Epoxy
September 27, 2021
BASF in China
BASF sees Zhanjiang site generating up to €5B in annual sales
Sep. 27, 2021 8:08 AM ETBASF SE (BASFY)By: Carl Surran, SA News Editor
- BASF (OTCQX:BASFY) says it expects the Zhanjiang chemical complex under construction in southern China will deliver €4B-€5B ($4.69B-$5.86B) in annual sales by 2030.
- The company says the Zhanjiang project, which will cost €8B-€10B, likely will contribute €1B-€1.2B to EBITDA by 2030.
- BASF expects two-thirds of the world’s chemical production will take place in China by 2030, and that the Zhanjiang plant ultimately would become the company third-largest production site after its Ludwigshafen headquarters in Germany and a complex in Antwerp, Belgium.
September 24, 2021
Interesting Speculation
What global petchems demand would have been like without the China property bubble warns us about the future
Australia, Business, China, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Japan, Malaysia, Methanol & Derivatives, Middle East, Olefins, Philippines, Polyolefins, Singapore, South Korea, Styrenics, Taiwan, Thailand, US By John Richardson on 24th September 2021 in Australia, Business, China, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Japan, Malaysia, Methanol & Derivatives, Middle East, Olefins, Philippines, Polyolefins, Singapore, South Korea, Styrenics, Taiwan, Thailand, US SHARE THIS STORY
By John Richardson
PLAYING “What if?” games by changing the course of history is popular amongst students of the subject, including myself.
Imagine, therefore, in our world of petrochemicals, if China hadn’t decided in late 2008 to launch the world’s biggest-ever economic stimulus package to compensate for the Global Financial Crisis.
Beijing felt it had no choice at the time because of a government estimate that some 20m citizens might return from the countryside to the cities after the Lunar New Year Holidays in 2009, only to find that their jobs in export-focused factories had disappeared.
China was in a rush to replace export-led growth with more local-for-local consumption, because of the collapse of overseas global demand resulting from the Global Financial Crisis
When things are rushed, there’s a higher chance they can go wrong. We ended up with factories being built almost solely for the economic multiplier effect from construction activity without sufficient regard for raw-material supply and how to sell the output. We saw this in purified terephthalic acid.
As for the real-estate bubble, James Kygne of the Financial Times – quoting Logan Wright, a Hong Kong-based director at the Rhodium Group – wrote that there were sufficient empty properties in China to house over 90m people.
There were five G7 countries – France, Germany, Italy, the UK and Canada – that could each fit their entire populations into the empty Chinese apartments with room to spare, he added.
This amounts to enough homes for more than 30m Chinese families as three people is the average size of a Chinese household.
This gargantuan oversupply is occurring as demand for real estate declines due to an ageing population. The number of new births registered in 2020 was just 10m, the lowest since the founding of the People’s Republic of China in 1949, wrote the Guardian.
China’s property developers appear to have ignored the demographic headwinds,
They had instead been driven by what Caixin magazine said were the “three carriages” – high turnover, high gross profit and high leverage. Developers used borrowed money to acquire land, collected presale cash before projects even started and then borrowed more to invest in further projects, according to the article.
Why global MDI and TDI demand could have been 8.6m tonnes lower
In keeping with “What if?”, let’s imagine that Beijing had taken an entirely different set of policy decisions in 2008, the same as what is happening today through President Xi Jinping’s pivot to “common prosperity”.
From 2009 onwards, income and wealth inequality would have been reduced. China would have raised the tax base to pay for what was even then a rapidly greying population.
Greater state revenues would have come from higher income taxes, more stringent regulations to make people pay their taxes and new property taxes – measures which are now being planned.
BANG, look at the chart on the left in the slide below – what the world of methylene diphenyl diisocyanate (MDI) and toluene diisocyanate (TDI) would have looked like without the 2009-2020 real estate frenzy. These are two of the raw materials needed to make polyurethanes (PU).
Growth would have still been solid, averaging 2% during most years, along with a few years of negative growth because of normal economic cycles.
Instead of China’s share of global demand rising from 21% in 2008 to an average of 30% in 2009-2020 – as actually happened – China’s percentage share of the total would have remained unchanged at 21%.
In the chart on the left, I have kept demand in the other regions unchanged from what actually took place. This would have left Europe as the world’s biggest market.
Cumulative global demand in 2008-2020 would have been 8.6m tonnes lower than was actually the case. Global demand would have risen by an average of 2% per year versus what really happened – a 4% increase.
The chart on the right shows the real course of events with, as I said, China’s global percentage share rising to an average of 30%. This pushed Europe into second place.
You might point out that global PU end-use demand is much more diverse than just rigid MDI-based foams for insulation and flexible TDI-base foams that go into sofas and mattresses etc. (see the chart below).
And it was not just people buying new homes in China who needed to insulate their houses and buy new sofas and mattresses.
But rising property wealth would have greatly supported sales of autos and luxury shoes, which are among the other end-use markets for PU.
How else does one fully explain the remarkable jump in China’s percentage share of global demand in 2009-2020 other than the property bubble, given that the headwinds of an ageing population grew stronger during this period?
All China’s long-term demand growth forecasts must be re-assessed
Global financial markets rallied following Evergrande’s pledge to meet $83.5m of interest payments on an overseas bond, which were due yesterday.
But Evergrande still has more than $300bn in obligations to creditors and 778 projects under way in 223 cities, with great uncertainty surrounding how the government would rescue Evergrande if it were to default on its debts.
I have been told by wise China hands that a rescue would involve big investors being left on the hook. The company would be converted into a state-owned enterprise with Evergrande’s land and property sold at discounts to small investors.
This would be entirely in keeping with Xi’s heavier emphasis on “common prosperity” at the expense of “get rich quick”.
But whatever happens with Evergrande, Beijing appears to have set a course for the long term – a greater focus on income equality and tax collection that could and maybe should have happened back in late 2008.
This means we need to redraw long-term forecasts for China’s petrochemicals demand growth. New forecasts must centre on three headline scenarios with lots of grey areas in between:
- “Back to the future”. China relaxes credit standards for real estate, leading to a re-inflation of the bubble. But how much longer could the bubble continue to inflate because of oversupply?
- Beijing sticks with “common prosperity”. It is a huge success.
- The government sticks with “common prosperity”. But its policies largely fail due to difficulties in expanding the tax base. The wealthy elite successfully resist attempts to reduce income and wealth inequalities.
Or you can just assume “back to the future” and not bother with Scenarios 2 and 3. But I see this an unacceptable risk for your employees and shareholders.
September 24, 2021
Interesting Speculation
What global petchems demand would have been like without the China property bubble warns us about the future
Australia, Business, China, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Japan, Malaysia, Methanol & Derivatives, Middle East, Olefins, Philippines, Polyolefins, Singapore, South Korea, Styrenics, Taiwan, Thailand, US By John Richardson on 24th September 2021 in Australia, Business, China, Company Strategy, Economics, Europe, European economy, European petrochemicals, Fibre Intermediates, India, Indonesia, Japan, Malaysia, Methanol & Derivatives, Middle East, Olefins, Philippines, Polyolefins, Singapore, South Korea, Styrenics, Taiwan, Thailand, US SHARE THIS STORY
By John Richardson
PLAYING “What if?” games by changing the course of history is popular amongst students of the subject, including myself.
Imagine, therefore, in our world of petrochemicals, if China hadn’t decided in late 2008 to launch the world’s biggest-ever economic stimulus package to compensate for the Global Financial Crisis.
Beijing felt it had no choice at the time because of a government estimate that some 20m citizens might return from the countryside to the cities after the Lunar New Year Holidays in 2009, only to find that their jobs in export-focused factories had disappeared.
China was in a rush to replace export-led growth with more local-for-local consumption, because of the collapse of overseas global demand resulting from the Global Financial Crisis
When things are rushed, there’s a higher chance they can go wrong. We ended up with factories being built almost solely for the economic multiplier effect from construction activity without sufficient regard for raw-material supply and how to sell the output. We saw this in purified terephthalic acid.
As for the real-estate bubble, James Kygne of the Financial Times – quoting Logan Wright, a Hong Kong-based director at the Rhodium Group – wrote that there were sufficient empty properties in China to house over 90m people.
There were five G7 countries – France, Germany, Italy, the UK and Canada – that could each fit their entire populations into the empty Chinese apartments with room to spare, he added.
This amounts to enough homes for more than 30m Chinese families as three people is the average size of a Chinese household.
This gargantuan oversupply is occurring as demand for real estate declines due to an ageing population. The number of new births registered in 2020 was just 10m, the lowest since the founding of the People’s Republic of China in 1949, wrote the Guardian.
China’s property developers appear to have ignored the demographic headwinds,
They had instead been driven by what Caixin magazine said were the “three carriages” – high turnover, high gross profit and high leverage. Developers used borrowed money to acquire land, collected presale cash before projects even started and then borrowed more to invest in further projects, according to the article.
Why global MDI and TDI demand could have been 8.6m tonnes lower
In keeping with “What if?”, let’s imagine that Beijing had taken an entirely different set of policy decisions in 2008, the same as what is happening today through President Xi Jinping’s pivot to “common prosperity”.
From 2009 onwards, income and wealth inequality would have been reduced. China would have raised the tax base to pay for what was even then a rapidly greying population.
Greater state revenues would have come from higher income taxes, more stringent regulations to make people pay their taxes and new property taxes – measures which are now being planned.
BANG, look at the chart on the left in the slide below – what the world of methylene diphenyl diisocyanate (MDI) and toluene diisocyanate (TDI) would have looked like without the 2009-2020 real estate frenzy. These are two of the raw materials needed to make polyurethanes (PU).
Growth would have still been solid, averaging 2% during most years, along with a few years of negative growth because of normal economic cycles.
Instead of China’s share of global demand rising from 21% in 2008 to an average of 30% in 2009-2020 – as actually happened – China’s percentage share of the total would have remained unchanged at 21%.
In the chart on the left, I have kept demand in the other regions unchanged from what actually took place. This would have left Europe as the world’s biggest market.
Cumulative global demand in 2008-2020 would have been 8.6m tonnes lower than was actually the case. Global demand would have risen by an average of 2% per year versus what really happened – a 4% increase.
The chart on the right shows the real course of events with, as I said, China’s global percentage share rising to an average of 30%. This pushed Europe into second place.
You might point out that global PU end-use demand is much more diverse than just rigid MDI-based foams for insulation and flexible TDI-base foams that go into sofas and mattresses etc. (see the chart below).
And it was not just people buying new homes in China who needed to insulate their houses and buy new sofas and mattresses.
But rising property wealth would have greatly supported sales of autos and luxury shoes, which are among the other end-use markets for PU.
How else does one fully explain the remarkable jump in China’s percentage share of global demand in 2009-2020 other than the property bubble, given that the headwinds of an ageing population grew stronger during this period?
All China’s long-term demand growth forecasts must be re-assessed
Global financial markets rallied following Evergrande’s pledge to meet $83.5m of interest payments on an overseas bond, which were due yesterday.
But Evergrande still has more than $300bn in obligations to creditors and 778 projects under way in 223 cities, with great uncertainty surrounding how the government would rescue Evergrande if it were to default on its debts.
I have been told by wise China hands that a rescue would involve big investors being left on the hook. The company would be converted into a state-owned enterprise with Evergrande’s land and property sold at discounts to small investors.
This would be entirely in keeping with Xi’s heavier emphasis on “common prosperity” at the expense of “get rich quick”.
But whatever happens with Evergrande, Beijing appears to have set a course for the long term – a greater focus on income equality and tax collection that could and maybe should have happened back in late 2008.
This means we need to redraw long-term forecasts for China’s petrochemicals demand growth. New forecasts must centre on three headline scenarios with lots of grey areas in between:
- “Back to the future”. China relaxes credit standards for real estate, leading to a re-inflation of the bubble. But how much longer could the bubble continue to inflate because of oversupply?
- Beijing sticks with “common prosperity”. It is a huge success.
- The government sticks with “common prosperity”. But its policies largely fail due to difficulties in expanding the tax base. The wealthy elite successfully resist attempts to reduce income and wealth inequalities.
Or you can just assume “back to the future” and not bother with Scenarios 2 and 3. But I see this an unacceptable risk for your employees and shareholders.
September 23, 2021
Storm Updates
Tropical Storm Nicholas – Update 13
Updated 9/22/2021 at 2:00 p.m. CDT – Updates in bold
Nicholas made landfall southwest of Sargent, TX as a Category 1 Hurricane with maximum sustained winds of 75 mph at approximately 12:30 a.m. CDT on Sep 14. The storm was shortly downgraded back to a tropical storm.
According to poweroutage.us, power was mostly restored in the impacted Texas coastal area as of Tuesday, Sep 21.
CHEMICAL & REFINING OPERATIONS
- LyondellBasell’s Matagorda Complex in Bay City, TX had resumed operations as of Sep 22, the facility had previously safely shut down due to widespread power outages in the area (per company spokesperson)
Hurricane Ida – Update 36
Updated 9/22/2021 at 2:00 p.m. CDT – Updates in bold
Hurricane Ida made landfall near Port Fourchon, LA around 11:55 a.m. CDT on Sunday, Aug 29 as an “extremely dangerous” Category 4 storm with maximum sustained winds of 150 mph, which is very close to a Category 5 hurricane, and a minimum central pressure of 930 mb, according to the National Weather Service (NWS) National Hurricane Center (NHC).
The storm maintained major category strength as it made its way over most of the petrochemical industry in southeastern Louisiana. At approximately 9 p.m. CDT on Sunday, Aug 29, an estimated nine hours after making landfall, Hurricane Ida weakened to a Category 2 hurricane with its eye just north of Garyville, LA, according to NWS. By 11 p.m. CDT, Hurricane Ida had decreased to a Category 1 hurricane near Maurepas, LA.
Louisiana produces nearly 25 billion pounds of ethylene each year (29% of US capacity). Based on the path of Hurricane Ida, it is estimated that 61.5% Louisiana’s ethylene capacity was offline immediately after the storm’s landfall, representing approximately 18% of total US capacity. For a list of current ethylene capacity that is offline by facility, please see page 7 of the OPIS PCW Daily Wire report.
Downstream, the storm affected roughly 14% of North American PE capacity, 11% of North American PP capacity and 25% of North American PS capacity. Approximately 40% of US PVC production was down. Hurricane Ida impacted 44% of the US styrene capacity (37% of North American capacity).
According to poweroutage.us, an estimated 25,790 customers were without power in southeastern Louisiana as of Wednesday, Sep 22 at approximately 1:45 p.m. CDT; this compares to an estimated 20,008 outages on Sep 21. Please see the “Facility Location by Parish” section below for power outage details by parish according to data published by poweroutage.us.
FACILITY LOCATION BY PARISH
Ascension Parish – estimated 0.4% tracked customers without power
- BASF at Geismar
- Lion Copolymer at Geismar
- Lonestar at Geismar
- NOVA at Geismar
- Occidental at Geismar
- Shell at Geismar
- Westlake at Geismar
East Baton Rouge Parish – estimated 0% tracked customers without power
- Deltech at Baton Rouge
- ExxonMobil at Baton Rouge
- Formosa at Baton Rouge
Iberville Parish – estimated 0.2% tracked customers without power
- Dow at Plaquemine
- Shintech at Plaquemine
- Total at Carville
- Westlake at Plaquemine
Jefferson Parish – estimated 1.7% tracked customers without power
- Cornerstone at Fortier
Plaquemines Parish – estimated 0.5% tracked customers without power
- Phillips 66 at Belle Chasse
St Bernard Parish – estimated 0% tracked customers without power
- Chalmette Refining (PBF) at Chalmette
- Murphy Oil (Valero) at Meraux
St Charles Parish – estimated 3.8% tracked customers without power
- Dow at St Charles
- Motiva at Norco
- Shell at Norco
- Valero at St Charles
St James Parish – estimated 0.2% tracked customers without power
- Occidental at Convent
- Americas Styrenics at St James
St John the Baptist Parish – estimated 22.3% tracked customers without power
- Marathon at Garyville
- Pinnacle Polymers at Garyville
West Baton Rouge Parish – estimated 0% tracked customers without power
- ExxonMobil at Port Allen
- Placid Refining at Port Allen
- Shintech at Addis
CHEMICAL & REFINING OPERATIONS
Facilities that have begun the restart process:
- Americas Styrenics began restart processes at its facility in St James, LA on Sep 12; the facility previously closed in preparation for the storm (per company spokesperson)
- Chalmette Refining (PBF Energy) at Chalmette, LA was confirmed to have restarted and is understood to be running at normal rates; the facility originally lost power on Aug 29 (per company spokesperson)
- Dow Chemical has begun bringing operations back online at Plaquemine, LA as of Sep 8 as third-party utility balances and raw materials availability allow; the facility was originally shut on Aug 29 (per company website)
- ExxonMobil stated on Sep 2 that it is in the process of restarting its refinery at Baton Rouge; the last update provided about the Baton Rouge chemical facilities was on Aug 31: “The Baton Rouge refinery, chemical plant and other ExxonMobil Baton Rouge facilities are safely progressing restart procedures. Our facilities did not sustain any significant damage during the hurricane.” The refinery had shut on Aug 30 (per company website)
- NOVA Chemicals said on Sep 17 that its “Geismar site has restarted and is operational”; the company began a safe and controlled shutdown of its facility in preparation for the storm on Aug 27 (per company spokesperson)
- OxyChem’s plants at Geismar, LA have returned to normal operations, and the plants at Convent, LA were in the process of coming online as of Sep 17; the plants at Taft, LA are expected to restart the week of Sep 20 (per company spokesperson)
- Pinnacle Polymers restarted the first line of its Garyville, LA plant and was producing prime resin as of the evening of Sep 15; the second line restarted and was expected to be producing prime resin on Sep 16 (per company source); the company declared force majeure on Aug 30 for all PP products due to the impacts of Hurricane Ida (per customer letter)
- Placid Refining at Port Allen, LA has power supply restored and after borrowing 300,000 bbl of crude from the Strategic Petroleum Reserve has been able to begin restarting processing units during the week of Sep 7 (OPIS News)
- Shell announced its Geismar, LA facility had restarted as of Sep 14 at 7 p.m. CDT, noting that the site was operating at reduced rates as it continued to experience utility and feedstocks constraints but has resumed loading and shipping product, subject to product availability (per company website)
- Valero refinery restarts were underway as of Sep 14 at the Meraux (Murphy Oil) and St Charles, LA sites near New Orleans, including Diamond Green Diesel; the facilities shut down prior to the storm making landfall (per company website)
- Westlake Chemical’s plants at Geismar and Plaquemine, LA were running at low rates and were waiting on an increase in nitrogen feed to ramp up further; the two facilities shut prior to Ida’s landfall; on Aug 31, the company reported limited damage and that restart was dependent primarily on availability of utilities, feedstocks and industrial gases (per company spokesperson); the company declared a system-wide force majeure on Aug 31 on PVC and VMC out of these two facilities (per customer letter)
Petrochemical assets that are confirmed to have shut include:
- BASF shut down its facility in Geismar, LA in anticipation of the Hurricane Ida (per company spokesperson)
- Cornerstone at Fortier, LA, which produces acrylonitrile, shut down on Aug 28 in preparation for Hurricane Ida; the facility lost power on Aug 29 and was running on auxiliary power to maintain key safety and environmental equipment as of Aug 31; the company completed an assessment on Aug 30 and found “no significant damage to Cornerstone assets. There are wind driven impacts to secondary building roofing systems, cooling tower exteriors, and insulation. First repairs commenced on August 31, 2021. At this time we do not believe damages incurred within the Cornerstone Energy Park fence line will impact a restart schedule.” (per company report on Aug 31)
- Dow declared force majeure on HDPE and LLDPE from its Taft (St Charles), LA plant on Sep 8, citing the unplanned shutdown and disruptions in operations, logistics and raw material supply due to Hurricane Ida, the company said that the St Charles site was “making progress toward restart of operations” and it expects to have a clearer timeline for restart sequencing later that week, based on repairs and as third-party utility balances and raw materials availability allow; the facility was originally shut on Aug 29 (per customer letter/company website)
- Galata Chemicals, which produces additives used by the PVC industry, on Aug 30 declared force majeure on supply of products manufactured at its facility in Taft, LA due to lack of electricity, availability of equipment for inbound and outbound shipments as well as other factors (per customer letter)
- Lion Elastomers announced on Sep 1 that its EPDM facility at Geismar, LA sustained no significant damage from Hurricane Ida, the site was waiting to confirm “a stable return of electrical power and utilities, personnel, and the required feedstocks” to being the process of returning to normal production and business operations; the company had previously idled production at this facility on Aug 30 in preparation for the storm (per company website)
- Marathon Petroleum’s refinery at Garyville, LA safely shut down prior to Hurricane Ida’s landfall; on Aug 31, minor damage was confirmed, generators were being used to “power aspects of our operations that enable us to progress with repairs and assessments” (per company spokesperson)
- Phillips 66 shut operations on Aug 27 at the Alliance Refinery in Belle Chasse, LA; on Aug 30, the company confirmed that there was water in the refinery and the facility remained shut; on Sep 1, the company confirmed it “discovered a sheen of unknown origin in some flooded areas of Alliance Refinery. At this time, the sheen appears to be secured and contained within refinery grounds… A full post-storm assessment remains underway at the refinery…The refinery remains shut down. Timelines for operational restarts are largely dependent on assessment impacts and access to electricity and other utilities.” (per company website)
- Shell issued an update about Norco, LA on Sep 12: “The Shell Norco Manufacturing facility continues to assess impacts from Hurricane Ida. The site continues to flare residual light hydrocarbon material with visible smoking. We are continuing to complete repairs and we are making improvements to minimize visible flaring until power is fully restored…” (per company website)
- TotalEnergies (Cosmar) at Carville, LA said on Sep 7 that partial power was restored at its PS plant in Carville, LA and that a restart plan was being developed based on power and outside service availability; the unit shut down prior to Hurricane Ida’s landfall (per company spokesperson)
Additional petrochemical assets in Louisiana that were in the path of Hurricane Ida and are understood to have shut include:
- Deltech at Baton Rouge
- Lonestar at Geismar
- Motiva at Norco
www.petrochemwire.com/storm-coverage/
September 23, 2021
Storm Updates
Tropical Storm Nicholas – Update 13
Updated 9/22/2021 at 2:00 p.m. CDT – Updates in bold
Nicholas made landfall southwest of Sargent, TX as a Category 1 Hurricane with maximum sustained winds of 75 mph at approximately 12:30 a.m. CDT on Sep 14. The storm was shortly downgraded back to a tropical storm.
According to poweroutage.us, power was mostly restored in the impacted Texas coastal area as of Tuesday, Sep 21.
CHEMICAL & REFINING OPERATIONS
- LyondellBasell’s Matagorda Complex in Bay City, TX had resumed operations as of Sep 22, the facility had previously safely shut down due to widespread power outages in the area (per company spokesperson)
Hurricane Ida – Update 36
Updated 9/22/2021 at 2:00 p.m. CDT – Updates in bold
Hurricane Ida made landfall near Port Fourchon, LA around 11:55 a.m. CDT on Sunday, Aug 29 as an “extremely dangerous” Category 4 storm with maximum sustained winds of 150 mph, which is very close to a Category 5 hurricane, and a minimum central pressure of 930 mb, according to the National Weather Service (NWS) National Hurricane Center (NHC).
The storm maintained major category strength as it made its way over most of the petrochemical industry in southeastern Louisiana. At approximately 9 p.m. CDT on Sunday, Aug 29, an estimated nine hours after making landfall, Hurricane Ida weakened to a Category 2 hurricane with its eye just north of Garyville, LA, according to NWS. By 11 p.m. CDT, Hurricane Ida had decreased to a Category 1 hurricane near Maurepas, LA.
Louisiana produces nearly 25 billion pounds of ethylene each year (29% of US capacity). Based on the path of Hurricane Ida, it is estimated that 61.5% Louisiana’s ethylene capacity was offline immediately after the storm’s landfall, representing approximately 18% of total US capacity. For a list of current ethylene capacity that is offline by facility, please see page 7 of the OPIS PCW Daily Wire report.
Downstream, the storm affected roughly 14% of North American PE capacity, 11% of North American PP capacity and 25% of North American PS capacity. Approximately 40% of US PVC production was down. Hurricane Ida impacted 44% of the US styrene capacity (37% of North American capacity).
According to poweroutage.us, an estimated 25,790 customers were without power in southeastern Louisiana as of Wednesday, Sep 22 at approximately 1:45 p.m. CDT; this compares to an estimated 20,008 outages on Sep 21. Please see the “Facility Location by Parish” section below for power outage details by parish according to data published by poweroutage.us.
FACILITY LOCATION BY PARISH
Ascension Parish – estimated 0.4% tracked customers without power
- BASF at Geismar
- Lion Copolymer at Geismar
- Lonestar at Geismar
- NOVA at Geismar
- Occidental at Geismar
- Shell at Geismar
- Westlake at Geismar
East Baton Rouge Parish – estimated 0% tracked customers without power
- Deltech at Baton Rouge
- ExxonMobil at Baton Rouge
- Formosa at Baton Rouge
Iberville Parish – estimated 0.2% tracked customers without power
- Dow at Plaquemine
- Shintech at Plaquemine
- Total at Carville
- Westlake at Plaquemine
Jefferson Parish – estimated 1.7% tracked customers without power
- Cornerstone at Fortier
Plaquemines Parish – estimated 0.5% tracked customers without power
- Phillips 66 at Belle Chasse
St Bernard Parish – estimated 0% tracked customers without power
- Chalmette Refining (PBF) at Chalmette
- Murphy Oil (Valero) at Meraux
St Charles Parish – estimated 3.8% tracked customers without power
- Dow at St Charles
- Motiva at Norco
- Shell at Norco
- Valero at St Charles
St James Parish – estimated 0.2% tracked customers without power
- Occidental at Convent
- Americas Styrenics at St James
St John the Baptist Parish – estimated 22.3% tracked customers without power
- Marathon at Garyville
- Pinnacle Polymers at Garyville
West Baton Rouge Parish – estimated 0% tracked customers without power
- ExxonMobil at Port Allen
- Placid Refining at Port Allen
- Shintech at Addis
CHEMICAL & REFINING OPERATIONS
Facilities that have begun the restart process:
- Americas Styrenics began restart processes at its facility in St James, LA on Sep 12; the facility previously closed in preparation for the storm (per company spokesperson)
- Chalmette Refining (PBF Energy) at Chalmette, LA was confirmed to have restarted and is understood to be running at normal rates; the facility originally lost power on Aug 29 (per company spokesperson)
- Dow Chemical has begun bringing operations back online at Plaquemine, LA as of Sep 8 as third-party utility balances and raw materials availability allow; the facility was originally shut on Aug 29 (per company website)
- ExxonMobil stated on Sep 2 that it is in the process of restarting its refinery at Baton Rouge; the last update provided about the Baton Rouge chemical facilities was on Aug 31: “The Baton Rouge refinery, chemical plant and other ExxonMobil Baton Rouge facilities are safely progressing restart procedures. Our facilities did not sustain any significant damage during the hurricane.” The refinery had shut on Aug 30 (per company website)
- NOVA Chemicals said on Sep 17 that its “Geismar site has restarted and is operational”; the company began a safe and controlled shutdown of its facility in preparation for the storm on Aug 27 (per company spokesperson)
- OxyChem’s plants at Geismar, LA have returned to normal operations, and the plants at Convent, LA were in the process of coming online as of Sep 17; the plants at Taft, LA are expected to restart the week of Sep 20 (per company spokesperson)
- Pinnacle Polymers restarted the first line of its Garyville, LA plant and was producing prime resin as of the evening of Sep 15; the second line restarted and was expected to be producing prime resin on Sep 16 (per company source); the company declared force majeure on Aug 30 for all PP products due to the impacts of Hurricane Ida (per customer letter)
- Placid Refining at Port Allen, LA has power supply restored and after borrowing 300,000 bbl of crude from the Strategic Petroleum Reserve has been able to begin restarting processing units during the week of Sep 7 (OPIS News)
- Shell announced its Geismar, LA facility had restarted as of Sep 14 at 7 p.m. CDT, noting that the site was operating at reduced rates as it continued to experience utility and feedstocks constraints but has resumed loading and shipping product, subject to product availability (per company website)
- Valero refinery restarts were underway as of Sep 14 at the Meraux (Murphy Oil) and St Charles, LA sites near New Orleans, including Diamond Green Diesel; the facilities shut down prior to the storm making landfall (per company website)
- Westlake Chemical’s plants at Geismar and Plaquemine, LA were running at low rates and were waiting on an increase in nitrogen feed to ramp up further; the two facilities shut prior to Ida’s landfall; on Aug 31, the company reported limited damage and that restart was dependent primarily on availability of utilities, feedstocks and industrial gases (per company spokesperson); the company declared a system-wide force majeure on Aug 31 on PVC and VMC out of these two facilities (per customer letter)
Petrochemical assets that are confirmed to have shut include:
- BASF shut down its facility in Geismar, LA in anticipation of the Hurricane Ida (per company spokesperson)
- Cornerstone at Fortier, LA, which produces acrylonitrile, shut down on Aug 28 in preparation for Hurricane Ida; the facility lost power on Aug 29 and was running on auxiliary power to maintain key safety and environmental equipment as of Aug 31; the company completed an assessment on Aug 30 and found “no significant damage to Cornerstone assets. There are wind driven impacts to secondary building roofing systems, cooling tower exteriors, and insulation. First repairs commenced on August 31, 2021. At this time we do not believe damages incurred within the Cornerstone Energy Park fence line will impact a restart schedule.” (per company report on Aug 31)
- Dow declared force majeure on HDPE and LLDPE from its Taft (St Charles), LA plant on Sep 8, citing the unplanned shutdown and disruptions in operations, logistics and raw material supply due to Hurricane Ida, the company said that the St Charles site was “making progress toward restart of operations” and it expects to have a clearer timeline for restart sequencing later that week, based on repairs and as third-party utility balances and raw materials availability allow; the facility was originally shut on Aug 29 (per customer letter/company website)
- Galata Chemicals, which produces additives used by the PVC industry, on Aug 30 declared force majeure on supply of products manufactured at its facility in Taft, LA due to lack of electricity, availability of equipment for inbound and outbound shipments as well as other factors (per customer letter)
- Lion Elastomers announced on Sep 1 that its EPDM facility at Geismar, LA sustained no significant damage from Hurricane Ida, the site was waiting to confirm “a stable return of electrical power and utilities, personnel, and the required feedstocks” to being the process of returning to normal production and business operations; the company had previously idled production at this facility on Aug 30 in preparation for the storm (per company website)
- Marathon Petroleum’s refinery at Garyville, LA safely shut down prior to Hurricane Ida’s landfall; on Aug 31, minor damage was confirmed, generators were being used to “power aspects of our operations that enable us to progress with repairs and assessments” (per company spokesperson)
- Phillips 66 shut operations on Aug 27 at the Alliance Refinery in Belle Chasse, LA; on Aug 30, the company confirmed that there was water in the refinery and the facility remained shut; on Sep 1, the company confirmed it “discovered a sheen of unknown origin in some flooded areas of Alliance Refinery. At this time, the sheen appears to be secured and contained within refinery grounds… A full post-storm assessment remains underway at the refinery…The refinery remains shut down. Timelines for operational restarts are largely dependent on assessment impacts and access to electricity and other utilities.” (per company website)
- Shell issued an update about Norco, LA on Sep 12: “The Shell Norco Manufacturing facility continues to assess impacts from Hurricane Ida. The site continues to flare residual light hydrocarbon material with visible smoking. We are continuing to complete repairs and we are making improvements to minimize visible flaring until power is fully restored…” (per company website)
- TotalEnergies (Cosmar) at Carville, LA said on Sep 7 that partial power was restored at its PS plant in Carville, LA and that a restart plan was being developed based on power and outside service availability; the unit shut down prior to Hurricane Ida’s landfall (per company spokesperson)
Additional petrochemical assets in Louisiana that were in the path of Hurricane Ida and are understood to have shut include:
- Deltech at Baton Rouge
- Lonestar at Geismar
- Motiva at Norco
www.petrochemwire.com/storm-coverage/
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