Petchem producers take action as winter storm sweeps across US

An Arctic blast and winter storm have brought frigid temperatures, heavy snow and high winds to most of the US. Severe weather conditions not only disrupted holiday travel but also left 800,000 customers across the country without power. Meanwhile, several petrochemical producers in the Gulf Coast took precautionary measures to lower operation rates or shut production ahead of the blast.

The major winter storm that hit most of the US this past week prompted precautionary measures from petrochemical producers. Several units along the Gulf Coast were either shut down or not running at full rates ahead of the arctic blast that began moving across the US on Friday. Although this arctic blast was forecast to be less severe than the storm in February 2021, the recent reports show an increased number of outages in the region.

Crackers offline or running at reduced rates

According to market sources, production at ExxonMobil’s cracker in Beaumont was disrupted while the company’s cracker compressor in Baytown was taken offline down due to freeze last week. The two crackers together produce more than 3 million tons/year of ethylene.

Dow’s cracker compressor in Freeport, Bayport Polymers’ cracker in Point Comfort, Chevron Phillips Chemical’s cracker in Cedar Bayou, Motiva’s cracker in Port Arthur and nearly 2 million tons/year of ethylene capacity at Formosa’s site in Point Comfort were also taken offline last week.

LyondellBasell reduced operating rates at its cracker in Channelview.

Downstream units shut amid freezing temperatures

Chevon Phillips Chemical shut its PE units at its Cedar Bayou plant due to freezing temperatures forecast. The producer was also reported to have been undergoing shutdown for PE lines at its Pasadena site.

INEOS Styrolution shut down its styrene unit in Bayport and Braskem shut down its PP operations in the state of Texas.

BASF, Celanese, INEOS and Sasol were also reported have begun winter protocols at their sites in the US.

Electricity demand exceeds expectations

ERCOT, which operates the power grid of Texas, announced that they had made tangible improvements since Winter Storm Uri, which wreaked havoc in petrochemicals production and logistics back in February 2021.

In a list published on December 16, Texas grid operator stated that they improved the ability to bring more generation online sooner when needed.

However, the operator reportedly requested an emergency order on Friday to bypass certain emission standards for power plants as demand for electricity exceeded their expectations.

Arctic blast to slowly moderate this week

The storm is expected to diminish in severity and temperatures are forecast to rebound later this week. However, it should be noted that the full extent of the impact of this Arctic blast moving across the US still remains to be seen.