A fire and power outage at Europe’s largest refinery, Pernis in the Netherlands, on 29 July may have disrupted summer holiday plans for some traders and executives at Anglo-Dutch energy major Shell as the extent of the damage became clear by the beginning of the following week.

A string of force majeure declarations started trickling down on 31 July, reaching a total of five by the morning of 4 August.

Soon after the accident, the company declared force majeure on isopropanol (IPA) and on propylene oxide (PO) glycol ethers. Shell then declared force majeures on propylene, other chemical solvents and hydrocarbon solvents.

European IPA spot prices rose following the outage on the back of tighter availability, sources said on 8 August.

Technical grade prices were assessed at €1,370-1,420/tonne FD (free delivered) NWE, up €80/tonne on the low end and €30/tonne on the high end.

Other facilities near Pernis also fell victim to the outage. On 3 August, Japan’s Shin-Etsu declared force majeure on its K67 grade polyvinyl chloride (PVC) production as a consequence of the fire. The facility has a PVC production capacity of 450,000 tonnes/year.


Shell’s Dutch petrochemical complex Moerdijk also declared force majeure on ethylene on 1 August as a knock-on effect from the fire at Pernis, after stating that the cracker at the facility would have to run at reduced capacities. Capacities at this cracker stand at 910,000 tonnes/year for ethylene and 510,000 tonnes/year for propylene.

An outage at Pernis can easily have early and deep repercussions in the markets, as the facility, near Rotterdam, sits in the crude oil and petrochemical hub of Amsterdam-Rotterdam-Antwerp (ARA), which is key for the production and distribution of product across the northwest Europe area.

Pernis processes 404,000 bbl/day of crude oil, according to the company, and the capacities for more downstream products also show shutdowns can have a big impact in the markets – and the company’s financials.

Some of Pernis’ more upstream products include diesel, jet kerosene, liquefied petroleum gas (LPG) or fuel oil.

Downstream, some of the disclosed production capacities include 250,000 tonnes/year for propylene and 150,000 tonnes/year for IPA, as well as 90,000 tonnes/year for methyl ethyl ketone (MEK) and 45,000 tonnes/year for methyl isobutyl ketone (MIBK).

Other European petrochemical markets have also felt the repercussions of Shell’s Pernis incident, mostly styrene, after the company informed its customers that availability had been impacted by the fire.

The impact of the fire – in terms of both production volumes and financials – may only become clear in a few weeks’ time.

Shell published its chemicals second-quarter financial results just two days before Pernis’ outage, showing earnings had more than doubled compared to the second quarter of 2016.


Shell is restarting “a number of units” at its Pernis refinery and petrochemicals site following the incident, a spokesperson said on 8 August.

Shell had shut down most of its production units at the site in the Netherlands over the 29-30 July weekend following the outage.

Prices for some chemicals had come under intense pressure as a result.

“We are currently restarting a number of units as part of the phased restart of the full complex,” said the Shell spokesperson.

“Complete restart will take place in a structured and controlled way. Flaring and noise will be part of re-commissioning. We will do our utmost to minimize impact for residents,” the spokesperson added.

Europe MEK spot prices rocket on Pernis

European MEK spot prices have spiked following a force majeure declaration at Shell’s Pernis plant in the Netherlands, with some offers more than doubling, sources said on 7 August.

Some European traders have floated price offers of over €3,000/tonne FD (free delivered) NWE (northwest Europe) due to the tightening market, making them more than twice as high at the average ICIS price of €1,460/tonne FD NWE the previous week.

“It’s gone berserk, you can’t get [MEK] for love nor money... [Offers are] €3,500 FD,” one distributor said.

“Everyone is screaming for material... For MEK, traders wouldn’t sell below €3,000-3,500/tonne FD,” another distributor said.

“I didn’t get a straight no [for that price] so I would guess most people with no contracts can’t get material. In order to get material [they] will pay more or less anything,” it added.

MEK spot prices are volatile because there are only a small number of producers remaining in Europe, leaving the market vulnerable to price spikes due to production issues.

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Additional reporting by Chris Barker, Nick Cleeve, Linda Naylor, Vasiliki Parapouli and Nel Weddle