Oil Country Tubular Goods From Mexico; Preliminary Results of Changed Circumstances Antidumping Duty Administrative Review

DEPARTMENT OF COMMERCE

International Trade Administration

[A-201-817]

Oil Country Tubular Goods From Mexico; Preliminary Results of

Changed Circumstances Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of changed circumstances

antidumping duty administrative review.

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SUMMARY: Since 1997, the Department of Commerce (``the Department'')

has received two requests to revoke the antidumping duty (AD) order

covering Oil Country Tubular Goods (``OCTG'') from Mexico as it

pertains to drill pipe with tool joints attached (commonly referred to

as finished drill pipe). One request came from the International

Association of Drilling Contractors (``IADC''), requesting that the

Department self-initiate a changed circumstances review for the

antidumping duty orders covering OCTG from Mexico, Japan, and

Argentina. The other request came from Grant Prideco Inc., the leading

producer of finished drill pipe in the United States. The latter

request, covering only the antidumping duty order on OCTG from Mexico,

was withdrawn.

Because of the unusual circumstances surrounding this product, we

initiated an antidumping duty changed circumstances administrative

review to determine the extent of domestic industry support for

continuing the antidumping duty order on OCTG from Mexico with regard

to both unfinished and finished drill pipe. We included both finished

and unfinished drill pipe in the review because the International Trade

Commission determined, in its injury test, that both finished and

unfinished drill pipe constituted a ``like product'' with respect to

the antidumping duty orders on OCTG from Argentina, Japan, and Mexico.

We solicited comments from parties regarding this review, and also

requested production figures for 1997 and the first quarter of 1998 for

all identified domestic producers of the like product (i.e. finished

and unfinished drill pipe). We conducted verifications of the submitted

data between September 29 and October 2, 1998.

Based on the information submitted by producers, and our findings

at verification, we preliminarily determine that there is insufficient

domestic industry support for proceeding to revoke the antidumping duty

order on oil country tubular goods with respect to finished drill pipe.

Interested parties are invited to comment on these preliminary

results. Parties who submit argument in this proceeding are requested

to submit with the argument (1) a statement of the issue and (2) a

brief summary of the argument (no longer than five pages, including

footnotes).

EFFECTIVE DATE: March 24, 1999.

FOR FURTHER INFORMATION CONTACT: John K. Drury or Richard Weible,

Import Administration, International Trade Administration, U.S.

Department of Commerce, 14th Street and Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone (202) 482-3208 or (202) 482-1103,

respectively.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are

references to the provisions effective January 1, 1995, the effective

date of the amendments made to the Tariff Act by the Uruguay Round

Agreements Act. In addition, unless otherwise indicated, all citations

to the Department's regulations are to the current regulations.

Scope of the Review

The merchandise subject to this changed circumstances review is

finished oil well drill pipe with tool joints attached. This

merchandise is currently classifiable in the Harmonized Tariff Schedule

of the United States (HTSUS) under item number 8431.43.8010 as ``Parts

suitable for use solely or principally with the machinery of headings

8425 to 8430, [o]f machinery of heading 8426, 8429 or 8430: [p]arts for

boring or sinking machinery of subheading 8430.41 or 8430.49: [o]ther:

[o]f oil and gas field machinery.'' Although the HTSUS subheadings are

provided for convenience and customs purposes, our written description

of the scope of this review is dispositive.

[[Page 14214]]

Background

On July 8, 1997, the IADC requested that the Department self-

initiate a changed circumstances review with respect to finished drill

pipe for all countries with finished drill pipe included in the OCTG

antidumping duty order. On March 13, 1998, the Department responded to

the IADC request. On January 28, 1998, Grant Prideco, Inc. requested

revocation of the AD order on Mexican OCTG with respect to finished

drill pipe. The Department received letters in opposition to this

second request from OMSCO Industries and Drill Pipe Industries, Inc. on

February 12, 1998, and February 13, 1998, respectively. On March 16,

1998, Grant Prideco withdrew its request for a changed circumstances

review.

Subsequent to the Department's response to IADC on March 13, 1998,

parties raised questions regarding whether ``substantially all'' of the

domestic industry supports continuation of the AD order on OCTG from

Mexico with respect to finished drill pipe. In light of the request

originally filed by Grant Prideco and the information available to the

Department, the Department believed that Grant Prideco's affirmative

statement of no interest constituted good cause for conducting a

changed circumstances review solely to determine if ``substantially

all'' of the domestic producers of the like product supported partial

revocation of the antidumping duty order with respect to finished drill

pipe.

Analysis

Section 351.222(g)(i) of the Department's regulations provides that

the Secretary may revoke an order in part based on changed

circumstances if ``producers accounting for substantially all of the

production of the domestic like product to which * * * the part of the

order to be revoked * * * have expressed a lack of interest'' in the

continued existence of the order, in whole or in part. The Department

interprets ``substantially all'' production to mean at least 85 percent

of domestic production of the domestic like product. The Department

thus conducted the review solely to determine the level of support of

domestic producers of the domestic like product for maintaining this

order with respect to finished drill pipe.

In order to determine whether ``substantially all'' of the domestic

producers supported revocation in part of the order, the Department

solicited comments from all parties with an interest in this review. In

addition, the Department requested production information from

producers of both finished and unfinished drill pipe. The Department

received numerous comments regarding interest in the order, including

comments on the supply and production lead times of finished drill pipe

in the United States. Additionally, the Department received production

information from producers of finished drill pipe, as well as producers

of unfinished drill pipe.

To verify this information, the Department conducted verifications

of three of the domestic producers of the like product (Grant Prideco,

OMSCO, and Drill Pipe Inc.) in September and October of 1998. Copies of

the public versions of the verification reports for all three companies

are available in the Import Administration's Central Records Unit.

Based on the responses by domestic producers, and the results of

our verification, we have determined that less than 85 percent of the

domestic industry of the like product supports the partial revocation

of the order.

Parties wishing to comment on these results must submit briefs to

the Department within 30 days after the publication of this notice in

the Federal Register. Parties will have five days subsequent to this

date to submit rebuttal briefs. Any requests for hearing must be filed

within 30 days of the publication of this notice in the Federal

Register.

Preliminary Results of Review

Based on the submissions by the producers, the Department has

preliminarily determined that producers supporting a partial revocation

of the order account for less than 85 percent of domestic production of

the like product. Under the definition given above, ``substantially

all'' of the domestic producers of the like product do not support

partial revocation of the order with respect to finished drill pipe. As

a result, we preliminarily determine that there is no basis to revoke,

in part, the antidumping duty order on oil country tubular goods from

Mexico with respect to finished drill pipe.

Dated: March 11, 1999.

Robert S. LaRussa,

Assistant Secretary for Import Administration.

[FR Doc. 99-7215 Filed 3-23-99; 8:45 am]

BILLING CODE 3510-DS-P