Paul is one of the three founders of Dilato Media Technology & is the Chief Editor of MyStockVoice.com as well as heading up Business Development. Paul has a backround in international telecoms, prior he was an officer in the Royal Navy. He is regularly published on online portals such as Seeking Alpha & iStockAnalyst, where he concentrates on telecom, energy & commodities, mainly via ADR & ETF investment vehicles.
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CommentsPosted: Tuesday 02/06/2009 11:17
WSP Holdings Limited (NYSE:WH) a leading Chinese manufacturer of API (American Petroleum Institute) and non-API seamless casing, tubing and drill pipes used in oil and natural gas exploration, drilling and extraction, has announced that it established a company through its wholly-owned subsidiary in northeast China to produce steel billet and ensure steady supplies for its growing OCTG manufacturing capacities.
The Company's wholly-owned subsidiary, Wuxi Seamless Oil Pipes Company Limited, or WSP China, together with two unrelated individuals, established Chaoyang Seamless Oil Steel Casting Pipes Co., Ltd., or Chaoyang Seamless. Chaoyang Seamless is a limited liability company with a registered capital of RMB10 million, located in Chaoyang, Liaoning Province, China. WSP China holds 51% equity interests in Chaoyang Seamless. In the next few months, all three shareholders of Chaoyang Seamless plan to provide, proportionately based on their respective equity interests, an additional RMB90 million in total capital contribution and RMB60 million in total loans to Chaoyang Seamless.
Chaoyang Seamless is in the process of acquiring tangible and intangible assets from a sponge iron and steel billet company in Liaoning province. The purpose of this investment is to ensure a steady supply of raw materials for WSP Holdings' growing OCTG manufacturing capacities in China, especially its OCTG production lines in northeastern China. After the completion of the acquisition, Chaoyang Seamless will have a sponge iron production line with an annual production capacity of 50,000 tonnes and a steel billet production line with a planned annual production capacity of 300,000 tonnes.
"Our investment in Chaoyang Seamless is an integrated part of our business strategy to become a vertically integrated business, as well as to maintain and enhance our leadership position in China's OCTG industry" said Mr. Longhua Piao, Chairman and CEO of WSP Holdings. "We expect this investment will help us further stabilize the supply, quality and cost of an important raw material and provide us with a competitive advantage in the domestic and international OCTG markets"
About WSP Holdings Limited
WSP Holdings develops and manufactures seamless Oil Country Tubular Goods (OCTG), including seamless casing, tubing and drill pipes used for on-shore and off-shore oil and gas exploration, drilling and extraction, and other pipes and connectors. Founded as WSP China in 1999, the Company offers a wide range of API and non-API seamless OCTG products, including products that are used in extreme drilling and extraction conditions. The Company's products are used in China's major oilfields and are exported to oil producing regions throughout the world.
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