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Ontario Steel Tenaris completes major investment in oil & gas pipe supply

Story by Mario Toneguzzi / Photos by Peter Power

Global steel pipe manufacturer Tenaris has completed a $150-million project to centralize its operations in Canada under one roof in Sault Ste. Marie, Ontario.

It’s an important investment from a key player in the supply chain that supports oil and gas development across the country.

“We believe that the energy sector is going to be gold in the following years in Canada,” said Ricardo Prosperi, president of Tenaris in Canada.

“Canada is a very important market - fourth largest producer in the world of energy, oil and gas... Our strategy is to continue investing in Canada.”

The new $150 million facility expands the company's capacity to supply pipe to oil and gas producers in western Canada.

The company’s new pipe manufacturing hub in Sault Ste. Marie has capacity to produce more than 600,000 tonnes of pipe. It is supported by facilities in Alberta, Saskatchewan, and Newfoundland and Labrador.

The project received funding of $21 million from the federal government, $9 million from the province, and $500,000 from the City of Sault Ste. Marie.

Prosperi said in the last two years Tenaris investments in Sault Ste. Marie have allowed the company to hire more than 300 people and it has plans to continue growing its workforce.

“I believe that today we have 620 people [and] we’re going to reach a level of 800 people or so. This is, I would say, the first benefit for the community,” he said, adding the company also has relationships with local suppliers and contractors, which contributes to the local economy.

“The last two years have been challenging for all Canadians, but Tenaris invested in its operations to better serve Canada’s energy industry,” said Sault Ste. Marie Mayor Christian Provenzano.

The new pipe manufacturing hub includes a new premium threading line and a new electric resistance weld pipe manufacturing line.

Ontario benefits from Canada’s oil and gas sector. According to CEC research, in 2017 the industry supported more than 71,000 direct and indirect jobs in Ontario, paying over $2.1 billion in wages and salaries, and adding $7.7 billion in nominal GDP to the province’s economy.

Tenaris’ history in Sault Ste. Marie dates back to 1999 when it leased an idled pipe mill to restart operations and established Algoma Tubes.

In 2004, Tenaris acquired Algoma Tubes mill and land and in 2006 it expanded in Canada with the acquisition of Maverick Tube, including the Prudential facility in Calgary, and Hydril, including Nisku pipe threading operations, in 2007.

Since it began in the area, Tenaris has invested about $450 million - $150 million until 2010 then another $150 million through 2020 and another $150 million in the last two-plus years.

"Canada has the resources, and we are pleased to invest with our people to serve them."

- Paolo Rocca, Tenaris CEO

Global oil and gas demand is expected to stay strong in the coming decades, even with the rise of renewable energy sources.

In 2050, oil and gas are expected to supply 47 per cent of world energy needs, down only slightly from 52 per cent in 2021, according to the International Energy Agency (IEA).

Meanwhile, the IEA projects that renewable energy’s share of global supply will increase from 12 per cent in 2021 to 29 per cent in 2050.

Headquartered in Luxembourg, Tenaris has more than 23,000 employees around the world. The company started operating in Sault Ste. Marie in 1999.

Tenaris is looking for additional projects in Ontario in the future, Prosperi said.

“We have more plans to continue doing some investments. We are working right now in two additional projects,” he said. “I am optimistic. I believe that we’re going to continue to do investments and building something more on the plant.”

The unaltered reproduction of this content is free of charge with attribution to Canadian Energy Centre Ltd.