A Hamriyah Free Zone, Sharjah (UAE) manufacturing facility of steel pipe maker PSL India has completed the construction and commissioning of a pipe mill that will add capacity of 75,000 tonnes per year, doubling the original capacity and taking total output capability to 150,000 tonnes annually.

Currently PSL FZE, which operates the Hamriyah Free Zone facility, is busy with fulfilling an order received earlier this year from the Saline Water Conversion Corporation (SWCC) of Saudi Arabia. The order requires the Hamriyah unit to supply bare line pipe for a water transmission system that will run from Ras Azour in the Saudi Eastern Province to Hafr Al Baten in the Central Province. It will constitute API 5LGrade X-65, 44-inch diameter pipes for a total length exceeding 350 km.

The value of the order is close to SR300 million ($80 million) and final delivery is to be made by the middle of 2012. Earlier, Ashok Punj, managing director of PSL, said the first mill would be fully utilised until May 2012 for the execution of the SWCC order. The new capacity created by the second mill enables the company to contribute to the SWCC supplies and take up new orders.

PSL, which has several mills across India, said recently it expected to bag projects worth over $120 million from India and the Middle East in the July-September quarter and aimed to have an order book of about Rs 3.5 billion ($700 million) by March 2012.

'We are expecting to get a significant order from Saudi Arabia, which will be about supplying 250,000 tonnes of line pipes. We have already submitted the bid but the order has not yet been placed,' Punj said.

He added that the tender is roughly in the range of $100 million to $120 million, but refused to disclose further details.

PSL has currently an unexecuted order book of about $500 million.

Bids sent for two projects

As well as the Saudi tender, PSL has bid for supplying line pipes for two pipelines, namely Indian Oil’s Salaya-Mathura pipeline expansion project and Mehasana-Srinagar pipeline via Bhatinda of Gujarat State Petroleum Corporation (GSPC).

'We are looking to get substantial orders from Indian Oil and GSPC because of our locational advantage as our mills are in the vicinity of pipelines (to be constructed). We are expecting them to be awarded sometime in the next quarter,' he added.

PSL has a pipe mill in Jaipur, with a production capacity of about 200,000 tonnes. The company will supply the Indian Oil and GSPC projects from that facility if its bids are successful.

'Cost plays a major role in our industry as carrying heavy pipes to the projects on time is an expensive affair, if your mill is not in the vicinity... So, there we have the advantage as we have a mill in Jaipur,' he said.

Punj also said demand had picked up in India’s oil and gas industry and there was more commitment to complete the national gas grid.

Gail order won

In early June, PSL announced that after the successful completion of the 130 km Dabhol-Bangalore Pipeline Project of 30-inch and18-inch diameters, it has been awarded an order for the supply of line pipe and three-layer polyethylene (3LPE) coating for Gas India Ltd’s (Gail) KKBMPL project. PSL will supply 24-inch diameter pipe conforming to API 5L X-70 and X-80 grades out of its Chennai and Visakhapatnam pipe mills.

The total length of pipe to be supplied is an estimated 735 km.