Portman Visit Highlights Work at TMK IPSCO

Monday, February 27, 2012

BROOKFIELD, Ohio – The semi-flush joint connection that Nick Drakulic showed to a reporter at TMK IPSCO’s Brookfield plant is the most complicated connection the plant makes – and the most expensive, he said.

“The flanks on the threads are actually slanted, which allows them to seal as they’re screwed together,” Drakulic, general supervisor at the plant, explained. The 28-element connection, which requires no coupling, is preferred in deep wells.

“The tolerance of these in areas is as small as an eighth of the thickness of a piece of paper,” he continued, and it takes longer to inspect the connection than it takes to manufacture it. “This connection is good for tension and compression because of the integrated seal that matches the seal in the opposite direction,” he said.

The joint connection was just one an example of the work done at the plant, which threads specialty pipe for the oil and gas industry, during a visit Friday afternoon by U.S. Sen. Rob Portman.

Following a brief tour of the plant, the Ohio Republican told assembled plant workers and reporters that he had wanted to visit the plant “because it is a great example of what we can do if we actually start to develop our natural resources in this country.” Portman noted that the plant, which opened in 2010, now employs 70 workers and is looking for an additional 17.

TMK IPSCO now runs two production lines, said David Diederich, vice president of operations and chief manufacturing officer. One line is running on three shifts and the second is running on one. The plant makes 2,000 to 3,000 joints per week, or 8,000 to 10,000 joints per month, he said.

“We are in the process of hiring so we can take the second line to three shifts,” he added. A third line is “on the drawing board” and will be added as the oil and gas market continues to grow, he said.

“This plant took over a building that was not being used, another great example where natural gas is really helping us to get the economy back on track,” Portman remarked. One of the workers he spoke to, prior to being hired at the plant, was working in retail because he couldn’t find a job as a machinist.

“We are the Saudi Arabia of natural gas,” Portman boasted.

Portman’s concern is that the federal government will get in the way of the economic development represented by development of the Marcellus and Utica shale plays, and that the Environmental Protection Agency, Interior Department and Energy Department will create “another overlay of regulations that makes it hard for us to keep this going to help our economy,” he said.

The “appropriate role” for the federal government is to rely on state regulation, he asserted. “Every state’s different. The geology of every state is different,” he said. “So we ought to have our own regulatory rules that work for us and we ought not have the federal government make this more difficult.”

Portman also called for bringing gasoline down by increasing domestic production. “What [the Obama] Administration has done unfortunately has made it harder to produce” by placing a moratorium on offshore drilling, slowing the permitting process and not allowing permitting on federal lands in places such as Alaska, and rejecting the Keystone XL Pipeline. He also criticized President Obama for suggesting a tax increase on oil companies.

“I don’t get that. You raise taxes on something, you’re going to get less of that, not more,” he said. “I don’t think it’s a matter of taxing people more. I think it’s a matter of more production and we’d better do it quickly because what’s happening in Iran means that if there is a regional conflict over there, you’re going to see the price of oil go even higher as it did with Libya.”

Regarding plans to reform business taxes, as separately proposed recently by Obama and Mitt Romney, who Portman supports for the GOP presidential nomination, the senator said he is pleased the issue is being discussed because U.S. business taxes are “antiquated” and “complex” and “make us less competitive around the world.” Only Japan’s business tax rate is higher among the developed nations and it is lowering its rates in April, Portman said.

The president has called for ending deductions for companies that outsource jobs, with that money going to help companies that bring jobs to the United States; setting a minimum tax for multinational corporations with those revenues going to lowering taxes for companies that choose to stay and hire in the United States; and increasing tax cuts for American manufacturers, particularly high-tech manufacturers, and providing incentives for companies that locate in hard-hit communities.

“My concern about the president’s plan is that he adds more taxation and he makes it harder to do business internationally, which is not the solution,” Portman said. “He also adds more preferences, makes the code more complicated in certain respects, so I like the plan better that Mitt Romney laid out which is simpler, lowers the rate [and] makes us more competitive internationally.”