CNC machining vision becomes reality – and transforms an industry

Challenge: LB Pipe & Coupling is a start-up company that uses Okuma vertical lathes to make high-quality precision couplings for the water well, oil company tubular goods and API (American Petroleum Institute)-certified markets. Owned as a joint venture between two industry stalwarts – L.B. Foster Company and Lally Pipe & Tube – LB Pipe currently operates as an in-house contract manufacturer for CNC machining, with plans to expand to serve additional outside customers.

The coupling industry is opportune. In the U.S., there is growth as more pipe goes in the ground, but not enough coupling capacity to sustain this growth. Many companies are making pipe, but few are making couplings because the process poses an unappealing business model. The way they’re manufactured today, 30% of every coupling is scrap. Making matters worse, it’s a labor intensive process, at a time when labor costs are skyrocketing.

The challenge – create a CNC machining process to build quality couplings while significantly reducing costs. The LB Pipe team knew the answer to increasing productivity and reducing labor costs was to create an automated system for manufacturing API couplings.

Real Help: Okuma initiated the innovation process with a premium coupling cell demonstrated at IMTS 2008. Okuma and distributor Hartwig worked in the trenches with LB Pipe to further customize an automated process designed specifically for the API market.

In operation since February 2010, LB Pipe has already reduced labor cost by more than half, increased consistency, and lowered the typical reject rate. They have one Okuma coupling cell in place, using two Okuma 2SP-V60 CNC vertical lathes. And, the company plans to add five more cells, compounding efficiencies along the way.

REAL STORY: INNOVATION

LB Pipe & Coupling Products, LLC

“We needed to find a better way. Just because things have always been done a certain way doesn’t mean it’s impossible to streamline the process.”

-Jim Legg

Location: Magnolia, Texas

Employees: 16 Equipment: 2 Okuma 2SP-V60s

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WANTED: A BETTER WAY

With 31 years in the oil and gas industry, many industry veterans would be entering the coasting phase of their careers. Not Jim Legg. He’s a fast-acting bundle of energy and ambition. His fuel has always been a unique vision for what’s possible beyond business-as-usual.

On the road to his current position as General Manager of LB Pipe, Jim got started in 1979 on the production side of the business, drilling and completing oil and gas wells in Northeast Ohio, first with Tipka Oil and Gas. He later went on to become owner/operator of JD Oil and Gas, a consulting completion business that kept him running for 18 years.

In 2000, Jim went to the manufacturing side when he joined a relatively small operation. By 2008 that company became the largest coupling manufacturer in North America.

During this time, his vision for the industry crystallized. The coupling manufacturing process relied heavily on manual labor, with escalating costs. Additionally, reject rates were relatively high, adding more to the price equation. Jim knew that streamlining cost out of the system was the way of the future. The only way to get there was automation.

When Jim left the large manufacturer in 2008, he took action toward creating this radical innovation.

“Our vision was to do things differently from what the industry has done for decades,” says Jim. “We needed to find a better way. Just because things have always been done a certain way doesn’t mean it’s impossible to streamline the process.”

Jim is the right man for this mission. His dedication and commitment are well beyond the norm. At his former employer, he even lived on the shop property to accommodate his long hours.

His father, Ken Legg, who today works at LB Pipe, summarizes his son’s personality perfectly. “Jim never stops. He loves to do things with his own hands. He’ll take a challenge, I’ll tell you that. What he loves most is to build and design the things he creates in his mind.”

All Jim needed was the right CNC machining equipment and a brand new, automated process.

BREAD AND BUTTER OF THE INDUSTRY

When the executives at L.B. Foster Company and Lally Pipe & Tube learned of Jim’s departure from his former employer, they initiated talks immediately. Clearly, Jim’s vision could revolutionize their businesses. If they could improve the process for coupling manufacturing, they could enhance their overall product offerings significantly.

They created a joint venture to set up LB Pipe & Coupling Products as an in-house contract manufacturer. Having a new way to make couplings would eventually attract other customers as well.

The focus would be on what’s known as the bread and butter of the industry – API couplings. These are standard-issue couplings certified by the American Petroleum Institute for use in oil and gas applications.

With conventional technology, it takes three workers to run one spindle in the manufacture of API couplings. With labor costs skyrocketing, and given the challenges of day-to-day workforce management, bread and butter were expensive staple items in the oil and gas producers’ budgets.

IMTS 2008 – THE SPARK

In September of 2008, Jim attended the International Manufacturing Technology Show (IMTS) with his vision in mind. He knew that doing things differently with couplings would require two things: automation and the latest technology for CNC machining. It would be there somewhere.

He encountered a surprise at the Okuma booth. They were demonstrating a cell for making premium couplings, which was a big head start toward Jim’s vision. Premium and API couplings are two different markets. The former are more difficult, with more stringent specifications and different threading operations. The API product uses different operations and different tooling.

Jim recalls his immediate reaction. “When I saw the Okuma coupling cell at IMTS 2008, I thought ‘that’s the way to go.’ They were about 60% of the way there in terms of developing the process. It would just take a little more research to determine how to integrate API tooling with the automated cell.”

“One thing was clear to me. I knew Okuma could manufacture the API coupling.”

FROM DIRT TO PRODUCTION

LB Pipe built their entire facility from the ground up in farm country in Magnolia, Texas. A small crew was established including Jim, his father, and hand-picked industry veterans. They did much of the construction work themselves, including pouring concrete floors in the middle of a winter night because they saw heavy weather coming. The hands-on approach kept budget contained and enabled them to stick to a rapid schedule.

From dirt to production, LB Pipe was built in four months.

INNOVATION CREATES THE NEW OKUMA COUPLING CELL

During this period, Okuma and Okuma distributor Hartwig worked with the LB Pipe team to customize the process for machining the couplings to make the API threads. The front end of the process was streamlined by adapting a rotating head cutoff machine so that coupling stock could be cut into exact lengths, each having a good face on a square part with a ready OD clamper. This is necessary for repeatability of the coupling cell and its robotics, and also eliminated some of the manual labor associated with the traditional band saw approach.

“What used to be our regular saw time is now the same as our complete run time,” says Jim.

With the parts prepped for the coupling cell, integration of the support equipment was needed to orchestrate the workflow. The blanks go to the robot, which loads the Okuma vertical lathes, unloads them and then places them on an outbound conveyor.

When the process was complete, the results were measured. The general rule of thumb in the industry is three people per spindle. With four spindles running right now, it takes two people to operate the automated cell. Two more spindles will be added to the cell soon, and will still require only two operators. So, for this one work cell, two people can do what would have required 18 people using the old technology.

Ted Roy, Plant Manager, has many years’ experience with coupling manufacturing. He sees additional advantages with the automation. “You want to keep guys out of the machines. When you’re running 50-60 tons of material per week, that’s a lot for human bodies to take. Plus, machines don’t complain or call in sick. The amount of material we can now move is pretty amazing.”

Ted also handles programming for the machines. Each machine has its own THINC® CNC control to dial-in the instructions for the operation. The entire group of machines is integrated using MacMan-Net, a networked machine management program for CNC monitoring.

“In 1987 I worked with my first Okuma. I always liked it because of the mechanical positioning,” says Ted. “Now I’m a fan of the programming capabilities. It’s very simple to program using a standard format. You can do it on the machines, or you can upload to a flash drive and plug it into the USB. This makes the process effortless as far as I’m concerned. The control has tons of memory so you can store all your jobs in there.”

“I’m really impressed with this whole concept.”

THE PATH FORWARD

While most of LB Pipe’s employees have experience running CNC machines to make couplings, the equipment and automated process is all new, so training is important. Okuma and the other partners have been supplying this training.

Two machines and four spindles are currently in operation, and one more machine will be added soon to complete the cell. Machines are on order for building a cell to handle smaller pipes, what the industry calls “macaroni.” Ultimately machines will be added to create four more automated cells for the larger pipes.

“WE WANT TO BE ALL OKUMA”

The overall productivity increase to-date stands at 10-15%. These efficiencies will compound as more equipment is added, while adding little in the way of additional workforce. The automated process has also increased consistency. With the old manual process, couplings-per-hour would drop off over time. Now, according to Jim, “With automation, you get the same number of parts hour after hour. It’s very consistent.”

Orders are coming in for high-profile projects in New York City. The LB Pipe team expects that the technology alone will attract more customers because of the reduction in labor costs and increase in consistent quality.

Jim sees his vision coming to life on the concrete floor poured not too long ago. The Okuma coupling cell is transforming the API coupling market.

“We want to be all Okuma. We like the reliability, the stability and the service response, for sure. Add to that the teamwork they provided as we innovated the process for automation, and we think we have the formula for continued success and transformation of our industry.”