LyondellBasell to cut US MTBE by two-thirds - sources

18 June 2009 17:45  [Source: ICIS news]

HOUSTON (ICIS news)--LyondellBasell will cut methyl-tertiary butyl-ether (MTBE) production by nearly two-thirds once it begins making bio-ethyl tertiary butyl ether (ETBE) at its Channelview complex in Texas in the fourth quarter, sources said on Thursday.

MTBE capacity at the Channelview complex is about 42,000 bbl/day, market sources told ICIS news, but following the switch to ETBE, only about 12,000-15,000 bbl/day of MTBE will be made at the site.

A spokesman for the company would not comment on capacity, future or present, at the Texas plant.

“Global ether production capacity is 75,000 bbl/day,” Lyondell spokesman David Harpole said.

Harpole confirmed that the Netherlands-based company would still produce the gasoline additive MTBE at Channelview, as it remains committed to producing ethers.

Traders said they anticipated MTBE production cutbacks and expected that the move would significantly decrease the availability of MTBE on the spot market.

“This will definitely make the South American market tighter,” said a US Gulf coast-based trader.

The US has largely phased out MTBE in gasoline, favouring ethanol as an oxygenate for gasoline.

However, MTBE is still used as a gasoline additive in the rest of the world.

US MTBE producers include LyondellBasell, Texas Petrochemicals and Huntsman.

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By: Steven McGinn
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