HOUSTON Price is a big
consideration in procuring pipe, but its hardly the only
one, according to some end-users.
Pipe and tube consumers in the
energy sector also look at a host of other factorsmill
quality, service, reliability and innovationwhen choosing
a supplier, all issues that might trump price when it comes to
deciding from whom to procure pipe.
The metallurgy of pipe and the
ability of a supplier to trace it also might be a key factor
when it comes to choosing a pipe supplier, according to Perry
Roberts, senior director of procurement at Dallas-based energy
transmission company Energy Transfer Partners LP.
"We are looking for suppliers
who can be more innovative in the ability to provide clear and
concise traceability from cradle to grave, all the way to the
end of the project. We would prefer our supplier to manage that
product all the way to the ditch if possible," he said during a
panel discussion at AMMs 6th annual Steel Tube
and Pipe conference in Houston.
Jeff Farmer, supply chain
director at Houston-based offshore drilling company Atwood
Oceanics Inc., agreed that price isnt the most salient
consideration. A products history, quality and
transportation costs also are big factors, he said. "In large
part, what we are looking for is whos got material that
meets our specifications, meets our standards and has it
available. ... Then we say OK, is this a reasonable price
for the product we are trying to buy? "
Keeping drill rigs running also
trumps price, Farmer said. "So when you start looking for a
string or a couple of joints of pipe, its Who has
got those things available ... and who is answering the phone
Panelists generally brushed off
the implications of a potential import complaint, noting that
their business models might require them to source pipe from
around the world.
Atwood Oceanics has ruled out
some suppliers, Farmer said, but because the company operates a
global fleet it has no incentive to buy tubular products from
the United States or any other one location.
Other advantages that might give
pipe suppliers an edge are better coatings, Farmer said. And on
the price front, it could be the ability to offer more creative
solutions. Atwood might have pipe in storage that is unusable
offshore, and that pipe could be scrapped and made into new
pipe that could then be sold at a discount, reflecting a
supplier saving on scrap, he said.
But at the end of the day, price
remains a big consideration, even if pipe costs sometimes gets
unfairly picked on compared with other costs, such as drilling
rig rates or the cost of fracking services, according to
Brandon Middleton, category manager at independent
Houston-based energy company Noble Energy Inc.