We wait for the mainstream media to pick up the story about the possibility that TransCanada built the Keystone pipeline with defective Indian steel. We also wait for someone to connect the dots and ask why a few sticky gas pedals provoke a recall of over five million Toyotas, but hundreds of faulty pipe joints don't trigger a recall of steel posing an ecological threat to South Dakota's farmland, wetlands, and drinking water.
Meanwhile, here are a few notes on Welspun, the maker of the faulty steel that might lie under the South Dakota prairie in the Keystone pipeline:
- Indian pipe maker Welspun (I'm waiting for plays on that name) faces three lawsuits from U.S. pipeline companies accusing the company of supplying substandard steel. The litigants include Kinder Morgan, in whose pipelines federal safety regulators found defective Welspun steel, as documented by Plains Justice.
- I'm not a professional finance reporter, so it'll take me a while to figure out which division is which, but Welspun Corp Ltd. is down 4.6% from its Monday close. Welspun-Gujarat Stahl Rohren Ltd. is down 4.7%.
- Ah! Welspun Corp Ltd. is Welspun-Gujarat Stahl Rohren. The company changed its name from the latter to the former this spring, taking three months of brainstorming and consultations to come up with the shorter name and a new logo. (Note: stahl rohren is German for "steel pipe".)
- Shipping bad pipe didn't hurt Welspun's business in 2009: Welspun increased revenue 28% and more than doubled operating profit.
- Welspun is acquiring majority stake in Saudi pipe maker Aziz. Dang: Even if we use Canadian oil, we're still depending on Saudi pipe.
- Welspun does business in Iran. TransCanada bought 47% of the steel for the Keystone pipeline from Welspun. This year's South Dakota State Legislature protected a huge tax break for TransCanada. At the same time, the Legislature passed a law to oppose investing state funds in Iran. Connect the dots....
Update 2010.07.02: The mainstream media speak! KJAM covers the concerns over Welspun steel pipe.