Welspun to acquire 40% stake in Joint Venture with TMK
Welspun-Gujarat Stahl Rohren Ltd has announced that the Company have signed the MOU with Volzhsky Pipe Plant (VTZ), a member of the TMK Group, Russia’s largest manufacturer and exporter of pipe products in oil and gas sector.
The transaction will provide for the transfer of TMK’s LD business comprising of approx 500,000 tons of LD (Spiral Facility) and installation of hi tech LSAW pipe welding line, bending facility and external and internal coating lines on the site of Volzhsky Pipe Plant, Volzhsky town, Volgograd region, Russia, delivered by the Company. The new capacities are intended for the production of Longitudinal Submerged Arc Welded (LSAW) pipes with 20" (508 mm) to 56" (1420 mm) diameter with one seam, up to 40 millimeters wall thickness and up to 18 meters length. The start-up of LSAW is scheduled for Q4 2007 at which the joint venture’s total capacities are expected to be more than 1.2 million tons per annum of large-diameter welded pipes.
LD pipes are used in the construction of oil and gas trunk pipelines. Russia’s largest consumers of these products are Gazprom and Transneft. TMK also sells line pipes to Kazakhstan, Uzbekistan and other countries of CIS and Caspian region.
"We look forward to consolidate our global presence through the formation of this Joint Venture," said B K Goenka, The Company’s Vice Chairman and Managing Director. "This partnership will leverage our high-quality, submerged arc weld production capabilities with TMKs strong regional presence and extensive sales and marketing expertise, allowing us to provide a wide array of products for onshore and offshore line pipe requirements to our customers. We have already done most challenging projects like supplying pipes for the world’s deepest pipeline in the Gulf of Mexico and this association will give us opportunity to cater to the need of burgeoning Oil and gas industry of Russia and CIS countries.
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