EUROPIPE to Supply Steel Pipe to Nord Stream

Nord Stream has finalised the international tender to supply high-quality steel pipes for the first pipeline. The tender was awarded to EUROPIPE, the world’s largest pipe producer (Mülheim a.d. Ruhr, Germany), and to the Russian pipe mill OMK (Vyksa). The decision was taken by the Shareholder’s Committee yesterday following thorough evaluation of bids from pre-qualified German, Japanese and Russian companies.

All bidders had to prove their technical ability to supply high pressure large-diameter steel pipes for offshore use. Both EUROPIPE and OMK are DNV (Det Norske Veritas) certified suppliers. This certification guarantees the highest international standard. EUROPIPE has a proven track record. OMK is a new player on the offshore pipe market. Its trial production was tested and certified by the independent DNV.

Both suppliers can provide the necessary capacities for manufacture and delivery of the required pipes in 2008 and 2009.

As one pipeline requires around 1.1 million tons of steel, this is one of the most significant decisions regarding the requirements for the project and also the overall budget. By committing itself to two-year contracts, which are expected to be signed in October, Nord Stream secures the pipes for the first line at the current price level. At the same time, the expected development of the steel market was taken into account to also provide for security on the contractors’ side.

As a result of the bid evaluation process, three quarters of the tender will be awarded to German EUROPIPE and one quarter to the Russian manufacturer OMK. Basis for the split are technical, commercial and capacity-related criteria. For the second pipeline, there will be a completely new pipe supply tender. The number of technically qualified pipe mills is expected to increase.


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