South Korean steelmaker Posco and US oil giant Exxon Mobil have agreed to mass produce and supply slurry pipes made of high steel manganese steel, the company said Wednesday.

It is the first joint development of the use of high steel manganese steel as a base material for pipelines that are engineered to move mined oil and sand, the company said. 

“Collaboration and teamwork have enabled rapid commercialization of the new advanced high manganese steel technology, which sets a new benchmark for use with slurry in oil sands mining production operations,“ said Tom Schuessler, president of Exxon Mobil Upstream Research Co.

Posco chief Kwon Oh-joon suggested expanding their business partnership to create synergy in various businesses within the oil sand industry.

“We are taking our first major steps into a new era in high manganese steel in the oil sands industry,” said Kwon.

“With this new and unique technology, Posco is ready to leap toward higher levels of synergy through slurry pipes and other high manganese steel applications.”

For the past five years, the two companies have worked closely to develop the slurry pipes made of steel added with a high percentage of manganese. They have also conducted field tests by installing the slurry pipes to verify its quality.

Last year, Posco tested an 1.2 kilometer-long slurry pipe for about an year at Exxon Mobil’s oil sand project in Kearl, Canada.

The high manganese steel pipe there has exhibited outstanding resistance to wear and abrasion. It had wear resistance five times higher than pipes made of conventional steel materials.

Slurry pipes are used to deliver the mixture of oil, water and sand, for a long distance, but are often under constant attack from abrasion, increasing costs for replacement and maintenance.

The high manganese steel pipe is expected to cut costs for entire operations and increase oil production, as it requires less time for replacement and maintenance, Posco said.

By Cho Chung-un (christory@heraldcorp.com)