02 August 2011 06:56 [Source: ICIS news]
(adds impact of force majeure on selected petrochemical prices, more details)
By Felicia Loo and Peh Soo Hwee
SINGAPORE (ICIS)--Taiwan’s Formosa Petrochemical Corp (FPCC) is going ahead with a major turnaround at its largest cracker in Mailiao on 15 August, although a fire over the weekend led to a complete shutdown of its 540,000 bbl/day refinery and related facilities at the site, company officials and traders said on Tuesday.
With the refinery down, FPCC has declared a force majeure on all petroleum products from the Mailiao complex, they said.
FPCC will shut the 1.2m tonne/year No 3 cracker as planned for a turnaround that will last 45 days, said a company spokesperson, confirming an earlier ICIS report.
However, “there is no schedule for the restart of the No 1 cracker,” he added. The 700,000 tonne/year No 1 cracker has been shut since 12 May.
The fire that broke out in late July at a propylene pipeline in Mailiao prompted the shutdown of the refinery, along with FPCC’s 520,000 tonne/year Group II base oil plant and 190,000 tonne/year methyl tertiary butyl ether (MTBE) plant.
The company’s two residual fluid catalytic crackers (RFCC) at Mailiao, which each can produce 325,000 tonnes/year of propylene, were also taken off line following the fire, an FPCC source said.
An olefins conversion unit (OCU) at the site, which can produce 250,000 tonnes/year of propylene, was also taken off line. The source said that the restart dates for the RFCCs and the OCU are not immediately known.
“At this point, FPCC has not been able to determine the length of the delay [in the shipments of petroleum products],” according to a company statement obtained by ICIS late on Monday.
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However, FPCC has no plans to acquire spot naphtha cargoes for September delivery and may continue to shun spot buying even for October, given the uncertainty over the restart period of the No 1 cracker and the upcoming turnaround of the No 3 cracker, traders said.
FPCC’s 1.03m tonne/year No 2 cracker and the No 3 cracker are currently operating at full capacity, the company spokesperson said.
“Sentiment is bullish as downstream prices are picking up. The [FPCC] refinery is down but other petrochemical units are still running,” said a naphtha trader in
Formosa Plastic Corp’s (FPC) acetone cyanohydrin-based 98,000 tonne/year methyl methacrylate (MMA) unit Mailiao is running at full tilt, while its 260,000 tonne/year acrylonitrile unit is heard last operating at 80% and a 23,000 tonne ammonia feedstock cargo for that unit is waiting to berth at Mailiao port later on Tuesday, company sources said.
Meanwhile, FPC has stopped offering spot propylene cargoes after the fire broke out. In response to the supply disruptions, traders in
The Taiwanese government may also require FPC to ensure that it can fulfil domestic requirements for propylene before it can resume exporting, a market source said.
Spot styrene monomer (SM) prices in
FCFC’s 200,000 tonne/year No 1 and 300,000 tonne/year No 2 plants have been shut since mid-May following a fire outbreak at FPCC’s 700,000 tonne/year No 1 cracker.
With two fires in one week and the sixth major plant accident over the past year, the government has suggested to Formosa to shut down all the units in the Mailiao complex in stages over a one-year period for inspection and safety checks, the spokesperson said.
“No decision has been made. It is a very difficult situation at this point,” he added.
Additional reporting by Yeow Peilin, Helen Lee, Chan Jingyi, Clive Ong, Pearl Bantillo, Lester Teo, Heng Hui, Junie Lin and Feliana Widjaja
($1 = €0.70)
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