Boulogne-Billancourt, 28 March 2007 - Vallourec and Sumitomo have today expressed their common intent to reach an agreement whereby Sumitomo Metals Industries, Ltd. and Sumitomo Corporation would jointly take a 49% stake in an overseas holding company controlling China-based VAM Changzhou. The parties anticipate to finalize a plan for the proposed investment in the near future. As a consequence of this project, Sumitomo will be able to use the mill’s production for its own needs.
The creation of VAM Changzhou, specialized in the threading of seamless steel tubing and casing for Oil and Gas OCTG (Oil Country Tubular Goods) products was announced in September 2006. VAM Changzhou is expected to deliver its first connections by mid-2007 and threading capacity will reach 50,000 tonnes per year. It will be dedicated to the threading of premium connections, i.e. the VAM®
product range. Whether by Vallourec or by Sumitomo, these connections will be sold in the Chinese market.
Vallourec and Sumitomo Metals, world leaders in the manufacture of high quality seamless pipes, have been collaborating for over 30 years in the field of VAM®
premium connections for Oil & Gas applications. Whilst Sumitomo Metals has been operating a license to produce VAM®
connections since 1976, cooperation between the two companies was extended in 1984 to include an R&D agreement.