Make one product, but make it really well
Above: MST’s new atmosphere-controlled 377-foot-long annealing furnace is part of the $40 million invested by parent company Optima Specialty Steel Inc.
Make one product, but make it really well
December 2015 - A well established tube mill wanted to eliminate a critical bottleneck in production. By doing so, it loaded up on finishing quality, reduced its carbon footprint and is now able to adapt its product features to new applications.
Michigan Seamless Tube opened in 1927 in South Lyon, Michigan, and its niche then was to take tubing out of industrial boilers and redraw the tubing, says Ted Fairley, vice president of sales and marketing. That continued through the mid-1950s when the company added a hot mill, with which it takes hot bar, pierces it to make seamless hollows and then draws the hollows to specific diameters and wall thicknesses.
After undergoing some ownership changes and a bankruptcy, the company was acquired in 2011 by Optima Specialty Steel Inc., Miami, and is now known as MST Seamless Tube & Pipe. With its three other subsidiaries—Kentucky Electric Steel, an Ashland, Kentucky, producer of special-bar quality and merchant bar products; cold-finished steel bar producer Niagara LaSalle Corp., Hammond, Indiana; and cold finisher and distributor Corey Steel Co., Cicero, Illinois—“Optima has created sort of a vertical integration. The model, the intent, is to take advantage of synergies among sister companies,” Fairley says.
“We really make one product: Cold-drawn seamless tubing for many markets,” he says. MST produces 3⁄4-inch to 5-inch outer diameters with wall thickness ranging from 0.083- to 0.750- inch, in 60-plus grades. The products meet ASTM and ASME standards, and “we work with a lot of individual customer specifications, including some international specs.” Quality certifications include ISO 9001-2008, ISO 16949, and the Pressure Equipment Directive (PED), a European standard. MST also has NCA 3800 nuclear certification.
The cold pilger mill, the “jewel” of MST’s modernization, brings cold reduction capacity to 80 percent from a mere 40 percent.
Ninety percent of MST’s shipments go to customers in the United States and Canada, 5 percent ends up in Mexico and 5 percent goes to 20 countries outside NAFTA, says Fairley.
“What drives sales outside the U.S. and Canada is our ability to respond quickly and get product to a port or even on an airplane,” he says. “We react the fastest to meet immediate needs.”
Oil and gas represents the No. 1 end market for MST. “A lot of it is downhole stuff. When drilling and extracting, [energy producers] use tubing as parts in the string as they drill, and in fracking.”
The second major market continues to be boiler tubing, which is supplied to utilities, such as those using steam to make electricity, plus smaller boilers used throughout industrial facilities. About 12 percent of sales go to transportation, mostly light and heavy-duty trucks but also a small amount of output ends up in passenger vehicles. “We also sell tubing for farm equipment and construction equipment,” Fairley says.
Investment plan
Optima has been “a hands-on involved owner, helping us to debottleneck and completely use our capacity,” says Fairley. The hot mill had long possessed greater capacity than the finishing mill. “Optima asked us what it would take to fully utilize the hot mill, so we put together a five-year, $40 million plan, which was fully implemented in 2015.”
The final capital investment was the pilger mill in February 2015, itself about a $15 million project. The other projects are an in-house quench and temper line, a pickle house, a 377-foot annealing furnace, new burners on the rotary furnace and a UV coating line, says Fairley.
A Linde Rebox burner system was installed at the hot mill, which allows MST to heat bars more quickly and more uniformly. “The biggest effect is it reduced the amount of natural gas we consumed, and reduce air pollutants resulting from the combustion process,” says Fairley. “This has cut our carbon footprint way down.” The system, developed by Linde with proprietary technology, injects oxygen with natural gas, providing a hotter yet more efficient combustion process.
The quench and temper process is used to achieve required mechanical properties. The new equipment, especially geared to produce oil and gas standard tubing, features a tunnel that does a secondary tempering in one long cycle.
Pickling & annealing
The expansion of MST’s pickling capacity required a new building. “The pickle line was a bottleneck. We now run five pickle lines. That was a $5 million project and gives us unique environmental controls,” says Fairley, adding, “It also reduced wastewater that we had to treat.”
The company’s new annealing furnace was especially built to guarantee the desired qualities of MST’s boiler tubing and carbon and alloy tubing. “These products have mechanical properties that have to be achieved via thermal treatment. There is a high-cycle heating section, then a lower heat tempering section. We used to put product through a single furnace at high temperature, set it down and then run it again at a lower temperature. This furnace has a high heat section, air-jet cooling and then a temper section,” he says. “It’s way more efficient and greener.”
The annealing line is atmospheric controlled, too, so the product is deoxidized. That means the product coming out of it is “virtually scale free.”
A crane lifts tubing from a pickling bath. MST now runs five pickle lines and eliminated a bottleneck in that operation.
Concentricity
The cold pilger mill, says Fairley, “is the crown jewel of MST’s modernization.” The project includes the cold mill and mill feed equipment and a new building to house it. MST now has 344,000 square feet under roof.
“A pilger mill provides a better product to the customer. It improves the concentricity of the seamless hollow, the uniformity of wall thickness and outer diameter, and provides a much better OD and ID surface finish compared to a typical cold bench operation,” he says.
“The average reduction on a bench is 30 to 40 percent by weight. A pilger mill can do up to an 80 percent reduction with very smooth surfaces and uniform concentricity. The customer gets this all at the same price,” he adds, noting, “Finally, we now can finish everything that we produce on the hot mill.”
The pilger mill is geared toward the lower diameter products, 3⁄4-inch to 2.5 inches, and mostly carbon and alloy products for the energy, power generation and, in the future, automotive applications. “We can make heavy reductions, producing smaller sizes in an innovative way,” Fairley says. “No one else is using a pilger mill to make this product line. The technology is proven but the innovation is the sizes and grades.”
Another project MST completed was a new ultraviolet coating line that applies a protective coating on the tube outer diameter, for its entire length. The UV light tunnel creates chemical bonding, which dries and protects the tubing from atmospheric conditions, usually up to six months or even a year, according to Fairley. MST can even tint the coating blue to match the trademark of Blue Diamond, a branding asset acquired during 2015.
Market outreach
Demand for seamless tubing, especially in the oil & gas sector, has been weak as energy prices hover in a low range, Fairley says, noting, “Right now we are operating well below capacity.”
However, the sales team is continuing to “work the market to capture more share with the Blue Diamond name in carbon,” and is pursuing other opportunities with alloy grades. “We will grow there and within the automotive market,” he predicts. “We hope to do more passenger vehicles. We had sizes that didn’t match automotive specifications but, with the pilger mill, we can make those sizes more cost effectively.”
Parlaying its enhanced product engineering expertise, Fairley says MST will “entertain opportunities that were not available before.” MM
