16 Jul 2009 08:51
July 16, 2009 PRESS RELEASE
TMK Announces 2009 First Half Production Results
The following may contain forward looking statements concerning future events. These statements are based on current information and assumptions of TMK management concerning known and unknown risks and uncertainties.
OAO TMK ("TMK" or "the Company"), one of the world's largest oil and gas pipe producers and the market leader of the Russian pipe industry, today announces its production results for the 1st April to 30th June 2009 period.
For the first six months of 2009, TMK shipped a total of 1,203 thousand tonnes of pipes to customers, a 20% decrease on the amount shipped over the same period the previous year.
Volumes of shipped pipe products in the first half of 2009
(thousands of tonnes)
| Product | 2009 H1 | 2008 H1 | Change, % |
| Seamless pipes | 765 | 985 | -22% |
| including OCTG | 450 | 460 | -2% |
| Welded pipe | 437 | 511 | -14% |
| including OCTG | 48 | 24 | +100% |
| Total pipes | 1,203 | 1,495 | -20% |
The decrease in pipe shipments was mainly related to the weak market demand observed in the first and second quarters of the year. The Company estimates that the Russian pipe market declined by 34.8% in the first half of 2009 as compared to 1H08.
Despite the weak pipe market, the Company increased shipments of high-margin OCTG products by 3% and premium connection shipments grew 47% to reach 61 thousand tonnes, allowing TMK to strengthen its leading position on the Russian oil and gas pipe market. The Company had an estimated 71% seamless OCTG market share in Russia in the first half of the year.
In the second quarter, TMK increased pipe shipments by 7% as compared to the previous three-month period, mainly as a result of its new longitudinal welded large-diameter (LD) pipe capacity. TMK secured longitudinal welded LD supply agreements for Gazprom's Bovanenkovo-Ukhta pipeline, Transneft's Eastern Siberia-Pacific Ocean oil pipeline and projects in Central Asia.
The Company expects further growth in large-diameter pipe demand in the second half of the year with the implementation of the Sakhalin-Khabarovsk-Vladivostok and Baltic Pipeline System-2 pipeline projects. Demand growth is also expected in the CIS as state-owned oil and gas companies in Uzbekistan, Turkmenistan and Kazakhstan invest in the development of oil and gas fields and related infrastructure.
TMK expects to continue increasing shipments of LD pipe thanks to its recently launched longitudinal welded capacity which allows the Company to successfully participate in large-diameter supply tenders.
TMK (www.tmk-group.com)
TMK (LSE: TMKS) is the largest pipe producer in Russia and one of the three global market leaders.
In 2008, TMK shipped over 3.2 million tonnes of pipes. TMK supplies to companies in more than 60 countries.
TMK production facilities are located in Russia, the United States, Romania and Kazakhstan
Volzhsky Pipe Plant
Seversky Tube Works
Taganrog Metallurgical Works (Tagmet)
Sinarsky Pipe Plant
TMK IPSCO
TMK Europe
TMK-Kaztrubprom
TMK Oilfield Services
TMK-Premium Service
For further information please contact:
TMK IR Department
Alexei Ratnikov
Tel: +7 495 775 7600 ext. 2078
Email: IR@tmk-group.com
TMK PR Department
Alexey Sotskov
Tel: +7 495 775 7600 ext. 2125
Email: PR@tmk-group.com