US firm plans to shut down Philadelphia refinery after fire

HOUSTON (ICIS)–Philadelphia Energy Solutions plans to shut down its refinery in Pennsylvania within the next month after a fire at its alkylation unit, the mayor of the city said on Wednesday.

The company also had a cumene unit at the refinery, so its shutdown will affect several petrochemical markets.

The cumene unit has a capacity of 612,000 tonnes/year.

Nylon producer AdvanSix uses cumene at its Frankford plant in Pennsylvania to make phenol. The Frankford plant has a capacity of 1.1bn lb/year (500,000 tonnes/year) of phenol and 680m lb/year of acetone.

AdvanSix sells all of its acetone, which its customers use to make adhesives, paints, coatings, solvents, herbicides and engineered plastics, the company said in its annual report.

The company sells about 20-25% of its phenol to customers, who use it to make resins, epoxies and bisphenol-A (BPA). AdvanSix uses the other 75-80% of its phenol to make caprolactam at its plant in Hopewell, Virginia.

The Hopewell plant has a caprolactam capacity of 795m lb/year.

AdvanSix uses the caprolactam to make nylon 6 at its plant in Chesterfield, Virginia. That plant has a capacity of 440m/lb/year of nylon 6.

AdvanSix referred to an earlier statement that it released on 24 June, in which it said that the refinery is just one of several companies that supply it with cumene. AdvanSix said it is continuing to operate its plants while implementing mitigation plans. That includes evaluating business-interruption insurance.

“As a result of this event, we expect an increase in our feedstock and logistics costs to persist into the third quarter 2019,” said Erin Kane, CEO. “We are actively working with a number of suppliers to mitigate the impact on our business operations.”

At the time, AdvanSix said the fire should cause a $7m-12m hit to the company’s pre-tax income during the third quarter. That estimate includes higher raw material and logistics cost as well as what AdvanSix called a “modest unfavourable impact from fixed-cost absorption”.

AdvanSix remains on force majeure with its phenol customers, it said.

Philadelphia Energy Solutions did not immediately respond to a request for comment.

The refinery also makes propylene from its fluid catalytic cracking (FCC) unit.

It is unclear if Philadelphia Energy Solutions sold any of its propylene to the merchant market, since the refinery had a cumene and alkylation units. Both of these use propylene as a feedstock.

Earlier in the week, Braskem said the fire had no effect on its operations.

Braskem owns a polypropylene (PP) plant south of the refinery in Marcus Hook, Pennsylvania. It has two lines that each produce 207,000 tonnes/year. A lot of the propylene for the PP lines comes from a splitter that Braskem bought in 2012. That splitter is also in Marcus Hook.

The refinery fire started on 21 June. The complex had three separate explosions, affecting the refinery’s alkylation unit, Philadelphia Energy Solutions said at the time.

Alkylation units use propylene and isobutane to produce alkylate, a high-octane blendstock.

The product burning is most likely propane, Philadelphia Energy Solutions said. The company confirmed that four people suffered from minor injuries.

The refinery has a capacity of 335,000 bbl/day. In addition to propylene and cumene, the refinery also makes benzene, toluene and xylenes.

It is running at reduced rates, Philadelphia Energy solutions said at the time.

The US Chemical Safety Board (CSB) is sending a team to investigate the explosion and fire.

The CSB is an independent federal agency that conducts investigations on chemical accidents. Its board does not issue citations or fines, but does make safety recommendations to companies, industry organisations, labour groups and regulatory agencies.

The image above shows the refinery fire. Photo by Matt Rourke/AP/Shutterstock