The world's leading steel pipes manufacturer for the oil and gas sector Welspun Corp and the Malaysian sectoral major Wasco Energy today formed a joint venture to set up a concrete weight coating (CWC) plant at Anjar in Gujarat at an investment of Rs 95 crore.
The company hopes to commission the proposed joint venture -- Welspun Wasco Pipes Coatings -- by March and hopes to cash in on the large government-driven pipeline orders that will be up for the grabs over the next two years, Welspun Corp Managing Director Braja Mishra and Wasco Energy chief executive Giancarlo Maccagno told PTI in a concall.
When asked about the market potential for this sector, Mishra said currently Jindal Saw is only manufacture of CWC pipes after the OP Jindal Group company had bought over PSL recently. Therefore, with the government announcing public investments into 15,000-km of oil and gas pipelines over the next two years, there is no dearth of market for his highly efficient pipes.
CWC is a plant-applied coating that provides negative buoyancy for offshore pipelines, river/road crossing applications. Concrete coating protects offshore pipelines from external corrosion at water crossings or in swamps along with mechanical protection at highways and railroad crossings.
Welspun Corp, which is into making steel pipes for the oil and gas sector, will hold 51 per cent in the joint venture while the Malaysian partner Wasco, which is a fully-owned arm of Wah Seong Corporation, will own the rest in the Rs 95-crore plant, Mishra said.
Mishra added that the investment into the CWC plant will be part of the Rs 200-crore capex planned for the company this financial year.
Maccagno said this is his group's maiden association with India and added the reputation that Welspun Group has in the global market made them partnering with the Mumbai-based Welspun Corp, which is the flagship arm of the USD 3-billion Welspun Group.
Mishra said Welspun Corp enjoys 8.4 per cent market share in the global large diameter pipes in terms of tonnage while market is worth 24.7 million tonne per annum, excluding the China and Russia demand as these markets are closed where independent data are hardly available.