24 October 1994 00:00 [Source: ICB]
SEVERE DAMAGE at Enron's 420 000 tonne/year nameplated cracker at Pasadena, Texas, US, has ensured at least three to six months of outage in the wake of the 12 October explosion.
While Enron refused comment partly due to problems in assessing the damage caused by torrential rains in the Houston area, various reports suggested extensive equipment damage and a potentially highly worrying release of asbestos. A complete levelling of the 25-year-old former Tenneco plant, which was until late September up for sale, and collection of accident insurance, is increasingly thought to be a serious option.
Despite a continuing state of near-panic last week, which produced November US contract quotes of $1.50/gal and $1.55/gal fob US Gulf (20-25 cent/gal above October levels) and spot quotes as high as $1.80-1.85/gal, players were already looking forward to an early return to balance.
Such hopes have been given a fresh boost by confirmation from Hoechst Celanese that a partnership deal to restart its 660 000 tonne/year moth-balled methanol plant at Clear Lake, Texas, is likely to be announced within a month. Sources close to the potential jv deal claim restart can be achieved by early 1996 at a cost of $75m, although detached observers say rebuild could take up to two years and cost $150m. Hoechst Celanese has meanwhile dismissed as premature US press reports that the deal involves US refiner and MTBE player, Valero, saying only that serious interest has been expressed by a number of players.
There may be a temporary respite to the current panic as the US and European markets anticipate the first methanol shipments from the new 670 000 tonne/year Ecofuel/Pequiven plant at José, Venezuela, just as the second of the recently shut down New Zealand methanol plants prepares for (end-October) startup. Lyondell's Channelview, Texas, plant is also back onstream.
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