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Russian Severstal balances domestic demand with international option

How much will Gazprom want in 2021?

Russian Severstal balances domestic demand with international option

Moscow, December 22 - Neftegaz.RU. Russia will remain the heart of Severstal’s focus for the near term, told Energy voice, but uncertainty around the timing of a contract with Gazprom has encouraged international growth.

Severstal’s Business development manager for energy D. Goroshkov said:
  • Severstal’s Izhora pipe mill won a contract in July to supply Gazprom with 320,000 tonnes of large-diameter pipelines during 2021-22. 
  • A slowdown in Russia in 2019-20 drove Severstal to consider new horizons,
  • In 2019, we started intensively searching for opportunities internationally,
  • Severstal expects to fully utilise its equipment in 2021.
  • How much will Gazprom want in 2021? The aim for international markets is to be able to balance out the domestic market with the international.
  • Before 2019, demand for large-diameter pipelines in Russia was very significant and we enjoyed 100% capacity utilisation,
  • Gazprom was the company’s major client?
  • The state-controlled gas company changed its investment plans, triggering Severstal’s decision to expand internationally.
  • Severstal has 3 key advantages over other pipeline manufacturers,
  • The company is vertically integrated, it is wholly responsible for customer satisfaction and it is working to develop new products to meet emerging needs.
  • Gazprom has a number of significant projects, including the continuation of the Power of Siberia,  also Rosneft has Vostok Oil work.
  • The executive was confident that Severstal’s ability to provide large-diameter pipelines would continue to give it a competitive edge. 
  • The company has begun looking at the use of non-metallic materials, an emerging trend in the Middle East. Demand in this area is focused at the moment on small and middle diameter pipelines.

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