MesoCoat to Begin Operations at Ohio Pipe Cladding Facility

Abakan Inc., an emerging leader in the advanced coatings and metal formulations markets, today announced its subsidiary MesoCoat is set to begin operations at its first full-scale pipe cladding facility in Euclid, Ohio. This event is both a critical turning point in the history of MesoCoat and a major step toward the market introduction of its CermaClad™ seamless, metallurgical bonded clad pipe.

The facility, which is expected to be one of the largest clad pipe manufacturing facilities in the United States when it is fully operational, will manufacture corrosion-resistant alloy (CRA) clad pipe for the oil and gas industry using the company’s patented and proprietary fusion cladding technology.

The next milestones for the CermaClad product team are to bring the facility to operational status -- expected to occur in January 2013 -- and then to complete manufacturing scale-up demonstration with the production of the facility’s first 12-meter clad pipe. Once demonstration is complete, it will be followed by qualification and certification of the pipe to industry standards, leading to market introduction and rollout expected before midyear. MesoCoat expects to gradually ramp up production while using the facility for both qualification and filling low rate initial production orders, with the one-line facility expected to ultimately produce up to 60 million dollars of clad pipe annually.

“I’m very impressed by everything our team has accomplished to date, and I’m completely confident that our efforts will soon be rewarded with product qualification and approved supplier status with our Fortune 50 Oil and Gas partners,” said Abakan CEO Robert Miller, who expressed delight that the facility was completed on budget, despite the team having to overcome a number of engineering, design, and integration challenges for this first-in-the-world fusion cladding facility.

This new, world-class cladding facility will help to meet the high demand in the oil and gas industry for corrosion-resistant clad pipe. An estimated 70 percent of the world’s oil reserves consist of heavy, high sulfur, “sour” crude, which will require large amounts of corrosion-resistant pipes to enable safe and efficient production. Driven by the increased amount of development of corrosive oil and gas fields, industry experts expect the annual market for corrosion-resistant clad pipe to increase significantly over the next three years. Clad steel products that the company can produce are also used in other industries, including oil sands, downstream petrochemicals, mining and mineral processing, desalination, and oil refining and processing.

“We have completed the infrastructure construction and equipment installation, thanks in large part to the outstanding teamwork and dedication of the CermaClad product team,” said MesoCoat President Andrew Sherman, a former rocket scientist and a serial entrepreneur. “The facility will soon be ready to carry out its primary mission of large-scale commercial demonstration of our revolutionary fusion-cladding manufacturing technology.”



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