4.9.Middle East Market

We strive to expand our footprint in major oil & gas regions, including the Middle East. In 2015, TMK’s facilities remained committed to building up their reputation with the local oil and gas majors.

In 2015, we were successfully registered and qualified by major state-run and private oil & gas companies of the Middle East and North Africa, including Egypt, Iraq, the UAE and Iran. Shipments of seamless casing and tubing with TMK UP premium threaded connections account for a considerable share in our successful qualifications.

TMK GIPI, a major producer of tubular products in Oman, continues to assert its leadership in the country and the Middle East supplying line pipe for the oil & gas industry. For instance, in November 2015, the company signed a large contract for the supply of pipe with three-layer external PE coating and liquid epoxy inner coating for the Muscat-Sohar Product Pipeline (MSPP), which will connect a refinery in Mina al Fahal with the Sohar refinery, Jifnain terminal, and the international airport of Muscat. The pipeline is a joint project between the Sultanate of Oman and Orpic Logistics Company (OLC). Its unique feature is that it will supply four types of fuel: premium and standard petrol, and diesel and jet fuel.

15 thousand tonnes

of carbon steel pipe with three-layer external EP coating were supplied for the Kauther project in the Sultanate of Oman

The highlights of 2015 also include a contract for the supply of 15 thousand tonnes of carbon steel pipe with three-layer external EP coating for the Kauther project with Petroleum Development Oman (PDO), the leader in hydrocarbon exploration and production in the Sultanate of Oman.

In 2015, TMK GIPI was actively exploring new target markets for its products. For example, in 2015, the company supplied the first pilot batch of casing pipe to Occidental Petroleum Corporation (Oxy) in Oman as part of substitution of welded pipe for seamless pipe. In 2016, the company is planning to build up its shipments of this type of products to companies that traditionally use seamless casing pipe in the region, as the new pipe has been successfully tested in the customer’s wells.

In the reporting year, the company received its first order from Occidental Petroleum Corporation for TMK’s premium products in Oman. TMK GIPI is planning further expansion into this market in the Sultanate, including through technical consultations and after-sale services for delivered tubular products. In 2015, to upgrade its coating services and access new sales markets the company successfully passed qualification tests run by Shell for its external EP coating and completed its first order for this coating for Shell’s Majnoon project in Iraq.

We also see strong opportunities in Iran’s market, as we have a considerable advantage over our competitors in being able to ship tubular products both from Russia (e.g. via the Volga from the Volzhsky Pipe Plant), and from Oman. We are actively exploring opportunities for marketing our products with TMK UP threaded connections in this market.