31 August 2012 22:00 [Source: ICIS news]
HOUSTON (ICIS)--Several companies have begun restarting their chemical plants by Friday in the aftermath of Hurricane Isaac.
Isaac made landfall on Tuesday in Louisiana, a state with numerous refineries and petrochemical plants.
The storm caused widespread flooding and power outages, drenching New Orleans with 20 inches (51cm) of rain, and other areas with more than 10 inches, according to the National Hurricane Center.
At one point, nearly 763,000 customers were without electricity in Louisiana and neighbouring Mississippi, said Entergy, the region's main power company.
Meanwhile, Isaac has dissipated after moving inland. Companies were assessing their plants and many were beginning restart operations.
Shell and Motiva were beginning restart procedures at their refineries in Convent and Geismar. Motiva's refinery units in Norco were shut down, but the chemical plant was operating at reduced rates.
BASF was working to restart its Geismar complex in Louisiana.
By Friday, Lion Copolymer planned to begin restart procedures at its Baton Rouge and Geismar plants.
Likewise, Cornerstone Chemical planned to begin restarting its Fortier Manufacturing Complex, which is just outside of New Orleans.
Dow Chemical was assessing its plants in Plaquemine and St Charles, Louisiana, the company said. Once Dow completes the assessments, it planned to send maintenance and operations teams to bring utilities back on line.
ExxonMobil's Baton Rouge units continued operating at reduced rates, and would resume normal operations as soon as it was safe to do so, the company said.
Meanwhile, ExxonMobil was assessing its Chalmette refinery, it said.
Americas Styrenics’ St James styrene plant incurred some minor damage but had electric power.
Phillips 66's 247,000 bbl/day Alliance Refinery in Belle Chasse, Louisiana, had lost power and had flooding, the company said. Workers were pumping out water.
Williams' Geismar cracker in Louisiana would remain off line for several days of maintenance.
For many plants, flooded roads could prevent plant employees from showing up to work, delaying restarts, said Luann Farrell, senior consultant at Nexant.
Several roads remain closed because of the storm, posing logistics challenges, according to the Louisiana Department of Transportation and Development.
American Chemistry Council (ACC) spokesman Scott Jenson said flooding could also disrupt feedstocks for plants.
Valero reduced rates at its Memphis refinery in Tennessee because a pipeline was shut down.
Even if plants have power, tScott said, they could still reduce rates or shut down if they cannot ship out finished products.
With so many factors, Nexant's Farrell said the speed under which producers can restart operations will vary plant by plant.
Ultimately, Isaac's effect on chemical markets will depend on how quickly companies can resume production.
Farrell said the shutdowns could affect spot prices if material was not available.
As it is, Pinnacle Polymers had declared force majeure for polypropylene (PP), based on difficulties in obtaining raw material as well interruptions in rail service.
Products that are already under price pressure could get a further boost from the shutdowns, Farrell said, but soft markets could see little change.
Additional reporting by Wesley Busch, Brian Ford, Michelle Klump, William Lemos, Anna Matherne and Frank Zaworski
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