U.S. Steel to debut oil, gas pipeline connector
July 27, 2015 by David Conti, Trib Total Media
U.S. Steel is trying to win more business from an oil and gas industry whose downturn it has blamed for a drop in sales.
The Downtown-based company said Monday that it would start selling a new connector designed to more securely and flexibly link lengths of pipe that form the steel casing or liner for deep underground wells at a lower cost. The USS-Liberty TC was made specifically for long, horizontal shale wells like those drilled and fracked in the Marcellus and Utica plays below Appalachia, adding to other pipe connectors made for the industry.
The connections are being produced by U.S. Steel’s tubular products division, which has suffered layoffs and plants idling over the past nine months as oil and gas companies slowed drilling activity because of a collapse in prices.
Under CEO Mario Longhi, the steel producer has focused more on profitable sales and increased efficiency in operation of its plants.
“The introduction of this new product continues U.S. Steel’s transformation as we provide highly engineered products to our customers in the oil and gas market,” Longhi said in an announcement.
The company would not discuss prices or sales goals for the product before an earnings call Wednesday, said spokeswoman Sarah Cassella. She did not respond to questions about where U.S. Steel would produce the connections or whether the product launch would reverse any plant closings.
Despite the continued drop in oil prices recently and news of more layoffs in the shale fields, this remains a good time for an American company to focus on new products for a U.S. industry, one economist said.
“It’s a very smart and very timely move,” said Iryna Lendel, assistant director at the Center for Economic Development in the Levin College of Urban Affairs at Cleveland State University. “The industry will continue to look for the highest efficiency and lowest-cost, high-security products.”
Drillers are looking for ways to reduce costs while boosting production and reliability. They are more likely to work with a domestic supplier as new products are developed, Lendel said.
“It’s extremely important for innovation to be local,” she said.
Better connections between pipes underground support a priority of the industry: casing integrity. Failures of the pipes can cause environmental damage through leaks, which would hurt the industry’s image at a delicate time and prove costly to fix.
“When you have casing failures, it very often it involves the connections,” said Doug Patchen, head of the Appalachian Oil and Natural Gas Research Consortium at West Virginia University. “This sounds like a step forward.”
Original Story: TribLive