Laura strengthens to category 4 hurricane as it heads towards US Gulf Coast

Author: Al Greenwood

2020/08/26

HOUSTON (ICIS)--Hurricane Laura strengthened into a category 4 on Wednesday, as it continues to head toward the border between Texas and Louisiana, causing several petrochemical plants and refineries to shut down.

Maximum sustained winds are nearly 140 miles/hour (220 km/hour), and further strengthening could take place, according to the National Hurricane Center.

Hurricane force winds extend up to 70 miles from the centre of the storm. A storm surge warning - extending from Freeport, Texas, to the mouth of the Mississippi river - has been issued.

Laura is 200 miles south-southeast of Port Arthur, Texas, and it is travelling 16 miles/hour, the centre said. Laura should make landfall by Thursday morning.

The following map shows the path of the storm.

Source: National Hurricane Center

CHEMICAL PLANTS AND REFINERIES

Hurricane Laura has led to a wave of plant shutdowns as companies prepare for the storm. A table at the bottom summarises the status of some of the major chemical plants along the Gulf Coast.

LyondellBasell has declared force majeure on all grades of polypropylene (PP), according to a customer letter.

Westlake shut down its styrene plant in Lake Charles, Louisiana, according to a company source.

INEOS declared force majeure on high density polyethylene (HDPE), according to a customer letter.

Bridgestone Firestone shut down a styrene butadiene rubber (SBR) plant in Louisiana, according to market sources.

Dow implemented order control on US methacrylates, according to a customer letter.

LyondellBasell shut down two polymer sites in Chocolate Bayou, Texas, and Bayport, Texas, the company said.

OCI shut down its methanol complex in Beaumont, Texas, the company said.

TPC Group shut down butadiene (BD) capacity in Houston, Texas, the company said.

Westlake said it is shutting down some of its units in Lake Charles. It did not specify which ones.

INEOS declared force majeure on PP, according to a customer letter.

US SBR producers Goodyear, Lion Elastomers and Arlanxeo have shut down their sites in southeast Texas, according to market sources. They represent 34% of US SBR production capacity, according to the ICIS Supply and Demand Database.

In addition, Excel Paralubes and Motiva have shut down their base oils operations. These plants represent 29% of total US base oil refining capacity, including re-refined material. They represent 42% of Group II base oil capacity in the US.

INEOS Styrolution is shutting down its styrene plants in Bayport, Texas, and Texas City, Texas, according to a company source.

INVISTA is shutting down its adiponitrile (ADN) and hexamethylene diamine (HMDA) plants in Orange, Texas, the company said.

CITGO is shutting down its refinery in Lake Charles, according to sources. The company was not immediately available for a request for comment.

ExxonMobil's refinery and chemical operations in Beaumont are running at reduced rates in anticipation of the hurricane, the company said. Its refinery in Baytown, Texas is operating normally.

Chevron Phillips Chemical is shutting down its HDPE plant in Pasadena, Texas, according to a filing with the Texas Commission on Environmental Quality (TCEQ).

RB Fuels is shutting down its biodiesel plant in Port Neches, Texas, according to a filing with the TCEQ.

INEOS is shutting down its cracker in Chocolate Bayou, according to a filing with the TCEQ.

Lucite is shutting down its methyl methacrylate (MMA) plant in Beaumont, the company said.

Phillips 66 shut down its base oil production in Lake Charles, the company aid.

Sasol shut down its Lake Charles plants ahead of the storm, the company said.

Thailand’s Indorama Ventures PCL (IVL) said it has begun preparations to shut its Port Neches site. It makes ethylene oxide (EG), ethylene glycols (EG), surfactants and propylene oxide (PO), among others.

Total said it is shutting down its refinery in Port Arthur.

Valero is also shutting down its refinery in Port Arthur, sources said.

Motiva Enterprises is shutting down its refinery and cracker in Port Arthur, according to filings made with the TCEQ.

Louisiana Pigment Company (LPC) said it is shutting down its titanium dioxide (TiO2) plant in Lake Charles. The company is a joint venture between Kronos Worldwide and Venator Materials.

BASF Total's cracker in Port Arthur was already down before the storms.

RAILROADS

Kansas City Southern said its Texas routes between Beaumont and Houston are no longer in service.

Union Pacific said it has closed the Settegast and Englewood intermodal terminals in Houston. Its intermodal terminal in Avondale, Louisiana, remains closed.

The New Orleans floodgates remain closed, with no interchange to the eastern carriers, Union Pacific said.

The CSX terminal in New Orleans has been evacuated, and inbound traffic is being diverted to Pensacola, Florida. CSX expects to resume normal operations in New Orleans by the end of the week.

PORTS

Most ports in Texas are now closed.

Port status updates are listed at the local times below, according to the US Coast Guard (USCG) and local port authorities.

The New Orleans port has reopened and returned to “Yankee” status as of 25 August. The Southwest Pass is expected to reopen late on Wednesday, according to shipping agency GAC North America.

The agency added that the Corpus Christi area has set “Yankee” status for surrounding smaller ports.

Any changes to port accessibility can impact the overall petrochemicals industry, as imports and exports rely heavily on the shipping industry.

The following legend describes the port conditions.  

Port Condition WHISKEY: tropical or hurricane force storm predicted to make landfall within 72 hours 

Port Condition X-RAY: within 48 hours

Port Condition YANKEE: within 24 hours

Port Condition ZULU: within 12 hours

Condition IV: storm has passed and no longer a threat

OIL SHUT-INS

By mid-day on Wednesday, companies had shut in 1.56m bbl/day of US oil production in the Gulf of Mexico, or 84.3% of the total, according to the Bureau of Safety and Environmental Enforcement (BSEE). Gas shut-ins totalled 1.65bn cubic feet/day, or 60.95% of the US total in the Gulf.

Companies have evacuated 299 production platforms, or 46.5% of the 643 manned platforms in the Gulf of Mexico.

Platforms produce oil and natural gas offshore. Unlike drilling rigs, which typically move from location to location, platforms stay in place throughout a project’s duration.

The Gulf of Mexico hosts several offshore oil wells, accounting for 17% of the nation's crude production, according to the Energy Information Administration (EIA). The region is home to more than 45% of its refining capacity and 51% of its natural gas processing capacity.

Company Site(s) Product(s) Status
BASF Geismar, LA BDO, EO, isocyanates, polyols, fatty alcohols, plasticizers Assessing
CITGO Lake Charles, LA Fuels Shutdown
Cornerstone Waggamon, LA Melamine, ACN, urea, sulphuric acid Operating for Marco; assessing for Laura
Dow Sabine, Beaumont, Deer Park, La Porte, Bayport, Texas City (all TX)
Dow Freeport, TX Operations normal
Eastman Longview, TX ethylene, propylene, EO, EG, ethanol, etac, 2-2-EH, isobutanol and other chemicals. Operations normal but implemented severe weather procedures (securing generators, sandbags, etc)
ExxonMobil Baton Rouge, LA Gasoline, refined products Operations normal
ExxonMobil Beaumont, TX Gasoline, refined products Reducing rates
ExxonMobil Baytown, TX Gasoline, refined products, base oils, NGLs Prepping for severe weather, operations running
Indorama Port Neches, TX EO, EG, surfactants, PO Shutting down
Louisiana Pigment Co Lake Charles, LA TiO2 Shutting down
LyondellBasell Lake Charles, LA PP Ride out crew; moving inventory
LyondellBasell Bayport, TX EO, PO Reducing rates
LyondellBasell Bayport, TX HDPE, PP, EO, PO Shutdown (HDPE, PP)
LyondellBasell Lake Charles, LA; Bayport, TX; Channelview, TX; Chocolate Bayou, TX; Corpus Christi, TX; La Porte, TX Olefins, derivatives Assessing
Marathon Galveston Bay, TX Fuels, refined products Warned of shutdown
MEGlobal Oyster Creek, TX EO, EG Assessing
Methanex Geismar, LA Methanol Assessing
Motiva Port Arthur, TX Ethylene, propylene, refinery, base oil Down as of 24 Aug
NOVA Chemicals Geismar, LA Ethylene, propylene, BD Assessing
OCI Beaumont, TX methanol shutting down
Phillips 66 Lake Charles, LA Gasoline, refined products, base oil Shutdown
Phillips 66 Sweeny, TX Gasoline, refined products Operating/assessing
RB Fuels Port Neches, TX Biodiesel Shutdown
Sasol Lake Charles, LA olefins, EO/EG, phenol, LDPE, LLDPE, surfactants, n-butanol, alkylbenzene, hexene-1, linear alcohol Shutdown
Shell Deer Park, TX Acrylic acid, acrylic acid esters, ethyl acrylate, MMA Assessing, making preparations
Total Port Arthur, TX Gasoline, diesel, jet fuel Shutdown
Valero Port Arthur, TX Gasoline, refined products Shutdown
Lion Elastomers Port Neches, TX; Orange, TX SBR Shutdown
INEOS Chocolate Bayou, TX Ethylene, propylene, BD Shutdown
Lucite Beaumont, TX MMA Shutdown
CP Chem Baytown, Pasadena, Orange, Port Arthur, Sweeny (all TX) Assessing
Westlake Chemical Lake Charles, LA Ethylene, propylene, polyethylene, vinyls Shutdown
Goodyear Beaumont, TX SBR Shutdown
Arlanxeo Orange, TX SBR Shutdown
TPC Group Houston, TX BD Shutdown
Bridgestone Lake Charles, TX SBR Shutdown

Additional reporting by Zachary Moore, Adam Yanelli, Anna Matherne, Tarun Raizada,

Thumbnail image shows the storm. Photo by NOAA/AP/Shutterstock

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