21 March 2011 10:20 [Source: ICIS news]
(recasts, adds details throughout)
By Felicia Loo and Helen Lee
The cracker was shut at 21:00 hours
The cracker complex produces 800,000 tonnes/year of C2, 450,000 tonnes/year of C3 and 230,000 tonnes/year of benzene, according to Shell’s website.
Shell’s 750,000 tonne/year MEG plant on neighbouring
“We have declared force majeure under some of our chemicals contracts,” said a company spokesperson, without elaborating which products have been affected.
“This is because the ethylene cracker unit on our Pulau Bukom manufacturing site is facing operational issues and this has affected our ability to supply product to some of our customers,” the spokesperson said.
The Asian benzene market was subdued following news of the outage and due to a public holiday in major regional supplier
“The effect will come tomorrow once the market digests this news. For C2, C3, benzene and butadiene the effect will come for sure,” a Singapore-based trader said.
Benzene spot prices in Asia were hovering at $1,175-1,185/tonne (€823-830/tonne) FOB (free on board)
Meanwhile, a northeast Asia-based C2 trader said he had no firm selling ideas until a clearer picture of the impact of the outage emerges.
“There’s a perceived ethylene shortage in the north because of issues in
“Shell was quite long before its outage,” the trader added.
The spokesperson said Shell was working to resume normal operations and supply as soon as possible so as to minimise potential impact on its customers.
“We very much regret the impact this has on some of our customers. We will continue to work with them and to keep them regularly updated with regard to our ability to resume normal operations and supply,” the spokesperson said.
“Things are in a bit of a flux now because it is just the first working day after the FM so they are waiting to assess the market situation,” according to a source close to the company.
With additional reporting by Nurluqman Suratman, Mahua Chakravarty and Yu Guo
($1 = €0.70)
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