Jindal SAW, a pipe manufacturing company, has formed a new joint venture (JV) with Hunting Energy Services, a developer of premium connection solutions, to create India’s first premium OCTG 130,000 sq. ft threading plant in Nashik, India. This JV will enable India to supply OCTG products globally, providing an alternative source of OCTG products to companies engaged in drilling activities. This partnership will also allow India to eliminate its reliance on imported OCTG products. The initial investment in this JV will be around $20-25 million and the potential annual market size for premium OCTG in India is close to $200 million.
The agreement formalizes a closer working partnership between the two businesses, following a strategic alliance in 2019 between Jindal SAW and Hunting Energy Services to develop their presence in the rapidly growing OCTG market in India.
The JV leverages Jindal SAW location-specific capabilities and local workforce with Hunting’s patented premium connection threading technology to create a full range of sizes of seamless tubing and casing for deep oil and gas drilling activities. The venture fills a gap in the US market by providing competitively priced premium OCTG (casing and tubing), accessories (couplings) and chrome OCTG supplies, giving US companies an alternative to existing limited offerings from a few key players.
“We are glad to join hands with Hunting Energy Services for this ground-breaking project. Our collective efforts and combined strengths will revolutionize the OCTG manufacturing sector and its usage in the domestic market. Jindal has always been a game-changer in the industry, and this partnership will be a step forward in this evolving industry. Together with Hunting, we will become the first in line to have such a manufacturing facility in India. This JV will add value to our existing line of products and will develop the local ancillary service industry,” said Neeraj Kumar, Group CEO and Whole Time Director at Jindal SAW.
“The Indian OCTG market provides significant growth potential for Hunting. We are delighted to have entered this joint venture agreement with Jindal SAW Ltd., leveraging our excellent working relationship since 2019. This partnership will be a gamechanger for India and the overall industry once we start manufacturing premium quality seamless pipes. As we move forward, our plan is to reduce imports in India. We stand by with the policy of manufacturing best-in-class products locally and hope this joint venture is a concrete step forward towards the ‘Make in India’ initiative as promoted by the Government of India,” said Jim Johnson, CEO of Hunting.
The facility is targeted to be operational by the end of 2022, with three threading lines commissioned over time with an annual capacity of 50,000 metric tons. It is anticipated that the venture will employ approximately 100 staff members once fully operational and will achieve close to 70 percent in capacity in its second year of operation.