05 April 2013 09:34 [Source: ICB]
Post turnaround, the Fort Saskatchewan site's capacity will rise 10-15%. Meawhile, US contract prices are expected to fall
MEGlobal plans to conduct a month-long turnaround at its monoethylene glycol (MEG) facility at Fort Saskachewan in Canada, a company executive said.
"In May, we have a full-month outage at one of the three plants [in Canada], and we are changing the reactors and the main purpose of this is to improve efficiency," MEGlobal executive vice president Frank Hanraets said on the sidelines of the International Petrochemical Conference (IPC) hosted by the American Fuel and Petrochemical Manufacturers (AFPM),
After the turnaround, the plant's capacity is expected to increase by about 10-15%, he said.
The Fort Saskachewan plant can produce more than 340,000 tonnes/year of ethylene oxide (EO) and glycol, according to MEGlobal's website.
The company's two other plants in Alberta province with MEG capacities of 310,000 tonnes/year and 350,000 tonnes/year are located in Prentiss.
MEGlobal is a major exporter to Asia. China's consumption of monoethylene glycol (MEG) is expected to grow 8% this year from 11m tonnes in 2012, said Hanraets.
The country's demand for the raw material for polyester production will grow at a slightly higher rate than its economic growth, sustaining the pace of increase registered last year, he said.
China, which is the world's second biggest economy, accounts for roughly half of the global demand for MEG which was estimated at around 23m tonnes in 2011, Hanraets said.
The country is keeping its GDP growth target of 7.5% for a second year in 2013. In 2012, the country's GDP growth was at 13-year low of 7.8%, lower than the 9.2% expansion recorded in the previous year. Although slowing down, China's economy continues to grow at a strong pace compared with the rest of the world, Hanraets said.
Global consumption of MEG is forecast to increase at a slower rate of 5-6%, with a slight improvement in the US and no growth in Europe, he said.
Meanwhile, contract prices for US ethylene glycol (EG) are expected to decline in April, several market sources said on the sidelines of the IPC. "We anticipate that EG will be down by approximately 2-3 cents/lb ($44-66/tonne, €34-51/tonne)," said one source.
Falling US prices are following declining price trends in the Asian and European monoethylene glycol (MEG) contract markets.
Additional reporting by Feliza Mirasol in San Antonio
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