German steelmaker Salzgitter AG (SZG.XE) said Wednesday its
50-50 joint venture Europipe GmbH has won a major order to supply
steel pipes to the South Stream gas pipeline project, adding that
the award will help improve capacity utilization at the presently
loss-making steel pipes business.
Europipe will deliver some 450,000 metric tons of steel pipes
for the Gazprom OAO (GAZP.RS)-led South Stream pipeline project,
Salzgitter said.
The order will help lift capacity utilization at Europipe to "a
satisfactory level" for about 12 months from the second quarter of
2013, the company said.
Europipe has been plagued by weak demand for its products and
has been loss making.
Salzgitter owns 50% in Europipe. The remainder is owned by
Dillinger Huettenwerke, in which ArcelorMittal owns a sizable
stake.
The South Stream gas pipeline is controlled by Russian gas
export monopoly Gazprom, which owns a 50% stake in the project.
Italy's Eni SpA (E) holds 20%, and France's Electricite de France
SA (EDF.FR) and Germany's Wintershall each own 15%.
Write to Jan Hromadko at jan.hromadko@wsj.com
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