Seamless and welded pipe producer Tenaris has opened an office in Baku to serve oil and gas customers in Azerbaijan and throughout the Caspian region, the company's regional managing director told S&P Global Platts.
"We expect that from an energy perspective this area will become even more important because it will play an important role in the corridor of the well-known project of One Belt and One road, linking Asia to Europe," Alessandro D'Angelo said in an interview.
He would not give details on Tenaris's expectations for market share or turnover in the Caucasus area.
"In the past, we used to handle this area from three different hubs: the Turkish area from our European offices (Dalmine in Italy and Zalau and Calarasi in Romania), the Caucasus area from our Russian office (Moscow) and Iran and Middles East from our Dubai office", D'Angelo said.
Tenaris will sell products from all its facilities worldwide from its Baku office. "In particular we look with interest into potential implementation of Rig Direct sales model for OCTG pipes. Our Rig Direct service model is continuing to grow as it helps the oil and gas industry to be more efficient, in particular in the new oil prices environment. Worldwide Tenaris's Rid Direct shipments reached almost 57% of total OCTG sales last year and we are working to increase it even more through this new hub," he said.
In 2016, Tenaris strengthened its presence in the Caspian region when opening a premium threading facility in Aktau, Kazakhstan, with a design capacity of 45,000 mt/year of OCTG.
From that facility, Tenaris threads seamless pipes and gas-tight premium connections, and is equipped to apply its proprietary Dopeless technology.
"From Baku we will sell tubes from all our facilities. But, of course, due to the proximity we want to expand the role that our Aktau facility has for the all Caspian region, aiming to reach 100% of its capacity. In the future, we will always look at what the market demands are and if there is possibility to further expand our service and industrial presence in any of the country in the region", D'Angelo said.
Tenaris's commitment to increase its presence in the Caspian area as well as in the Russian federation and in neighboring countries was demonstrated by its recent joint venture with Severstal to build a welded pipe plant to produce OCTG products in the Surgut area, West Siberia.
Tenaris will have a 49% interest in the joint venture company, with Severstal owning 51%. The plant, which was estimated to require an investment of $240 million and have a construction period of two years, was planned to have annual production capacity of 300,000 mt.
Last year, Tenaris posted sales up 45% to $7.7 billion. EBITDA rose 63% to $1.5 billion, with margins recovering to 20%. Tubes sales volume were up 36% to 3.6 million mt.
