Miami, Florida-based Abakan Inc. announced Tuesday that it has entered into a memorandum of understanding with Cone S.A. for construction of a manufacturing facility to suit large-scale clad pipe manufacture inside the new Suape Export Processing Zone (Suape EPZ) in Pernambuco State, Brazil. Abakan said that the facility will help meet the demand for corrosion-resistant clad pipe to enable the safe and efficient production of oil in Brazil, where more than 80 percent of oil fields are highly sour. The facility will be built on 1.6 hectares (four acres) inside the Suape EPZ together with an adjacent storage area.
The large-scale, four-line clad pipe manufacturing plant will be capable of producing up to $200 million of clad products annually. The decision to establish a plant in Brazil was driven by the requirements of Abakan's technology development partner, Petrobras, along with anticipated demand from other Brazilian energy and mining companies that have expressed interest in Abakan's cladding solutions as a means of reducing capital and operating costs in some of the world's most challenging corrosive and abrasive environments, Abakan said in a press release.
Cone (Business Condominium) is an initiative of Conepar - Moura Dubeux Engineering shareholders with an Infrastructure Fund (FI/FGTS) managed by the Caixa Econômica Federal, the largest government owned bank in Latin America. Architectural drawings are finalized and permitting for the site has started, land preparation is slated to begin next month and the foundation will be completed in July. Abakan plans to start the installation of its specialty equipment by December.
The construction of the Brazil facility represents the first step in Abakan's plan to build corrosion-resistant clad pipe manufacturing facilities globally, to meet the rising global demand for corrosion-resistant clad pipe, plates and components used in extracting sour oil and gas resources. Due to the potential that any one of a dozen oil majors or their contractors could tie up the entire production capacity of the Brazilian facility, Abakan plans to establish similar four- to eight-line facilities in Indonesia, the Middle East and North America.