V & M Report #03 - VAM Services

V&MREPORT
O C T G D I V I S I O N S P E C I A L I S S U E JUNE 03 - # 3
Oil & Gas Network:
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Beneath the ocean’s great depths lie undeveloped hydrocarbon reserves yet to be
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40 years experience and innovation in the offshore industry. Their exploration
and development will require the highest levels of technical expertise. Thanks to its
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of more than 2,800 metres offshore Gabon and developing the resources of the Girassol
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2003
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Summary
Editorial
Frame Agreement
signed with TOTAL
TOTAL /V & M TUBES:
A win-win commitment for
the long term
Strategic investment
in the United States
V & M STAR:
An ideal addition in terms
of markets and products
An expanded Horizon
Vallourec, a major player
on the expandable market
Spotlights
V&MREPORT
O C T G D I V I S I O N S P E C I A L I S S U E
Publisher
VALLOUREC & MANNESMANN TUBES
130, rue de Silly, 92100 Boulogne - France
Editorial Team
Hassna Belmalek - Phone: + 33 1 49 09 35 83
E-mail: hassna.belmalek@vmtubes.fr
Alain Lancry - Phone: + 33 1 49 09 37 77
E-mail: alain.lancry@vmtubes.fr
Fax: + 33 1 49 09 37 13
Production
Zabriskie., Paris
Design
LeGrand8, Paris
Photographs
Shell, TOTAL, Vallourec, Thierry Truck, or as mentioned
otherwise
All rights reserved
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6
10
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The Oil and Gas industry consolidation of these last
years has deeply modified our customers purchasing
policies. Many customers of V&M OCTG division have
adopted a global sourcing policy, or at least a regional
one, based on long term contracts that include different
levels of services. The frame agreement with Total is
one of the most accomplished example of this trend.
Although such contracts are defined to last several years,
it is essential to actively manage them on a day to day
basis by developing them through a continuous
improvement methodology and by building a more
comprehensive understanding of our customer needs.
During these last years V&M have
grown their size and their organisation
to be better prepared to respond
to these global purchasing policies.
Successive acquisitions have made
V&M a first class player on the
OCTG worldwide scene. The latest
acquisition, V&M Star, consolidates
further this leadership position by
strengthening our presence on the
USA reference market.
In order to respond to our customers
expectations for global sourcing, it is
certainly not enough to be big, you
have also to offer a wide and diversified
range of products and services in
Alain Lancry
all the areas of the world where our customers operate,
even the most remote. The range of V&M steel grades
as well as the VAM premium line supported by a strong
R&D effort participate to this global offer. Indeed, we
have to acknowledge the fact that it was a great success
of the teams who worked before us in this market to
recognise at an early stage that developing the global
presence of VAM through strategic partnerships and
licensees was a strategic issue. It was before “ global
sourcing “ was a buzz word.
Alain Lancry,
Marketing and Development Director
VALLOUREC MANNESMANN OIL & GAS FRANCE
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

Frame Agreement signed with TOTAL
TOTAL/V & M TUBES:
A win-win
commitment for
the long term
4
Following a review triggered by the Total group’s change in size, and subsequent to a
succession of mergers that has made it what it is today, the procurements managers of its
Exploration & Production activity published a call for tender of a type that is unprecedented
in the oil sector. The group was looking for a partner with the capacity to commit to a longterm
Frame Agreement for all the tubes it would have to supply. Just over nine months have
passed since VALLOUREC & MANNESMANN TUBES’ OCTG Division was awarded the contract.
Those involved in this unique experience review the situation thus far…
The result of the merger
between Total, Fina and
Elf Aquitaine, Total is
the largest French company and
!
Henry Delafon,
vice-president Contracts
and Procurement at Total
Exploration & Production
the fourth largest oil and gas
group in the world. With operations
worldwide, Total covers all
activities in the oil industry chain:
exploration and production, gas
and power, refining and marketing,
and trading . Total is also
a major player in the chemicals
sector through its chemicals
branch Atofina.
Like all global groups, Total
strives to rationalise its various
operations including, of course,
procurements. “In this area”,
explains Henry Delafon, vicepresident
Contracts and Procurement
at Total Exploration &
Production , “our task involves
collating and analysing all data
relating to the needs of our
various entities and cross-checking
it against our suppliers’
proposals. The aim is not to
centralise procurements, but rather
to synchronise the work by the
relevant teams and provide them
with the means to make the best
choices. This was the rationale
behind wanting to trial the
relevance of a Frame Agreement
for the supply of drilling tubulars.
While many of our buyers are
now aware of the existence of
this agreement, they are, as I have
just said, free to use the Frame
agreement or publish their own
call for tenders.”
Converging interests
The scope of a contract of this
type is not limited to a mere
reciprocal agreement of the
‘guaranteed volume against a
minimum price’ type. “It is very
important”, explains Henry
Delafon, “to be able to initiate
and maintain clear, formalised
relations over the long term
between the company and its
strategic suppliers. The Frame
Agreement that we have signed
with V & M TUBES reflects
this approach. It is designed to test
our organisations’ commitment
and ability to truly synchronise
their internal strengths to create
and develop converging interests
over the long term. The aim is
not just to buy the best products
at the best price – even if this is
still an essential aspect – but also
to find other potential sources of
value added: work organisation,
joint planning, improvement
plans, etc.”
The agreement, which covers
V & M TUBES’ entire OCTG
range, refers in particular to
product availability with, for
example, the establish-
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V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

Girassol, floating storage,
production and offloading unit
(FPSO), lying 150 kilometres off
the Angola coast, is the first
deep-offshore field (1,400 metres)
to be developed using a subsea
scheme
Number 4 worldwide…
Key data about a multinational
organisation:
• 1999: merger with Pétrofina
• 2000: merger with Elf Aquitaine
• 5.94 billion euros net earnings
in 2002
• 900 consolidated companies
• 2.4 million barrels per day oil
equivalent production (SEC)
in 2002
• 11.2 billion barrels proven oil
and gas reserves
• Interest in 5 liquefied natural
gas complexes
Total is also one of the world’s
leading producers in the
chemicals sector.
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V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

!
Frame Agreement signed with TOTAL
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▼ ▼
Bernard Wyss, Global Contract Sales Manager, Valérie Juillard, Export
Sales Assistant, Nathalie Blot, Export Sales Assistant, and Pierre-Marie
Reymondon, Global Contract Sales Manager at V&M
ment of stocks of the most
standard tubes and reserved
production capacity for the more
specific ones, as well as the buy
back clauses for non used
products. “All this is pretty
standard”, said John Foulkes,
Head of the Drilling, Wells and
Logistics Contracts Department
at Total. “What is less so is that
our contract also makes provision
for periodic meetings. This
obligation enables us to review
current business, of course, but
also to drive the improvement
plan under the co-operative spirit
to which we are jointly committed.
We are discovering together
this new way of approaching the
relations between a customer and
its supplier. We believe that the
potential for progress for both our
organisations is very promising.”
A process to be nurtured
After nine months’ experience
with this first Frame Agreement,
TOTAL and Vallourec a long common history
We have found some important milestones in the relationship between Vallourec and TOTAL:
• 1935: First line pipe orders for the Irak operations: For those who have been working
in the seventies by Vallourec the expression "grille Irak" was a famous part of the Aulnoye
as well as Anzin mills In the thirties the French company " compagnie francaise des
pétroles" started to operate in Irak, and placed such large orders to Vallourec and
Lorraine Escaut the 2 French seamless pipe suppliers in those days that special
workshops were created for that purpose and the name remained for almost 50 years.
• 1950/60: The big challenge of the french oil industry was at that time to develop
the sour gas Lacq field. Huge common studies between what became Elf and Vallourec
were made to find a steel resisting to that corrosion. A connection, the ancestor of
the VAM was also designed.
• 1960/70: The development of gas was requesting a premium gas tight connection,
again the common work between Vallourec and TotalFinaElf was at the origin of
the VAM connection, which has been the origin of the famous VAM family products
representing still to day more than 50 % of the world premium joint market.
• 1970/1980: That has been the development of the North sea.
• 1980/90: Again new developments between Vallourec and Total and Elf for all the
challenging new projects: the North sea even deeper, the always more corrosive
environments, the HPHT wells, the deviated wells…
• 2002: Signature of a frame agreement between TOTAL and Vallourec.
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

!
!
TOTAL, Vallourec, Citra Tubindo and Co…
the parties agree that the process
is in place, but it now needs
nurturing. “I don’t think this
agreement raises any particular
difficulty between V & M TUBES
and us”, adds John Foulkes.
“We have always had excellent
relations; now they are even
better. On the other hand, this way
of operating is fairly demanding
in terms of internal organisation.
It forces us to collect all the necessary
data so that we can capitalise
fully on its advantages, notably
with regard to planning for
upcoming operations. We have
to convince our teams of its
John Foulkes, Head of the
Drilling, Wells and Logistics
Contracts Department at TOTAL
The Girassol FPSO,
the largest of its kind in the
world, produces 200,000 barrels
per day and can store 2 millions
barrels for offloading into
tankers via an export Buoy.
It has accomodating for
140 people
validity so that they stand fully
behind it. We had perhaps
underestimated the amount
of information gathering and
explanation needed.”
In any event, the results speak
for themselves: the quantities
delivered, which should gradually
increase over the first three years,
are on target.
“Insofar as Total manages to
demonstrate its ability to sustain
the relation and providing V & M
TUBES proves its performance
on a competitive level”, concludes
Henry Delafon, “it would seem
that we are on the point of proving
the concept. We can thus hope
to achieve the necessary support
for it to be extended to other types
of products – why not pipelines –
and to many of our local facilities.
There can be no doubt
that current campaigns in our
subsidiaries will benefit from
this Frame Agreement which is
truly proving to be a win-win
solution.”
When Total Indonésie started their operation in the sixties,
and from the beginning they were using our VAM products.
They used to buy all the tubular goods on the open market.
In 1982 the indonesian government realised the contribution
such large foreign companies could bring to the country.
Further to the direct and indirect employment, the
Indonesian legislation constantly tended to increase local
content in all activities including of course the oil & gas
industry.
Through Pertamina and Migas all tenders shall include a
part of local manufacturing to be taken into consideration.
In order to secure their tubular supply Total Indonésie
requested Vallourec their co-operation to establish in
Indonesia a manufacturing plant. It has not been an easy
decision to take and quite a risky one! however Vallourec
replied “present” and founded with a local partner Citra
Tubindo on the Batam island in the Malacca strait. Since
then Vallourec with Citra Tubindo constantly followed
the increasing demand of TOTAL operations with even
more request of local manufacturing from the indonesian
government.
• 1982 Founding of Citra Tubindo in Batu Ampar
first threading line for plain end pipes from France:
Out put of 45000 T°
• 1988 Start of the Kabil heat treatment plant able to
achieve all the most used steel grades from “Green
pipes” from the Vallourec mills
• 1990 Move of the Batu Ampar threading plant to Kabil
to create a vast integrated plant
Today PT Citra Tubindo has reached a production of
80,000 Tons to serve the indonesian market and for a large
part TOTAL.
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V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

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Strategic investment in the United States
V & M STAR:
terms of markets and
8
!
Charging the 85-tonne
electric-arc furnace
with scrap
Steel melting
in the electric-arc
furnace
Tapping the
hot metal
!
V & M TUBES has acquired an 80% stake in North Star Tubular Division, a subsidiary of the
US Cargill Inc. group. Just seven weeks of intense negotiations involving the shareholders
of V & M TUBES (the Vallourec group and Mannesmannröhren-Werke AG) resulted in this
strategically important investment in the United States being pulled off. The remaining 20%
stake was taken over by the Japanese Sumitomo group, V & M TUBES’ partner of over 25 years
in oilfield tube development, most notably the VAM ® .
With this new subsidiary called V & M STAR, V & M TUBES now has an independent production
chain in the US, from steel production through pipe manufacture and even threading.
!
At the helm of
V & M STAR:
Jean-Yves LeCuziat,
Chairman and CEO
Jean-Yves Le Cuziat, Chairman
of V & M STAR, explains very
simply the reasons that led
the Cargill group to divest itself
of its seamless tubes activities,
and how this disposal has been
received. “the Cargill Group
operates chiefly in the food
production industry, but it’s also
involved in many other areas,
and steel tube doesn’t form part of
its core business. The fact of
having sold this branch to the
Vallourec group, whose entire
business revolves around seamless
steel tubes, should reassure the 560
or so employees in Youngstown
and Houston.”
It is well know that V & M TUBES
has been present on the US
market for many years through
its two units based in Houston:
the sales entity of VALLOUREC
& MANNESMANN TUBES
CORP., which has successfully
marketed V & M TUBES’ products
in the United States, particularly
to the oil and gas sector; and
VAM PTS (a joint subsidiary of
V & M TUBES and Sumitomo),
which specializes in the manufacture
of VAM ® premium connections
for oilfield tubulars and
related services.
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

an ideal addition in
products
9
!
Three-strand continuous caster
With an annual production capacity
of some 500,000 tons, V & M STAR
will substantially boost V & M
TUBES’ position, making it the
world’s leading manufacturer
of seamless tubes. In particular,
V & M TUBES’ presence is now
significantly stronger in the US
oil and gas industry.
Around 80% of V & M STAR’s
products are OCTG, the remainder
are line pipe, also mainly supplied
to this same major market.
Besides V & M STAR’s own
manufacturing program, which
covers the 5” to 10 3 /4” range (API
standard), major US customers will
now be able to access the complete
V & M TUBES’ manufacturing
program for larger and smaller
sizes, higher alloyed materials, etc.,
through its facilities in Germany,
France and Brazil.
“Our reputation as one of the
leading manufacturers of oilfield
tubular products and line pipe in
the USA and our quality standards
are excellent”, explains Jean-Yves
Le Cuziat. “V & M STAR is
committed to protecting this
reputation, and even to improving
it if possible. The upcoming close
cooperation with our colleagues
in France, Germany and Brazil
has opened a vast potential for
the intensive exchange of ideas
and experience and consequent
improvement.”
The Youngstown works
Youngstown is located about
midway between Cleveland and
Pittsburgh. It is named after one
of the city’s founding fathers,
one certain John Young, who built
the first settlement there in 1797.
The first steelworks was built here
in 1855, and by around 1920,
Pittsburgh, Cleveland, Chicago
and Youngstown were known
collectively as the “steel towns of
the USA”. For several decades,
Youngstown mainly survived on
the iron and steel industry. In the
1940s, the town’s population was
140,000 (82,000 today), but the
various crises in the US steel
industry led to layoffs and closures.
At the end of the 1970s, there
were still six active steelworks
in Youngstown; today, only one
remains, V & M STAR.
Modernized in 1999 and equipped
with a new electric-arc furnace
with a capacity of 85 tons per heat,
it smelts scrap iron to produce the
new steel. After tapping, the steel
is subjected to secondary metallurgical
treatment in the ladle and
alloyed to specified requirements.
The raw steel is then continuously
cast into tube-making rounds with
a diameter of 8 3 /4” and 11 1 /4”.
The pipe rolling mill is a Multiple
Pass Mill (MPM), also referred
to as a Retained Mandrel Mill, and
is located just behind the steelworks.
Here, the tube-making
rounds are heated to the forming
temperature in a reheating furnace
and rolled to 5” to 10 3 /4” seamless
steel tubes.
Line pipe with machined ends and
marking in accordance with API
5L is supplied directly to the
customer, while the oilfield tubulars
go onto rail trucks after marking
for further processing, to Houston,
Texas, V & M STAR’s second
works.
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V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

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Strategic investment in the United States
!
Continuously cast rounds
are the starting material
for tube production
Rolling
seamless tubes
The finish-rolled
tubes being cut
to length
!
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The Houston works
With almost two million inhabitants,
Houston ranks among the
largest cities in the USA. It is not
only famous worldwide for its
NASA Space Center, but it is also
regarded as the hub of the North
American oil and gas industry.
No less than 200 petrochemical
companies are based here. Founded
in 1836 by Sam Houston, it was
the first capital of Texas. It is hardly
surprising then that V & M TUBES
is also present there today ... now
with three companies.
“The area used to be a rice field”,
explains Dave Garver, manager of
V & M STAR Houston, as he
proudly shows us round the large
premises owned by V&M STAR
in Sheldon Road on the outskirts
of Houston. “We purchased the
land in December 1986, set up
our heat treatment and threading
capacities step by step, and started
production here in 1988. Over the
past ten years we have succeeded
in upping our US market share in
API threading from an insignificant
level to 40%.” These figures
speak for themselves, or, to be
more precise, for the sales and
production teams in Houston and
the service they provide.
The ultramodern heat treatment
plant includes precise temperature
control for the furnaces and efficient
water hardening. After heat
treatment, the oilfield tubes pass
The Houston management
team: Plant Manager Dave Garver
(right) with Ronny Clark, General
Manager Sales and Marketing
!
Oilfield tubes with API thread
or plain ends ready for shipment
from the Houston works
!
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

V & M STAR
Formerly: North Star Steel Company, Tubular Division,
a subsidiary of Cargill Inc.
Shareholders since 1 July 2002:
80 % VALLOUREC & MANNESMANN TUBES
20 % SUMITOMO
V & M STAR in Youngstown
through a straightening and sizing
mill and go on to hydrostatic
testing. Then the pipe ends are
threaded in accordance with the
applicable API standards.
“We have an output capability
of 30,000 to 35,000 tons of heat
treated material per month”,
explains Ronny Clark, General
Manager Sales and Marketing at
V & M STAR. “We are one of the
two big OCTG manufacturers in
the United States. Service is writ
large in our company, and flexibility
is what our customers expect
from us. This includes JIT deliveries
as well as managing their
tube stocks.” It is obvious that
V & M STAR’s success is proof
that its managers are right on
target with their approach.
Address: 2669 Dr. Martin Luther King Jr. Boulevard,
Youngstown (Ohio) 44510-1033
Phone: +1 (330) 7 42 63 00 - Fax: +1 (330) 7 42 63 15
• An 85-ton electric-arc furnace
• A continuous caster
• A reheating furnace
• An MPM pipe rolling mill
V & M STAR in Houston
11
Loading threaded and
coupled oilfield tubes
!
Address: 8603 Sheldon Road, Houston (Texas) 77049
Phone: +1 (281) 4 56 60 00 - Fax: +1 (281) 4 56 02 70
• Heat treatment facilities
• Straightening and sizing machines
• Finishing lines, complete with hydrostatic pipe tester
• Threading lines
Manufacturing program
Seamless hot rolled steel tubes sized 5" to 10 3 /4",
with or without heat treatment, mainly:
• OCTG tubes in accordance with API 5CT,
ends plain or threaded to API
• Line pipe in accordance with API 5L
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

!
!
An expanded Horizon
Vallourec, a major
on the expandable
Multiple-record installation of
a Solid Expandable Tubular
(SET) liner in a NAM producing
well in the Netherlands
Groningen Field
12
In September 2002, thanks to
the expansion technology,
a 5 1 /2-in gas producer was
worked over and converted to a
7 5 /8” producer, resulting in 60%
increase in well capacity.
The existing 5 1 /2-in tubing has
been removed and a new 6-in
18.6 ppf CRA expandable has been
expanded in the existing 7 5 /8 -in.
39 ppf, 33.7 ppf and 29.7 ppf
casing, with elastomer seals in each
section. Combined mechanical
and hydraulic forces used to expand
the chrome pipe by 9.8 % averaged
approximately 92,000 lbs. Postexpansion
ID of the 6-in.18.6 ppf
CRA Liner was 5.92-in. (compared
to a pre-expansion diameter of
5.39 in.), while post-expansion
burst and collapse were estimated
at 7,000 psi and 4,000 psi,
respectively. Overall liner length
was reduced from 6,095 feet to
5,869 feet as a natural result of
the expansion process.
!
This success corresponds to the
longest ever down hole tubular
expansion with a record 1858m of
tubing expanded in a single trip.
Conducted in a NAM gas well in
the Groningen field, this project
involved the first commercial application
of expandable 6” gas-tight
premium connections VAM ET
NA and expandable 13Cr seamless
pipe. The field installation has been
performed by ENVENTURE,
a company specialised in the
expansion technology.
"This project is an excellent
demonstration of the impact of
Groningen field
SET Technology," said Hans
Bouman, Groningen Asset Manager
for NAM. "Because of limitations
in drilling additional wells in this
field, we need to maximize the
deliverability from existing wells
to provide flexibility in meeting
peak gas demand situations."
"The ability to expand Cr13
tubulars will allow us to do that
by providing far greater production
deliverability from highlycorrosive
wells and allowing us to
drill deeper than ever before,"
Bouman added.
Plans are now underway within
NAM to initiate follow-up SET
workover projects.
!
Inspection of
the connection on site
Expandable 13Cr
seamless pipe on yard
R&D breakthrough thanks
to project organisation
The design and conception of the
gas tight expandable connection is
the result of over two years of joint
effort of Vallourec Mannesmann
Oil & Gas and Shell International
Exploration & Production.
Research & Development activities
have largely used computer works
and laboratory testing facilities to
elaborate new concept of tubular
goods with performances enhanced
by the expansion process itself.
Before the production job, a fullscale
system test was performed
in a test well onshore. This appli-
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

!
!
!
!
player
market
Combined loads with thermal cycles
cation has provided ample learning
opportunities in both the engineering
and deployment of the
SET systems.
Due to the size and complexity of
these Research & Development
activities, a project organisation has
been elaborated. Detailed project
specifications, updated Planning,
organigram and WBS have allowed
efficient study progress toward
common and clear final objectives.
Revolutionary expandable
tubulars and connectors
The connections have proven
satisfactory stability and tightness
after expansion under various
simulated well conditions, including
compression, tension, thermal
cycles, internal and external
pressures. Besides, the metal/metal
seal and the “Clean Well” option
(Dope less solution) constitute
a significant improvement in
running procedure.
The seamless tubes offer homogeneous
toughness with very stringent
mechanical properties for
expansion without embrittlement.
Solid Expansion Tubular (SET)
Technology Principle
Traditional drilling operations use progressively smaller casing
diameters that telescope down to the reservoir objective. This
limits the number of casing strings that can be deployed and
restricts the wellbore cross-sectional area available for fluid
flow.
With expandable tubular technology, the operator runs casing
into the wellbore normally, then expands it in situ by hydraulically
pushing or pulling a specially designed mandrel, or pig,
through the pipe (plastic deformation process known as cold
drawing). The result is a minimal reduction in internal casing
diameter from the previous string to the newly expanded string.
Thus expandable tubular technology greatly increases the number
of casing diameters available.
This conservation of wellbore size allows operators to drill
deeper wells, extend the length of deviat-ed wells and reach
deepwater objectives previously thought impractical or impossible.
The ability of expanded tubular systems to be deployed
downhole permits operators to control problems associated
with particular formations, including lost circulation, salt, water
flow, subsidence and high temperature. By expanding tubulars
inside existing casing, old wellbores can be repaired, depleted
zones isolated and burst or collapse properties of existing casing
enhanced.
Expandable technology will change the basic design and
construction of oil and gas wells. This may look as a threat for
pipe manufacturers (reduction of the number of casings per
well) but this can also be seen as a great challenge. This technology
will create new applications and the manufacturer who will
be a leader on this market will benefit of a significant
differential advantage on competition, allowing increased
market shares.
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VAM ET NA Connection
FEA simulation of the connection under expansion
Principle of the Mono Diameter Application
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

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Spotlights
VMUSA
V & M STAR AND
V & M TUBES CORP
COMBINE THEIR
OCTG SALES FORCES
David Hamrick
Ronny Clark
David Hamrick, President of V & M Tubes Corp. will be the leader
of the combined Sales Organization. In a new position reporting to
David will be Ronny Clark, Vice President of OCTG Sales. Ronny,
who used to be the General Sales Manager of V&M Star, will be
responsible for all OCTG and Coupling Stock business. Each Sales
Representative that is currently working for either organization, will
be assigned as a single point of contact for our customers in all of
our business dealings with V&M Star or V&M Tubes Corp.
The new location for the group will be the current V & M Tubes
Corp offices in the Post Oak area of Houston. We believe these
changes will make it easier to do business with V & M, as we strive
to be a complete source of seamless pipe to our customers.
VAM SERVICES
MORE THAN 100 VAM LICENSEES
ALL AROUND THE WORLD
We are pleased to announce that as of
September 2002, we have now more than 100
VAM licensees. More than ever, this allows our
customers to have their accessories
manufactured and their pipes maintained in
increasing number of different countries,
present date more than 40. This network
permits us to have a strong presence in the
market place and enables us improve the field
support in order to fulfill the needs of our
customers. As always all new licensees must
meet required machining capabilities and
pertinent criteria in relation to quality control
procedures as demanded by VAM Services. The
VAM Services team provides all the necessary
training to support the evolution of the VAM
product line within this network and V&M
Tubes has a commitment to continue to
reinforce its capacity inline with the network
and product line expansion.
14
VMOGUK
VAM HP FOR SHELL EXPROS JANUS HPHT EXPLORA
TION WELL
Shell UK Exploration and Production (Shell Expro)
are one of the leading North Sea Oil & Gas operators,
with considerable experience of High Pressure, High
Temperature gas condensate production. Vallourec
Mannesmann Oil & Gas have worked closely with
Shell Expro engineers to develop casing and tubing
products that meet the very demanding technical
challenges of HP.HT wells. A typical well architecture
for the Shearwater field includes VM110SS and
VM130CY steel grades, providing high strength and
resistance to corrosive hydrogen sulphide. VAM HP
and VAM TOP connections are the only ones qualified
by Shell Expro for use in the production casing string.
The connection chosen for the production tubing is
VAM TOP HT. During manufacture of casing the wall
thickness of each pipe is checked and the order is
segregated into three groups. The thicker pipe is put
into the well in areas where Shell engineers calculate
that drill pipe wear will be most severe. Whenever
Shell Expro drill a new HP.HTwell the V&M products
are supported by VAM Field Service International who
send dedicated engineers to help prepare the tubulars
and to supervise offshore operations.
Shell Expro’s confidence in our ability to meet their
technical challenges was illustrated when, to meet a
tight project window, they placed an order for 10,000
feet of 10” diameter casing (a new size), before the
connection design was validated. The design,
qualification testing, manufacture, delivery and first
field use of 10” x 73.9# VM130CY, VAM TOP-NB,
was achieved within a nine month period. R&D testing
has continued and shows the connection performance
envelope to be beyond Shell Expro’s original
requirements.
VAM HP Coupling ready for surface
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E

VAM PREMIUM CONNECTIONS
NEW SERIES OF BROCHURES ON VAM THREAD CONNECTIONS
VALLOUREC & MANNESMANN TUBES' OCTG Division has recently brought
out a new series of brochures on their patented VAM premium connections for oil and
gas field tubulars. The 6- or 8-page leaflets contain all the important technical details,
in particular dimension tables with the performance data for the relevant premium
connections. So far, the series covers the following:
• VAM TOP - TOP of the class
• VAM TOP HC - Beyond the TOP in compression
• VAM TOP HT - Beyond the TOP with torque
• NEW VAM - The famous versatile premium
• VAM ACE - Put an ACE in the hole
• VAM HWST - The Heavy Weight champion
• VAM FLJ - No gamble with the royal flush
• VAM MUST - When success is a MUST
All the brochures are available in English
and can be obtained from
VALLOUREC MANNESMANN OIL & GAS FRANCE
130, rue de Silly, 92100 Boulogne - Fax: +33 1 4909-3713
E-mail: hassna.belmalek@vmtubes.fr
VMB
5 LOGISTICS BASES
OPENED BY VMB
FOR PETROBRAS
OPERATIONS
After signing in April 2002
a 5-year alliance contract with
Petrobras, for the supply of
OCTG and Line Pipe, VMB
has opened until last December
5 Logistic Bases close to
Petrobras operations.
These bases, located in Macaé
(Rio de Janeiro), São Mateus
(Espirito Santo), Salvador
(Bahia), Natal (Rio Grande do
Norte) and Aracajú (Sergipe),
will manage the stock of
tubular, as well as a just-in-time
flow of material based on
Petrobras needs.
PRINVER
QUALIFICATION ISO 9001-2000
In 2002, drilling activity
and pipe consumption
in Mexico were good
and in accordance with
Budget.
In premium
connections, our
target in market
share was achieved
and maintained at
56 % of total
Mexican market.
Two new products were launched in the
Mexican market: DINO VAM and VAM
SLIJ II.
- DINO VAM to substitute BTC
connections in 13 3/8 “ casing
- VAM SLIJ II in 9 5/8”, 7” and 5” to be
used in onshore deep wells,
All together YTD (Dec-2002)
represents 775 MT of pipe.
Moreover, Prinver was qualified in ISO-
9001, ver. 2000 and has been certificated
in April 2003.
FIRST ORDER OF
13%CR TUBING
FOR PETROBRAS
VMB rolled and delivered in
2002 its first order of tubing
13%Cr to Petrobras, based on
steel bars imported from
Europe. Subsequently, VMB
process was audited and
qualified by the Mc Gregor
inspection company, on behalf
of Enterprise Oil, opening
the way to future orders to be
manufactured locally.
15
VAM PTS
PARTICIPATION TO SPE 2002
EXHIBITION
VAM PTS once again participated as an
exhibitor in the annual Society of Petroleum
Engineers Technical Conference and
Exhibition, held this year in San Antonio.
Similar to the OTC in Houston, the SPE
primarily attracts engineers from the oil and gas industry. This successful exhibit was a
cooperative effort of VAM PTS, V&M USA and V&M Star. The focus for VAM PTS was
VAM TOP in tubing sizes, which offers 100% pipe body compression with full gas tightness.
VFSI IN BRAZIL
Since the end of 2002,
a team of four VAM Field
Service engineers is available to
serve any operator in South
America. This new service will
support VMB action to promote
the VAM connection in Brazil
and Latin America. The VAM
family is now extensively
manufactured in Belo Horizonte,
and will benefit from this 1st
class support.
V & M R E P O R T - O C T G D I V I S I O N S P E C I A L I S S U E