31 October 2013 15:51 [Source: ICIS news]
HOUSTON (ICIS)--Williams estimates that it will receive about $343m (€250m) in cash recoveries from insurers for business interruption losses related to June's accident at its olefins plant at Geismar, Louisiana, executives at the US-based energy and petrochemicals firm said on Thursday.
The plant has been down since 13 June, when an explosion and fire left two people dead and more than 70 injured. Williams expects to be able to resume operations at Geismar in April 2014.
However, chief financial officer Donald Chappel told analysts during Williams third-quarter earnings call that the actual amount of claims from lost production will depend on market prices Williams would have realised, “so that will be dependent of what happens in the market over the coming quarters”.
“I think we got a solid basis for our estimate,” he added.
In the third quarter, Williams already recognised $50m in insurance recoveries from Geismar. This initial recovery payment “evidences good faith on the part of the insurers”, Chappel said.
Williams’ combined business interruption and property damage insurance for Geismar is $500m, “subject to deductibles and other limitations.”
Williams estimates the uninsured business interruption loss, property damage loss and other losses from the accident at $73m. The actual plant repair cost is currently estimated at $102m.
($1 = €0.73)
Additional reporting by Jeremy Pafford
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