UpdateCEPSA declares immediate FM on phenol, acetone from Huelva

23 April 2010 15:29  [Source: ICIS news]

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LONDON(ICIS news)—CEPSA Quimica has declared force majeure (FM) on phenol and acetone from it plant in Huelva, Spain, a company source confirmed on Friday.

Earlier in the day CEPSA Quimica said that it had detected major corrosion on its newest production line, line three, and was assessing whether to declare force majeure on phenol and acetone.

“We had detected major corrosion on the line and tried to make some emergency repairs,” the company source said. “But this does not guarantee the safety of the line so there will be an enquiry and investigation which will take a long time.”

CEPSA had been talking with its legal department about whether to put customers on allocation, possibly followed by force majeure, or both.

Earlier, Germany’s INEOS Phenol announced it had put phenol customers on 85% allocation for phenol contract volumes because of problems with the availability of raw materials.

In correspondence with its customers, the company said: “Due to severe problems on the raw material side beyond its control, INEOS Phenol has been forced put customers on 85% allocation from 1 May. This is for European phenol customers and does not concern acetone.”

INEOS Phenol will enter into a 14-day planned turnaround at its Gladbeck site in Germany on 18 May. The site has a capacity of 650,000 tonnes/year of phenol and 395,000 tonnes/year of acetone.

"When you hear half and hour ago that the major producer has put customers on allocation and now this - it will be like a bomb shell," the source said.

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By: Julia Meehan
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