Shell lifts Moerdijk cracker products force majeure

23 March 2012 11:59  [Source: ICIS news]

A Shell petchem plantLONDON (ICIS)--Shell Chemicals has lifted the force majeure on cracker products from its Moerdijk facility in the Netherlands, as stable and normal production rates have been re-established, a company spokesman said on Wednesday.

The spokesman said its customers had been notified on 20 March.

Shell Chemicals declared force majeure on ethylene, propylene, isoprene and acetylene on 1 March because of “unforeseen fouling in the ethylene cracker bottom oil circulation”, which meant that the company was forced to operate the cracker at reduced rates.

Butadiene (BD) was not affected. The situation steadily improved and Shell was able to increase rates by 9 March.

But the unplanned reduction in operating rates at Europe’s second-largest ethylene cracker and the subsequent force majeure declaration contributed to ethylene spot prices closing the gap with an already record high March contract price.

Spot prices were talked as high as $1,700–1,750/tonne (€1,295–1,330/tonne) CIF (cost insurance & freight) NWE (northwest Europe). The March contract price currently stands at €1,305/tonne FD (free delivered) NWE.

However, news of improved rates at the Moerdijk cracker, the resumption of operations at a Cologne, Germany cracker owned by the multinational chemical company INEOS, together with expectations of a high level of imports arriving in the second half of the month, soon saw the trend reversed and spot numbers fell back.

The focus is now on April contract prices, discussions for which are expected to get underway towards the end of this week.

Shell Chemicals has a nameplate capacity at its Moerdijk cracker of 910,000 tonnes/year of ethylene, 500,000 tonnes/year for propylene and 115,000 tonnes/year of BD, according to ICIS

($1 = €0.76)

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By: Nel Weddle
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