SecProbe.io

CORRESP
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 filename1.htm

 ppih20260619_corresp.htm

 June 22, 2026

 Via EDGAR

 U.S. Securities and Exchange Commission

 Division of Corporation Finance

 100 F Street, N.E.

 Washington, D.C. 20549

 Attention: Alexandra Barone

 Re:
 Perma-Pipe International Holdings, Inc.

 Registration Statement on Form S-3

 Filed June 9, 2026

 File No. 333-296640

 Acceleration Request

 Requested Date:
 June 26, 2026

 Requested Time:
 4:00 PM Eastern Time

 Ladies and Gentlemen:

 Pursuant to Rule 461 under the Securities Act of 1933, as amended, Perma-Pipe International Holdings, Inc. (the “ Company ”) hereby requests that the above-referenced Registration Statement on Form S-3 (File No. 333-296640) (the “ Registration Statement ”) be declared effective at the “Requested Date” and “Requested Time” set forth above or as soon thereafter as practicable, or at such later time as the Company may request by telephone to the staff (the “ Staff ”) of the Securities and Exchange Commission (the “ Commission ”). The Company hereby authorizes David R. Earhart of Gray Reed & McGraw LLP, counsel for the Company, to make such request on the Company’s behalf.

 The Company requests that it be notified of the effectiveness of the Registration Statement by telephone to David R. Earhart of Gray Reed & McGraw LLP, at (469) 320-6041. Please direct any questions or comments regarding this acceleration request to David R. Earhart.

 Sincerely,

 PERMA-PIPE INTERNATIONAL HOLDINGS, INC.

 By: /s/ Matthew Lewicki

 Matthew Lewicki

 Chief Financial Officer

 cc:
 David R. Earhart

 Gray Reed & McGraw LLP

<DOCUMENT>
<TYPE>TEXT-EXTRACT
<SEQUENCE>2
<FILENAME>filename2.txt
<TEXT>
 June 15, 2026

Saleh Sagr
Chief Executive Officer
Perma-Pipe International Holdings, Inc.
2445 Technology Forest Blvd, Suite 1010
The Woodlands, Texas 77381

 Re: Perma-Pipe International Holdings, Inc.
 Registration Statement on Form S-3
 Filed June 9, 2026
 File No. 333-296640
Dear Saleh Sagr:
 This is to advise you that we have not reviewed and will not review your
registration
statement.
 Please refer to Rules 460 and 461 regarding requests for acceleration.
We remind you that
the company and its management are responsible for the accuracy and adequacy of
their
disclosures, notwithstanding any review, comments, action or absence of action
by the staff.
 Please contact Alexandra Barone at 202-551-8816 with any questions.

 Sincerely,

 Division of
Corporation Finance
 Office of
Technology
cc: David R. Earhart, Esq.
</TEXT>
</DOCUMENT>

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	ppih20220517_corresp.htm

PERMA-PIPE INTERNATIONAL HOLDINGS, INC.

6410 W. Howard Street

Niles, Illinois 60714

May 18, 2022

VIA EDGAR

United States Securities and Exchange Commission

Division of Corporation Finance

100 F. Street, N.E.

Washington, D.C. 20549

Attention: Anna Abramson

Re:      Perma-Pipe International Holdings, Inc.

 Registration Statement on Form S‑3 (File No. 333-264913)

Dear Ms. Abramson:

Pursuant to Rule 461 under the Securities Act of 1933, as amended, the undersigned registrant, Perma-Pipe International Holdings, Inc., hereby respectfully requests that the above-referenced Registration Statement be declared effective at 11:00 a.m., Eastern Time, on May 20, 2022, or as soon as practicable thereafter.

Very truly yours,

PERMA-PIPE INTERNATIONAL HOLDINGS, INC.

By:  /s/ D. Bryan Norwood

D. Bryan Norwood

Vice President and Chief Financial Officer

United States securities and exchange commission logo
May 17, 2022
Bryan Norwood
Chief Financial Officer
Perma-Pipe International Holdings, Inc.
6410 W. Howard Street
Niles, Illinois 60714
Re:Perma-Pipe International Holdings, Inc.
Registration Statement on Form S-3
Filed May 13, 2022
File No. 333-264913
Dear Mr. Norwood:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration.  We remind you
that the company and its management are responsible for the accuracy and adequacy of their
disclosures, notwithstanding any review, comments, action or absence of action by the staff.
            Please contact Anna Abramson, Staff Attorney, at (202) 551-4969 or Jan Woo, Legal
Branch Chief, at (202) 551-3453 with any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Spencer T. Moats

February 2, 2012
 Via facsimile

Mr. Michael D. Bennett VP, Chief Financial Officer, Secretary and Treasurer MFRI, Inc.
7720 N. Leigh Avenue
Niles, IL 60714
Re: MFRI, Inc.
 Form 10-K for the fiscal year ended January 31, 2011
Filed April 14, 2011 Definitive Proxy Statement on Schedule 14A Filed May 27, 2011 Forms 10-Q for the periods ended April 30, 2011, July 31, 2011 and October 31, 2011 Filed June 13, 2011, September 14, 2011 and December 12, 2011 File No. 1-32530

Dear Mr. Bennett:
 We have completed our review of your f ilings.  We remind you that our comments or
changes to disclosure in res ponse to our comments do not for eclose the Commission from taking
any action with respect to the company or the filings and the company may not assert staff
comments as a defense in any proceeding ini tiated by the Commission or any person under the
federal securities laws of the United States.  We urge all pers ons who are responsible for the
accuracy and adequacy of the disclosure in the fi lings to be certain that the filings include the
information the Securities Exchange Act of 1934 and all applicable rules require.

Sincerely,
   /s/ John Cash
John Cash Branch Chief

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		Response to SEC comment letter

7720 North Lehigh Avenue

Niles, Illinois 60714-3491

Phone (847) 929-1202

Fax (847) 966-1310

January 13, 2012

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

Re:     MFRI, Inc.

Form 10-K for the Fiscal year ended January 31, 2011

Filed April 14, 2011

Definitive Proxy Statement on Schedule 14A

Filed May 27, 2011

Forms 10-Q for the periods ended April 30, 2011, July 31, 2011 and October 31, 2011

Filed June 13, 2011, September 14, 2011 and December 12, 2011

File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

Following are our responses to your letter of December 29, 2011.  Our response follows the organization of your letter.  We have used terms that were defined in the subject filings without re-iterating their definition in this letter.

Form 10-K for the Fiscal year ended January 31, 2011

Condensed Consolidated Statement of Cash Flows, page 30

1.

 In future periodic filings please remove the subtotal included under Financing Activities as this presentation is not contemplated under ASC 230.  Please also refer to ASC Topic 230-10-45-7 for information pertaining to gross and net cash flows.

Company response.  In future filings we will remove the subtotal included under Financing Activities.

Definitive Proxy Statement on Schedule l4A

Compensation Plans for NEOs as of January 31. 2011

2.

 We note your disclosures in this section regarding the incentive compensation of Mr.Unger, Mr. Elgendy, and Mr. Maffei. You included similar disclosure in your definitive proxy statement filed May 29, 2008. In our letter dated December 23, 2008 we requested that you disclose in future filings the percentages of (i) consolidated income before income taxes and before corporate profit-based incentive compensation and (ii) business unit income from operations before allocated corporate expenses that you must meet in order for executives to earn their respective bonuses and disclose what the actual amounts were for the prior year. Please tell us this information for the last fiscal year, with a view toward future disclosure. See Item 402(o)(5) of Regulation S-K.

Company response.  Following is the relevant section of the Definitive Proxy Statement on Schedule 14A filed May 27, 2011 modified to include the information required by the staff's comment.  Added information is identified by bold italics.

Compensation Plans for NEOs as of January 31, 2011

David Unger. In addition to Mr. Unger's annual base salary, he earns incentive compensation calculated as two percent of the company's consolidated income before income taxes and before corporate profit-based incentive

Compensation (“Corporate Incentive Earnings”); the two percent rate is increased to four percent of Corporate Incentive Earnings in excess of $4,584,000. 2010 Corporate Incentive Earnings were $2,816,129 and Mr. Unger earned $56,323 of incentive compensation .The company makes available to Mr. Unger an annual amount to pay premiums for certain insurance policies for Mr. Unger and his wife currently or in later years and reimburses his and his wife's medical expenses. Mr. Unger is reimbursed for a club membership and is provided a company automobile. Mr. Unger is granted stock options as approved by the Compensation Committee from time to time.

Fati A. Elgendy. On November 12, 2007, the Company and Mr. Elgendy entered into an employment agreement to confirm Mr. Elgendy's employment arrangement with the company (“Employment Agreement”). For details, refer to Exhibit 10(j) filed with the company's Form 10- K on April 19, 2009. In addition to Mr. Elgendy's annual base salary under the Employment Agreement, he earns incentive compensation calculated as  six percent of the Perma-Pipe business unit's income from operations before allocated corporate expenses to the extent such income exceeds six percent of business unit sales (the “Perma-Pipe President Incentive Earnings”). In 2010, Perma-Pipe President Incentive Earnings were $8,707,033, and Mr. Elgendy earned $522,422 of incentive compensation. Pursuant to the Employment Agreement, Mr. Elgendy is provided a company automobile, credited with nonqualified deferred compensation and granted stock options as approved by the Compensation Committee from time to time. If Mr. Elgendy's employment is terminated by the company other than for death, disability, or due cause (as defined in the Employment Agreement), Mr. Elgendy will be entitled to additional base salary and incentive payments as set forth in his Employment Agreement.

Robert A. Maffei. In addition to Mr. Maffei's annual base salary, he earns incentive compensation calculated as three percent of the Perma-Pipe business unit's income from operations before allocated corporate expenses and before U.S. employees' incentive compensation to the extent such income exceeds six percent of business unit sales (the “Perma-Pipe Management Incentive Earnings”).  2010 Perma Pipe Management Incentive Earnings were $10,661,444, and Mr. Maffei earned $319,843 of incentive compensation.  Mr. Maffei is credited with nonqualified deferred compensation and is granted stock options as approved by the Compensation Committee from time to time.

Related Parties

3.

 In future filings, please fully comply with Item 404(a)( 1) of Regulation S-K by providing the name of the company and the two principal stockholders who own the company to which you provided services.

Company response.  The information described will be included in future filings.

Forms 10-Q for the quarters ended April 30, 2011, July 31, 2011 and October 31, 2011

Exhibits 31.1 and 31.2

4.

 In future filings, please provide the certifications exactly as provided in Item 601(b)(31) of Regulation S-K, including the entire introductory paragraph 4 regarding disclosure controls and procedures and internal control over financial reporting and the parenthetical text in paragraph 4(d).

Company response.  Future filings will recite the language exactly as described in the staff's comment.

Form 10-Q for the quarter ended October 31, 2011

Financial Statements

Note 3 - Income Taxes, page 5

5.

 We note your disclosure which indicates you have repatriated foreign earnings during your most recent fiscal quarter. In future filings, please expand your liquidity disclosures to discuss the locations of your cash balances and also discuss the potential range of tax consequences, should you continue to repatriate additional cash. If further repatriations are anticipated, please also discuss the extent and timing of such repatriations.

Company response.  The information described will be included in future filings.

*    *    *    *    *

We acknowledge that

•

 The company is responsible for the adequacy and accuracy of disclosures in its filings;

•

 Staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any actions with respect to the company's filings; and

•

 The company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Very truly yours,

MFRI, Inc.

/s/  Michael D. Bennett

Michael D. Bennett

Vice President, Chief Financial Officer, Secretary and Treasurer

(Principal Financial and Accounting Officer)

December 29, 2011
 Via facsimile

Mr. Michael D. Bennett VP, Chief Financial Officer, Secretary and Treasurer MFRI, Inc.
7720 N. Leigh Avenue
Niles, IL 60714
Re: MFRI, Inc.
 Form 10-K for the fiscal year ended January 31, 2011
Filed April 14, 2011 Definitive Proxy Statement on Schedule 14A Filed May 27, 2011 Forms 10-Q for the periods ended April 30, 2011, July 31, 2011 and October 31, 2011 Filed June 13, 2011, September 14, 2011 and December 12, 2011 File No. 1-32530

Dear Mr. Bennett:
 We have reviewed your filings and have the following comments.  In some of our
comments, we may ask you to provide us with  information so we may better understand your
disclosure.
 Please respond to this letter within te n business days by providing the requested
information, or by advising us when you will provide the requested response.  If you do not believe our comments apply to your facts and circ umstances, please tell us why in your response.
 After reviewing the information you provide in response to these comments, we may
have additional comments.  Form 10-K for the period ended January 31, 2011

 Condensed Consolidated Statement of Cash Flows, page 30

 1. In future periodic filings please remove th e subtotal included unde r Financing Activities
as this presentation is not contemplated under ASC 230.  Please also refer to ASC Topic
230-10-45-7 for information pertaining  to gross and net cash flows.

Mr. Michael D. Bennett MFRI, Inc. December 29, 2011 Page 2

 Definitive Proxy Statement on Schedule 14A

 Compensation Plans for NEOs as of January 31, 2011

 2. We note your disclosures in this section re garding the incentive compensation of Mr.
Unger, Mr. Elgendy, and Mr. Maffei.  You includ ed similar disclosure  in your definitive
proxy statement filed May 29, 2008.  In our le tter dated December 23, 2008 we requested
that you disclose in future filings the per centages of (i) consolidated income before
income taxes and before corporate profit-ba sed incentive compensati on and (ii) business
unit income from operations befo re allocated corpor ate expenses that you must meet in
order for executives to earn their respective bonuses and di sclose what the actual amounts
were for the prior year. Please tell us this info rmation for the last fiscal year, with a view
toward future disclosure.  See Item 402(o)(5) of Regulation S-K.
 Related Parties

 3. In future filings, please fully comply with Item 404(a)(1) of Regulation S-K by providing
the name of the company and the two prin cipal stockholders who own the company to
which you provided services.

Forms 10-Q for the quarters ended April 30, 2011, July 31, 2011 and October 31, 2011

 Exhibits 31.1 and 31.2

 4. In future filings, please provide  the certifications exactly as  provided in Item 601(b)(31)
of Regulation S-K, including the entire in troductory paragraph 4 regarding disclosure
controls and procedures and
 internal control over financial reporting and the parenthetical
text in paragraph 4(d).
 Form 10-Q for the quarter ended October 31, 2011

 Financial Statements

 Note 3 – Income Taxes, page 5

 5. We note your disclosure which indicates you have repatriated fo reign earnings during
your most recent fiscal quarter.  In future filings, please expand your liquidity disclosures
to discuss the locations of your cash balances and also discuss the pot ential range of tax
consequences, should you continue  to repatriate additional cas h.  If further repatriations
are anticipated, please also discuss the ex tent and timing of such repatriations.
 We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing include s the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules requir e.  Since the company and its management are

Mr. Michael D. Bennett MFRI, Inc. December 29, 2011 Page 3

 in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.
 In responding to our comments, please provi de a written statement from the company
acknowledging that:
 the company is responsible for the adequacy  and accuracy of the disclosure in the
filing;

 staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking any action with respect to the filing; and

 the company may not assert staff comments as a defense in any proceeding initiated
by the Commission or any person under the federal securities laws of the United States.

You may contact Mindy Hooker at  (202) 551-3732 or Kevin Ster tzel at (202) 551-3723 if
you have questions regarding comments on the fina ncial statements and related matters.  Please
contact Chambre Malone at ( 202) 551-3262, Craig Slivka at ( 202) 551-3729 or me at (202) 551-
3768 with any other questions.
Sincerely,
   /s/ John Cash

John Cash Branch Chief

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

       DIVISION OF
CORPORATION FINANCE

March 10, 2009
  Mr. Michael D. Bennett Vice President, Secretary and Treasurer, MFRI, Inc. 7720 N. Leigh Ave Niles, IL  60714
Re: MFRI, Inc.
Form 10-K for the year ended January 31, 2008 Definitive Proxy Statement on Schedule 14A, filed May 29, 2008
Form 10-Q for the quart er ended October 31, 2008
File No. 1-32530

 Dear Mr. Bennett:
 We have completed our review of your Fo rm 10-K and related filings and have no
further comments at this time.
If you have any questions regarding our revi ew of these filings, please direct them
to Mindy Hooker, Staff Accountant, at (202)  551-3732, Hagen Ganem, Attorney, at (202)
551-3330, or to the undersigned at (202) 551-3768.         S i n c e r e l y ,            John Cash        B r a n c h  C h i e f

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March 4, 2009

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

Re:

MFRI, Inc.

Form 10-K for the year ended January 31, 2008

Definitive Proxy Statement on Schedule 14A, filed May 29, 2008

Form 10-Q for the quarter ended October 31, 2008

File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

Following are our responses to your letter of February 3, 2009.  Our response follows the organization of your letter.  We have used terms that were defined in the Subject filings without re-iterating their definition in this letter.

Form 10-K for the year ended January 31, 2008

Critical Accounting Estimates and Policies - Goodwill . . . . page 25

1.

SEC comment.  We note you have identified Goodwill as a critical accounting policy.  In order to provide readers with a better insight into management’s judgments in accounting for goodwill, please disclose the following:

•

A qualitative and quantitative description of the material assumptions used and a sensitivity analysis of those assumptions based upon reasonable likely changes; and

•

How the assumptions used for valuing goodwill in the current year have changed since the prior year highlighting the impact of any changes.

Company response.   In future filings the company will disclose the matters described in this SEC comment.

Page 2

Definitive Proxy Satement on Schedule 14A

Compensation Discussion and Analysis, page 9

2.

SEC comment.  We note your responses to comments 9 and 10 in our letter dated December 23, 2008.  Please confirm to us that by your responses you mean that you intend to disclose in future filings the particular information requested by comments 9 and 10.

Company response.  The company intends to disclose in future filings all the information required by Item 402 of Regulation S-K, including the particular information requested by comments 9 and 10.

We acknowledge that

•

the company is responsible for the adequacy and accuracy of the disclosure in its filings;

•

Staff comments or changes to disclosures in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and

•

The Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Very truly yours,

MFRI, INC.

/s/ Michael D. Bennett

Michael D. Bennett

Vice President Chief Financial Officer

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February 18, 2009

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

Re:

MFRI, Inc.

Form 10-K for the year ended January 31, 2008

Definitive Proxy Statement on Schedule 14A, filed May 29, 2008

Form 10-Q for the quarter ended October 31, 2008

File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

We have received your February 3, 2009 letter with subject as above (“Comment Letter”), and are preparing our response.   As instructed in the Comment Letter we are writing to advise you that, due to press of the year-end close of the company’s books and the need to work further with company employees and outside advisors and consultants, we have not yet completed our response.  We expect to be able to provide you with our response by March 4, 2009 (an additional 10 business days).

Very truly yours,

MFRI, INC.

/s/ Michael D. Bennett

Michael D. Bennett

Vice President Chief Financial Officer

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

       DIVISION OF
CORPORATION FINANCE

February 3, 2009
  Mr. Michael D. Bennett Vice President, Secretary and Treasurer, MFRI, Inc. 7720 N. Leigh Ave Niles, IL  60714
Re: MFRI, Inc.
Form 10-K for the year ended January 31, 2008 Definitive Proxy Statement on Schedule 14A, filed May 29, 2008
Form 10-Q for the quart er ended October 31, 2008
File No. 1-32530

 Dear Mr. Bennett:
We have reviewed your response to our letter dated December 23, 2008 and have the
following comments.  We ask that  you respond by February 18, 2009.

Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure requir ements and to enhance the overall disclosure in
your filing.  We look forward to working with you in these respects.  We welcome any questions
you may have about our comments or on any other aspe ct of our review.  Feel free to call us at
the telephone numbers listed at  the end of this letter.

Form 10-K for the year ended January 31, 2008

Critical Accounting Estimates a nd Policies – Goodwill…, page 25

1. We note you have identified Goodwill as a cri tical accounting policy.  In order to provide
readers with a better insi ght into management’s judg ments in accounting for goodwill,
please disclose the following:

• A qualitative and quantitative description of the material assumptions used and a
sensitivity analysis of those assumptions based upon reasonable likely changes; and
• How the assumptions and methodologies us ed for valuing goodwill in the current
year have changed since the prior year highlighting the impact of any changes.

Mr. Michael D. Bennett
MFRI, Inc.
February 3, 2009 Page 2

Definitive Proxy Statement on Schedule 14A

Compensation Discussion and Analysis, page 9

2. We note your responses to comments 9 a nd 10 in our letter dated December 23, 2008.
Please confirm to us that by your responses you mean that you intend to disclose in future
filings the particular information requested by comments 9 and 10.

As appropriate, please amend your filing a nd respond to these comments within 10
business days or tell us when you will provide us  with a response.  Plea se provide us with a
supplemental response letter that keys your re sponses to our comments and provides any
requested supplemental information.  Detailed letter s greatly facilitate our review.  Please file
your supplemental response on EDGAR as a corres pondence file.  Please understand that we
may have additional comments after reviewing your responses to our comments.
If you have any questions regarding these comments, please direct them to Mindy
Hooker, Staff Accountant, at  (202) 551-3732, Hagen Ganem, Attorney, at (202) 551-3330,
Jennifer Hardy, Legal Branch Chief, at (202)  551-3767 or to the unde rsigned at (202) 551-3768.

Sincerely,    John Cash Branch Chief

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**AMENDED**

January 16, 2009

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

Re:

MFRI, Inc.

Form 10-K for the year ended January 31, 2008

                                  Definitive Proxy Statement on Schedule 14A, filed May 29, 2008

Form 10-Q for the quarter ended October 31, 2008

File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

Following are our responses to your letter of December 23, 2008.  Our response follows the organization of your letter.  We have used terms that were defined in the Subject filings without re-iterating their definition in this letter.

Form 10-K for the year ended January 31, 2008

Item 1. Business, page 1

Piping Systems Business, page 3

Patents, Trademarks, and Approvals, page 3

1.

SEC comment.  We note that you own several patents covering the features of your piping and electronic detection systems.  In future filings, please disclose the duration and effect of your patents or explain supplementally why you believe this information is immaterial to your piping systems business.

See Item 101(c)(1)(iv) of Regulation S-K

Company response.  The patents are not material either individually or in the aggregate to the overall business of MFRI or to its piping system business because we believe sales in such business would not be materially reduced if patent protection were not available.

Raw materials and Manufacturing, page 4

2.

SEC comment.  We note from the first paragraph in this section that you currently have adequate supplies or available sources for raw materials but that “there are risks and uncertainties with respect to the supply of certain raw materials,” which could impact your ability to obtain those needed materials.  In future filings,

Page 2

please expand your raw materials discussion to identify the risks and uncertainties that pose an issue for you and identify those materials that are likely to be affected.

Company response.

In future filings, the Company will identify the risks and uncertainties and identify those materials that are likely to be affected.

Item 13. Certain Relationships and Related Transactions . . . . page 29

3.

SEC comment.  You incorporate the information required by Item 13 of Form 10-K by reference to your proxy statement to the 2008 annual stockholders meeting.  However, there is no discussion of related party transactions in your proxy statement.  In future filings, please include the discussion required by Item 404 of Regulation S-K.  In this regard, we
note from the third paragraph on page 24 that you were engaged in at least one related party transaction with “two principal stockholders, who are also members of management, for approximately $4,428,000.”  Please also file as exhibits the agreements related to these transactions as required by Item 601(b)(10)(ii)(A) of Regulation S-K.

Company response.  The related party transaction was included in the Proxy Statement in error.  There were no reportable related party transactions during the period covered by the reviewed filings that required disclosure in the Proxy Settlement.

Item 15. Exhibits and Financial Statement Schedules, page 29

General

4.

SEC comment.  In future filings, please file as a material contract the employment agreement you have with Mr. Elgendy.  See Item 601(b)(10)(iii)(A) of Regulation S-K.

Company response.  The Company will file Mr. Elgendy’s employment agreement as an exhibit.

Notes to the Consolidated Financial Statements

Note 9 – Employee Retirement Plans, page 47

Pension Plan, page 47

Page 3

5.

SEC comment.  We note at January 31, 2008 that approximately 99% of your pension plan assets were held in mutual funds.  In future filings please expand your discussion to include the impact market conditions have had on plan assumptions and the net periodic benefit cost, as well as the expected impact on future operations from a decrease in plan
assets, change in expected return and amortization of actuarial loss.  Please also address potential funding requirements relative to your accumulated benefit obligation and the implications to current and future liquidity resulting from potential incremental cash payments required to maintain funding requirements.

Company response.  The company will evaluate, in consultation with the pension plan’s actuary, all of the matters listed in the SEC comment above, and in future filings the company will expand the discussion to include all of those matters.

Item 10 – Business Segment and Geographic Information, page 49

Geographical Information, page 51

6.

SEC comment.  In future filings please disclose net sales attributable to individual countries within Europe and Asia, if material.  We note your increasing foreign activity and believe this disclosure refinement will assist your investors.  See paragraph 38 a. of SFAS 131 for guidance.

Company response.  In future filings the company will disclose the net sales attributable to each material combination of countries or individual country.

Exhibits 31.1 and 31.2

7.

SEC comment.  We note that your certifications omit the introductory language in paragraph 4 referring to internal control over financial reporting as required by Item 601(b)(31) of Regulation S-K.  In this regard, please amend your latest Form 10-K and your Forms 10-Q for the quarters ended April 30, July 31, and October 31, 2008 to include the
aforementioned language in your certifications.  Each of your amendments may consist of a cover page, explanatory note, signature page, and paragraphs 1, 2, 4, and 5 of the certifications.

Company response.  The company will amend its latest form 10-K and its Forms 10-Q for the quarters ended April 30, July 31, and October 31, 2008 to include the aforementioned language in its certifications.  Each of the amendments will be filed promptly in the manner described in the SEC comment above.

8.

SEC comment.  We note that paragraph 4(d) of your certifications omits the phrase “(the registrant’s fourth fiscal quarter in the case of an annual  report).”  In

Page 4

future filings, including the amendments requested above, please insert this omitted phrase as required by Item 601(b)(31) of Regulation S-K.

Company response.  The company will include the omitted phrase cited in the SEC comment in future filings, including the amendments described above.

Definitive Proxy Statement on Schedule 14A

Compensation Discussion and Analysis, page 9

Incentive Compensation, page 10

9.

SEC comment.  In future filings, please disclose the percentages of (i) consolidated income before income taxes and before corporate profit-based incentive compensation and (ii) business unit income from operations before allocated corporate expenses that you must meet in order for executives to earn a bonus and disclose what the actual amounts were for
the prior year.

Company response.  In future filings, the Company will provide additional disclosure to more fully meet the requirements of Item 402 of Regulation S-K.

Executive Compensation, page 12

Compensation Plans for NEOs. . . . page 13

10.

SEC comment.  With respect to your discussion of Mr. Elgendy’s employment arrangement on page 14, you state that his incentive compensation is calculated as a defined percentage of the “Perma-Pipe Incentive Earnings.”  In future filings, please define this term, provide any further disclosure necessary for an investor to understand how
Mr. Elgendy’s incentive compensation is determined, and quantify the most recent amount.

Company response.  In future filings, the Company will provide a definition of “Perma-Pipe Incentive Earnings,” as well as any additional disclosure required by Item 402 of Regulation S-K.

For 10-Q for the period ended October 31, 2008

Liquidity and Capital Resources, page 13

11.

SEC comment.  We note your non-compliance with the earnings covenant at January 31, 2008 and your reference to the subsequent waiver and amendment of that covenant.   Please disclose here or elsewhere in your filing the specific terms of any material debt covenants in your debt agreements.  For any material debt

Page 5

covenants, please disclose the required ratios as well as the actual ratios as of each reporting date.  This will allow readers to understand how much cushion there is between the required ratios and the actual ratios.  Please show the specific computations used to arrive at the actual ratios with corresponding reconciliations to US GAAP amounts, if necessary.  See Sections I.D and IV.C of the SEC Interpretive Release No. 3308350 and Question 10 of our FAQ Regarding the Use of Non-GAAP Financial Measures dated June 13, 2003.

Company response.   In future filings the company will disclose in Liquidity and Capital Resources or in the debt note to the financial statements the material debt covenants as well as the actual ratios as of each reporting date.  The company believes it has one material debt covenant, which is calculated, at any date, on the basis of the most recent four fiscal quarters:  EBITDA – For the most recent four fiscal quarters, consolidated income before interest expense, income taxes, depreciation and amortization for such period (but excluding any extraordinary gains for such period) plus the amount of any expenses or charges deducted therefrom for the applicable period in connection with the closure and write down of the company’s facility in Cicero, Illinois, provided that the aggregate amount of add-backs to EBITDA as a result of any such charges or expenses shall not exceed
$2,500,000.   The company is required to achieve EBITDA of at least $8,000,000 each fiscal quarter.  Actual EBITDA achieved for the most recent four fiscal quarters ended January 31, 2008 and subsequent reporting dates were as follows:

January 31, 2008 - $7,327,000 (waiver obtained)

April 30, 2008 - $6,728,000 (no covenant requirement)

July 31, 2008 - $8,672,000

October 31, 2008 - $9,814,000

Critical Accounting Estimates and Policies

Goodwill and Other Intangible Assets with Indefinite Lives, page 14

12.

SEC comment.  It appears that your current market capitalization is significantly below the book value of your equity.  Please advise us whether you have performed a recent impairment test.  If not, please explain how you analyzed the difference to conclude that an impairment test is not necessary.  Please explain any qualitative and quantitative
factors you considered (e.g. reconciliation).  If you have performed a recent impairment test, please provide us with a summary of your results in Step 1 and Step 2, if applicable.  We may have further comment.

Company response.  The company performed its annual goodwill impairment test  using discounted cash flows expected from the Industrial Process Cooling Equipment and Filtration Products businesses, where the goodwill resides, on

Page 6

February 1, 2008 and will perform another such test on February 1, 2009.  No intervening impairment test was made, as the company did not believe there was reason to suspect that the goodwill values for the Industrial Process Cooling Equipment and Filtration Products business had been impaired.  The decrease in the company’s market capitalization to below book value cited in the SEC comment above took place very late in the October 31, 2008 quarter.  The company is presently assessing its business plans for the Industrial Process Cooling Equipment and Filtration Products businesses, along with its other businesses, during its budgeting and planning cycle, and will use those updated plans for its impairment test to be performed on February 1, 2009.

We acknowledge that

•

the company is responsible for the adequacy and accuracy of the disclosure in its filings;

•

Staff comments or changes to disclosures in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and

•

The Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Very truly yours,

MFRI, INC.

/s/ Michael D. Bennett

Michael D. Bennett

Vice President Chief Financial Officer

CORRESP
1
filename1.htm

January 9, 2009

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

Re:

MFRI, Inc.

Form 10-K for the year ended January 31, 2008

Definitive Proxy Statement on Schedule 14A, filed May 29, 2008

Form 10-Q for the quarter ended October 31, 2008

File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

We have received your December 23, 2008 letter with subject as above (“Comment Letter”), and are preparing our response.   As instructed in the Comment Letter we are writing to advise you that, due to irregular availability of the necessary company employees and other individuals, including counsel, during the ten business days since December 23, 2008, we have not yet completed our response.  We expect to be able to provide you with our response by January 16, 2009.

Very truly yours,

MFRI, INC.

/s/ Michael D. Bennett

Michael D. Bennett

Vice President Chief Financial Officer

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

       DIVISION OF
CORPORATION FINANCE

December 23, 2008
  Mr. Michael D. Bennett Vice President, Secretary and Treasurer, MFRI, Inc. 7720 N. Leigh Ave Niles, IL  60714
Re: MFRI, Inc.
Form 10-K for the year ended January 31, 2008 Definitive Proxy Statement on Schedule 14A, filed May 29, 2008
Form 10-Q for the quart er ended October 31, 2008
File No. 1-32530

 Dear Mr. Bennett:
We have reviewed your filing and have th e following comments.  Where indicated, we
think you should revise your document in response to these comments.  If you disagree, we will
consider your explanation as to why our commen t is inapplicable or a revision is unnecessary.
Please be as detailed as necessa ry in your explanation.  In some  of our comments, we may ask
you to provide us with information so we may better understand your disclosure.  After
reviewing this information, we may or  may not raise additional comments.

Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure requir ements and to enhance the overall disclosure in
your filing.  We look forward to working with you in these respects.  We welcome any questions
you may have about our comments or on any other aspe ct of our review.  Feel free to call us at
the telephone numbers listed at  the end of this letter.

Form 10-K for the year ended January 31, 2008

Item 1. Business, page 1
 Piping Systems Business, page 3

 Patents, Trademarks, and Approvals, page 3

1. We note that you own several patents covering th e features of your piping and electronic
detection systems.  In future filings, pleas e disclose the duration and effect of your
patents or explain supplementally why you believe  this information is immaterial to your
piping systems business.  See Item  101(c)(1)(iv) of  Regulation S-K.

Mr. Michael D. Bennett
MFRI, Inc.
December 23, 2008 Page 2
Raw Materials and Manufacturing, page 4

2. We note from the first paragraph in this sec tion that you currently have adequate supplies
or available sources for raw materials but th at “there are risks and uncertainties with
respect to the supply of certain raw materi als,” which could impact your ability to
obtained those needed materials.  In futu re filings, please expa nd your raw materials
discussion to identify the risks and uncertainti es that pose an issue for you and identify
those materials that are likely to be affected.

Item 13. Certain Relationships and Related Transactions…, page 29

3. You incorporate the information required by Item 13 of Form 10-K by reference to your
proxy statement for the 2008 annual stockholders meeting.  However, there is no discussion of related party transactions in your  proxy statement.  In future filings, please
include the discussion required by Item 404 of Regulation S-K.  In this regard, we note
from the third paragraph on page 24 that you we re engaged in at le ast one related party
transaction with “two princi pal stockholders, who are also  members of management, for
approximately $4,438,000.”  Please also file as ex hibits the agreements related to these
transactions as required by Item 601(b)(10)(ii)(A) of Regulation S-K.

Item 15. Exhibits and Financia l Statement Schedules, page 29

 General

4. In future filings, please file as a material  contract the employment agreement you have
with Mr. Elgendy.  See Item 601(b) (10)(iii)(A) of Regulation S-K.

Notes to the Consolidated Financial Statements
 Note 9 – Employee Retirement Plans, page 47

 Pension Plan, page 47

5. We note at January 31, 2008 that approximately  99% of your pension plan assets were
held in mutual funds.  In future filings  please expand your discussion to include the
impact market conditions have had on plan assumptions and the net periodic benefit cost,
as well as the expected impact on future operatio ns from a decrease in plan assets, change
in expected return and amor tization of actuarial loss.  Please also address potential
funding requirements relative to your accumulate d benefit obligation and the implications
to current and future liquidity resulting from potential incremental cash payments
required to maintain funding requirements.

Mr. Michael D. Bennett
MFRI, Inc.
December 23, 2008 Page 3

Note 10 – Business Segment and Geographic Information, page 49
 Geographical Information, page 51

6. In future filings please disclose net sales attributable to individual countries within
Europe and Asia, if material.  We note your  increasing foreign activ ity and believe this
disclosure refinement will assist your invest ors.  See paragraph 38 a. of SFAS 131 for
guidance.

Exhibits 31.1 and 31.2

7. We note that your certifications omit the intr oductory language in paragraph 4 referring
to internal control over financial reporting as required by Item 601(b)(31) of Regulation
S-K.  In this regard, please amend your latest Form 10-K and your Forms 10-Q for the
quarters ended April 30, July 31, and Oct ober 31, 2008 to include the aforementioned
language in your certifications.  Each of your amendments may consist of a cover page,
explanatory note, signature pa ge and paragraphs 1, 2, 4, a nd 5 of the certifications.

8. We note that paragraph 4(d) of your certifi cations omits the phrase  “(the registrant's
fourth fiscal quarter in the case of an annual report).”  In future filings, including in the
amendments requested above, please insert this omitted phrase as required by Item 601(b)(31) of Regulation S-K.

Definitive Proxy Statement on Schedule 14A

Compensation Discussion and Analysis, page 9
 Incentive Compensation, page 10

9. In future filings, please disclose the percentage s of (i) consolidated income before income
taxes and before corporate profit-based incentive compensation a nd (ii) business unit
income from operations before allocated cor porate expenses that you must meet in order
for executives to earn a bonus and disclose what the actual amounts were for the prior
year.

Mr. Michael D. Bennett
MFRI, Inc.
December 23, 2008 Page 4
Executive Compensation, page 12
 Compensation Plans for NEOs…, page 13

10. With respect to your discussion of Mr. El gendy’s employment arrangement on page 14,
you state that his incentive compensation is ca lculated as a defined percentage of the
“Perma-Pipe Incentive Earnings.”  In future filings, please define this term, provide any further disclosure necessary for an investor  to understand how Mr. Elgendy’s incentive
compensation is determined, and quantify the most recent amount.

Form 10-Q for the period ended October 31, 2008

Liquidity and Capital Resources, page 13

11. We note your non-compliance with the earni ngs covenant at Ja nuary 31, 2008 and your
reference to the subsequent waiver and amen dment of that covenants.  Please disclose
here or elsewhere in your f iling the specific terms of any ma terial debt covenants in your
debt agreements. For any material debt covena nts, please disclose the required ratios as
well as the actual ratios as of each reporti ng date. This will allow readers to understand
how much cushion there is between the requi red ratios and the actual ratios. Please show
the specific computations used to arrive  at the actual ratio s with corresponding
reconciliations to US GAAP amounts, if necessa ry. See Sections I.D and IV.C of the SEC
Interpretive Release No. 33-8350 and Question 10 of our FAQ Regarding the Use of
Non-GAAP Financial Measur es dated June 13, 2003.

Critical Accounting Estimates and Policies
 Goodwill and Other Intangibles Assets with Indefinite Lives, page 14

12. It appears that your cu rrent market capitaliza tion is significantly below the book value of
your equity.  Please advise us whether you have  performed a recent impairment test.  If
not, please explain how you anal yzed the difference to conclude that an impairment test
is not necessary.  Please expl ain any qualitative and quantit ative factors you considered
(e.g. reconciliation).  If you have performed a recent impairment test, please provide us
with a summary of your results in Step 1 and Step 2, if applicable.  We may have further
comment.

As appropriate, please amend your filing a nd respond to these comments within 10
business days or tell us when you will provide us  with a response.  Please provide us with a
supplemental response letter that keys your re sponses to our comments and provides any
requested supplemental information.  Detailed letter s greatly facilitate our review.  Please file
your supplemental response on EDGAR as a corres pondence file.  Please understand that we
may have additional comments after reviewing your responses to our comments.

Mr. Michael D. Bennett
MFRI, Inc.
December 23, 2008 Page 5

We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing incl udes all information require d under the Securities and
Exchange Act of 1934 and that they have provi ded all information investors require for an
informed investment decision.  Since the compa ny and its management are in possession of all
facts relating to a company’s disclosure, they are responsible for the acc uracy and adequacy of
the disclosures they have made.
 In connection with responding to our comment s, please provide, in writing, a statement
from the company acknowledging that:
• the company is responsible for the adequacy an d accuracy of the disclosure in their filings;
• staff comments or changes to disclosure in re sponse to staff comments do not foreclose the
Commission from taking any action w ith respect to the filing; and
• the company may not assert staff comments as a defense in any proceeding initiated by the
Commission or any person under the federal securities laws of the United States.

In addition, please be advise d that the Division of Enfo rcement has access to all
information you provide to the sta ff of the Division of Corporati on Finance in our review of your
filing or in response to our comments on your filing.
If you have any questions regarding these comments, please direct them to Mindy
Hooker, Staff Accountant, at  (202) 551-3732, Hagen Ganem, Attorney, at (202) 551-3330,
Jennifer Hardy, Legal Branch Chief, at (202)  551-3767 or to the unde rsigned at (202) 551-3768.

Sincerely,    John Cash Branch Chief

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

       DIVISION OF
CORPORATION FINANCE

May 1, 2006

Mr. Michael D. Bennett
Vice President, Secretary and Treasurer, MFRI, Inc.
7720 Lehigh Avenue
Niles, IL 60714

Re: MFRI, Inc.
Form 10-K for the fiscal year ended January 31, 2005
File No. 1-32530

Dear Mr. Bennett:

We have completed our review of your Fo rm 10-K and related filings and have no
further comments at this time.

If you have any further questions regard ing our review of your filings, please
direct them to Mindy Hooker, Staff Accountant,  at (202) 551-3732 or, in her absence, to
the undersigned at (202) 551-3769.

       S i n c e r e l y ,

       John Cash
       B r a n c h  C h i e f

CORRESP
1
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 Page 1

April 4, 2006

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

            Re:

            MFRI, Inc.

            Form 10-K for the fiscal year ended January 31, 2005

            File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

Following are our responses to your letter of March 21, 2006.  We have used terms that were defined in the Subject filings without repeating their definitions in this letter.

SEC Comment:

Note 11 - Business Segment and Geographical Information, page 44

1. We note your response to our prior comment and appreciate the additional information that you have provided.  Based on that information, it remains unclear to us how you have concluded that all three of the operating segments you aggregate in the Filtration Products segment meet all the aggregation criteria in paragraph 17 of SFAS 131 and that your aggregation of these segments is consistent with the objective and basic principles of SFAS 131.  For example, we note that the gross profit margins achieved in your Filtration Products segment ranged from 16.3% to 25.3% and 13.9% to 25.3% for the years ended January 31, 2004 and January 31, 2003, respectively.  Additionally we note that the operating profit margins realized in your Filtration Products segment ranged from 1.9% to 12.1% and negative 2.5% to 8.8% for the years ended January 31, 2004 and January 31, 2003, respectively.  Specifically we note that
Midwesco Filter Resources, Inc. had consistently lower gross profit and operating profit margins during each historical period you presented.  In light of these factors, help us understand how and why you have concluded that the three operating segments in your Filtration Products reporting segment have similar economic characteristics.

~CHGO1:30761876.v2

 Page 2

Company Response:

The Company does not believe that the individual subsidiaries in the Filtration Products segment constitute separate “operating segments” within the meaning of Paragraphs 3 through 5 and 10 through 15 of SFAS 131, and accordingly does not believe that the aggregation criteria of paragraph 17 of SFAS 131 are applicable.  The Company believes that the presentation of the Filtration Products as a single operating segment is consistent with the objectives and basic principles set forth in SFAS 131 paragraph 3, for all the reasons set forth below.   Moreover, even if the individual subsidiaries were viewed as separate operating segments, the Company believes, as more fully described below, that all should be aggregated as one reporting segment.

Paragraph 4 of SFAS 131 states that the single basis of segmentation selected by the FASB is the management approach, which is based on the way that management organizes its segments within the enterprise for making operating decisions and assessing performance,  that the segments are evident from the structure of the enterprise’s internal organization, and that the required segment information should therefore be available in a cost-effective and timely manner.  SFAS paragraph 10 defines an operating segment as a component of an enterprise:

a.     That engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same enterprise),

b.     Whose operating results are regularly reviewed by the enterprise’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance, and

            c.

            For which discrete financial information is available.

Of the three criteria, criterion b. most clearly identifies Filtration Products as a single operating segment rather than an aggregation of three operating segments in the Company’s management approach, as a single segment manager is accountable to the chief operating decision maker, as described in the last sentence of SFAS 131 Paragraph 14.

Through a succession of acquisitions; Midwesco Filter Resources Inc.(“Midwesco Filter”) in December 1989,  TDC Filter Manufacturing Inc. (“TDC”) in December 1997 and Nordic Air Filtration A/S (“Nordic”) in November 1998; the Company and its predecessors have maintained the Filtration Products segment as described below, for purposes of management and internal reporting.  Pursuant to the provisions of SFAS 131 Paragraph 4 the management approach determines segmentation for public reporting purposes as well.

_________________________

 This response contains both new material and material repeated from the Company’s responses to the SEC’s comment letters dated January 24 and February 13, 2006, and does not attempt to separate new material from material previously provided.

~CHGO1:30761876.v2

 Page 3

Specifically, the Filtration Products segment has at all times in the Company’s history had a Segment President who functions as the segment’s chief executive officer, and who has at all times reported solely to the “chief operating decision maker” of the enterprise (SFAS 131 paragraph 12), a function which is performed by the Company’s Chief Executive Officer and the Company’s Chief Operating Officer.  The chief operating decision maker, in turn, has at all times dealt with the Segment President and not with management of the individual subsidiaries within the Filtration Products segment.  The Segment President has also been at all times a member of the Company’s Management Committee, which meets quarterly with the Company’s Board of Directors. No subordinate of the Segment President is or has been directly accountable to or maintains regular contact with the chief
operating decision maker, nor has any such subordinate been a member of the Management Committee. Prior to the decrease in the Company’s Board size to comply with NASDAQ requirement that a majority of the Board of Directors be independent, the Segment President was a member of the Company’s Board of Directors, and no subordinate was ever a member of the Company’s Board.

The Filtration Products segment has a unified strategic plan and segment budget, some shared customers, and a single sales force of people who each sell products from more than one factory to those customers, sometimes selling to a customer a product from one factory for a use previously filled by a product from another factory.  Management looks at customers and sales forces on a Filtration Products segment basis rather than by subsidiary.  Moreover, persons outside the Company, such as investment analysts, view the Company as having a Filtration Products segment and do not seek information on a subsidiary-by- subsidiary basis.  These points are discussed below in more detail.

Economic similarity:

The Filtration Products reporting segment consists of three subsidiaries:   Midwesco Filter, TDC and Nordic. With respect to trends in financial indicators, we note that neither gross profit margins nor operating profit margins trend in a noticeably different way in one subsidiary compared with the other two.  The trend in operating profit margin, the most important financial indicator of those listed, is generally upward in the three subsidiaries, with only a 2002-2003 decrease in Nordic interrupting an otherwise perfectly consistent comparison.

The three subsidiaries became part of the Company through acquisition from third parties, and have been maintained as separate legal entities, for which discrete financial information is available, for reasons that are common in such circumstances, including limitation of legal liability.  In the specific case of TDC, Midwesco Filter was working to expand its business to include pleated products sold for the same purposes to the same customer base as its original filter bag produce line when the opportunity to acquire TDC materialized in 1997.  This acquisition proved to be a more advantageous way to add pleated products to the business.  In the specific case of Nordic, cross-border legal, banking and other

~CHGO1:30761876.v2

 Page 4

considerations make it impractical not to retain Nordic as a Danish corporation.  Because TDC and Nordic continue as separate legal entities for the reasons just stated, separate financial records are of course required to be maintained internally and separate financial statements prepared.  But since the acquisition of TDC in 1997 and Nordic in 1998, the Company, its Board of Directors, and its chief operation decision maker, have consistently looked to one Segment President to operate the combined filtration business efficiently and profitably; budgets and strategic plans have been prepared, reviewed and evaluated for the Filtration Products Segment as one segment, and the Segment President has taken various organizational actions to cause the subsidiaries to operate as one business.  Sales employees in the two North American units are encouraged and are paid financial incentives to sell products from either
of the U.S. factories, Midwesco Filter or TDC, to any customer. Most recently, the North American marketing and sales function of the entire Filtration Products business has been combined under one head of marketing and sales, North American operations have been combined under one head of operations, worldwide controllership has been placed under one worldwide controller, and global sourcing and procurement has been placed under the direction of a single head of sourcing and procurement.

Product and customer similarity:

Although the Filtration Segment’s subsidiaries may generally produce different products and generally have different customers, products are of a similar nature and types or classes of customers are of a similar nature.  Moreover, a customer will sometimes purchase a product from one factory in the Segment to replace a product from another factory in the Segment previously used for the same customer purpose.

The principal similar economic characteristics affecting this entire segment are substantial dependence upon governmental regulation of air pollution, and the impact of the business cycle on sales for both original equipment and replacement purposes.

Nature of products and services:  The Filtration Products segment manufactures and sells filter elements for dry filtration, together with filter-related products and accessories used during installation, operation and maintenance of the collectors and baghouses that utilize the Company’s filter elements. All of the filter-related parts and accessories sold, and all of the services provided, are related to sale of the Company’s filter elements.  The products are installed and used in filtration systems designed and built by others.  All filter elements wear out and need to be replaced more frequently than the filtration system in which they are an integral part. The filter elements come in a variety of sizes, shapes, and filtration media, and are manufactured to custom specifications, as appropriate for the particles to be removed and the environment in which the particles are
located. The Company’s filter elements include knitted, woven or felted fabric filter bags, and cellulose or spun bond polyester pleated filter bags and cartridges. The Company also sells filter-related products and accessories for installation, operation, and maintenance of the filtration systems in which its filter elements are used.

~CHGO1:30761876.v2

 Page 5

Production processes of all the filter elements involve measuring, marking, and cutting the filtration media, and then assembling the media with necessary support hardware and components.

Type or class of customers:  all customers of this segment utilize the Company’s filter elements in stationary applications to remove dry particles from air.  The Filtration Products reporting segment’s customers are all industrial companies, needing to remove different particles for different reasons – generally to protect the air from a pollutant, but sometimes to protect machinery from damage or to capture a valuable product that exists in particle form during production.  Despite the superficial differences in products and customers, all of the Filtration Products segment’s products work to remove particles from air, with product differences that are significant for technological reasons but not significant financially.  All of the segment’s customers need to remove particles from air in a stationary application, for purposes that differ in important ways for the
customers but are not financially significant to the Company.

Methods used to distribute:  sale and distribution of all the company’s filtration products are accomplished by a combination of direct sales contact, independent representatives, and telemarketers.

The regulatory environment:  this segment is substantially dependent upon governmental regulation of air pollution at the federal and state levels.

Profit margins:

The gross profit margins cited by the staff range from a low of 13.9% to a high of 25.3% during the periods reported. These gross profit margins are all in the range expected for somewhat specialized products manufactured to meet customer specifications, in a market where several competitors are producing substantially equivalent products.  That is, the gross profit margins are neither the very small gross profit margins realized by sellers of undifferentiated commodity products nor the very high profit margins realized by sellers of highly specialized products with no direct competition due to patent protection. The gross profit margins of products within the Filtration Products segment differ for reasons including sales order size (with very large orders being highly competitive and having lower gross profit margin) and the maturity of the product being sold (with more mature products
having lower gross profit margin).  The Midwesco Filter factory manufactures the company’s fabric filter elements which therefore are included in its sales.  During the periods reported, the very large Filtration Products sales have generally been sales of fabric filter elements.  The Company’s  fabric filter elements are also a more mature product than its pleated filter elements. For these reasons the Midwesco Filter gross profit margin tends to be lower than in the other two corporations in the Filtration Products segment, both of which manufacture pleated fabric elements.  In addition, beginning during the most recent year reported, and in the future,

~CHGO1:30761876.v2

 Page 6

Midwesco Filter cost of goods sold are disproportionately burdened by the salary and related expenses of the Vice President, North American Operations, although he serves and manages the operations of both the Midwesco Filter and TDC factories.  The Company has not attempted to allocate and account for his salary and expenses between the two companies because it has always considered the Filtration Products segment as a single operating segment in its management of its businesses.

Operating profit margins vary with gross profit margins and, in addition, Midwesco Filter operating expenses are disproportionately burdened by the following items.  The Company makes no effort to allocate such expenses among the subsidiaries, as such allocation is not relevant in the Company’s management of the Filtration Products business:

            •

            Midwesco Filter bears the salary and related expenses of the Filtration Products Segment President, although he serves and manages all three companies in the segment.   The Company has not attempted to allocate and account for his salary and expenses among the three companies because it has always considered the Filtration Products segment as a single segment in its management of its businesses.

            •

            Sales personnel of Midwesco Filter and of TDC each sell the products manufactur

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
March 21, 2006

Mr. Michael D. Bennett
Vice President, Secretary and Treasurer, MFRI, Inc.
7720 Lehigh Avenue
Niles, IL 60714

Re:	MFRI, Inc.
Form 10-K for the fiscal year ended January 31, 2005
      File No. 1-32530

Dear Mr. Bennett:

      We have reviewed your response to our letter dated February
13,
2006 and have the following comment.  We ask that you respond by
April
4, 2006.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We
look forward to working with you in these respects.  We welcome
any
questions you may have about our comments or on any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Note 11 - Business Segment and Geographical Information, page 44

1. We note your response to our prior comment and appreciate the
additional information you have provided.  Based on that
information,
it remains unclear to us how you have concluded that all three of
the
operating segments you aggregate in the Filtration Products
segment
meet all the aggregation criteria in paragraph 17 of SFAS 131 and
that
your aggregation of these segments is consistent with the
objective
and basic principles of SFAS 131.  For example, we note that the
gross
profit margins achieved in your Filtration Products segment ranged
from 16.3% to 25.3% and 13.9% to 25.3% for the years ended January
31,
2004 and January 31, 2003, respectively.  Additionally we note
that
the operating profit margins realized in your Filtration Products
segment ranged from 1.9% to 12.1% and negative 2.5% to 8.8% for
the
years ended January 31, 2004 and January 31, 2003, respectively.
Specifically we note that Midwestco Filter Resources, Inc. had
consistently lower gross profit and operating profit margins
during
each historical period you presented.  In light of these factors,
help
us understand how and why you have concluded that the three
operating
segments in your Filtration Products reporting segment have
similar
economic characteristics.

	Please respond to these comments within 10 business days, or
tell
us when you will provide us with a response.  Please provide us
with a
supplemental response letter that keys your responses to our
comments
and provides any requested supplemental information.  Detailed
letters
greatly facilitate our review.  Please file your supplemental
response
on EDGAR as a correspondence file.  Please understand that we may
have
additional comments after reviewing your responses to our
comments.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts
relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.

      If you have any questions regarding these comments, please
direct them to Mindy Hooker, Staff Accountant, at (202) 551-3732
or to
the undersigned at (202) 551-3768.

      Sincerely,

      John Cash
      Accounting Branch Chief
??

??

??

??

Mr. Michael Bennett
MFRI, Inc.
March 21, 2006
Page 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

         DIVISION OF
CORPORATION FINANCE

</TEXT>
</DOCUMENT>

CORRESP
1
filename1.htm

Exhibit C

midwesco Filter Resources, Inc.

ORGANIZATIONAL ANNOUCEMENT

February 16, 2006

The five year strategic plan adapted in 2005 for MFRI’s Filter Group called for the business to grow sales revenues to nearly $120 million by 2010 and to steadily improve its operating profit as a percentage of sales to 15.0 during this period.

One of the key success elements identified in the strategic plan was to develop a “one company” approach to our various marketplaces.  The first step was taken when we consolidated the North American marketing and selling resources in Winchester, VA and Cicero, IL under McLeod Stephens’ leadership as Senior Vice President, North American Marketing and Sales.

In another step forward in the implementation of our strategic plan we are dissolving the general manager’s role at TDC and creating a function oriented organizational structure in North America.  Effective immediately, Joe Marcinski will become responsible for the manufacturing and related activities at both Winchester and Cicero as Vice President, North American Operations.

A generalized schematic of the North American organization will look like:

The human resource activities in Cicero will continue reporting to the Controller, Otilia Esparza and the human resource activities in Winchester will continue reporting to the President.

Until his retirement in June, Herb Sturm will continue to direct the material and marketing services efforts in Winchester reporting to the President.  Upon his retirement, these activities will be deployed into the organization announced above.

            Gene K. Ogilvie, President

            Copy:

            David Unger

            CPE

            Midwesco Filter Resources, Inc.

            Brad Mautner

            UPC

            Michael Bennett

midwesco Filter Resources, Inc.

Filter Group Global Sourcing & Procurement Organization

February 17, 2006

Relentless pursuit of lower material costs is the single largest ingredient to improving the financial success of MFRI’s Filter Group.  Sourcing and procurement of these materials must be conducted on a global basis to be competitive on a global basis.  It is recognized that lower material costs can come as the result of (1) buying current materials at a lower cost, (2) new product designs that allow lower cost materials to be utilized and/or (3) changing manufacturing methods to allow lower cost materials to be incorporated.

To that end, we have formed the Filter Group Global Sourcing and Procurement Team.  Jorgen Poulsen, Managing Director Nordic Air Filtration, effective immediately, will serve additionally as Director of Global Sourcing and Procurement.  It is envisioned the global sourcing and procurement effort will be conducted in three phases:  (1) finding sources, (2) qualifying those sources and (3) procuring from those sources.

While everyone in the Filter Group is encouraged to help us find new potentially lower cost material sources, the primary “finders” will be Jorgen Poulsen, Paul Condliffe, Keith Ogilvie and Gene Ogilvie.

Qualifying new sources and materials is a critical part of the effort to drive our material costs lower.  It is understood that material testing, prototyping and process(manufacturing) evaluations will involve many of us in the organization but, the primary role of qualifying a new source/material will reside with Jorgen Poulsen, Jacob Jacobsen,  McLeod Stephens, Tom Anderson, Dan Modesto, Joe Marcinski, Keith Ogilvie and Gene Ogilvie(the “qualifiers”).

Procurement activities throughout the Filter Group will continue to reside with the local purchasing organizations through their replenishment material models in support of our customer driven product delivery needs.  Jesper Bonde, Sue Gubala and Randy McAvoy will be working with the Group’s finders and qualifiers to shorten the time required to realize material cost reductions and have a dotted line reporting relationship to Jorgen Poulsen.

Filter Group Global Sourcing & Procurement Organization—Page 2

Overall, the effective management of this effort under Jorgen’s direction will be coordinated using a limited access website that will host the various “projects” in process and generate progress reports and measurements.  Organizationally, the sourcing/procurement effort is schematically depicted below:

Filtration media is our largest material cost.  It will be the initial primary focus of the group.  We, as an organization, must be willing to change vendors, materials of construction, product design, methods of manufacture or whatever else it may take to drive our material costs down.

Please join the effort.  Share you thoughts and ideas with Jorgen.  I can assure you this group will be action oriented.  They are already moving forward on a number of very exciting cost reduction fronts which could dramatically affect our 2006 financial performance.  The group will be active on a daily basis and will report to you in appropriate ways our progress.

Gene K. Ogilvie, President

Midwesco Filter Resources, Inc.

Copy: David Unger

            Brad Mautner

            Michael Bennett

            CPE

            UPC

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
February 13, 2006

Mr. Michael D. Bennett
Vice President, Secretary and Treasurer, MFRI, Inc.
7720 Lehigh Avenue
Niles, IL 60714

Re:	MFRI, Inc.
Form 10-K for the fiscal year ended January 31, 2005
      File No. 1-32530

Dear Mr. Bennett:

      We have reviewed your response to our letter dated January
24,
2006 and have the following comment.  We ask that you respond by
February 28, 2006.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We
look forward to working with you in these respects.  We welcome
any
questions you may have about our comments or on any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Note 11 - Business Segment and Geographical Information, page 44

1. We note your response to our prior comment six and appreciate
the
additional information.  To the extent that you aggregate your
operating segments to form your reporting units, for each period
presented, please provide us with the historical revenues, gross
profits, gross profit margins, operating profits, and operating
profit
margins, along with any other information you believe would be
useful
for each of your operating segments to help us understand how
these
operating segments are economically similar.  Please also address
any
differences in the trends these financial indicators depict (e.g.
if
gross profit margin is decreasing for one component and increasing
for
another).

We would also like further clarification with respect to the types
of
products and customers of the operating segments in all three of
your
segments.  Although your response indicates that you believe the
products and customers are similar; it appears to us that the
operating segments produce different products and have different
customers.  In light of these factors, it is not clear to us how
and
why you have concluded that the operating segments in each of your
reportable segments have similar products and customers.  For
example,
in your Process Cooling Equipment segment, page 44 of your 10-K
indicates that the reporting segment produces different products,
including chillers, mold temperature controllers, cooling towers,
plant circulating systems and coolers for industrial process
applications, and your response indicates that you have different
customers, thermoplastics manufacturers, commercial printers and
several other types of manufacturers; therefore, it is not clear
to us
how and why you have concluded that the operating segments in your
Process Cooling Equipment segment have similar products and
customers.

	Please respond to these comments within 10 business days, or
tell
us when you will provide us with a response.  Please provide us
with a
supplemental response letter that keys your responses to our
comments
and provides any requested supplemental information.  Detailed
letters
greatly facilitate our review.  Please file your supplemental
response
on EDGAR as a correspondence file.  Please understand that we may
have
additional comments after reviewing your responses to our
comments.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts
relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.

      If you have any questions regarding these comments, please
direct them to Mindy Hooker, Staff Accountant, at (202) 551-3732
or to
the undersigned at (202) 551-3768.

      Sincerely,

      John Cash
      Accounting Branch Chief
??

??

??

??

Mr. Michael Bennett
MFRI, Inc.
February 13, 2006
Page 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

         DIVISION OF
CORPORATION FINANCE

</TEXT>
</DOCUMENT>

CORRESP
1
filename1.htm

February 7, 2006

Mr. John Cash, Branch Chief

Ms. Mindy Hooker, Staff Accountant

Division of Corporation Finance

United States Securities and Exchange Commission

Washington, D.C. 20549-7010

            Re:

            MFRI, Inc.

            Form 10-K for the fiscal year ended January 31, 2005

            Form 10-Q for the period ended October 31, 2005

File No. 1-32530

Dear Mr. Cash and Ms. Hooker:

Following are our responses to your letter of January 24, 2006.  Our response follows the organization of your letter.  We have used terms that were defined in the Subject filings without re-iterating their definition in this letter.

Liquidity and Capital Resources, page 18.

            1.

            SEC Comment.  Your discussion of cash flows provided by operating activities merely repeats information that a reader can readily obtain from your balance sheets and statements of cash flows.  Revise your disclosures to discuss the reasons for significant changes in operating assets and liabilities from period.  Refer to SEC Release 33-8350.

Company Response.  Ms. Hooker confirmed by telephone that the Comment pertains only to the Company’s discussion of cash flows provided by operating activities for the prior years 2003 and 2002, as the discussion for the current year 2004 does discuss the reasons for significant changes.  As Regulation S-K Item 303 only requires discussion of the current year liquidity and capital resources, the Company will in its future filings omit any discussion of prior year cash flows provided by operating activities rather than merely repeating information from the balance sheets and statements of cash flows for those years, and will continue to discuss the reasons for significant changes in the current year.

 Page 2

            2.

            SEC Comment.  Your tabular disclosure of contractual obligations on page 19 does not include all of your future obligations.  To increase the transparency of cash flow, please include scheduled interest payments in your table.  To the extent that the interest rates are variable and unknown, you may use your judgment to determine whether or not to include estimates of future variable rate interest payments in the table or in a footnote to the table.  Regardless of whether you decide to include variable rate estimated interest payments in the table or in a footnote, you should provide appropriate disclosure with respect to your assumptions.  Refer to Item 303(a)(5) of Regulation S-K and Release 33-8182.

Company Response.  In its future filings the Company will include scheduled fixed rate interest payments in the table.  The Company’s revolving lines of credit, which have been omitted from the table and disclosed in a footnote to the table, bear interest at floating rates of interest.  Rather than attempting to estimate those floating interest rates and the levels of debt on which they are charged, the Company will disclose floating rate interest in a footnote to the table using words such as the following: “Interest obligations exclude floating rate interest on debt payable under revolving lines of credit. Based on the amount of such debt at January 31, 2005, and the weighted average interest rates on that debt at that date (5.75%), such interest was being incurred at an annual rate of  approximately $692,000.”

            3.

            SEC Comment.  Your disclosure indicates that you are currently classifying your revolving credit agreement as long-term debt.  We note that your loan agreement provides that all payments by your customers are deposited in a bank account from which all funds may only be used to pay the debt under the loan agreement.  Please explain to us the details of your 2005 refinancing which allow you to classify the balances owed under the revolving credit agreement as long-term based on EITF 95-22.

Company Response.  In the Company’s March 28, 2005 loan agreement amendment (the “Amendment”),  “material adverse  affect”  was removed from the list of  events of default.  After the Amendment , every listed event of default in the loan agreement is objectively determinable or measurable, so that from the date of the Amendment the company’s credit agreement no longer “includes both a subjective acceleration clause and a requirement to maintain a lock-box arrangement” as described in EITF 95-22, so that the provisions of EITF 95-22 no longer pertain to debt outstanding under the loan agreement after the Amendment.

 Page 3

Item 9A – Controls and Procedures, page 24

            4.

            SEC Comment.  We note that your Chief Executive Officer and Chief Financial Officer concluded that as of January 31, 2005, disclosure controls and procedures “were not entirely effective as they relate to inventory for the Company’s subsidiary, Midwesco Filter.”  Please revise to address your officer’s conclusions regarding the disclosure controls and procedures of the entire company.

Company Response.  The Company could have stated, and in future similar cases will state, ”Based solely on  the material weakness described below, the Company’s Chief Executive Officer and Chief Financial Officer concluded that, as of January 31, 2005,  the Company’s  disclosure controls and procedures were not effective as of the end of the fiscal period covered by this Annual Report on Form 10-K. Due to this material weakness, the Company, in preparing its consolidated financial statements as of and for the year ended January 31, 2005, performed additional procedures relating to inventory to enable it to conclude that the consolidated financial statements were stated fairly in all material respects in accordance with U.S. generally accepted accounting principles.”

Significant Accounting Policies – Revenue Recognition, page 32

            5.

            SEC Comment.  We note that all subsidiaries of the Company, other than Perma-Pipe, recognize revenues at the date of shipment.  We also note that your filtration products business provides certain services.  Please demonstrate to us and revise future filings to further clarify, your compliance with SAB 101 and 104.

Company Response.  The Company will resequence and revise its Revenue Recognition policies  as follows in future filings: (a) the general policies will appear before, rather than after, the “Percentage of Completion Revenue Recognition” disclosure; (b) revenue recognition will read substantially as follows:  “Revenue Recognition:  The Company recognizes revenues when all the following criteria are met:  (i) persuasive evidence of an arrangement exists, (ii) the seller’s price to the buyer is fixed or determinable, and (iii) collectibility is reasonably assured.  All subsidiaries of the Company except Perma-Pipe recognize revenues when product has been shipped (for FOB shipping point orders) or delivered (for FOB destination sales) or when services have been rendered” and (c)  the Perma-Pipe Percentage of Completion Revenue Recognition policy will then be included as
in the current Form10-K disclosure.

 Page 4

Note 11 – Business Segment and Geographical Information, page 44

            6.

            SEC Comment.  We note your three reportable segments:  filtration products, piping systems and industrial process cooling equipment.  It appears to us that you have aggregated various business units into these reportable segments.  Demonstrate to us that the operating segments you aggregate meet all of the aggregation criteria in paragraph 17 of SFAS 131, including similar economic characteristics.  In addition, revise future filings to provide product-line disclosures as required by paragraph 37 of SFAS 131, or tell us why they are not required.  Please provide a reconciliation of your reportable segments’ income from operations to income before income taxes, extraordinary items, discontinued operations and the cumulative effect of changes in accounting principles as required by paragraph 32b of SFAS 131.

Company Response:  Through a succession of acquisitions the Company and its predecessors have maintained its basic business organization as three segments as described below, for purposes of management, internal reporting, and public reporting. Each of the Company’s three reportable segments has a segment manager who is directly accountable to and maintains regular contact with the  Company’s chief operating decision maker, a function which is performed by the Company’s Chief Executive Officer and the Company’s Chief Operating Officer. Each of those  three segment managers also is a member of the Company’s Management Committee, which meets quarterly with the Company’s Board of Directors. No subordinate of the three segment managers is directly accountable to or maintains regular contact with the chief operating decision maker, nor is any such subordinate a member of the Management
Committee.  Following are separate discussions for each of the Company’s three reportable segments in light of the aggregation criteria in paragraph 17 of SFAS 131.

Filtration Products segment

The principal similar economic characteristics affecting this entire segment are substantial dependence upon governmental regulation of air pollution, and the impact of the business cycle on sales for both original equipment and replacement purposes.

Nature of products and services:  The Filtration Products segment manufactures and sells filter elements for dry filtration, together with filter-related products and accessories used during installation, operation and maintenance of the collectors and baghouses that utilize the Company’s filter elements. All of the filter-related parts and accessories sold, and all of the services provided, are related to sale of the Company’s filter elements.

 Page 5

Production processes of all the filter elements involve measuring, marking, and cutting the filtration media, and then assembling the media with necessary support hardware and  components.

Type or class of customers:  all customers of this segment utilize the Company’s filter elements in stationary applications to remove dry particles from air.

Methods used to distribute:  sale and distribution of all the company’s filtration products are accomplished by a combination of direct sales contact, independent representatives, and telemarketers.

The regulatory environment:  this segment is substantially dependent upon governmental regulation of air pollution at the federal and state levels.

Piping Systems segment

The principal similar economic characteristics affecting this entire segment are seasonality due to warm and cold weather in the northern hemisphere, and the impact of the construction economic cycle.

Nature of products and services:  The Piping Systems segment engineers, designs, manufactures and sells specialty piping systems, as well as leak detection and location systems which are generally, though not always, sold as a part of a piping system.  Substantially all of the Company’s piping systems are insulated.

The production process for Piping Systems manufacture generally involves some combination of computer controlled metal cutting, pipe cutting, pipe bending, pipe coating, insulation foam application, and welding.

Customers of the Piping Systems segment generally use the Company’s products to transport liquids from one location to another.

Methods used to distribute:  sales and distribution of all Piping Systems products are either direct or through independent representatives.

The regulatory environment:  this segment’s products are affected by clean water and similar federal and state regulations, except where used for transport of water.

 Page 6

Industrial Process Cooling Equipment segment

The principal similar economic characteristics affecting this entire segment are the impacts of general economic conditions and the industrial business cycle on its sales.

Nature of products and services:  the Industrial Process Cooling Equipment segment engineers, designs, manufactures and sells thermostatically controlled coolers for industrial purposes.

Production processes of this segment involve assembly of equipment from subassemblies, prefabricated sheet metal, electrical control boxes, and hardware components.

This segment’s customers all use the Segment’s products to optimize manufacturing productivity by quickly removing heat from manufacturing processes. Customers include thermoplastics manufacturers, commercial printers, and several other types of manufacturers.

Methods used to distribute:  the Company’s Industrial Process Cooling Equipment products are generally sold through independent representatives and original equipment manufacturers.

Regulatory environment:  government regulation is generally not a significant issue in this segment.

The Company believes that its segment disclosure also satisfies the product-line disclosure requirement of paragraph 37 of SFAS 131. Within each of the three segments, all of the primary products share the important characteristics listed in each segment’s discussion above.  Following are comments regarding other-than-primary products of each segment. The Filtration Products filter-related products and accessories are directly tied to sale of filter elements, and total revenues from sale of such items are less than 10% of the Company’s revenues.  Filtration Products services are directly tied to sale of filter elements, and revenues from such services total less than 10% of the Company’s revenues.  The Piping Systems segment sales of leak detection and location systems are generally but not always tied to sale of a piping system, and total revenues from sale of such items are
less than 10% of the Company’s revenues.  Industrial Process Cooling Equipment sales of parts are for systems manufactured by it, and total less than 10% of the Company’s revenues. Industrial Process Cooling Equipment revenues from services are to service systems manufactured by it, and total less than 10% of the Company’s revenues.

 Page 7

The Company’s joint venture is a part of its Piping Systems business, and the Company’s interest expense is a Corporate expense.  Therefore, the required reconciliation, which will be a part of future filings, is as follows:

            Income (loss) before income taxes, extraordinary items and cumulative effect of accounting change:

            2004

            2003

            2002

            Filtration Products

            $      3,539

            $      1,145

            $         400

            Piping Systems

            5,630

            2,773

            4,378

            Industrial Process Cooling Equipment

            1,570

            738

            702

            Corporate

            (6,995)

            (6,888)

            (6,616)

            Total Income (loss) before income taxes, extraordinary items and cumulative effect of accounting change

            $      3,744

            $    (2,232)

            $   (1,136)

10-Q for the period ended October 31, 2005

Item 4. Controls and procedures, page 14

            7.

            SEC Comment.  We note that your Chief Executive Officer and Chief Financial Officer concluded that the Company’s “disclosure controls and procedures were effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed in the Company’s periodic SEC filings.”  Revise to clarify, if true, that your officers concluded that your disclosure controls and procedures are also effective to ensure that information required to be disclosed in the reports that you file or submit under the Exchange Act is accumulated and communicated to your management, including your chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.  See Exchange Act Rule 13a-15(e).  Alternatively, you may simply state that your disclosure controls and procedures ar

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
January 24, 2006

Mr. Michael D. Bennett
Vice President, Secretary and Treasurer, MFRI, Inc.
7720 Lehigh Avenue
Niles, IL 60714

Re:	MFRI, Inc.
Form 10-K for the fiscal year ended January 31, 2005
      Form 10-Q for the period ended October 31, 2005
      File No. 1-32530

Dear Mr. Bennett:

      We have reviewed your filing and have the following
comments.
Where indicated, we think you should revise your document in
response
to these comments.  If you disagree, we will consider your
explanation
as to why our comment is inapplicable or a revision is
unnecessary.
Please be as detailed as necessary in your explanation.  In some
of
our comments, we may ask you to provide us with information so we
may
better understand your disclosure.  After reviewing this
information,
we may or may not raise additional comments.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We
look forward to working with you in these respects.  We welcome
any
questions you may have about our comments or on any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Liquidity and Capital Resources, page 18
1. Your discussion of cash flows provided by operating activities
merely repeats information that a reader can readily obtain from
your
balance sheets and statements of cash flows.  Revise your
disclosures
to discuss the reasons for significant changes in operating assets
and
liabilities from period to period.  Refer to SEC Release 33-8350.

2. Your tabular disclosure of contractual obligations on page 19
does
not include all of your future obligations.  To increase the
transparency of cash flow, please include scheduled interest
payments
in your table.  To the extent that the interest rates are variable
and
unknown, you may use your judgment to determine whether or not to
include estimates of future variable rate interest payments in the
table or in a footnote to the table.  Regardless of whether you
decide
to include variable rate estimated interest payments in the table
or
in a footnote, you should provide appropriate disclosure with
respect
to your assumptions.  Refer to Item 303(a)(5) of Regulation S-K
and
Release 33-8182.
3. Your disclosure indicates that you are currently classifying
your
revolving credit agreement as long-term debt.  We note that your
loan
agreement provides that all payments by your customers are
deposited
in a bank account from which all funds may only be used to pay the
debt under the loan agreement.  Please explain to us the details
of
your 2005 refinancing which allow you to classify the balances
owed
under the revolving credit agreement as long-term based on EITF
95-22.

Item 9A-Controls and Procedures, page 24
4. We note that your Chief Executive Officer and Chief Financial
Officer concluded that as of January 31, 2005, disclosure controls
and
procedures "were not entirely effective as they relate to
inventory
for the Company`s subsidiary, Midwesco Filter."  Please revise to
address your officer`s conclusions regarding the disclosure
controls
and procedures of the entire company.

Note 2-Significant Accounting Policies-Revenue Recognition, page
32
5. We note that all subsidiaries of the Company, other than Perma-
Pipe, recognize revenues at the date of shipment.  We also note
that
your filtration products business provides certain services,
please
demonstrate to us and revise future filings to further clarify,
your
compliance with SAB 101 and 104.

Note 11-Business Segment and Geographical Information, page 44
6. We note your three reportable segments: filtration products,
piping
systems and industrial process cooling equipment.  It appears to
us
that you have aggregated various business units into these
reportable
segments.  Demonstrate to us that the operating segments you
aggregate
meet all of the aggregation criteria in paragraph 17 of SFAS 131,
including similar economic characteristics.  In addition, revise
future filings to provide product-line disclosures as required by
paragraph 37 of SFAS 131, or tell us why they are not required.
Please provide a reconciliation of your reportable segment`s
income
from operations to income before income taxes, extraordinary
items,
discontinued operations and the cumulative effect of changes in
accounting principles as required by paragraph 32b of SFAS 131.

10-Q for the period ended October 31, 2005

Item 4.  Controls and Procedures, page 14
7. We note that your Chief Executive Officer and Chief Financial
Officer concluded that the Company`s "disclosure controls and
procedures were effective in recording, processing, summarizing
and
reporting, on a timely basis, information required to be disclosed
in
the Company`s periodic SEC filings."  Revise to clarify, if true,
that
your officers concluded that your disclosure controls and
procedures
are also effective to ensure that information required to be
disclosed
in the reports that you file or submit under the Exchange Act is
accumulated and communicated to your management, including your
chief
executive officer and chief financial officer, to allow timely
decisions regarding required disclosure.  See Exchange Act Rule
13a-
15(e).  Alternatively, you may simply state that your disclosure
controls and procedures are effective or ineffective.
 	As appropriate, please amend your filing and respond to these
comments within 10 business days or tell us when you will provide
us
with a response.  Please provide us with a supplemental response
letter that keys your responses to our comments and provides any
requested supplemental information.  Detailed letters greatly
facilitate our review.  Please file your supplemental response on
EDGAR as a correspondence file.  Please understand that we may
have
additional comments after reviewing your responses to our
comments.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing
includes all information required under the Securities and
Exchange
Act of 1934 and that they have provided all information investors
require for an informed investment decision..  Since the company
and
its management are in possession of all facts relating to a
company`s
disclosure, they are responsible for the accuracy and adequacy of
the
disclosures they have made.

      In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in their filings;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal
securities laws of the United States.

In addition, please be advised that the Division of Enforcement
has
access to all information you provide to the staff of the Division
of
Corporation Finance in our review of your filing or in response to
our
comments on your filing.

If you have any questions regarding these comments, please direct
them
to Mindy Hooker, Staff Accountant, at (202) 551-3732 or to the
undersigned at (202) 551-3768.

Sincerely,

John Cash
Branch Chief
??

??

??

??

Mr. Michael Bennett
MFRI, Inc.
January 24, 2005
Page 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

         DIVISION OF
CORPORATION FINANCE

</TEXT>
</DOCUMENT>