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Push to restart storm-hit energy operations gets yawn from oil markets

September 02/2020

MOSCOW (MRC) -- Energy companies last Friday continued efforts to restore operations at US Gulf Coast offshore platforms and refineries shut by Hurricane Laura as oil markets largely shrugged off the storm's impact, reported Reuters.

Some 300 offshore production facilities and half-dozen refineries halted ahead of a Category 4 storm that hit the coast of Louisiana early Thursday with winds of 150 mile per hour (240 kph). The destructive winds cut a narrow path through the area, sparing facilities not directly in its path.

However, repairs to Citgo Petroleum's s 418,000-barrel per day Lake Charles, Louisiana, plant that was on the storm's path could take four to six weeks, according to Mizuho Securities. The company did not immediately reply to a request for comment.

Motiva Enterprises, operator of the largest US refinery, and Valero Energy Corp on Friday began restarting their Port Arthur, Texas, refineries, said people familiar with plant operations.

US crude futures traded at USD43.10 per barrel early Friday, up six cents, and not far from its USD42.34 level a week ago. US gasoline futures were up two cents, but are up less than 2% from a week ago, before the storm.

ExxonMobil Corp said its 369,024 bpd Beaumont, Texas, refinery, about 50 miles (80 km) west of where the storm's landfall, required "minor repairs," a spokesman said, and the company was taking steps to restart once power and port operations were restored.

"Refiners may be reluctant to quickly return to production when the product they make is a money losing proposition," Robert Yawger, director of energy futures at Mizuho Securities, wrote on Friday.

The ports of Beaumont, Orange and Sabine, Texas, and Cameron and Lake Charles, Louisiana, remained closed on Friday, according to the US Coast Guard.

Houston, the United States' largest energy export port, restarted operations on Thursday and had nearly halved the list of 53 vessels waiting on Thursday to reenter the port.

One-way movement and other restrictions were in place on Friday at points along the Houston Ship Channel, according to the US Coast Guard.

As MRC informed before, Exxon Mobil Corp restored stable power to its 369,024-barrel-per-day (bpd) Beaumont, Texas, refinery as it prepares to begin restarting production units. Exxons Beaumont refinery and chemical plant were shut down last Tuesday as Hurricane Laura was menacing the southeast Texas coast. In Beaumont, the company also operates a cracker with a capacity of 830,000 mt of ethylene and 195,000 mt of proplyelen per year, low density polyethylene (LDPE) plant with a capacity of 236,000 mt per year and linear low density polyethylene (LLDPE) plant with a capacity of 727,000 tonnes per year.

Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
Author:Margaret Volkova
Tags:PP, PE, LLDPE, crude and gaz condensate, homopolymer PP, propylene, LDPE, HDPE, ethylene, petrochemistry, Citgo petroleum corporation, Exxon Mobil, Motiva Enterprises, Valero, Russia, USA.
Category:General News
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