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US petrochemical production crippled by deep freeze

February 19/2021

MOSCOW (MRC) -- Severe winter weather continues to decimate US base chemical production with just about every facility in Texas reporting shutdowns or curtailments on Wednesday. Production is expected to remain offline until this weekend at the earliest, reported Chemweek.

"While the US Gulf Coast is accustomed to severe hurricanes, the impact of the cold has been much more severe than the many Category 4-5 hurricanes that hit the coast over past decades," according to IHS Markit. "It is likely to be at least several days before refinery/petrochemical facilities and production operations can return to normal levels."

For polyethylene, IHS Markit is assuming outages affect all Texas and western Louisiana facilities. "We currently assume that 88% of all US PE capacity is offline and will be so until this weekend at the earliest," IHS Markit says. "We are assuming that upstream supply of key feedstocks for ethylene production, like ethane gas, are also experiencing issues as well as the actual ethylene crackers themselves."

The timing of successful startups upstream will be critical to support the restart of derivative units. Logistics are also widely affected and delays for moving polyethylene (PE) rail cars for both domestic and exports are expected. Multiple resin producers have announced either a sales allocation, force majeure, or some type of plant update.

IHS Markit estimates that 89% of all US polypropylene (PP) production is currently offline and will be so until this weekend at the earliest. Only four or 10 North American PP producers, only four (Braskem, Indelpro, Phillips 66, and Pinnacle Polymers) are not under a force majeure or sales allocation program.

Unusually cold temperatures are expected to persist in the Houston area through Friday morning. A hard freeze watch is in effect for Houston from late Thursday night through Friday morning. The National Weather Service expects temperatures in the Houston area to begin warming up later Friday, with a high of 60°F forecast for Sunday.

The Texas Commission on Environmental Quality (TCEQ) has been inundated with air emission reports from producers whose operations have been affected by the weather. “Extreme cold and instability of electrical supply, nitrogen, and fuel gas systems caused operating unit monitoring and control systems failures,” says a submission by Chevron Phillips Chemical (CPChem) relating to its Sweeny site in Old Ocean, Texas. CPChem shut down its Pasadena plastics complex because the cold has prevented delivery of nitrogen from a supplier. Many producers are also citing loss of steam because of the cold.

Specific South Texas operations shut down by the winter storm include Formosa Plastics’ three steam crackers at Point Comfort, and LyondellBasell’s cracker at Corpus Christi.

In the Greater Houston, Texas, area, steam crackers shut down include CPChem’s three at Sweeny and two at Cedar Bayou; ExxonMobil’s three at Channelview and Baytown; Ineos’s two at Alvin; and Shell’s one at Deer Park. Dow has shut down one of its Freeport crackers and is running two at reduced rates. LyondellBasell has shut down two of the three crackers it has at La Porte and Channelview, while one has been stabilized.

The Houston area is also home to five on-purpose propylene units. The Enterprise propane dehydrogenation (PDH) unit at Mont Belvieu is offline, as is the Flint Hills Resources PDH unit in Houston. Dow’s Freeport PDH unit is running at reduced rates, as are LyondellBasell’s metathesis units at Channelview.

The six steam crackers in the “golden triangle” northeast of Houston have all been shut down. These include BASF/Total, CPChem, and Motiva’s respective units at Port Arthur as well as Dow’s unit at Orange, ExxonMobil’s at Beaumont, and Indorama’s at Port Neches. BASF/Total’s metathesis unit is also offline.

Eastman’s three steam crackers in Longview, Texas, have also been shut down.

IHS Markit has confirmed the shutdown of three steam crackers in Louisiana: Westlake Chemical’s units at Sulphur and Indorama’s unit at Westlake. The status of Louisiana’s other steam crackers, which account for about 24% of US ethylene capacity, is uncertain. Located further east, they have been spared the worst of the cold, but with the winter storm moving in their direction over the next few days, that could change.

As MRC informed earlier, in late August 2020, Chevron Phillips Chemical  shut down its Port Arthur, Texas cracker in preparation for Hurricane Laura. The unit's capacity of 855,000 mt/year. Chevron Phillips also shut its Cedar Bayou, Texas, crackers ahead of the storm. The company's Cedar Bayou crackers 1 and 2 have capacities of 837,000 mt/year and 1.7 million mt/year, respectively.

Ethylene and propylene are feedstocks for producing PE and PP.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, PP random copolymer, propylene, LDPE, HDPE, ethylene, petrochemistry, Braskem, Chevron Phillips, Eastman Chemical, Enterprise Products, Exxon Mobil, Formosa, LyondellBasell, Phillips 66, Pinnacle Polymers, Shell, Westlake Chemical, Russia, US.
Category:General News
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