'Why not make more of it here?
President Trump's promise to bring steel jobs back to Pittsburgh was widely lampooned, but not in the offices of Dura-Bond Industries.
The Export-based company has steadily, over the past 13 years, turned itself into one of the go-to manufacturers of steel pipe in the United States. It employs about 550 people and is preparing to add 100 more jobs in the historic steel-making heart of the Mon Valley later this year.
So when Trump signaled his support for domestic steel during the presidential campaign, Dura-Bond President Jason Norris sat up and took notice.
“He's said it a number of times — that he wants pipelines that are installed in the United States to be made in the United States, with steel melted and rolled in the United States,” Norris said. “There's always going to be a need for pipe, even if it's not transporting natural gas. Civilization was started with pipe.”
Dura-Bond bills itself as a premier provider and coater of pipe for the oil and gas industry, but it's the company's proximity to Pennsylvania's steel-making centers that has made that possible, Norris said.
The private, family-owned company recently announced that it was reactivating the former U.S. Steel McKeesport Tubular Operations and retooling it for the manufacture of smaller, midstream pipe. U.S. Steel idled the plant in 2014 because of the downturn in the oil and gas industry and the glut of cheap imports from overseas. An estimated 260 people lost their jobs.
Dura-Bond's agreement with U.S. Steel includes the purchase of all the equipment on the 317,000-square-foot site, which sits at the confluence of the Monongahela and Youghiogheny rivers. Dura-Bond is leasing the land and the buildings from the Regional Industrial Development Corp., with an option to purchase at a later date.
“They're making a major capital investment into the site,” said RIDC Senior Vice President Timothy White. “It's certainly one of the biggest deals in the Mon Valley in recent years.”
Parties to the deal declined to discuss specific dollar amounts, but Norris said the company will focus on upgrading equipment and investing in new technology before reopening the McKeesport mill. Within six to nine months, Dura-Bond hopes to build on its experience operating the former Bethlehem Steel mill in Steelton, near Harrisburg, Norris said.
At 47, Norris is the third generation of his family to be involved with the business. His brothers, Ryan and Adam, also are active with the company. Dura-Bond was founded in 1960 by his grandfather, Jim “Buster” Norris, who came to Export from Alabama as a 16-year-old.
The business expanded as the technology of pipe coating changed from coal tar to more sophisticated forms of corrosion protection. Dura-Bond operated a coating facility near the McKeesport Tubular Operations through 2011 and opened a new plant in Duquesne in 2012.
“(U.S. Steel) made most of the pipe that we coated,” Norris said.
Dura-Bond acquired the Bethlehem Steel pipe mill in 2003 and started manufacturing pipe there in 2004. “The coating plant had no future without being next to a pipe mill,” Norris said, noting that the Bethlehem deal provided the template for the most recent acquisition. “It's the same situation as in Steelton. We have a coating plant (in Duquesne) that we spent $12 million on, but without having a producing mill in close proximity, its days are numbered.”
Driving the recent deal with U.S. Steel and RIDC is Norris' belief that the oil and gas industry will bounce back in Western Pennsylvania, opening up opportunities for the manufacture of midstream piping and smaller-capacity transmission lines.
“Oil and gas always has peaks and troughs. … You have to be ready to capitalize on that when it comes out of the trough,” he said. “Obviously, we feel that the market's going to come back. It may not come back as strong as it was, but it's going to come back.”
Norris also believes that the growing pipeline infrastructure in the United States should be made with domestic pipe whenever possible. While he has purchased steel from overseas suppliers, he anticipates buying coil steel for the McKeesport operation from U.S. Steel, ArcelorMittal and other domestic suppliers.
The economic impact of buying imported steel is limited, while relying on domestic steel produces a ripple effect, Norris said.
“I see this being an American mill, buying American steel,” he said. “My (coating) mill and that steel mill generate revenue and spend money that is pumped back out into the economy. … It's not just 100 jobs making pipe — it's thousands of people that support that piece of pipe.”
Norris said the response to Dura-Bond's announcement has been “overwhelming” and that he expects to fill all the jobs locally. Manufacturing, he insists, is not dead.
“We can't let somebody else make all the stuff and act like it doesn't exist,” he said. “It's going to be made. Why not make more of it here? … More than 50 percent of the oil and gas pipe used in the United States comes from overseas, and that must change.”
The Dura-Bond announcement shows that the “legacy” industries of steel, manufacturing and energy are still vital for the economic health of the region, said Philip Cynar, spokesman for the Allegheny Conference, an economic development agency.
“It's exciting when a company like Dura-Bond, a full-blooded manufacturer, sees an emerging opportunity and is able to run with it,” Cynar said. “We hope that market conditions will be such that these types of partnerships will only increase.”
Dura-Bond is providing the steel pipe for the Atlantic Coast Pipeline LLC, a 550-mile natural gas pipeline that will run from Harrison County, W.Va., to Virginia and North Carolina.