About Tenaris
Tenaris S.A. (Tenaris) operates as a manufacturer and supplier of steel pipe products and related services for the world’s energy industry and other industrial applications. The company’s customers include most of the world’s leading oil and gas companies, and it operates an integrated network of steel pipe manufacturing, research, finishing and service facilities with industrial operations in the Americas, Europe, the Middle East, Asia and Africa. The company operates as a subsidiary of Techint Holdings S.à r.l. Although the company’s operations are focused on serving the oil and gas industry, it also supplies pipes and tubular components for non-energy applications. The company develops and supplies products and services for low-carbon energy applications, such as geothermal wells, waste-to-energy (bio-energy) power plants, hydrogen storage and transportation, and carbon capture and storage. As of December 31, 2022, the company’s investments included controlling interests in several manufacturing companies, such as Tamsa, the sole Mexican producer of seamless steel pipe products; Dalmine S.p.A. (Dalmine), a leading Italian producer of seamless steel pipe products; Confab, the leading Brazilian producer of welded steel pipe products; Algoma Tubes Inc. (AlgomaTubes), a Canadian producer of seamless and welded steel pipe products; S.C. Silcotub S.A. (Silcotub), a leading Romanian producer of seamless steel pipe products; Maverick Tube Corporation (Maverick), a U.S. producer of seamless and welded steel pipe products; Tenaris TuboCaribe Ltda. (TuboCaribe), a welded pipe mill producing OCTG products including finishing of welded and seamless pipes, line pipe products, and couplings in Colombia; Hydril, a North American manufacturer of premium connection products for oil and gas drilling production; PT Seamless Pipe Indonesia Jaya (SPIJ), an Indonesian OCTG processing business with heat treatment and premium connection threading facilities; Tenaris Qingdao Steel Pipes Ltd. (Tenaris Qingdao), a Chinese producer of premium joints, couplings and tubular components for airbags; Pipe Coaters Nigeria Ltd. (Pipe Coaters), the leading company in the Nigerian coating industry; Tenaris Bay City Inc. (Tenaris Bay City), a state-of-the-art seamless pipe mill in Bay City, Texas; Saudi Steel Pipe Company (SSPC), a Saudi producer of welded steel pipe products; IPSCO, a North American manufacturer of seamless and welded steel pipes; Tenaris Baogang Bautou Steel Pipes, Ltd. (TBSP), a Chinese company that owns a premium connection threading facility in Baotou, China, in which it has a 60% interest; and sucker rod businesses, in various countries. The company also owns strategic interests in Ternium S.A. (Ternium), one of the leading flat steel producers of the Americas with operating facilities in Mexico, Brazil, Argentina, Colombia, the southern United States and Central America; Usiminas, a Brazilian producer of high quality flat steel products used in the energy, automotive and other industries; Techgen, an electric power plant in Mexico; and Global Pipe Company (GPC), a Saudi-German joint venture which manufactures longitudinal submerged arc welded (LSAW) pipes. In addition, the company has established a global network of pipe finishing, distribution and service facilities with a direct presence in most major oil and gas markets and a global network of R&D centers. Business The company’s business strategy is to consolidate its position as a leading global supplier of integrated product and service solutions to the energy and other industries and to adapt to the energy transition through reducing the carbon emissions in its operations and on developing and supplying products and services for low-carbon energy applications by pursuing strategic investment opportunities in order to further strengthen its presence in local and global markets; expanding its comprehensive range of products and developing new products designed to meet the needs of customers operating in challenging environments, including low carbon energy applications, such as hydrogen and carbon capture and storage; enhancing its offering of technical, digital and supply chain integration services designed to enable customers to optimize well planning and integrity, simplify operations; and securing an adequate supply of production inputs and reducing the manufacturing costs and carbon intensity of its core products. Business Segments The company has one major business segment, Tubes, which is also the operating segment. The Tubes segment includes the production and sale of both seamless and welded steel tubular products and related services mainly for the energy industry, particularly casing and tubing used in oil and gas drilling operations, and line pipe used in the transportation and processing of oil and gas, but also other industrial applications. The company’s production processes include the production of steel and its transformation into tubular products. Business activities included in this segment are mainly dependent on the oil and gas industry worldwide, as this industry is a major consumer of steel pipe products. Demand for steel pipe products from the energy industry has historically been volatile and depends primarily upon the number of oil and natural gas wells being drilled, completed and reworked, and the depth and drilling conditions of such wells. Major oil and gas companies are beginning to adapt their strategies and increase their investments in renewable energies to address the energy transition while maintaining their capability to meet market demand for oil and gas, and reducing the emissions from their operations. As the energy transition advances, demand for the company’s products and services from low-carbon energy applications, such as geothermal, hydrogen and carbon capture and storage, is expected to increase while demand for oil and gas applications may decrease. Sales are generally made to end users, with exports being done through a centrally managed global distribution network and domestic sales made through local subsidiaries. The Others segment includes all other business activities and operating segments related to the production and sale of sucker rods, tubes used for plumbing and construction applications, coiled tubing used in oil and gas extraction activities, oil and gas services including fracking and coiled tubing services in Argentina, the sale of energy and raw materials that exceed the company’s internal requirements, and industrial equipment of various specifications and for diverse applications (this business was discontinued in 2022). Products The company’s principal finished products are seamless and welded steel casing and tubing, line pipe and various other mechanical and structural steel pipes for different uses. Casing and tubing are also known as oil country tubular goods (OCTG). The company manufactures its steel pipe products in a wide range of specifications, which vary in diameter, length, thickness, finishing, steel grades, coating, threading and coupling. For more complex applications, including high pressure and high temperature applications, seamless steel pipes are usually specified and, for some standard applications, welded steel pipes can also be used. In addition to oil and gas applications, many of the company’s products can also be used in low-carbon energy applications, such as geothermal, hydrogen and carbon capture and storage. Casing: Steel casing is used to sustain the walls of oil and gas wells during and after drilling. Tubing: Steel tubing is used to conduct crude oil and natural gas to the surface after drilling has been completed. Line Pipe: Steel line pipe is used to transport crude oil and natural gas from wells to refineries, storage tanks and loading and distribution centers. Mechanical and Structural Pipes: Mechanical and structural pipes are used by general industry for various applications, including the transportation of other forms of gas and liquids under high pressure. Cold-Drawn Pipe: The cold-drawing process permits the production of pipes with the diameter and wall thickness required for use in boilers, superheaters, condensers, heat exchangers, automobile production and several other industrial applications. Premium Joints and Couplings: Premium joints and couplings are specially designed connections used to join lengths of steel casing and tubing for use in high temperature or high pressure environments. A significant portion of its steel casing and tubing products are supplied with premium joints and couplings. The company owns an extensive range of premium connections, and following the integration of the premium connections business of Hydril, it has marketed its premium connection products under the TenarisHydril brand name. In addition, the company holds licensing rights to manufacture and sell the Atlas Bradford range of premium connections outside the United States and, since its acquisition of IPSCO in January 2020, the company owns the Ultra and TORQ ranges of premium connections. Coiled tubing. Coiled tubing is used for oil and gas drilling and well workovers and for subsea pipelines. Other Products: The company also manufactures sucker rods used in oil extraction activities, tubes used for plumbing and construction applications, oilfield / hydraulic fracturing services, energy and raw materials that exceed its internal requirements, and industrial equipment (discontinued in 2022). Sales and Marketing The company’s sales in the United States are also affected by the level of investment of oil and gas companies in exploration and production in offshore projects. In Mexico, the company has enjoyed a long and mutually beneficial relationship with Pemex, the Mexican state-owned oil company, and one of the world’s largest crude oil and condensates producers. The company’s largest market in South America is Argentina. The company also has significant sales in Brazil and Colombia. A principal component of the company’s marketing strategy in South American markets is the establishment of long-term supply agreements and Rig Direct services with national and international oil and gas companies operating in those markets. In Argentina, the company has a significant share of the market for OCTG products. The company has longstanding business relationships with YPF S.A. (YPF), the Argentine state-controlled company, and with other operators in the oil and gas sector. The company strengthened its relationship with YPF in 2013 through a long-term agreement, which was renewed for an additional five-year term at the beginning of 2022, under which it provides Rig Direct services. In Brazil, the company has a longstanding business relationship with Petrobras. The company supplies Petrobras with casing (including premium connections) and line pipe products, many of which are produced in its Brazilian welded pipe facility, for both offshore and onshore applications. In Colombia, the company has established a leading position in the market for OCTG products since 2006, following its acquisition of TuboCaribe, a welded pipe manufacturing facility located in Cartagena. The company’s principal customer in Colombia is Ecopetrol S.A. (Ecopetrol), to which it supplies Rig Direct services. In 2022, the company renewed its agreement with Ecopetrol for two years. The company also has sales in Ecuador, supplying Petroamazonas Ecuador S.A., which merged with EP PetroEcuador, the national oil company, as well as private operators. To increase local content, the company has established a local OCTG threading facility in Machachi. The company has business relationships with Petróleos de Venezuela S.A. and the joint venture operators in the oil and gas sector until the imposition of economic sanctions by the Office of Foreign Assets Control (OFAC). The company’s single largest country market in Europe is Italy. In Europe, the company has significant sales to the oil and gas sector, particularly in the North Sea. Demand from this market is affected by oil and gas prices in the international markets and their consequent impact on oil and gas drilling activities in the North Sea and other areas, like Romania. In addition, the company ceased sales to Russia that would breach applicable sanctions imposed by the U.S. and the EU following the Russian invasion of Ukraine. The company’s sales in the Middle East and Africa could be adversely affected by political and other events in the region, such as armed conflicts, terrorist attacks and social unrest, which could materially impact the operations of companies active in the region’s oil and gas industry. The company’s sales in the region can also be affected by the levels of inventories held by the principal national oil companies and their effect on purchasing requirements. In addition, Tenaris owns, through its subsidiary SSPC, a 35% share interest in GPC, a Saudi-German joint venture, and located in Jubail, Saudi Arabia, which manufactures LSAW pipes. In August 2019 the company was awarded a long-term agreement with Rig Direct conditions to supply approximately half of the OCTG requirements of Abu Dhabi National Oil Company (ADNOC) in Abu Dhabi over the next five to seven years. The company has also been awarded significant contracts to supply Qatargas Liquefied Gas Company Limited (QatarGas) and Kuwait Oil Company (KOC) over the coming years. The company has a presence in the region with local production facilities in Indonesia, China and a service center in Australia. Sales to Indonesia and other markets in South East Asia and Oceania are mainly affected by the level of oil and gas drilling activity, particularly offshore drilling activity. Low oil prices have deeply affected drilling activity and the company’s sales throughout the region. The company’s sales in China are concentrated on premium OCTG products used in oil and gas drilling activities. In 2020, the company established a joint venture with Baotou Steel, a major domestic supplier of seamless pipes to the onshore oil and gas fields, for the construction of a premium threading facility located within its partner’s steelmaking facilities in Inner Mongolia. The company’s participation in the joint venture is 60%. During 2022, Baotou Steel and Baosteel International Group (Baosteel) merged their seamless pipe business into a new company named Baogang. Baogang holds 40% of the shares in the joint venture with Tenaris, and has confirmed its intention to continue with the joint venture. Others The company’s other products and services include sucker rods used in oil extraction activities, oil and gas services, including fracking and coiled tubing services in Argentina, sales of pipe for plumbing applications from the company’s Italian Piombino mill, coiled tubes used in oil and gas extraction activities, and sales of raw materials and energy that exceed its internal requirements. During 2022, the company closed down its Brazilian industrial equipment business. Suppliers The company consumes iron ore in the form of pellets for production of DRI in Argentina. Siderca’s consumption of iron ore during 2022 was approximately 972 thousand tons, supplied by Vale International S.A. and Samarco Mineração S.A. from Brazil, and Iron Ore Company (IOC) from Canada. In Japan, following the termination of the company’s joint venture and the closure of the NKKTubes (NKKTubes K.K.) plant, JFE agreed to provide the company with 13 Chrome alloy products for two years, while it advances with the investments required to produce such materials in the rest of its industrial system. For its welded pipe operations in the United States, a significant part of the company’s requirements for steel coils are supplied by Nucor Steel which is the company’s principal supplier in the United States. Nucor Steel has a steel coil manufacturing facility in Hickman, Arkansas, near to the company’s principal welded pipe facility in the United States. To secure a supply of steel coils for the company’s U.S. facilities, during 2022 it renewed a long-term purchase agreement with Nucor Steel which is due to expire at the end of 2024. During 2022, the company also diversified the sourcing of these materials to include Ternium and Big River Steel. In Canada, the company has restarted negotiations with the main local suppliers to reach long-term agreements for its welded pipe operations. Among such suppliers are ArcelorMittal Dofasco, which has steel coil manufacturing facilities in Hamilton, Ontario, and Algoma Steel, which has steel coil manufacturing facilities in Sault Ste. Marie, Ontario. The company also purchases steel coils and plates for its welded pipe operations in South America (Colombia, Brazil and Argentina) principally from Usiminas, Gerdau S.A. and ArcelorMittal Tubarão in Brazil, from Ternium Argentina S.A. (Ternium Argentina), a subsidiary of Ternium in Argentina, and from Ternium’s facilities in Mexico. In addition, in Brazil the company sources plates and coils from international suppliers when not produced domestically. In Mexico, the company’s r electric power requirements are mainly satisfied by Techgen, a natural gas-fired combined cycle electric power plant in the Pesquería area of the state of Nuevo León, while a small portion of its energy requirements are furnished by the Mexican government-owned CFE. The company consumes substantial volumes of natural gas in Argentina, for the generation of DRI in addition to the requirements for producing seamless pipes. Tecpetrol, a San Faustin subsidiary, is its main natural gas supplier in Argentina under market conditions and according to local regulations. The company has transportation capacity agreements with Transportadora de Gas del Norte S.A. (TGN), a company in which San Faustin holds a significant but non-controlling interest, corresponding to capacity of 1,000,000 cubic meters per day until April 2027. In order to meet its transportation requirements for natural gas above volumes contracted with TGN, the company also has agreements with Naturgy S.A. (Naturgy), for a maximum transportation capacity corresponding to approximately 970,000 cubic meters per day. For the final transportation phase, the company also has a supply contract with Naturgy. Both contracts with Naturgy are in place until April 2023 and are expected to be renewed. The company’s natural gas requirements for the power generation facility are supplied by Edison Energia S.p.A while the natural gas consumed at its Italian plants is supplied by Eni S.p.A. Research and Development The company spent $50.7 million in R&D in 2022. Competition The company’s principal competitors in steel pipe markets worldwide are Vallourec S.A.; Nippon Steel Corporation and JFE Holdings Inc. (JFE); PAO TMK; Tianjin Pipe (Group) Corporation Limited; Baosteel International Group; Tubos Reunidos S.A. of Spain; Benteler International A.G. of Germany; Voest Alpine A.G. of Austria; and Jubail Energy Services Company. History Tenaris S.A. was founded in 2001. The company was incorporated under the laws of the Grand Duchy of Luxembourg in 2002.
