Higher steel prices for oil-country tubular goods (OCTG) are here to stay, according to Chuck Keszler, chief financial officer, Lone Star Technologies Inc. The Dallas-based maker of specialty tubing products, flat and rolled steel, and casing and production tubing began a $100-million stock buyback program in the fourth quarter. It reported revenues of $1 billion for the first nine months of 2006. Keszler briefed analysts at the 9th annual oil and gas conference of the New York Society of Security Analysts recently. "Steel prices were 15% higher in the third quarter than in the first quarter, which caused our earnings to be a bit lower. We think higher steel prices are here to stay." Lone Star is the largest domestic supplier of OCTG, but its business is increasingly international. It has or plans tubing-manufacturing joint ventures in China and Brazil. For more on this, see the January issue of Oil and Gas Investor. For a subscription, call 713-260-6441.
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