Chinese manufacturer Hanwei Energy Services Corp announced it is actively pursuing sales of fibreglass reinforced plastic (FRP) pipe products to oilfield projects in the Middle East following the recent order it bagged from a Kuwait oilfield project.

The order, worth $9.9 million, signalled Hanwei’s entry into the Middle East market. The company said it was strategically significant in establishing its position in the region. Production to fulfill the order has been completed and the consignment is being shipped for delivery over the coming months.

“The scale and size of orders in this region are larger than that traditionally received by the company from China domestic operations and potentially can be spread over a number of years,” Hanwei said.

Outlining Hanwei’s business strategy for global markets, its chairman and executive officer Fulai Lang said: “The core of our business remains our expertise in the production and field applications of our FRP pipe products. Our production facilities and engineering are first class. We hold superior proprietary technology over our competitors. Our FRP pipe products meet and exceed the requirements of several stringent international rating agencies. We are best at this. As such we must focus on FRP, expand our sales capability internationally utilising our core products in a wider range of markets and applications, and strengthen our sales and management so that enhanced results are forthcoming.”

Operations review
Hanwei has reviewed its operations and examined the market potential of all segments of its business. Through this review, and in conjunction with management’s renewed focus on Hanwei’s core FRP business, the company has identified several key initiatives and milestones that will enable Hanwei to leverage its core expertise in FRP pipe production.

It has determined that the growth profile of its FGD pollution control systems business is too slow in developing due to market conditions affecting potential profitability. As such the company has elected to cease its marketing and production operations in FGD pollution control systems for coal-fired power plants in China and dissolve its China joint venture with Ershigs Inc.

Hanwei is continuing its discussions with a major Chinese, state-owned enterprise on a potential repositioning of its wind power business. While discussions are ongoing and no agreement in principal has been reached such an arrangement aims at leveraging the significant influence and market stature of a major local partner where Hanwei becomes a direct financial beneficiary, while minimising its management resource requirements and maintaining focus on its core FRP pipe business.

China market
The company holds a strong client list for FRP pipes that includes leading Chinese oil and gas producers such as CNPC, Petrochina and Sinopec. It said the longstanding China relationships were an enduring testimony to its quality of products and field service capability and so it would continue to leverage endorsement of these established relationships into other oil and gas locations across China as well as utilise feedback from these major accounts to determine and implement complementary technologies for domestic oilfield applications. Hanwei has previously announced efforts to drive sales in brine, saltwater and offshore oil and gas applications. It said there would be renewed focus on those markets.

Kazakhstan region
The Kazakhstan region also remains a key market for the company. Several major producers are in the process of replacing their steel pipes in the Kazakhstan oilfields with non-metal products. It said Kazakhstan’s geographic location allows the company to leverage into the neighbouring markets of Russia, Belarus and Ukraine both in oil and gas and complementary applications. It noted that the region suffered from an aging infrastructure, for example in sewage transmission lines, much of which was installed by the former Soviet Union in the 1960s.