HOUSTON (ICIS)--The blast that hit TPC Group's US butadiene (BD) plant in Port Neches, Texas, happened amid a price slump for the monomer.
TPC has not provided any production updates on the plant.
The company has two lines at the site that produce a combined 426,000 tonnes/year, according to the according to the ICIS Supply & Demand Database.
It makes up a sizeable portion of the total BD capacity in the US.
Overall, the US has a BD capacity of 2.60m tonnes/year among six producers, with TPC's Port Neches operations making up 16%, according to the according to the ICIS Supply & Demand Database.
However, not all of those producers are included the monthly contract settlement.
Assessment of contracts is based on nominations from four producers. Those four suppliers have a total US capacity of 2.09m tonnes/year, with TPC's Port Neches operations making up 20%.
US BD contract prices have been declining over the years, as shown in the following chart.
For December contracts, producers have separately proposed lower nominations.
Global supply has outpaced slumping demand all year despite a heavy turnaround schedule and other unplanned outages and logistics issues that would ordinarily pressure prices.
US BD contract prices have fallen to 37.625 cents/lb ($829/tonne) in November from a high of 73 cents/lb in 2018, a year marked by tight supply.
Recent declines reflect weak demand for synthetic rubber, which is made with BD.
Also, over the past few years, supplies of BD in the US have been rising because of the start-up of several new crackers.
These crackers use ethane as a feedstock, which produces little crude C4, from which BD is extracted.
However, the US has built so many new ethane crackers, their combined effect has created a substantial increase in supplies of crude C4 - enough to affect global markets.
In the past, the US had to import BD and crude C4 to meet demand. Given the new crackers, the US could become balanced.
TPC had been preparing for this influx of crude C4 by making improvements to increase the reliability of its operations.
It had conducted turnarounds at all three of its BD extraction units. It has also upgraded its logistics system.
Earlier this year, the company said it was planning a second growth phase, following the completion of the first one.
It is unclear how the explosion and fire will affect the work TPC has done up to this point and the projects it planned for its second phase.
The fire continued burning on Wednesday following an explosion at TPC Group's BD plant at Port Neches, Texas.
The explosion took place at 1:00 hours Houston time (7:00 GMT) in the south 4 group processing area of the plant, said Troy Monk director of health, safety and security at TPC Group. He made his comments during a press conference.
The area processes BD, Monk said.
The company has not provided any details about when normal operations could resume.
At least three tanks were involved, although Monk did not elaborate on the extent of their involvement. Nor does the company know which other pieces of equipment were involved in the fire.
When the explosion happened, the site had a total power outage, Monk said. The company cannot even access its data recorders to see how much material was in the site's vessels and how much was flowing in its pipelines.
Flow of material coming into the plant and out of it was stopped, Monk said. “When an event like this occurs, you become an island of your own.”
TPC has yet to be able to send a team into the site to investigate the cause of the explosion. Right now, it is focusing on controlling and extinguishing the fire, Monk said.
As part of those efforts, firefighters are spraying water on metal equipment to keep it relatively cool. Otherwise, any metal exposed long enough to the fire will fail, and that would cause the blaze to expand, Monk said.
Because of the explosion and fire, TPC had to establish its emergency operations centre (EOC) offsite at a nearby Huntsman plant.
The TPC site produces BD, with two production lines with capacities of 166,000 tonnes/year and 260,000 tonnes/year. It also makes methyl tertiary butyl ether (MTBE), with production capacity at 400,000 tonnes/year.
The accident injured two TPC employees and one contractor, Monk said. All three have been treated and released.
Many people living nearby the plant posted online comments about damage to their homes.
One of those who suffered damage was Jeff Branick, county judge of Jefferson County, which includes Port Neches. He said the front and back door of his house was blown in.
Port Neches Mayor Glenn Johnson said, "I understand what getting blown out of bed means now."
He had windows and doors blown out of his house.
A safety zone has been established on the Neches river in Texas between Light 20 and Light 29 following the explosion, according to a notice from the US Coast Guard Captain of the Port (COTP).
As a precaution, Huntsman shut down its Port Neches plant following an explosion and fire at a nearby plant owned by TPC Group. Huntsman has found no physical damage at its site, and the company expects to bring the various units back online in the coming days.
Huntsman did not specify which units were shut down. However, MTBE uses isobutene as a feedstock. The TPC plant nearby processes C4 chemicals.
Huntsman is still running its crackers and some of the units downstream from it.
The MTBE unit has a capacity of 650,000 tonnes/year.
BD is used to make styrene butadiene rubber (SBR) as well as high-impact polystyrene (HIPS) and acrylonitrile butadiene styrene (ABS).
Focus article by Al Greenwood
Additional reporting by Lane Kelley, Morgan Condon, Anna Matherne and Amanda Hay
Thumbnail image map by Miguel
(adds paragraphs 1-17, 35-38)