Iran 2017 | ENERGY | B2B

The country's largest pipe mills are making great strides to leverage new technologies and meet domestic and regional demand in their bid to become global players.

Amir Hossein Kaveh
Deputy CEO
Sadid Industrial Group
Abdolhossein Bossagh Zadeh
Managing Director & Member of the Board
Ahwaz Pipe Mills Co.

How do you assess your contribution to the sector in Iran?

Amir Hossein Kaveh We are active in many different fields, and one of our core businesses is manufacturing steel pipes for oil, gas, and water projects. One of our steel mills is located in Tehran, and its nominal capacity is 300,000 tons. Another is located in Mahshahr, on the shore of the Persian Gulf, which gives us access to the entire region. We can supply neighboring countries with our products in less than two hours, a great strategic advantage. A third factory in Tabriz manufactures pumps and turbines for oil, gas, and water projects. Our pipe manufacturers have already built 4,000km of pipes, and our pump and turbine manufacturer, Petco, has already made 1,000 pumps. We have a long history of completing national projects. 14 years ago, the country needed renewable energy; therefore, we build a windmill turbine factory. Yet, we need more water pipelines to address drought in certain areas, which will require a huge network of steel pipelines. Our gas network is also being completed, and 800km of pipeline was recently finished in the Sistan and Baluchestan province. Neighboring countries are interested in buying our products, and we recently conducted an export project to Turkmenistan worth USD200 million. The Turkmenistan-Afghanistan-Pakistan-India Pipeline (TAPI) will also be an important export source for us.

Abdolhossein Bossagh Zadeh I have been working for this company for 27 of its 50 years of existence. Ahwaz Pipe Mills was the first pipe supplier and manufacturer in the country and was established under the license of Kaiser Company from the US. We were working under an API license and have produced products of strategic importance to the country since our establishment. Since the beginning, we have been working under the Ministry of Petroleum. We were a paid manufacturer of the pipelines of the National Iranian Oil Company and had no problems in meeting its demands. As we work under the rules and regulations of the Ministry of Petroleum we have agencies in control of engineering. Ahwaz Pipe Mills started many major industrial projects in Iran. We were the first company here to manufacture pipes and start the process of storing sour gas. Our company also produces casing. These are pipes used to extract oil. Ahwaz Pipe Mills consists of four pipe manufacturing companies that produce parts in different diameters for different kinds of fields. We also have two coating companies that operate in the inner and outer coating of pipes. We are producing 750,000 tons per year and expect this to increase to 900,000 tons a year.

What is your growth strategy?

AHK The oil majors have a history in Iran. We have always welcomed international companies to play a part here, and this will continue to be true. Unfortunately, we have seen these major companies make promises that they were unable to keep. Despite the opportunities in Iran, political pressures have forced them to abandon projects and leave the country. This has created some pessimism and distrust. We hope that by behaving in a fair manner in the time to come, they will compensate for what has happened in the past. The history of cooperation between major international firms and Iranian companies has enabled Iranian firms to produce foreign technologies at home. When the major companies left, our engineers continued to work on these technologies, and we now have many years of experience with advanced processes. This has allowed us to develop independently, and it has proliferated robust growth in our export sector.

ABZ Ahwaz is located in the south of Iran, not far from the Iman Khomeini Port, so we have great opportunities to export our products. Currently we are exporting to Iraq and Turkmenistan and will export to other countries in the near future. We are also looking at Oman, whose water transmission pipes we can make. We are also considering Afghanistan and especially Pakistan, because we took part in the Iranian part of the Iran-Pakistan pipeline, which involved 902km of pipes. The Iran-Pakistan pipeline is the best way to export to India. With 50 years of experience and the quality that we are known for, we have great recognition in France and Italy. We produced all the pipes for phases 1 through 5 of the South Pars project and received awards from the observation teams from these countries. We are also planning on having branches in other countries. Transferring pipes is expensive, but we currently have 153 wagons to transfer pipes and plan to increase this to 700. We were once the sole operator in the Iranian pipe industry, but are still pressing ahead even though we have some competition. In order to meet global standards, we should stick to our original strategy in order to reach them.