France-based pipe producer Vallourec saw revenues for its South American business rise 15.9 percent, year-on-year, for the full year of 2018, the company said while releasing its results. Vallourec attributed the stronger revenues in South America to higher sales volumes for line pipe. Revenues in South America totaled €625 million ($708 million) for the full year 2018.
“In South America, industry and other revenue increased year-on-year essentially as a result of higher volumes in (the) mechanical engineering and automotive (industries) driven by the progressive recovery of the Brazilian economy. The mine activity benefitted in H2 from (an) iron ore price increase after a lower H1,” the company noted.
Vallourec said it expects to take advantage of sales volumes in the Brazilian offshore market, where it holds strong positions thanks to its “renewed long-term agreement with (oil giant) Petrobras and (its) comprehensive offer, which will also support international oil companies launching E&P projects in this country.”
Vallourec said Brazil accounted for 12 percent the company’s global oil and gas revenues, on average, over the 2014-2018 period. The company also said the Brazilian market is expected to improve in 2020, noting that its largest Brazilian client, Petronras, announced plans to invest over $69 billion for the 2019-2023 period.
“Vallourec is uniquely positioned to take advantage of this market opportunity,” Vallourec said, adding that Brazil’s industry market “should benefit from the Brazilian economy recovery, particularly in automotive.”