Texas crackers restarting after Gustav shutdown

03 September 2008 15:44  [Source: ICIS news]

HOUSTON (ICIS news)--Olefins crackers in Texas that were shut down ahead of Hurricane Gustav were undergoing normal restart procedures, according to regulatory filings posted on Wednesday.

Producers had shut down units in the Port Arthur area, east of Houston and close to the border with Louisiana, because forecasts had at one point warned that Gustav might follow a track closer to that of the devastating Hurricane Rita in September 2005.

The filings posted so far with the Texas Commission on Environmental Quality (TCEQ) do not indicate any problems with the restarts.

"Standard operating procedures will be followed to safely start production units and bring equipment on line while minimising flaring," Chevron Phillips Chemical said in a filing that indicated the procedure at its Port Arthur plant began early on Wednesday.

The Chevron Phillips olefins cracker has capacity of 805,000 tonnes/year, according to data from global chemical market intelligence service ICIS pricing.

The filing did not give a timetable to complete the restart procedure.

Huntsman said its Port Neches plant on the east Texas coast was also following a normal restart procedure that commenced on Tuesday.

"The Huntsman Port Neches performance products facility plans to restart all shutdown units and resume production operations of all idled units as the threat of Gustav has passed," it said.

The Huntsman filing indicated the restart procedure could last through Saturday. The plant has olefins capacity of 193,000 tonnes/year.

A number of olefins crackers remain shut down in Louisiana, where the electricity grid appears to have borne the brunt of infrastructure damage from the storm.

Crews from utility companies in Texas were being sent on Wednesday to help restore power, and civil authorities have told hundreds of thousands of evacuees they cannot return home to New Orleans and other cities just yet.

US Gulf ethylene and propylene markets reopened quietly on Tuesday after Gustav's passage on the long weekend. No fresh deals have been heard yet.

Ethylene and propylene values had been supported by the threat of Gustav, arresting a downtrend amid ample supply. The post-hurricane slide in energy values has since set the tone for market sentiment.

On Wednesday morning, spot ethylene bid/offer levels were notionally assessed at 52-53 cents/lb ($1,146-1,168/tonne, €791-806/tonne) for September, compared with 53-54 cents/lb late on Friday.

Bid-offer levels for September refinery-grade propylene (RGP) were notionally assessed at 55.00-56.00 cents/lb, down from 57.50-58.50 cents/lb late on Friday.

($1 = €0.69)

For more on Chevron Phillips Chemical's Port Arthur plant, visit ICIS plants and projects
For more on ethylene and propylene visit ICIS chemical intelligence
To discuss issues facing the chemical industry go to ICIS connect

By: Stephen Burns
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