Jilin Petchem to restart phenol/acetone mid-April

22 March 2006 06:51  [Source: ICIS news]

SINGAPORE (ICIS news)--Jilin Petrochemical, a subsidiary of Chinese oil, gas and petrochemical major PetroChina, plans to restart its phenol/acetone unit in mid-April, company sources said on Tuesday.

The company shut its 120,000 tonne/year phenol/acetone unit in Jilin, Jilin Province, after an explosion at an adjacent aniline unit on 13 November last year. Benzene, aniline and nitrobenzene leaked into the Songhua River, which is a source of drinking water for tens of millions of people living in northeastern China and Russia.

China’s State Environment Protection Administration ordered the company to review the waste management and disposal system at its petrochemical complex after the incident.

Jilin Petrochemical had to keep its phenol-acetone unit shut to carry out modifications to its waste management system.

The startup of Jilin’s plant is likely to weigh on phenol import prices, which are already expected to see some downward pressure in the second half of April when several regional facilities complete their turnarounds, Chinese traders said. Sluggish upstream benzene prices also added to the bearish price outlook, they said.

Tight supplies linked mainly to a spate of regional shutdowns from February to April had been the key driver behind the recent increase in phenol prices. Spot rates were up by about $100/tonne over a six-week period to $950/tonne CFR China in late February.

Acetone prices are not expected to be affected significantly by the startup of Jilin’s plant, according to Chinese traders. This is because the producer’s output is mainly for captive use, they said.

Jilin Petrochemical, which was the largest aniline producer in China, might exit from the business as it plans to sell its remaining 70,000 tonne/year aniline unit to another company, one of the company sources said. He declined to reveal the name of the buyer.

Yeow Pei Lin in Singapore contributed to this article.
By: Florence Tan
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