Welspun Tubular Plant Finds Hearty Welcome In Little Rock

There might be better times to open a pipe mill, but don’t tell that to the folks at Welspun, the India-based conglomerate that cut the ribbon on its $150 million plant in the Arkansas city of Little Rock last April.

Amid plenty of fanfare from grateful local and state officials and residents, B.K. Goenka, the CEO of parent company Welspun-Gujarat Stahl Rohren Ltd. and his staff made clear their determination to fulfill its commitment to open its first American plant despite the worsening global recession. Conceived barely two years ago when the pipeline industry was in the midst of an enormous boom that had many wondering if they could acquire line pipe at any price, few would have blamed Welspun if it had preferred to hold off on opening its new plant. According to The Wall Street Journal, capacity utilization at U.S. steel mills has fallen to 43%, a level not seen since the Depression.

Orders from energy producers have fallen 30% or more since last year because of the decline in exploration, the Journal noted. Short-term prospects don’t appear to offer much encouragement although the U.S. Department of Energy has estimated that more than 40,000 kilometers of new oil and gas pipe will be needed during the next four years.

Built with the encouragement of tax incentives from both the state and city, Welspun Tubular LLC’s state-of-the-art spiral pipe-making plant is spread over 740 acres of land next to the Little Rock Port Authority. It includes external and internal coatings as well as a double jointing facility. Earlier this year, the plant began commercial production of 240,000 tons of 80-foot spiral weld pipe for the Ruby Pipeline Project. About 300 people are employed at the plant which is designed for 500 workers.

In a wide-ranging interview with P&GJ, Goenka talked about his vision for the pipe mill and his determination to see the project through.

P&GJ: What were your thoughts as the facility was dedicated?
Goenka: It was a moment of pride for everyone at Welspun. We could see the launch of the Little Rock facility as a big step toward our vision to be the largest and the most respected company in the world in line pipe production.

P&GJ: From conception to completion took just two years. What made this possible?
Goenka: A clear strategy and a concrete road map were in place even before we scouted for land to set up this greenfield project. Once we decided on the location of the project and resolved the logistical and financial issues, we were fully dedicated to the timely completion of the project.

P&GJ: What are some of the unique characteristics of this facility?
Goenka: We have substantial capacity in our Arkansas facility, which is fully integrated with our pipe plants in India. In Arkansas, we have capacity to produce 350,000 tons of spiral weld pipes per year, with facilities for double jointing and coating. In India, we can produce more than 1 million tons of large-diameter pipe. Working together, we can meet the needs of even the largest and most demanding pipeline projects in the world. Capacity to produce grades X80 to X100 (API 5L certified); diameter 24-60-inches; thickness 6-25 mm (0.250-1 inch); length 12-24 meters (40-80 feet), with the world’s best technology and equipment.