Interfax cited Mr Alexander Deineko head of the Russian Pipe Industry Development Foundation as saying that Russia could reduce steel pipe production 25% to 30% this year to 5.1 million tonnes to 5.3 million tonnes.

Mr Deineko said Russia could produce 1.2 million tonnes of large diameter pipes.

He also said that pipe exports could come to 1.4 million tonnes to 1.5 million tonnes.

He added that Russia was currently exporting pipes to 80 countries. He also said "We're trying to ramp up exports in times of crisis. Exports are growing, but not very predictably. We'd like the state to support us."

Mr Deineko said pipe production could grow to 6 million tonnes or more in 2010.

Mr Sergei Bilan deputy general director of Russia one of the world top three oil and gas industry pipe producers said 6 million tonnes to 7 million tonnes per year was a comfortable level for the industry, one that enabled it to invest and develop. Large diameter pipe production could total 1.6 million tonnes to 1.7 million tonnes next year.

According to the report, steel pipe production in Russia fell 10.7% in 2008 to 7.778 million tonnes.

Mr Deineko said an investment program costing USD 10 billion to modernize the Russian pipe industry would be rounded off in 2012. He said that "We've accomplished a lot and 70% of the funds or about USD 8 billion have already been invested. He added that "The main thing is we have been able to reduce our exposure to imports quickly."

Mr Sergei Shishkarev chairman of the State Duma Transport Committee said investment in the pipe industry was currently the highest in the real sector at USD 200 per tonne of end products. He said Russia would have the capacity to produce 14 million tonnes of pipes by 2012 and that 5.9 million tonnes of these would be large-diameter pipes.

(Sourced from Interfax)