China’s Tianjin Pipe Corp. (TPCO) broke ground recently on a Gregory, Texas, $1.3-billion pipe manufacturing plant, which represents the largest investment in a manufacturing facility in the U.S., the company claims.

“This is a very large market for seamless pipe, and [TPCO] saw an opportunity here given the proximity to what is a quickly expanding oil-and-gas production market,” says Leah Olivarri, spokeswoman for TPCO America, the firm’s U.S. arm. The plant will produce about 500,000 metric tons of “oil country tubular goods” (OTCG), which are used in oil and gas drilling processes. Most of the pipe will measure between four inches and 103/4 in. in dia. The company plans to add lines designed for shale-gas production.

Being constructed on 253 acres just outside of Corpus Christie, the plant is expected to take 34 months to build and employ 2,000 construction workers. TPCO selected Jacobs Engineering Group, Pasadena, Calif., as program manager.
The facility is scheduled to be delivered in two phases between late 2012 and the end of 2014. Phase one will construct the pipe treatment and finishing facility.

Phase two will build the rolling mill and electric-arc furnace, which is where the metal will be melted and formed into pipe.
The shale-gas boom has kept busy steel manufacturers both in and out of the U.S. as demand has increased for pipe for drilling operations and transmission lines. Since an initial spike in 2007, pipe costs have remained steady.

“We haven’t seen construction capital cost run-ups lately like we did four or five years ago,” says Scott Smith, vice president at Black & Veatch. “The cost of [natural-gas] pipe hasn’t followed the falloff of natural-gas prices.”