April 29, 2014. Pipe Metallurgical Company (TMK), one of the world's major OCTG manufacturers, signed an agreement with Gazpromneft regarding the formula for calculating the price of its pipe products.

According to TMK press service, the price formula is calculated in accordance with the market prices for raw materials and the materials needed for making pipes.
This agreement is the first document of such nature that Gazpromneft has signed with this Russian pipe manufacturer. Since 2012, a similar agreement has been working between Gazprom and a number of major Russian pipe manufacturers.

TMK has already received its first order for a pipe shipment; the price of the pipes was calculated on the basis of this formula. The company is planning to deliver its first set of casings to Gazpromneft in April 2014.

‘The use of the pricing formula is a transparent tool for commercial interaction that allows a business to react timely to changing raw materials prices,’ says TMK Director-General Alexander Shiryaev.