Created: 4/22/1974

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Iron and Steel:

The Soviet Union has extended5 billion of economic aid to help develop the steel industriesess developed countiies. Included among the recipients are Algeria, Egypt, India, Indonesia, Iran, Sri Lanka, and Turkey with preliminary surveys underway in Peru. Soviet aid may include design work, supply of equipment and some construction materials, training, and sometimes raw material supplies. In addition to the steel plants themselves, Moscow may help develop raw material supplies and help construct ancillary facilities such as power and cement plants. The value of Moscow's contribution variesf total costs depending on the recipient's ability to supply equipment and cover local construction costs.

Possibly Moscow's greatest contribution is in the fields of training and employment. Average domestic employment at the plnntsost of whom have recieved training at Soviet run centers in the recipient country or have been sent to Soviet Union for training. Local construction employment averagaslthough the'number varies as construction proceeds. Soviet Steel Industry Technology

The Soviet Union, which now rivals the United States as the world's largest steel producer, has developed an essentially modern steel industry although the level of technology is not unifoimaly high ln all sectors of the industry. Soviet technology


is most advanced in the primary sectorthat it, in the treatment of iron orereparation of the charge for the blast furnacend in the operation of. blast furnaces. However, the Soviets employ oxygen converter steelmaking and continuous casting processes less than in the West although it should be noted that these processes are steadily gaining acceptance in the USSR. The Soviets are the least advanced in the rolling and finishing sector. The Soviets have relied mainly on their own efforts to equip their steel industry but they are increasing purchases of equipment from abroad for selective types of equipment. Export of Equipment

The Soviets have had considerable experience in building steel plants abroad. Most of the work has been for other Communist countries but developing countries have also received large amounts of equipment. Ashe Soviets1 record for construction of steel industry facilities abroad in the period since World War II was as follows (in terms of millions of tons of productive capacity):

Cepec ity_





The Soviet recordixed one in terms of resultsmong the developing countries the principal recipients of Soviet aid have been India, the OAR, Algeria, Iran, and Turkey, The Bhilai plant in India has generally been regardedell constructed plant although there were lags in construction (due in part to tardy Soviet deliveries and planning mix-ups but also Indian insistence on handling as much of job as possible by local machine builders). The product mix of the Bhilai plant consists mainly of rails and structural steel, or relatively simple products. The record in the case of another major Indian projectthe Bokaro steel millis less satisfactory. The plant is considerably


Its first

.o:'ur3 I

furnace oparahions hiiwt begun. Tha pXwit isi

illion tona in the t'irstnd .nay uvwaCuall

on plant although many years will

be required and Soviet competence has yet to be demonstrated insofar

as the necessary rolling and finishing equipment is concerned.

Hot and cold strip mills and tinning and galvanizing lines are to

be installed. The Soviets have lagged in meeting their own needs

for those types of equipment and have imported some types of

finishing equipment.

Briefly it may be stated that Soviet competenceupplier of basic production equipment and equipment needed forf the less sophisticated products (such as those neededeveloping country) is well demonstrated. However, Soviet performance in meeting delivery dates has not been impressive. Soviet domestic machine building plants are heavily-burdened and plcns for expanding capacity have not been carried out. esult there have frequently been delays in meeting overseas delivery dates. Delays have also been encountered in the planning and designing stages and probably exacerbated in coordinating and gaining find approval froa the client government. Probably slow progrnas in getting some facilities into operation and up to ratede attributed to difficulties in technical training

but tv-iwS

y far thatT-theit.byoir "jv.t. sL^p! ustrv isignificant:has beer, imported. Koafc of the imports traditionally have come from other Communist countriesmainly rolling mill equipment from Czechoslovakia and East Germany. In recent years, however, the Soviets have been turning to Western supplierside variety of equipment of the types needed to improve the quality of their steel (specialized melting facilities, control equipment, instrumentation,nd to widen the assortment of steel products (special coating lines, stainless steel processing lines, etc.). In aggregate the value of these imports, although growing^representsmall share of actual investment in the Soviet steel industry but they are important for helping correct deficiencies and bottlenecks in the industry. Proposed USSR Steel Plant for Higeria

If the plant is toarge integrated steel complexubstantial productof finished rolled steal products any plant built by the USSR would lag considerably behind one built by the USA, Japan, or Wast Garmsny in the technology of the roiling mills, particularly if there are to ba any ccid rc1Line mills. q plant is to arcploy the basic oxvv-en fT r? SO?) process.ofhich is thai^wra and


economical methods used today, the Russians have not achieved technology in this field comparable to the three countries mentioned above. Also, if the plant was toirect reduction process for the manufacture of steel furnance feed material instead of the convential blast furnace, again it is believed that the USSR lags considerably behind Western technology With Nigeria's available oil and natural gas, however, the direct reduction process may be the most economical route to go.


Petroleum: Soviet Aid to Less Developed Countries

he Soviet Union has extended someillion in petroleum development aid toess developed countries. Major recipients of Soviet aid have been India, Iraq, Afghanistan, Egypt Iran, and Syria. Soviot aid has encompassed exploration, production, transportation, and supply of refining facilities. India, which has relied heavily on the USSR to help itational oil industry, has0 million in Soviet credits since the inception of Soviet aid. In Iraq, Soviet aid of0 million has inducted planning, exploration, development of new oil fields, construction ot refineries and other facilities and the .'training of Iraqi technicians. Tne USSR also is constructing pipelines in Iraq, ajor line tnat will connect tne North Rumaylah fieldsefinery the USSR is building in Mosul. Moscow has small programs in other less developed countries. Among the small producers, Moscow has been active in Syria, where Soviet-developed fields account for all of Syria's production of six millionear. However, the USSR reportedly is with drawing fromyear unsuccessful search for oil in Egpyt Western desert.

Petroleum Training Standards

Soviet aid inetroleum training institute may bo adequate for basic and intermediate level training purposes-Beyond this point, Nigerians will gain more from observing Western

operations where they are more apt to see modern technology being applied in all phases of exploration drilling, production, and pipeline operation. Tho Soviocs are excellent theoreticians, with great mathematical capabilities in the geological and engineering fields. However, their inability to apply the latest techniques and methods is evident in most petroleum industry operations.

Oil Exploration

Soviet assistance in oil exploration onshore probably would be of some value to Nigeria, but they have no expertise or experience worth considering in offsnoro exploration. Mathematical capabilities of Soviet geophysicists are acknowledged throughout the world. However, their use of digital recording seismie equipment and re la tea computer hardware and software has been very limited and is otears behind that of the OS. Well-logging and core analysis techniques are not as well developed as in tne West. Drilling technology and drilling fluid composition is poor by Western standards. Production testing and formation evaluation methods are inferior and very time consuming. Reservoir engineering methods can be excellent, but exploitation and the application of different production methods could prove to be inefficient.


Comparison of Soviet Western Equipment Soviet equipment is generally bulky end less reliable thanquiprr-.ant and maintenance is complicatedack ofts and skilled service personnel- Soviet drilling equipment is not as efficient as Western equipment, and failures of Soviat drill pipe are common. Most equipment lacks portability and would be unsuited for undeveloped wilderness'use. More efficient seismic equipment, rotary drilling equipment, tungsten steel and diamond bits, blowout preventors and drilling fluid technology can be supplied only by the West.

Soviet Technology in Oil Refining

Soviet technology and equipment for oil refiningequata for most of its own needs but lags behind that in the West. Most of the secondary crocesses, such as catalytic cracking, catalytic reformingvhydrogen treating/ used to improve quality and vary the mi* Of product are available in Soviet refineries. However, the size cf the units is irsuch smaller than employed in the west and the efficiency of operation is lower, primarily because cf lower quality of catalysts and poox design-


US refinery experts obs-srvec.aficiencies inilt units in Eastern Europe, when the last European countries

han Sr-viet, Moiststsce in ffo-^arnisinsre'lr-tri^s. ch ior


corr-erciel unit o* its own. rench firm recently has built the only commercial hydrocracker in the Soviet Unicr..

Soviet Technology in Petrochemicalimilar situation exists in the Soviet petrochemical industry. Much of modern expansion in the Soviet petrocheniical industry is based on Western technology. The USSR has had difficul in designing and operating large units fcr more efficient output. In recentarge number of Soviet orders have been placed in Western Europe, Japan, and the US for large plants, including ethylene, ethylene opide, polyethylene, ammonia and acrylor.itrile.



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