The booming development of stainless steel tubes & steel pipes is attributed to the oil and gas industry
Business environment
Pipe and pipeline manufacturers in general continued to see economic growth, particularly due to the recovery of the upstream oil and gas industry. For example, TMK reports that total steel pipe shipments increased by 7% in the third quarter of 2018 compared to the same period last year, due to increased demand for welded pipe volumes in the North American drilling industry and increased demand for OCTG and LDP seamless pipes in Russia. NSSMC operates at full capacity and has increased the price of seamless stainless steel tubes by 10%; Sandvik also reported that 2018 was a strong year and broke many records, with an 11% increase in revenue compared to the same period last year; Vallourec also reported a 4.7% increase in revenues compared with the same period last year, thanks to “the momentum in the oil and gas market”.
In terms of earnings growth, it’s hard to beat Tubacex, which saw a 40% increase in third-quarter sales compared to the same period in 2017. The company is benefiting from the recovery of the oil and gas extraction and production industry, which accounts for 52% of its sales, and this is the main reason for the growth. Tubacex has a long track record of success in both the chemical fuel and nuclear power sectors.
compete
Demand is high and supply is plentiful, and manufacturers must reinvent themselves if they are to stay in the market game. The desire to expand the range of services for customers has spurred many manufacturers to invest and consolidate. In order to gain a foothold in the vast market while avoiding tariffs, Qingshan Steel Plant in Zhejiang, China, is creating special steel grades and investing in new equipment around the world. Tubacex has the same goal of establishing itself as a universal service provider and has launched several projects in collaboration with its partners, customers and other suppliers such as VDM Metals. MST has also built a new cold cycle pipe mill in Germany, and has become a partner of SOTEP and Chandan Steel in India. The acquisition of Ferrostaal and Sosta Butting by VAN LEEUWEN would be even more complementary.
reformation
For example, Butinen introduced Glubi tube, a mechanical liner developed from Bubi tube, which adds a layer of adhesive between the carbon-manganese outer layer and the corrosion-resistant lining. This means that no internal water pressure or increased lining thickness can be used in the reel process, thus saving material costs. By introducing 3D printing technology to manufacture pipes, pipelines, fittings, valves, costs can be saved. In 2017, Spanish stainless steel accessory manufacturer DICSA began using 3D printing to produce multiway connectors for its pneumatic and hydraulic components, significantly reducing manufacturing time. In January 2019 Metso shipped its first batch of valves containing 3D printed parts from its Helsinki facility. Aidro Hydraulics, an Italian company, also produces 3D printed components for fluid systems: hydraulic multipass joints, heat exchangers, and valve blocks. The beauty of this technology is not only the cost savings, but also the ability to retrofit the product itself to make it lighter but stronger and therefore more resistant to pressure. At the same time, we are beginning to see wire arc additive manufacturing (WAAM) also applied to the manufacture of pipe fittings. Seamless duplex stainless steel pipes can now be produced using the WAAM process, and the same technology is used to make 10-way pipe joints.
Oil and gas
Oil and gas is by far the largest segment in the stainless steel pipe upstream industry, and the surge in oil prices has triggered a boom in exploration and development that benefits suppliers. They invest in facilities close to oil and markets and make a fortune. Tenaris has established a service center in Grand Prairie City, Alberta, and a seamless steel pipe plant in Bay City, Texas, both of which are testament to the vitality of the North American oil and gas extraction industry. Sandvik has opened its Asia Pacific oil and gas headquarters in Malaysia, where its line of control will have a prominent position. Project construction is common in many places, including North America and East Asia, Africa (e.g. Angola, Mozambique) and the Eastern Mediterranean, Guyana, and Brazil. Suppliers such as Sandvik, Tenaris, Butting and Tuacex are active in all of these projects (Table 1), and varieties such as duplex and super duplex steels that meet seabed depth, pressure and corrosion conditions, as well as titanium steels, will be particularly popular.
Despite concerns about global warming, China and India are still building coal-fired power plants with lower emissions. Higher temperatures require higher grades of nickel alloys. To meet this demand, Sandvik and Jiuli High-tech Metals have teamed up to supply SANICRO 25, an alloy specifically developed for superheater tubes in a new generation of ultra-supercritical (USC) coal-fired power plants. Tisco also supplies stainless steel boiler tubes for ultra-supercritical coal-fired power plants with combustion temperatures of 650 ° C, but has recently developed a nickel alloy for third-generation ultra-supercritical coal-fired power plants with combustion temperatures of 700 ° C, which is currently being tested by Chinese power giant Huaneng. India is growing faster than China and is building power plants at a breakneck pace. Tubzcex has partnered with Midhani to supply the Indian energy sector with the advanced materials it needs. For example, TUBACEX is supplying 1,500 tonnes of shot blasted stainless steel boiler tubes to NTPC’s first USC project. Nuclear energy is also an important and growing industry in the use of stainless steel and titanium tubes. The World Energy Outlook 2017 predicts that nuclear power production will increase by 46% between 2017 and 2040. Despite the decline in market share, it is still significant, especially for India and China, which are expected to grow by 93%. Products include high-precision stainless steel tubes, nickel, titanium and zirconium tubes for heat exchangers, instrumentation, fuel tanks and cladding tubes, superheaters, condensers, fuel tanks and fuel rods. NEOTISS is actively involved in India’s nuclear programme and supports the plan to build six ERP plants in Jaitapur. Tubacex is also very active and has been asked to supply Egypt’s first nuclear power plant to be built by Rosatom at El Dabaa. Vallourec has won another major order to supply steam generator tubes for Framatome’s EPR reactor at Hinkley Point C in the UK. Two sister companies, Superior Tubes and Fine Tubes, have also developed a range of tube products for PWR, PHWR, LWR, BWR and FBR reactors, and both companies are also involved in small modular reactor projects.
Other industries
The automotive and semiconductor industries have considerable demand for bright annealed tubes, and the aerospace industry also maintains strong demand. Desalination is one of the most dynamic areas and is expected to grow at an annual rate of 7.8% between 2018 and 2025. Drivers include rapid urbanization in developing economies and unstable climate conditions caused by global warming. This development is led by the Middle East, followed by several African countries, and this trend is favorable for stainless steel pipes, especially duplex and super duplex steel pipes, as well as titanium steel pipes. The world’s largest condenser unit recently shipped includes 2500km of titanium tubes supplied by Neotiss ‘joint venture with PoongsanNeotiss of Korea for the Shoaiba Phase II MED expansion plant in Saudi Arabia.