Jacky Massaglia, senior vice president for North America at Vallourec, talks to The Energy Year about domestic tubular manufacturing, the expansion of premium threading capacity in Ohio and Vallourec’s role in supplying next-generation geothermal projects.
Vallourec is a pure-play manufacturer of seamless steel tubes serving the energy sector, best known for its VAM premium threaded connections.
- Vallourec’s integrated US manufacturing footprint is benefiting from sustained shale demand and a trade environment favouring domestic supply chains, following approximately USD 2 billion of investment in North America over the past 20 years.
- The company is investing USD 48 million to expand high-torque threading capacity in Ohio as longer shale laterals increase technical requirements for tubular connections, with the new line scheduled to ramp up from late 2026 into 2027.
- Geothermal is emerging as Vallourec’s leading New Energies opportunity, with major agreements with Fervo Energy and XGS Energy demonstrating how tubular technologies developed for oil and gas can support the commercial scale-up of advanced geothermal in the US.
What drove Vallourec’s Q1 2026 performance in North America?
The US market has become an engine for the group, delivering strong Q1 2026 results driven by the combination of sustained shale demand and a supportive trade environment. On the demand side, US unconventionals have continued to value our technology, particularly our VAM premium threaded connections.
The trade policy shift has been equally significant. The administration reactivated Section 232 in mid-2025, initially setting tariffs at 25% before doubling them to 50%. As a fully integrated domestic manufacturer – producing steel from scrap in our own shop, then rolling, piercing, finishing and delivering pipes across the US – we are well-positioned in an environment that increasingly values domestic production and resilient US supply chains.
Our US production capacity is almost entirely dedicated to domestic consumption, with only small volumes exported to Canada. We have invested approximately USD 2 billion in North America over the past 20 years to build this integrated position, and the region has become one of the most important in Vallourec’s global footprint.
What is the rationale behind the USD 48 million expansion at the Youngstown facility in Ohio?
Our customers increasingly need what we call high-torque connections, driven by the continued push for longer laterals. Operators drill longer laterals to increase recovery per well, and longer laterals require higher torque to overcome friction. These connections are more difficult to thread than commodity products, but because we are close to the technical leaders among operators, we identified this trend early.
The USD 48 million investment at Youngstown will significantly expand our threading capacity for these high-torque connections. The line is on time and on budget, with construction due to complete in Q4 2026 and ramp-up beginning at the end of the year and into 2027.
How is Vallourec’s fully integrated manufacturing model reinforcing its sustainability commitments?
ESG has been embedded in Vallourec’s DNA for decades, and North America is central to that positioning. It starts with contracting decarbonised electricity for our electric arc furnace, drawn from nuclear and other carbon-free sources. It extends to maximising the utilisation of raw materials through scrap recycling, where our rates are among the highest in the global steel industry – not only in the pipe segment.
Continuous improvement projects across our facilities recover waste gas and heat that would otherwise be lost, optimising energy consumption and asset efficiency at the same time. In Brazil, our mill uses coke sourced from our own forests, further reducing the carbon intensity of our operations. As a result, our CO2 emissions per tonne of pipe produced are significantly lower than the standard steel benchmark.
Vallourec has signed significant agreements with Fervo Energy and XGS Energy. What role does geothermal play in the company’s New Energies strategy?
Vallourec’s New Energies strategy is focused on three pillars – geothermal, carbon capture, utilisation and storage, and hydrogen. Together, these activities are expected to contribute 10-15% of group EBITDA in the coming years. Geothermal has emerged as the most material of the three because it is a more mature technology and draws on many of the same capabilities our historical oil and gas customers already trust.
In February 2026, we signed a five-year supply agreement with Fervo Energy representing up to USD 800 million in potential revenue. Under the agreement, Vallourec is the exclusive supplier of US-manufactured tubular solutions and VAM connections to Fervo, delivered through our distribution partner Sorian – establishing a fully domestic supply chain for Fervo’s next-generation geothermal wells. Earlier in the year, we entered a strategic partnership with XGS Energy to support a 3 GW pipeline of commercial geothermal projects across the western US, including a 150 MW project in New Mexico backed by Meta. The projects will be supported through one of our key distribution partners.
Data centre electricity demand is a key driver. If advanced geothermal continues to meet its technology readiness milestones and delivers electrons at scale, it can become a significant market for Vallourec. The US is by far the leading region.
Where do you see the next phase of growth for Vallourec in North America?
The next phase is anchored in expansion. Given Vallourec’s long-term commitment to the US, we are evaluating opportunities to further increase our capabilities.
Growth also comes from technical differentiation. Our distribution partnership model gives end users both direct engagement and a packaged supply offering, while our technical agility at industrial scale is difficult for competitors to match.
Our US technology base is also becoming increasingly relevant globally. Customers are exporting the shale playbook to South America and, particularly, to the Middle East. Unconventional drilling is set to grow in the UAE and Saudi Arabia, and the technologies and services we develop here in Houston are already being deployed by those same customers in Saudi Arabia and beyond.
source: The Energy Year