Charles W. Thurston, Latin America Correspondent09.29.23
The rapid expansion of oil and gas pipelines in Latin America is driving a strong demand for pipe coatings, including projects in Argentina, Bolivia Brazil, Colombia, Ecuador, Guyana and Venezuela.
Among major players in the pipe coatings market, Luxembourg-based Tenaris expanded its base in Latin America with the August purchase of all of Mattr’s shares of its Bredero Shaw International subsidiary, including Shawcor’s Pipeline Performance Group (PPG) for $166 million.
In May, Shawcor announced an $81 million contract for thermal insulation and anticorrosion coating services from an unnamed Western Hemisphere facility. The project initiation was expected to begin in the fourth quarter of this year, the company said in a statement. In December 2022, the company booked $200 million worth of other project contracts in Latin America, it said. Shawcor restructured in 2022 as a unit of Mattr prior to the Tenaris buyout.
The Tenaris deal includes nine Mattr plants located in Canada, Mexico, Norway, Indonesia, the United Arab Emirates and the United States, as well as several concrete coating plants, a joint venture interest in Azerbaijan, R&D facilities in Canada and Norway, and a wide portfolio of intellectual property, the company said in a statement.
The August deal does not include the Shawcor PPG business in Malaysia, Italy, the United Kingdom or Brazil, which the company plans to divest in the future. “Once complete, the transaction announced today [August 15], combined with the previously completed sale of PPG’s Socotherm Argentina and UK specialty coating businesses, and a few remaining non-material actions, will conclude our strategic review process,” said Mike Reeves, Mattr’s president and CEO.
Among the most commonly used types of pipe coating, thermoplastic polymer coatings are PE, PP, and PU, all of which are commonly used in polyolefin coatings, GreyViews said. “3LPE coatings are now being preferred on a large scale as they have the added advantage of thermoplastic polymer coatings and epoxy fusion bonded coatings. They are primarily used for oil and gas applications,” the analysts report.
Among other significant players operating in the global pipe coating market are Arkema, Dura-Bond Industries, Wah Seong, 3M, Winn & Coales, PPG Industries, Wasco Energy, BASF SE, L.B. Foster, Aegion, Eupec Pipecoatings, and Berry Plastics CPG, GreyViews said.
Among many pipeline projects now underway in Latin America are the following, in alphabetic order by country:
For the BM-C-33 project, Tenaris will use three-layer polypropylene anticorrosion coating (3LPP), an internal flow coat to improve the flow of gas, and the application of an anti-buoyancy concrete coating (CWC) in approximately 120 km of the pipes, the company noted.
Elsewhere in Brazil, the $2.3 billion Bilac-Santa Maria gas pipeline is being designed and engineered by the Ministério de Minas e Energia da República Federativa do Brasil (MME), according to according to an April report by BNAmericas. The line will run from Bilac in São Paulo state to Santa Maria in Rio Grande do Sul state.
Similarly, the $2.1 billion Penápolis-Canoas gas pipeline is being designed and engineered by MME to run between Penápolis, in São Paulo state to Canoas in Rio Grande do Sul state. BNAmericas reported.
The $467 million pipeline runs from Maracaibo in the state of Zulia in Venezuela to Puerto Ballena gas fields in La Guajira, Colombia, operated by Petróleos de Venezuela. The pipeline suffered FARC rebel attacks in 2013, but the Colombian government signed a truce with the group in 2016.
The pipeline will serve southeast Mexico, starting onshore in Tuxpan, Veracruz, then proceeding offshore, making landfall at Coatzacoalcos, Veracruz, and Dos Bocas, Tabasco, according to Oil & Gas Journal.
Shawcor in August 2022 announced that its pipe coating division received a contract worth $370 million from Transportadora de Gas Natural de la Huasteca, the Mexican subsidiary of TC Energy (See CW Sept. 22).
In September, Tenaris announced that over 6,000 meters of pipe was used at the Felipe Carrillo Puerto International Airport in Tulum in Quintana Roo state for the construction of a jet fuel pipeline that will serve to refuel both naval and commercial aircraft at the airport, according to a statement by Josué Zilli, Senior Sales Manager at Tenaris in Mexico.
Similarly, the $1.5 billion Cuxtal II pipeline is being designed and engineered by CFEnergía for a December 2024 online date, running between Mérida, in Yucatán state to Cancún in Quintana Roo state, BNAmericas reported.
Among major players in the pipe coatings market, Luxembourg-based Tenaris expanded its base in Latin America with the August purchase of all of Mattr’s shares of its Bredero Shaw International subsidiary, including Shawcor’s Pipeline Performance Group (PPG) for $166 million.
In May, Shawcor announced an $81 million contract for thermal insulation and anticorrosion coating services from an unnamed Western Hemisphere facility. The project initiation was expected to begin in the fourth quarter of this year, the company said in a statement. In December 2022, the company booked $200 million worth of other project contracts in Latin America, it said. Shawcor restructured in 2022 as a unit of Mattr prior to the Tenaris buyout.
The Tenaris deal includes nine Mattr plants located in Canada, Mexico, Norway, Indonesia, the United Arab Emirates and the United States, as well as several concrete coating plants, a joint venture interest in Azerbaijan, R&D facilities in Canada and Norway, and a wide portfolio of intellectual property, the company said in a statement.
The August deal does not include the Shawcor PPG business in Malaysia, Italy, the United Kingdom or Brazil, which the company plans to divest in the future. “Once complete, the transaction announced today [August 15], combined with the previously completed sale of PPG’s Socotherm Argentina and UK specialty coating businesses, and a few remaining non-material actions, will conclude our strategic review process,” said Mike Reeves, Mattr’s president and CEO.
Pipe Coating Market Grows
Because of its rapid growth, the global oil and gas industry is the largest market for pipe coatings, which is predicted to expand to a $10 billion value by 2030, according to a February analysis by GreyViews. Thermoplastic pipe coatings, including thermoplastic and thermosets, are expected to be the fastest-growing segment, the analysts said.Among the most commonly used types of pipe coating, thermoplastic polymer coatings are PE, PP, and PU, all of which are commonly used in polyolefin coatings, GreyViews said. “3LPE coatings are now being preferred on a large scale as they have the added advantage of thermoplastic polymer coatings and epoxy fusion bonded coatings. They are primarily used for oil and gas applications,” the analysts report.
Among other significant players operating in the global pipe coating market are Arkema, Dura-Bond Industries, Wah Seong, 3M, Winn & Coales, PPG Industries, Wasco Energy, BASF SE, L.B. Foster, Aegion, Eupec Pipecoatings, and Berry Plastics CPG, GreyViews said.
Among many pipeline projects now underway in Latin America are the following, in alphabetic order by country:
Argentina
One recently inaugurated pipeline in Argentina is the new Néstor Kirchner pipeline was inaugurated in July to move Vaca Muerta gas 400 miles northeast to the capital province of Buenos Aires, which imports liquefied natural gas part of the year (See CW Aug 2023). Eventually, the pipeline, which runs from northern Patagonia to Salliqueló, in Buenos Aires province, will allow the country to save as much as $4.2 billion per year in gas imports.Bolivia
In June, Bolivian state-owned gas and oil company YPFB announced that it had recommenced gas supply to Potosí via its Sucre-Potosí gas pipeline, which underwent a 32% capacity expansion. YPFB indicated that the expanded Sucre-Potosí pipeline will help to boost cement production in Bolivia, both to supply domestic demand and to establish an export market, according to Global Cement News.Brazil
Tenaris announced in September that it has been selected by Equinor to supply welded line pipe, tubular accessories, and services for the gas export line of the $9 billion BM-C-33 block project, part of a consortium with Repsol Sinopec and Petrobras. The offshore project will move gas from the southern part of the Campos Basin, 200 km off the coast of Rio de Janeiro, through a pipeline connecting the floating oil rigs to Cabiúnas, in the city of Macaé, also in Rio de Janeiro state, according to a statement by Renato Catallini, Tenaris President in Brazil.For the BM-C-33 project, Tenaris will use three-layer polypropylene anticorrosion coating (3LPP), an internal flow coat to improve the flow of gas, and the application of an anti-buoyancy concrete coating (CWC) in approximately 120 km of the pipes, the company noted.
Elsewhere in Brazil, the $2.3 billion Bilac-Santa Maria gas pipeline is being designed and engineered by the Ministério de Minas e Energia da República Federativa do Brasil (MME), according to according to an April report by BNAmericas. The line will run from Bilac in São Paulo state to Santa Maria in Rio Grande do Sul state.
Similarly, the $2.1 billion Penápolis-Canoas gas pipeline is being designed and engineered by MME to run between Penápolis, in São Paulo state to Canoas in Rio Grande do Sul state. BNAmericas reported.
Colombia
In Colombia, there are plans to recover the abandoned 140 mile Antonio Ricaurte gas pipeline, also known as the Trans-Caribbean gas pipeline (also known as the Antonio Ricaurte Gas Pipeline) is a natural gas pipeline to Venezuela, with proposed extension to Panama and probably to Nicaragua, according to a Foreign Policy report in January.The $467 million pipeline runs from Maracaibo in the state of Zulia in Venezuela to Puerto Ballena gas fields in La Guajira, Colombia, operated by Petróleos de Venezuela. The pipeline suffered FARC rebel attacks in 2013, but the Colombian government signed a truce with the group in 2016.
Ecuador
In July, Ecuadorian oil services company Shaya, part of the SLB Group, in consortium with Petroecuador, contracted with Tenaris for its Rig Direct services to include RunReady pipe, in an agreement that will extend until 2024. The pipes are prepared at the Tenaris service center in Machachi and delivered ready to be run at the Acua well, located in the Ecuadorian Amazon, east of Quito, according to Tenaris Managing Director in Ecuador, Gustavo Martínez.Guyana
In Guyana, the Liza pipeline has been proposed to run from the Liza field in Guyana’s offshore Stabroek block to the proposed Wales Power Station in the Essequibo Islands-West Demerara region of Guyana. Gas from the $500 to $800 million pipeline project is being developed by ExxonMobil. Early this year, the company submitted a revised development plan for the Liza field and pipeline to Guyana’s Ministry of Natural Resources, according to GEM.WIKI.Mexico
In Mexico, the 715 km Southeast Gateway pipeline is due to be completed by mid-2025 at a cost of $4.5 billion. The pipeline is being built by TC Energy and Mexico’s state-owned Comisión Federal de Electricidad (CFE).The pipeline will serve southeast Mexico, starting onshore in Tuxpan, Veracruz, then proceeding offshore, making landfall at Coatzacoalcos, Veracruz, and Dos Bocas, Tabasco, according to Oil & Gas Journal.
Shawcor in August 2022 announced that its pipe coating division received a contract worth $370 million from Transportadora de Gas Natural de la Huasteca, the Mexican subsidiary of TC Energy (See CW Sept. 22).
In September, Tenaris announced that over 6,000 meters of pipe was used at the Felipe Carrillo Puerto International Airport in Tulum in Quintana Roo state for the construction of a jet fuel pipeline that will serve to refuel both naval and commercial aircraft at the airport, according to a statement by Josué Zilli, Senior Sales Manager at Tenaris in Mexico.
Similarly, the $1.5 billion Cuxtal II pipeline is being designed and engineered by CFEnergía for a December 2024 online date, running between Mérida, in Yucatán state to Cancún in Quintana Roo state, BNAmericas reported.
