15 March 2011 19:18 [Source: ICIS news]
HOUSTON (ICIS)--US-based producers Dow Chemical and DuPont have shut down two facilities in Japan, although their other plants are still operating, the companies said on Tuesday.
A 9.0-magnitude earthquake hit the country on Friday, knocking out several petrochemical plants.
DuPont's research and manufacturing facility in Utsunomiya was damaged, and it would remain closed until the company finishes assessing it.
The company was reviewing the operations at its 15 joint ventures in the nation, it said.
DuPont's remaining sites in Japan were operating, it said. Also, all of its employees and their immediate family were safe.
Dow Chemical said its Soma site was closed after being flooded during the tsunami that followed the earthquake.
The Soma site produces ion-exchange resins. Dow would review the damage to the site as soon as possible, it said.
Dow's other sites in Japan are operational, the company said.
No damage was reported at Solutia's manufacturing facility, and the company confirmed the safety of all employees and their families in the region over the weekend.
The Kashima plant has enough inventory to meet its current commitments, since it was preparing for a turnaround, the company said.
Solutia's other sites in Asia and around the world were fully operational, the company said.
In the upcoming weeks, the key issue for the Cabot plants would be transportation. Feedstock and employees would need to enter the plants, and finished product would need to leave them.
Since the earthquake was so recent, Cabot does not know how transportation could affect its plants.
DuPont mentioned similar concerns about damage to Japan's electric-power, communications and transportation infrastructure.
DuPont was working on ways to deal with these problems so it can resume normal operations as quickly as possible, it said.
Meanwhile, Germany-based Bayer has given its 700 employees in the Tokyo area the option to move to Osaka amid concerns over the safety of Japan's nuclear plants north of the city.
The offices though, are not being closed.
Germany-based LANXESS has temporarily closed its Japanese headquarters. Its management would work from Toyohashi.
So far, several Japanese plants were off line because of the earthquake and subsequent tsunami.
Jefferies & Co analyst Laurence Alexander said 23% of Japan's ethylene capacity was shut down. That represents 5% of northeast Asian capacity and 1.3% of global capacity.
For polyethylene (PE), 14% of Japan's capacity was shut down, he said. This represents 3% of northeast Asian capacity and 0.6% of global capacity.
For propylene, 37% of Japan's fluid-catalytic-cracking (FCC) capacity is shut down, he said. This represents 6% of northeast Asian capacity.
Jefferies estimated that up to 800,000 tonnes/year of propylene production shut down if 1.8m tonnes/year of ethylene capacity was off line. That estimate was made under the assumption that all production was through naphtha.
For polypropylene (PP), 25% of Japan's capacity was shut down, Jefferies estimated. This represents 4% of northeast Asian capacity and 1.4% of global capacity.
(Additional reporting by Pearl Bantillo, Stefan Baumgarten, Franco Capaldo and Judith Wang)
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