PSL - Going Global

PSL Ltd has informed BSE that the final negotiations between the Company's recently incorporated Company namely "PSL - NORTH AMERICA" (PSL-NA) and State of Mississippi in USA have been completed resulting in allocation of 156 Acres of land along with an attractive package of incentives to the said Company for setting up a Greenfield Steel Pipe Manufacturing facility just outside of Bay of St. Louis, MS at the Port Bienville Industrial Park in the State of Mississippi, USA.

While on the subject, it is pertinent to inform that the aforesaid Company was formed as a result of a Joint Venture between the Company and two other parties including the US based A & L GROUP, which is engaged in construction of gas distribution projects, and is a multifaceted provider of construction services both in the United States and in select markets around the World. Its comprehensive range of services include cross-country pipeline construction, pipeline maintenance and integrity upgrades, facilities - station fabrication / installation, horizontal directional drilling, and gas distribution / rehabilitation.

The Company will be holding a majority stake of approximately 75% in the aforesaid Joint Venture through funding of approximately US$ 20 Million aggregate consideration.

The above mentioned 156 Acres land will be used for setting up a Plant, which will Manufacture and Coat large diameter API pipe with a diameter range of 24" to 60", a wall thickness range of 1/4" to 1", lengths up to 80", and grade up to and including X80. Annual plant capacity will ultimately be 300,000 short tons depending on order mix. The plant employment at capacity will exceed 300. The state-of-the-art facility will utilize the latest technology available in terms of the Helical Two-Step, Submerged Arc Welded (HTS-SAW) pipe manufacturing process and is expected to begin serving the strong Large Diameter Line Pipe market in the second quarter of 2008. PSL - NA is building this facility because there is a significant imbalance with domestic US demand far exceeding domestic supply of Large Diameter Line Pipe for Natural Gas Transportation requirements. The Company expects the Large Diameter Line Pipe demand to continue to grow in the coming years to meet increased natural gas consumption, encompass new natural gas sources such as Liquid Natural Gas terminals, and replace existing infrastructure as it reaches the end of its useful life. PSL-NA is strategically locating this facility along the Gulf Coast to minimize overall freight coasts with access to barge, railroad and truck.

Source - Bombay Stock Exchange