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Steely resolve

Published:  02 July, 2014

Steel & mining company ArcelorMittal recently signed a five-year contract to supply highly-resistant steel to be used in the manufacturing of flexible sheaths for Technip. This is ArcelorMittal’s most significant European contract for its wire activities to date with a value over €200 million. ODEE spoke with Patrick Laudamy, managing director of ArcelorMittal’s site in Bourg-en-Bresse, about the deal, the range of uses for wire products in offshore applications and the company’s products, processes and R&D activities in this all-important technology space.

ArcelorMittal’s site in Bourg-en-Bresse, Rhônes-Alpes region, France, is part of the company’s Distribution Solutions division, and home to some of the offshore oil & gas solutions supply industry’s most forward-thinking technical personnel. One of the key focuses of the site is the continued development of its rigorous research & development (R&D) programme, complemented by ArcelorMittal’s global R&D centres.

With ever more demanding customer requirements for reliable, strong and resilient steel wire solutions for offshore and other applications, the company also keeps its production machinery and associated tools at the cutting edge of the steel solutions supply industry. The site’s wire activities has benefited from a €6 million investment over the past three years, which has reinforced the company’s production teams and its technical capabilities.

For the recently announced Technip contract, ArcelorMittal will fabricate highly-resistant, semi-manufactured rolled products to be used on flexible sheaths for the development of ever deeper oil and gas fields worldwide. The site already supplies Technip’s manufacturing plants located in France, Brazil and Malaysia, and this latest agreement reinforces ArcelorMittal’s position as one of the leading providers of high-end technological solutions for the buoyant offshore market. The contract has also further strengthened ArcelorMittal’s wire activities in Bourg-en-Bresse, which will see a significant increase in its production to support the buoyant high-potential offshore market.

Furthermore, the recent Technip deal is further bolstered by a research & innovation contract, with a focus on developing new wire solutions to meet Technip’s ongoing needs. This will further boost the Bourg-en-Bresse site’s technological development.

Alain Le Grix de la Salle, head of distribution solutions at ArcelorMittal, recently said of the contract: “We are both delighted and proud to have signed this major contract with one of our main long-standing clients. This agreement is testimony to Technip’s trust in our solutions and our ability to accompany them in their development, as well as a reward and a challenge for our Bourg-en-Bresse teams and their expertise. This is a perfect example of partnership in which we use our research and development capabilities to create differentiation and value together with our client.”

Providing the background from Technip’s perspective, Frédéric Delormel, the company’s executive vice president and chief operating officer subsea, commented: “Our know-how and solutions are a competitive advantage for our oil & gas clients…This is reflected not only in the implementation of ambitious research & development programmes but also in the crucial importance of the supply chain, part of our manufacturing policy, and therefore in the quality of the components we use in our flexible pipes.”

Benchmark

“This contract is very important for our Bourg-en-Bresse site,” said Patrick Laudamy, managing director of ArcelorMittal’s site in Bourg-en-Bresse. “It reinforces the industrial outlook of our site, which has managed, over the years, to become a benchmark in the high-end steel wire market thanks to the development of more and more efficient solutions.”

He added that Technip has been a partner of ArcelorMittal for a number of years, during which time many products & processes have been designed and built utilising the experience and knowhow of both parties. “So this recently announced five-year contract is not an end but a beginning for us in terms of forging an even stronger and deeper relationship with Technip,” he said. “This partnership also aims to think about the future, as in the offshore oil & gas industry tomorrow starts now. Combined efforts through mixed Technip and ArcelorMittal task forces will continue working on the products and processes that will over the next few years make a step change in the flexible pipe business. We are confident that the results will be more robust, easier-to-install products, together with all the established features required by our end-customers today.”

Extensive range of applications

Laudamy outlined the range of uses for wire products in modern offshore applications. “Wire rod is used to build flexible pipes – either risers or flow lines. Not only are wire products the base structure of the pipe but they also look to ensure pipe integrity as far as corrosion and fatigue are concerned. Wire rod is also used to produce mooring ropes, constructed in such a way that they are able to resist all kinds of sea perturbations. Those ropes are used to anchor Floating Production Storage & Offloading vessels (FPSOs), rigs or buoys on oil & gas fields throughout the world. ArcelorMittal has gained much proven experience in design and production of such ropes for our many offshore customers.”

Key challenges

Laudamy reflected on some of the main challenges of manufacturing and supplying steel wire products for offshore oil and gas rig applications. “The most challenging aspect of delivering solutions to the offshore oil & gas market is to provide a level of quality that seeks to ensure zero failure – after all, effective risk management is a golden rule for end users. It isn’t hard to appreciate just how serious a flexible pipe leak due to a defective steel wire would be on an offshore oil or gas platform. Therefore product quality, together with the safety of all personnel involved, is an extremely strong focus for ArcelorMittal – in all instances and at all times.”

Laudamy added that another key challenge for the company is to both develop and anticipate the properties and qualities of the steel products of tomorrow, and to look to lead the market in terms of innovation. “Some decades ago, deep water was about 500 to 1000 metres,” he pointed out. “Now it is close to 4000 metres. Our products need to be mechanically and corrosion-resistant whatever happens. We have many ongoing R&D projects with the aim of designing the future wire rod in grade and shape in order to follow offshore market demand, and consider ourselves to be one of the pioneers in this field.”

With this claim in mind, Laudamy went on to outline what he sees as some of the core USPs of ArcelorMittal's wire solutions. “First, our wire rods have a high level of mechanical strength. Also, depending on the steel structure, they also offer integrity and longevity even in extreme conditions.” Laudamy also pointed out that over the many years of supplying to the offshore sector ArcelorMittal has no record of failure in producing and delivering wire solutions to its customers. “We are therefore recognised as being an expert in our field; able to respond to customer demand in terms of product design as well as in service,” he added.

WireSolutions

Laudamy spoke in detail about WireSolutions, ArcelorMittal’s wiredrawing division, an operation that supplies wire solutions to more than 4000 customers worldwide. “WireSolutions has 14 plants throughout the world, and offers a diversified range of low- and high-carbon wires, steel cord, strands, ropes and corrosion-resistant solutions,” he said. “While WireSolutions is a major solution provider to the oil & gas industry for the production of flexible pipes it is also heavily involved in new energies, providing the cutting wire for silicon for photovoltaic cells.”

For added context, Laudamy also explained that WireSolutions’ products also go far further afield than just offshore applications. “As well as providing solutions to the offshore oil & gas industry, WireSolutions is also an active supplier to the automotive industry, creating wire solutions for a large variety of car parts such as tyres, clutches, seats, wipers and many other applications. While in construction, steel fibres and PSC strands are some of the solutions supplied for concrete reinforcement. A full range of fencing products is also available for securing properties, roads, railways and industrial premises. And in agriculture, a long tradition of high-quality environmentally friendly solutions means that our brand and products are well recognised.”

Laudamy explained that this important ArcelorMittal division is constantly looking to develop new solutions with ArcelorMittal's research centres. “WireSolutions was one of the first to offer galvanised, waxed and sheathed strand for cable-stayed structures and higher tensile strands (> 2000 N/mm²),” he said. “Its corrosion-resistant solutions, with the established Crapal brand, are well-recognised in our industry.”

One step ahead

And what do the technical personnel at ArcelorMittal’s Bourg-en-Bresse site bring to the table with regard to the new contract with Technip? “The team, supported by the company’s global R&D centres, has been able to keep a step ahead of customer needs and has been able to propose uses for products to customers that they may have only dreamed about in the past,” enthused Laudamy. “Products & processes have been developed in-house, as well as many of the machines and tools we use every day. Our team’s dedication, together with the commitment of personnel from the company’s wider global R&D activities, means we are able to develop new steel grades for offshore applications and offer our customers a truly differentiated range of products.”

As well as supplying steel wire products to oil & gas platform applications, what other services does ArcelorMittal provide to the offshore oil & gas sector? Laudamy immediately homed-in on the level of training and knowledge that is present within the company’s technical team in Bourg-en-Bresse, not only in terms of what they have achieved from a product development perspective, but also what they can offer the customer in terms of responding to any technical query they might have when sourcing or using the company’s steel wire solutions.

Communication

Laudamy further reflected on the needs of the end customer: “We appreciate our customers' business and strive to be their preferred supplier. Our experience and knowledge of products and markets enable us to satisfy the most specialised requirements within tight deadlines. We always aim to be a listener and to participate in our customers' processes in order to develop new applications that are a perfect fit for their requirements. And our sales team aims to ensure that close communication is always maintained with all our customers. After all, the support of our customers and their confidence in our solutions and services is the reason why we have continued to be such a major market player for so many years.”

ArcelorMittal fact file

ArcelorMittal is a global steel and mining company, with a presence in more than 60 countries and an industrial footprint in over 20 countries. Guided by a philosophy to produce safe, sustainable steel, it supplies quality steel in the major global steel markets, including: offshore, automotive, construction, household appliances and packaging, with R&D and distribution networks worldwide. Through the company’s core values of sustainability, quality and leadership, it focuses on operating responsibly with respect to the health, safety and wellbeing of its employees, contractors and the communities in which it operates.

The company has an ongoing policy of researching, developing and producing steel-based technologies and solutions that make many of the products and components people use every day more energy efficient and reliable.

ArcelorMittal is one of the world’s five largest producers of iron ore and metallurgical coal and its mining business is an essential part of its growth strategy. With a geographically diversified portfolio of iron ore and coal assets, ArcelorMittal is strategically positioned to serve its network of steel plants and the external global market. While the company’s steel operations are important customers, its supply to the external market is increasing as it grows.

In 2012, ArcelorMittal achieved revenues of US$84.2 billion and crude steel production of 88.2 million tonnes, while iron ore production reached 55.9 million tonnes. ArcelorMittal is listed on the stock exchanges of New York (MT), Amsterdam (MT), Paris (MT), Luxembourg (MT) and on the Spanish stock exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS).

Technip fact file

Technip is a global player in project management, engineering and construction for the energy industry. From the deepest subsea oil & gas developments to large and complex offshore and onshore infrastructures, the company’s 38,000 people are constantly offering cutting-edge solutions and technologies to meet the world’s energy challenges. Present in 48 countries, Technip has industrial assets on all continents and operates a fleet of specialised vessels for pipeline installation and subsea construction.

• Technip is active in three business segments: Subsea, Offshore and Onshore.

• 38,000 people in 48 countries.

• Industrial assets on five continents.

• A fleet of 27 vessels in operation and 7 more under construction.

• 2012 operating income from recurring activities: €821.7 million.

• 2012 revenues of more than €8.2 billion.

• Technip is listed on Euronext Paris (Euronext: FR0000131708).

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