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Olin to shut its chlor-alkali plant in the USA

March 18/2021

MOSCOW (MRC) -- Olin (Clayton, Missouri) has announced plans to shut a portion of its diaphragm-grade chlor-alkali capacity in the USA, reported Chemweek.

Thus, th company is to permanently shut down about 200,000 metric tons/year of diaphragm-grade chlor-alkali capacity at its McIntosh, Alabama, facility by 31 March. Olin will take a USD5 million of restructuring charge for the move, which the company expects to be cash flow accretive.

"This is yet another step in Olin's efforts to right-size our asset base and achieve reinvestment economics across our complete electrochemical unit portfolio," says Scott Sutton, Olin president and CEO.

Separately, the company has raised its adjusted EBITDA forecast for Q1 2021 by USD75 million, citing gains related to hedges and contracts that protected the company during the polar storm at the US Gulf Coast in mid-February, .

Before the storm, Olin expected first-quarter adjusted EBITDA of USD400-425 million, up year-over-year (YOY) from USD123 million. The company now expects adjusted EBITDA of USD475500 million range.

This forecast includes a net one-time benefit associated with Olin's customary financial hedges and contracts maintained to provide protection from rapid and dramatic changes in energy costs, partially offset by unabsorbed fixed manufacturing costs, reduced profit from lost sales, and storm-related maintenance costs, says Olin. This first quarter 2021 outlook has further potential upside associated with the final settlement of these one-time items associated with Winter Storm Uri.

Olin was forced to shut production at its Freeport, Texas, facility during the storm because of the loss of access to electrical power, natural gas, and other raw materials. Products made at Freeport include chlor-alkali, vinyl chloride monomer (VCM), epichlorohydrin, and bisphenol-A. Olin says production at its facilities in Plaquemine, Louisiana; St. Gabriel, Louisiana; Oxford, Mississippi; and McIntosh, Alabama facilities were also affected. By 18 February, the company had declared force majeure on all chemical product shipments from North America. While our facilities have returned to operation, product supply constraints are expected to continue, says Olin.

We remind that Russia's November production of sodium hydroxide (caustic soda) were 111,000 tonnes (100% of the basic substance) versus 108,000 tonnes a month earlier. Overall output of caustic soda totalled 1,165,600 tonnes in the first eleven months of 2020, down by 1.3% year on year.


mrcplast.com
Author:Margaret Volkova
Tags:PVC, vinilhlorid, liquid caustic soda, kausticheskaya soda, rigid caustic soda, Olin Corporation, Russia, USA.
Category:General News
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