31 March 2006 19:14 [Source: ICIS news]
TORONTO (ICIS news)--The suspension of ethylene shipments on Canada's Cochin pipeline system will impact chemical firms at Ontario’s Sarnia petrochemicals hub, analysts said this week.?xml:namespace>
BP announced earlier this month that it is suspending ethylene on the Cochin pipeline system, which transports ethylene and other products from Alberta to Sarnia, likely until “at least the fall of 2007.” The company, citing a finding of stress corrosion cracking in a 2003 incident, said it has cut pressure on the Cochin system to about 900/square inch to ensure an appropriate safety margin for operations. As a result, shipments of ethylene, which has a higher vapour pressure than other products shipped on the pipeline, have been suspended.
John Cummings, an analyst with Toronto-based Canadian C2+ Petrochemical Report, said the suspension will impact chemical plants at Sarnia, which traditionally has an ethylene deficit that is mostly made up by Cochin shipments.
Sarnia’s net ethylene deficit is currently around 228,000 tonne/year, according to Cummings’ estimates. The suspension will primarily affect Dow Chemical and Imperial Oil while Nova Chemicals has more ethylene from its nearby Corunna cracker than it requires to feed its polyethylene (PE) and styrene monomer (SM) operations, he said.
Cummings added that during Nova’s recent five-month cracker outage all of Sarnia’s ethylene demand would normally have been supplied through Cochin, except that the line was down for almost a month during that period.
BP experienced a release on the Cochin line in July 2003 and has since done "extensive pipeline integrity work" on the system. There is concern an accidental release could occur near a populated area along the line’s US section. The pressure reduction allows the whole US section to be examined and repaired where necessary, Cummings said.
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