Vallourec invests to meet the needs of the North American Oil & Gas market

15/02/2010 - Activity and markets, United States, Oil & gas, OCTG
Vallourec today announces that it will build a new state-of-the-art small diameter rolling mill in Youngstown, Ohio.

Boulogne-Billancourt, 15 February, 2010 - Vallourec, world leader in premium tubular solutions, announces today that it will build a new state-of-the-art small diameter rolling mill in Youngstown, Ohio. This decision is supported by the long term development of unconventional gas production in the US which is driving increased demand for small diameter OCTG tubes. The new mill, which will initially produce 350,000 tonnes per year, provides an annual nominal rolling capacity of 500,000 tonnes of seamless tubes. The project includes heat treatment and threading facilities. The investment will amount to US$650 million, with operations expected to start by the fourth quarter 2011. The project will create around 350 new direct jobs.

The exploitation of unconventional gas resources has revolutionized the US gas market and, thanks to new technologies lowering extraction costs, has become a sustainable source of gas supply. Shale gas production typically requires an increased number of wells, horizontal drilling and sand fracturing at high pressures. This implies higher volumes of small diameter alloy pipes, with an increasing proportion of premium connections.

This new offer will complement the range produced by Vallourec in North America and will consolidate the Group’s leadership position as a provider of competitive and fully integrated premium tubular solutions. Ideally located close to major shale basins (eg. Marcellus), and combined with the Group’s other operations in the vicinity of other shale plays (eg. Fayetteville or Haynesville), this new facility will benefit Vallourec’s customers in the US.

Philippe Crouzet, Chairman of Vallourec’s Management Board stated: “This is a strategic investment to support our customers in the development of America’s natural gas resources. We are excited about the opportunities that this new investment brings for the development of the Group. This project capitalizes on our long-term commitments to the US market, our local business partnerships, as well as the support of federal, state and municipal governments. Specifically, we benefit from the talent and skill of our workforce who have demonstrated their ability and commitment to delivering world class products and excellent customer service.”

 


About Vallourec

Vallourec is a world leader in premium tubular solutions primarily serving the energy markets, as well as other industrial applications.

With 18 000 employees, integrated manufacturing facilities, advanced R&D and a presence in more than 20 countries, Vallourec offers its customers innovative global solutions to meet the growing energy challenges of the 21st century.

Listed on the NYSE Euronext in Paris (ISIN code: FR0000120354) and eligible for the Deferred Settlement System, Vallourec is included in the following indices: MSCI World Index, Euronext 100 and CAC 40.

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