Shell Chemicals declares force majeure on Moerdijk styrene

25 February 2010 12:13  [Source: ICIS news]

LONDON (ICIS news)--Shell Chemicals has declared force majeure on styrene from its Moerdijk plant in the Netherlands as a result of problems with its upstream ethylene supply, a company source said on Thursday.

“We declared force majeure on styrene yesterday [24 February], after we had to declare force majeure for the feedstock ethylene earlier,” the company source said.

The company has been experiencing production problems for almost a week.

Last week, a company source confirmed that an incident with a hydrotreater unit had led to reduced benzene output at its Moerdijk plant.

At the same time, the source noted that the firm's Godorf plant in Germany, which is part of the Rhineland refinery, was experiencing technical problems.

Then, on 23 February, Shell had to declare forces majeures on ethylene (C2) and propylene (C3) at its Moerdijk cracker due to reduced operations following a mechanical problem.

The cracker, which has the capacity to produce 910,000 tonnes/year of ethylene and 500,000 tonnes/year of propylene, developed a problem that was expected to take around seven days to resolve.

The company source could not immediately comment on the anticipated timeframe of the styrene force majeure, but did say that he expected the “technical problem from last Friday to be solved within nine days”.

Shell has two styrene plants at Moerdijk, one of which is a joint venture with BASF. It was unclear if both plants were affected. The total nameplate capacity at Moerdijk is estimated at 990,000 tonnes/year of styrene, according to data from ICIS plants and projects.

The domestic styrene market responded with higher numbers on Thursday morning, with bids assessed at $1,310/tonne FOB (free on board) Rotterdam and offers pegged at around $1,350/tonne, although it was uncertain how firm these were.

This range was up from Wednesday’s close by approximately $30-50/tonne, and it was likely that the styrene barge contract, which was expected to settle on 1 March, would see an increase from the February price as a result, some sources said.

The February styrene barge contract price was agreed at €1,002-1,005/tonne FD (free delivered) NWE (northwest Europe).

($1 = €0.74)

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By: Madelon Ten Cate
+44 20 8652 3214



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