union Pacific was
able to provide customers with the added convenience of
receiving timely rail ratesa process that previously had
been delayed by the inability to properly establish suitable
locations for unloading.
Service Center/Distributor of the Year:
Steel Supply Co.
Steel Supply Co., selected as Service Center/Distributor of
the Year in AMMs Awards for Steel Tube and Pipe
Excellence, started well over a century ago and is going strong
with plans to further explore potential in export markets.
Its roots were as Solid Steel Co., founded in 1888, which
became Steel Supply in 1904, vice president and general manager
David Sheer said. A distributor of bar products as well as a
processor and tubing warehouse, Steel Supply has been owned by
the same family for seven decades. Martin Hjortland acquired
the company in 1939 and was succeeded as president in 1971 by
his son, Donald Hjortland, a metallurgist.
Steel Supply was first built in what became Chicagos
skid row, a low-income neighborhood just west of
the Loop often called Skid Row Steel. By 1952, Steel Supply had
built a warehouse in west suburban Schiller Park, but moved to
Rolling Meadows in 1971 and built an addition in 1994
encompassing 65,000 square feet of warehouse and production
area, according to Sheer.
The companys expertise lies in special finishing of
tubing products and in inventorying metric as well as American
Tubing is processed for honed inside diameter
typically used in the hydraulic cylinder manufacturing
process, Sheer said. Hydraulic cylinders are widely used
in mobile equipment, construction machinery such as earth
movers, and in material handling equipment. The company also
stocks chrome-plated tubing that is consumed in hydraulic
All of our tubing is carbon or mild alloy steel,
Sheer said, but the company also stocks carbon, alloy and
stainless steel bar as turned, ground and polished (TG&P)
and chrome plated.
Seamless Pipe Producer of the Year:
Vallourec SA topped long-time and fierce competitor Tenaris
SA in a battle of seamless titans in the inaugural AMM
Awards for Steel Tube and Pipe Excellence. Vallourec &
Mannesmann (V&M) USA Corp., the French companys U.S.
subsidiary which is building a small-diameter seamless pipe
rolling mill in Youngstown, Ohio, took home the title of
Seamless Pipe Producer of the Year.
So what was V&Ms secret? V&M pointed out in
its nominating materials for the award that it certainly helps
to have a $650-million seamless pipe mill in
Youngstownsmack in the heart of the Marcellus and Utica
V&M is nearing completion of the Youngstown mill, which
is on schedule to start commercial production this summer. The
mill is expected to be capable of making about 500,000 tonnes
of seamless pipe annually in diameters from 23⁄8 to 7
inches, according to the companys website. Small-diameter
oil country tubular goods (OCTG) from the mill should help meet
demand in such areas as the Marcellus and Utica shales
(AMM, Feb. 23).
But its not just rolling capacity that makes a
seamless pipe producer excellent. It also helps that the new
small-diameter pipe mill in Youngstown will be located on a
campus with heat-treatment facilities, semi-premium and premium
connection capabilities and plenty of storage.
V&M also has invested in research and development in the
United States. That has paid off, especially in the wake of the
2010 drilling rig explosion and subsequent oil spill in the
Gulf of Mexico, which the company said resulted in a flood of
demand for testing connections. The company plans to double its
testing capacity in Houston, with the new portion of the
research and development facility expected to start up in the
Welded Pipe Producer of the Year:
Plymouth Tube Co.
When Plymouth Tube Co. was named the winner of
AMMs Welded Pipe Producer of the Year award,
Curt McDowell, general manager of the mill in Eupora, Miss.,
stepped to the microphone and joked, Ive waited a
long time to thank the Academy for this.
The Eupora mill, one of 10 operated by Warrenville,
Ill.-based Plymouth Tube, was up against some fierce
competition: Boomerang Tube LLC, Chesterfield, Mo., and Welspun
Pipes Inc., Little Rock, Ark.
McDowell said the award belonged to the Plymouth team who
had made the achievement possible. The team has worked
very hard in preparing ourselves for this as the market comes
back. And at the end of the day, people make the
difference, he said.
The Eupora facility produces welded, drawn-over-mandrel
tubing as well as hydraulic and fabricated tubing. It has
bragging rights even among Plymouths 10 mills, having
finished first in the companys manufacturing excellence
survey for the past six yearsno small achievement
considering that expectations also increase every year.
So what is the secret to Plymouths success at Eupora?
McDowell wasnt kidding when he said it starts with
people. Plymouth tries to recruit the top 10 percent of
available talent, develop their skills and make sure it has
the right people in the right seats on the right
bus, according to the companys award
Being the best welded tube maker also means listening to
those talented people when they have good ideas, Plymouth said.
To that end, the company has implemented a suggestion system
that rewards employees when their good ideas are put into
practice. As of October 2011, Plymouth had implemented 300
suggestionsor roughly two per employeeat the Eupora