CNOOC-Shell runs Huizhou MEG at reduced rates

11 September 2007 13:27  [Source: ICIS news]

SINGAPORE (ICIS news)--CNOOC & Shell Petrochemical Co (CSPC) has been running its 320,000 tonne/year monoethylene glycol (MEG) plant in China at 60% of nameplate capacity since earlier this month, sources close to the company said on Tuesday.

“The plant, together with the cracker, developed some mechanical issues in early September following a power failure,” one of the sources said, referring to the 800,000 tonne/year cracker which is integrated with the MEG unit at Huizhou in the southern Chinese province of Guangdong.

“Contract supplies had been tighter than usual, but all commitments to customers were met for September,” said a second source.

“The problems should not be too serious, and we don’t expect any major cut in volumes,” said a third, who declined to estimate how much volumes could be lost.

Officials from the joint venture of China National Offshore Oil Corp (CNOOC) and the Anglo-Dutch Shell Chemicals declined to comment on the cut in operations, with one saying that “we do not comment on market rumours”.

CSPC’s reduced operations are expected to further tighten already snug supply in the market, and push prices further up.

Spot MEG prices had rocketed towards $1,390/tonne CFR (cost and freight) China from about $970-980/tonne CFR in early August following outages in various parts of the world, firm demand among end-users and trader speculation.

By: Salmon Aidan Lee
+65 6780 4359

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly