United States Steel Corporation (NYSE:X) has revealed that it has been working with Range Resources (NYSE:RRC) to develop special steel piping for oil and gas wells. Previously, oil & gas companies had to rely on foreign manufacturers for this equipment, but now U.S. Steel would be providing a local option. The project has been christened as the USS-Liberty TC and is specifically focused on sealing steel pipes for a Marcellus shale project.
The director of external communications, Courtney Boone, stated that the two companies had successfully managed to develop the seal, which has been tested and is ready for the market. The testing was performed at a Range Resource well, located in West Alexander. In a report published by the Department of Environmental Protection, only half of all oil & gas wells, in the state of Pennsylvania, make use of all American made piping. The representatives of these companies have cited the lack of a variety of options from US pipe manufacturers as the main reason for this trend.
The successful development of this new option comes at a crucial time for U.S. Steel Corp, since it has been facing strong competition from cheap steel imports and lower demands. Consequently, the company has had to make a series of cuts, including the permanent closure of its operations in Fairfield, Alabama. Analysts believe that this downfall is here to stay and Forbes has even lowered its target price to $16. Since most of the cheap steel imports are coming from China, which is mostly due to oversupply in the country, steelmakers in the US are rallying for the imposition of anti-dumping duties on these imports. However, this would mean the creation of new regulatory laws and intervention from the governing body. Furthermore, the decline in demand for steel products is also expected to decline by 0.9% by the end of 2015.
United States Steel Corporation (NYSE:X) completed the September 17 session after experiencing trade volumes of 11.42 million and registering a spike of 0.58% to its share value, to finally close at $13.81.