Petchems start altering turnaround schedules amid coronavirus

Author: Juhi Varma

2020/03/17

HOUSTON (ICIS)--Petrochemical producers and refiners have started altering maintenance schedules and turnarounds as quarantines from the coronavirus (Covid-19) make it difficult to assemble work crews and as demand weakens for chemicals.

Saudi petrochemicals manufacturer SABIC has postponed the planned turnaround that was due to take place at its Wilton, UK cracker in April.

A spokesperson said that the company has "decided to postpone its upcoming Olefins 6 turnaround and associated site-wide overhaul work to a later date. In the meantime, the Teesside operations, including Olefins 6, will continue to operate as normal with safety as our first priority."

No reasons were given for the postponement of the turnaround, which was two years in the planning, and no rescheduled date has been given.

Market sources said that SABIC may have taken the decision on the back of the growing spread of the coronavirus, given the significant number of additional personnel that is usually on site to manage turnarounds.

US refiner PBF Energy’s Q1 maintenance at Chalmette in Louisiana has been deferred to Q3 or Q4, a market source said. PBF’s work at a fluid catalytic cracking (FCC) unit at its Toledo refinery in Ohio will not be wrapped up until the second week of April at the earliest.

PBF declined to comment.

Other producers may choose to extend maintenance schedules to avoid losses, said Paolo Scafetta, ICIS senior analyst. Europe’s cracker operators could trim rates or take other measures to maintain profitability.

“They could extend scheduled maintenances, cut operating rates or, in the final instance, declare force majeure to avoid losses in the second quarter, especially April and May,” he said.

A major polyvinyl chloride (PVC) producer said that the large auto manufacturing slowdown could prompt lower production or shifting schedules for plant maintenance turnarounds.

A large polymer distributor in the US said they have not seen any producers making radical changes to maintenance schedules yet. However, a recent ban on single-use plastics was not being observed.

LATIN AMERICA
A polystyrene (PS) producer in Latin America said the plant was working as before, but 90-95% of the office personnel was working from home. The company worries that if plant personnel start becoming sick, unions will likely force a shutdown or some other measure.

The company sees no improvement on demand, but sales have been normal so far, as many buyers fear they could run out of resin.

A polypropylene (PP) producer reported being unaffected so far and continues to receive a good supply of propylene from the local refiner. The company has a turnaround planned for October.

Another polymer producer said production was normal at this time, although it sees softer demand ahead. Operations have been at slightly lower rates in recent months to avoid oversupply.

COMPANIES STAYING ALERT
Other companies are conducting business as usual but have prepared plans for general operations.

ExxonMobil said it had a well-established processes in place to manage impacts related to infectious disease outbreaks, the safety of workers being of primary importance.

“ExxonMobil has implemented restrictions on business travel,” a company spokesperson said. “We've already seen the impacts on global demand, but it's too early to quantify the full impact to our global business lines.”

US Celanese declined to comment on operations, although a company spokesperson said: “Our local regional customer service and sales personnel continue to work closely on keeping our customers apprised of any changes to deliveries.”

Additional reporting by Nel Weddle, Al Greenwood, Alex Snodgrass, George Martin, Zachary Moore, Michael Sims, Anna Matherne, and Bill Bowen

Visit the ICIS coronavirus topic page for analysis of the impact on chemical markets and links to latest news.