Petrochemical producers continue post-Ida damage assessments

Louisiana petrochemical producers were regaining access to power and conducting damage assessments Aug. 31 in the aftermath of Hurricane Ida's assault, but some remained shut while awaiting critical feedstock supply, according to companies and sources familiar with company operations.

Shintech's Plaquemine and Addis operations had access to power, but no industrial gases necessary to feed output, according to sources familiar with company operations. Shintech's initial evaluations of its facilities showed no major damage from the storm, those sources said.

Formosa Plastics USA's Baton Rouge complex also had power restored, but was awaiting the restart of nitrogen inflows from a third-party supplier that had yet to gain access to electric power, according to sources familiar with Formosa's operations.

Neither company responded to requests for comment.

Related content: US EPA issues RVP waiver for gasoline in Louisiana, Mississippi following Ida

Both operate Louisiana complexes that produce construction staple polyvinyl chloride, which is used to make pipes, window frames, vinyl siding and other products. About 41% of 8.29 million mt/year of US PVC capacity remained offline Aug. 31.

Shintech has two PVC plants in Plaquemine and Addis with a combined capacity of 1.5 million mt/year, and Formosa's Baton Rouge PVC plant can produce up to 513,000 mt/year.

Shintech's Plaquemine complex also produces upstream chlor-alkali, ethylene dichloride and vinyl chloride monomer, while Formosa's complex has an upstream VCM plant as well.

Entergy, the major power provider in the region, said Aug. 31 that damage to eight high-voltage transmission lines took out power in parishes in southeast Louisiana, including the city of New Orleans. Those parishes are southeast of others that house petrochemical centers along the river, which market sources said could bode well for restarts in the coming days if facilities escaped damage.

Ida came ashore Aug. 29 on the eastern Louisiana coastline as a Category 4 storm, packing 150 mph winds, just 7 mph shy of Category 5 status. The storm retained hurricane strength as it moved inland, and was downgraded to a tropical storm in the early morning hours of Aug. 30 as it moved toward Mississippi.

Chlor-alkali supply seen short post-Ida

Ida affected petrochemical plants along the river from Baton Rouge to Louisiana that make various plastics, chlorine and caustic soda, a byproduct of chlorine production that is a key feedstock for alumina as well as pulp and paper industries.

Olin, the world's largest chlor-alkali producer, said Aug. 31 that the company was running "many" of its US Gulf Coast facilities at reduced rates "as a precautionary action and in response to limited logistics capabilities," but declined to specify which facilities. "We continue to assess this ongoing situation as we work to safely resume full operations," the company said.

Olin operates chlor-alkali facilities in Plaquemine and St. Gabriel alongside the river north of New Orleans, with a combined capacity of 1.1 million mt/year of chlorine and 1.2 million mt/year of caustic soda.

The company also operates a chlor-alkali unit in McIntosh, Alabama, where a force majeure declared on all products July 20 remained in effect Aug. 31, and has a turnaround slated for its massive 3 million mt/year chlor-alkali plant in Freeport, Texas, for September.

The storm also affected multiple units in the PVC production chain along the river operated by OxyChem, the chemical division of Occidental Petroleum. Those include two ethylene dichloride plants in Geismar and Convent with a combined capacity of 925,000 mt/year, and chlor-alkali units in Taft and Convent with combined capacities of 1 million mt/year of chlorine and 1.2 million mt/year of caustic soda.

OxyChem declined to comment on the operational status of its plants, which were shut ahead of Ida's landfall, according to sources familiar with company operations.

Supply of all products in the PVC production chain has been tight since two hurricanes hit Lake Charles, Louisiana, in August and October 2020, followed by a deep freeze that hit the US Gulf Coast in mid-February, forcing widespread petrochemical shutdowns.

At the same time, demand for chlorine, caustic soda and PVC has been strong, hindering efforts to restock inventories, market sources said. A source had said before Ida formed that a major storm in the US Gulf Coast region would be "catastrophic" for supply.

The US caustic soda market "was already narrow from a supply/demand standpoint with producers operating under limited inventories," a market source said. "Given where this hurricane landed, it will make a difficult balance impossible. The market will be short and it will be some time before balance recovers."

Dow Chemical operates petrochemical complexes in Taft and Plaquemine, each with two crackers that combined can produce up to 2.48 million mt/year. The complexes also have a combined six polyethylene plants with a total capacity of 3.37 million mt/year.

Dow's latest statement on the storm, issued Aug. 30, said the company had begun initial site assessments "and expect those efforts to ramp up as additional colleagues are able to return to our Louisiana sites."

ExxonMobil spokesperson Sarah Nordin said Aug. 31 that the company's Baton Rouge chemical facilities did not sustain significant damage from the storm and were "safely progressing restart procedures."

ExxonMobil operates a 1 million mt/year cracker, three PE plants with a combined capacity of 1.7 million mt/year and a 410,000 mt/year polypropylene plant at its Baton Rouge complex.