TITANIUM and Steel Manufacturing Company (TSM Arabia) a SR100 million ($26.63 million) joint venture between Saudi Steel Pipe Company (70 per cent) and TSM Tech Company (30 per cent) of South Korea will start commercial production from May 1, 2013, says TSM Arabia general manager Ayman A AlHoti.

The objective of the venture is to design, manufacture, assemble, maintain and market heavy process equipment using specialised materials including titanium and titanium alloys, nickel alloys, super alloys and special materials (hastelloy, inconel and monel, etc), stainless and duplex and carbon steel, AlHoti tells OGN in an interview.

“We plan that some 25-30 per cent of our total capacity of 12,000 tonnes will be utilised in the first year,” he says.

“Our products including heat exchangers, pressure vessels, reactors, columns and towers, tanks drums and scrubbers, on/off shore skid and module, piping and spool fittings will find use in the oil and gas sector, chemical and petrochemical plants, power plants, desalination plants, offshore platforms, mining and solar energy,” he says.

The joint venture will also engage in maintenance services like shutdowns, revamping, replacing heat exchanger tube bundles and repair work, he says.

“We see good prospects for the specialised products in the region and beyond, and if market conditions permit we plan to undertake Phase 2 development in five years and increase capacity by 24,000 tonnes,” says AlHoti.

As per the agreement, TSM Tech will transfer technology, train Saudi nationals and help source materials for the project, he says. “We would be sourcing the titanium from Germany, Japan and the US,” he says.

“Our main objective will be to develop in-house engineering and equip ourselves for mechanical and thermal design, strength calculation, stress and fatigue analysis and heat balance calculation.

“We want to empower the local population of Saudi Arabia and localise the industry. The thrust will be on quality. The local and regional demand for heat exchangers is huge. We will ensure that quality-wise our products are state-of-the-art,” he says.

Saudi Steel Pipe has 32 years’ experience in the steel pipe industry and has a wide distribution and marketing network, solid financial capabilities, manpower and startup support. Approved by Saudi Aramco, TSM Tech has 13 years of world wide experience in the process equipment business, and is ranked as the fifth private sector Titanium consumer worldwide.

The company has highly distinguished engineering and production know-how and will be able to lend comprehensive technical support to TSM Arabia through key personnel dispatch and training, he says.

The 10-year agreement provides for project management and commissioning, engineering, training in Saudi Arabia and South Korea, sales and marketing and estimation, quality control, production management, material procurement, certification, maintenance and technical development. The competitive advantages the partnership has locally include association with a highly qualified technical partner, cooperation in marketing with TSM Tech of Korea, cooperation in sourcing material with TSM Tech, capability to develop speciality materials and products in the future and above all in-house design and engineering, he adds.

Recently, TSM Arabia obtained ASME ‘U’ ‘U2’ ‘S’ ‘PP’ and National Board ‘R’ Certification & Stamps, and is in the process of obtaining the approval of Aramco and other major companies in the GCC region, says AlHoti.