More moly! More nickel! And fast!
Japanese steel mill Sumitomo Metal Industries plans to raise its molybdenum consumption by up to 1,500 mt/year from 2010 after the production launch of high grade steel pipes, the company said on Thursday.
The company plans to launch production of seamless steel pipes with yield strength of 100,000 psi (pounds per square inch) or more in 2010. It aims to produce 500,000 mt/year of such pipes.
The pipes with yield intensity of 100,000 psi or more are classified as X100 grade and have not been produced on commercial basis yet. The X100 pipes are expected to contain 0.3% molybdenum, 0.5% nickel, and 1.5-2.0% manganese. To compare, the current pipes mostly are X65 or X70 grades containing less than 0.5% nickel and no molybdenum.
Sumitomo Metal plans to invest Yen 10 billion ($85 million) for upgrading its Kashima steel plant near Tokyo to start producing the X100 pipes. The plant has the capacity to produce 8 million mt/year of crude steel.
The X65, X70 and X100 steel pipes are to be used for natural gas pipelines stretching over 5,000 km, such as the planned Alaska Gas Pipeline from North Slope field in the US state of Alaska to Chicago, and pipelines carrying gas from central Asia to Russia, company senior officials said.
The company said global demand for the X100 pipes is expected to increase. Energy majors BP, ExxonMobil, and ConocoPhillips have asked Sumitomo to upgrade its steel production facility for the steady supply of high strength X100 steel pipes, said Fumio Ohtaguro, general manager of the company's pipe and tube business unit.
"We had been debating for 10 years...a chicken or egg situation, where the oil majors say they want a stable steel pipe supply, and we say is it worth additional investment," Ohtaguro said. He added his company has decided to produce X100 pipes as the three oil majors plan to construct a 5,600 km gas pipeline infrastructure connecting Alaska and Chicago by 2015.
"This comes to about 2-2.5 million mt of steel pipes," Ohtaguro said.
He said the three majors are expected to hold a tender for pipe suppliers in 2007, place orders in 2009 for deliveries in 2011-2012. The pipeline is expected to start operation in 2015.
"Sumitomo Metal putting a real focus on X100 pipe production...[which] would prompt other energy majors to start planning for construction of new pipelines using high grade materials in Siberia, from Central Asia to India...stretching up to 8,000 km," he said.
The major advantages of the new X100 grade steel pipes over the standard X65 and X70 grade pipes are lower costs and reduced construction time. As X100 pipes use nickel and molybdenum, high steel strength can be achieved using thinner pipes with thickness of 15-20 mm. The time to weld the pipes would be shortened as the pipes are thinner, said Izumi Takeuchi, Sumitomo Metal vice president for pipe and tube technology.
metalsplace.com |
