Technip Asia Pacific Sdn Bhd expects to launch a RM600mil flexible pipe-manufacturing plant in Tanjung Langsat, Johor, on Nov 25.
Technip Asia is a subsidiary of Pacific Technip SA of France which provides oil and gas-related engineering works and technology.
Technip Asia Pacific senior vice-president Edgar Pushparatnam said the plant had started operation and would reach its maximum annual output of 200km of pipes in 2013.
Pushparatnam said the plant would be the first of its kind in South-East Asia and was Technip’s third, after its facilities in Africa and Brazil.
“We command 60% to 70% of the global market for flexible pipes for the oil and gas industry and we expect the Johor plant to further strengthen our leadership position,” he told StarBiz yesterday.
The company expects flexible pipelines with diameters of four to 14 inches to be its most profitable products. “We expect this market segment to grow significantly over the years,” he added.
Compared with rigid pipelines, Pushparatnam said flexible pipelines were more resistant to corrosion, required less maintenance, easier and quicker to install and could be reused and extended.
However, he said, it doubled the cost of rigid pipelines.
Pushparatnam said the Johor plant would meet the demand for flexible pipelines in the oil and gas industry, for the replacement market (of rigid pipelines) and for deep-sea oil and gas explorations.
Technip supplies its flexible pipelines to several countries in Asia such as Vietnam, Indonesia and Malaysia.
Pushparatnam said he expected return on investment for the Johor plant to take five to seven years.
He said the company had started the second phase development of the Johor plant and had so far invested RM50mil.
“The completion of the second phase, costing about RM200mil, will take a year or so,” he said, adding that it would manufacture steel tubes and thermoplastic hoses, known as umbilicals, for the oil and gas industry.
