NEW YORK MFRI Inc.s Perma-Pipe subsidiary has signed a joint-venture agreement with Colombian pipe producer Tayrona Steel Pipe to manufacture pre-insulated pipe in the South American country.
The joint venture follows the signing of a "three-year, multimillion-dollar, blanket order" for the material with a major Latin American oil company, Niles, Ill.-based MFRI said.
Santa Marta, Colombia-based Tayrona will provide steel pipe, casing and tubing, and corrosion-coated line pipe for the joint venture.
"We are delighted to establish Perma-Pipe as the first pre-insulated pipe manufacturer in this important market," Perma-Pipe president Fati Elgendy said in a statement. "Santa Marta is well located in Colombia, within a short distance of Venezuela and enjoying logistical advantages to the Caribbean Islands."
Perma-Pipe will hold a 49-percent stake in the joint venture, which will initially serve the oil and gas markets in Colombia, Mexico, Venezuela, Ecuador and Peru, while Tayrona will hold a 51-percent stake.
The joint ventures production facility will be based on Tayronas campus in the Santa Marta free-trade zone.
Production is expected to begin in late 2014 with the facility expected to be fully operational in early 2015.