Westlake says Louisiana facilities largely undamaged
Westlake Chemical said its Louisiana plants "incurred limited physical damage" from Hurricane Ida.
Westlake shuttered operations at its plants ahead of the storm, and did not provide an estimate as to when operations will resume. Restarting will depend on the availability of power and industrial gases, the Houston-based operator said.
Westlake operates a 1.36mn t/y steam cracker and derivative units in Lake Charles, Louisiana, and operates other derivative units in Geismar and Plaquemine, Louisiana.
Local utility Entergy said eight major power transmission lines serving much of the refinery-heavy New Orleans area were knocked out over the weekend, as well as some generating plants serving greater New Orleans. Power was restored to about 10pc of affected customers in the state by last night, but it may take much longer to restore power to the region.
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Duqm plans key to Oman’s LPG export outlook
Duqm plans key to Oman’s LPG export outlook
The revival of a major petrochemical project could cap exports despite rising production, writes Ieva Paldaviciute Dubai, 17 September (Argus) — Production from the new Duqm refinery has boosted Oman's LPG output this year, and driven an 89pc year-on-year rise in exports to 371,000t for the first eight months of 2024, according to data from analytics firm Kpler. But plans for new petrochemical facilities linked to the refinery could put a cap on export capacity in the near future. Oman's LPG output has more than doubled within the past decade, from 420,000t (13,400 b/d) in 2015 — the earliest year for which energy and minerals ministry data are available — to around 990,000t last year. That is due in large part to the start-up of state-owned OQ's Salalah LPG extraction plant in the southern Dhofar governorate. The first-of-its-kind gas treatment project in Oman and now contributes close to 300,000 t/yr to the country's LPG output. The majority of Oman's LPG production now comes from downstream facilities operated by OQ — around 62pc of last year's output came from its 198,000 b/d Sohar and 106,000 b/d Mina al Fahal refineries. Another 30pc came from the Salalah LPG plant, and just 8pc from the upstream Bukha and West Bukha, Saih Rawl and Wadi Aswad fields. Shortly before the Salalah plant came on line, OQ in early 2021 started up its Liwa Plastics Industrial Complex (LPIC), whose 880,000 t/yr ethylene steam cracker would fast become a major LPG consumer. Output from the steam cracker, in turn, feeds the complex's 880,000 t/yr polyethylene and 300,000 t/yr polypropylene units. This contributed to a near collapse in Omani LPG exports in the first quarter of 2021, as OQ started diverting the Sohar refinery's LPG output to feed LPIC. But once the Salalah LPG plant began to ramp up, Oman managed to gradually resume exports, this time from Salalah port. This has enabled Oman to export refrigerated LPG cargoes on larger tankers, with Sohar previously only able to accommodate pressurised or midsize carriers. Oman is now a net LPG exporter, but still imports the occasional cargo when Sohar is unable to provide sufficient feedstock supply to LPIC — Sohar port received 104,000t of LPG between January and August, according to data from analytics firm Kpler. Both the Sohar refinery and LPIC are in northern Oman, far from the sultanate's other LPG production points. Chemical ambitions Oman's LPG output and exports have been lifted this year by new supply from the 230,000 b/d Duqm refinery, which at full capacity can produce up to 15,000 b/d of LPG. The facility was inaugurated in February but appears to have exported its first LPG cargo in September 2023, according to Kpler data, although this is not recorded in government data. But future exports could be capped if a new planned petrochemical complex, fed with naphtha and LPG produced at Duqm, is built alongside the refinery. Operator OQ8 — a 50:50 joint venture between OQ and Kuwait's state-owned KPI — initially had plans to build a 1.6mn t/yr petrochemicals complex, but design works were suspended in 2020, during the early part of the Covid-19 pandemic, because of the uncertain demand outlook. Plans appeared to have been revived in 2022, when OQ and KPI welcomed Saudi chemical giant Sabic onboard to develop a jointly owned petrochemical complex in Duqm. This project envisaged construction of a steam cracker and derivative units, as well as a natural gas liquid extraction facility. The three parties signed a non-binding agreement in late 2022, but a final investment decision has not yet been made. Oman LPG infrastructure Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
LPG World editorial: Cracks appear
LPG World editorial: Cracks appear
The emergence and growing supplies of alternative feedstocks are challenging LPG's position in Europe London, 17 September (Argus) — The European petrochemical sector's growing appetite for LPG has been vital in maintaining the region's position as an important LPG hub over the past few decades. But this outlet could come under increasing strain from more readily available and competitively priced naphtha from European refineries, as well as ethane from the US, all while regional olefins production flags. Europe's LPG production and demand for LPG as a fuel is in a state of long-term decline. The former is being constricted by North Sea field decline and energy transition pressures in Norway and the UK, even if investment is made to try to shore up North Sea oil and gas supplies in the prelude to net zero. It is also hamstrung by an ageing refining sector sorely lacking in investment and also at threat from the energy transition. Non-petrochemical LPG consumption meanwhile has been sliding and would have fallen more sharply were it not for the growth in autogas sales in eastern Europe — another sector moving towards decarbonisation. This demonstrates how important cheap and abundant US LPG imports have been in terms of supply, and investment in the flexibility of Europe's fleet of ethylene steam crackers in terms of demand. The latter has arisen from the year-round discounts LPG has secured over naphtha feedstock since US supplies started washing up on Europe's shores. But healthy LPG discounts to naphtha could be about to shrink, because European refineries are increasingly producing more naphtha at the same time as oil products and cracker feedstock demand wanes. The region's refiners have found naphtha weighing much more heavily on their bottom lines since the Covid pandemic. Naphtha's discount to North Sea Dated crude has averaged $8/bl this year in northwest Europe and $11/bl since 2022, compared with $4/bl in 2010-19. EU refiners produced much more naphtha this year and last year than they delivered domestically, including to petrochemical producers, Eurostat data show. This is because the best-value crude for them has become increasingly light. The loss of Russian medium sour Urals owing to EU sanctions has been partly offset by more naphtha-rich US light sweet WTI arriving in the region — climbing to about 1.86mn b/d in the first half of the year from 1.45mn b/d in 2022, Kpler data show. The light naphtha increasingly emerging from refineries is more suitable for cracking. But EU olefins output has shrunk since the pandemic, with cracker operating rates still trailing far behind those prior to 2020. European polypropylene production last year was the lowest since at least 2013 and 20pc lower than a 2017 peak, Eurostat data show. This is partly because the EU petrochemical sector has lost competitiveness with its Asian rivals. Cheap slates The US shale boom that has flooded Europe with cheap LPG has also blessed the US with bountiful volumes of an even cheaper petrochemical feedstock — ethane. Overseas shipments have grown over the past two decades, but the investment needed in ethane-fed crackers, US export capacity and ethane vessels has limited European uptake. Yet flows are increasing. Europe has imported around 180,000 t/month of US ethane this year, steady from 2023 but 12pc more than in 2022, Kpler data show. The US has been shipping 750,000 t/month since 2023, more than triple the 2017 volume. US ethane prices meanwhile keep falling as supplies keep growing. European producer Ineos is due to open Europe's largest cracker in Antwerp by 2026, a 1.4mn t/yr ethane-fed unit. Other investments in new ethane-fed capacity could emerge, or in conversions of crackers. The challenge of getting the ethane over the Atlantic may prolong plans to increase its use in Europe, but it is likely to arrive in increasing volumes and probably join swelling naphtha supplies, potentially reducing LPG's appeal among producers looking to regain their competitive edge. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
NGL pipeline burning in La Porte, Texas: Update
NGL pipeline burning in La Porte, Texas: Update
Houston, 16 September (Argus) — A natural gas liquids (NGL) pipeline operated by Energy Transfer Partners caught fire in La Porte, Texas, this morning, sending a bright orange plume of flame hundreds of feet into the air and leading to evacuations of nearby homes and businesses. The fire started at a valve station for a 20-inch NGL line, Energy Transfer said, located in a right-of-way shared with a number of other pipelines and high voltage power lines about 17 miles southeast of downtown Houston. Energy Transfer said the line has been isolated so that the residual product in the line can safely burn itself out. "We have no timeline at this point on how long that process will take, but we are working closely with local authorities," the company said. In a broadcast press conference today La Porte officials said it would likely be many hours until the fire burns out. Energy Transfer said it was aware of reports indicating that an unknown passenger car entered the right-of-way and struck the valve location. A vehicle could be seen very close to the flaring pipeline in video broadcasts of the fire this morning. The fire was first reported at 11:24am ET by the La Porte Office of Emergency Management via the X social media platform. The fire is near the intersection of Somerton Drive and Spencer Highway. First responders, including Harris County hazardous materials officials, were on the scene at the time of the post. The right-of-way includes a refined products pipeline system, various petrochemical pipelines, a Shell butadiene line, a Chevron ethylene line and an Enbridge Energy natural gas pipeline. Chevron said its pipeline was not affected by the fire. A shelter-in-place order has been issued for the nearby San Jacinto College campus and La Porte is recommending an evacuation of all homes and businesses between Luella and Canada roads. By Michael Camarda and Gordon Pollock Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Colombia’s old troubles hurt Petro’s new energy drive
Colombia’s old troubles hurt Petro’s new energy drive
A new tax on oil and coal producers may further undermine investment and energy security, writes Carla Bass Houston, 13 September (Argus) — Entrenched subsidies, violence and social conflict that have long plagued Colombia's traditional hydrocarbon producers are now hurting Colombian president Gustavo Petro's ambitious plan to move abruptly to cleaner energies and break dependencies on crude and natural gas. Some Colombian families had to resume burning wood for cooking fuel in early September — an energy transition in the opposite direction — after truckers blocked roads in protest against the end of diesel subsidies, slowing deliveries of alternative household fuel LPG. And around the same time, a series of new attacks on Colombia's oil pipelines following the breakdown of peace talks between the government and leftist guerrilla group ELN hobbled crude flows. Indigenous communities in late August temporarily took over a gas processing plant important to LPG output to demand more social spending in their territories. And the country recently experienced a new shortfall of refined products, when a refinery shutdown cut into its barely balanced jet fuel supply. Energy shortages were not part of Petro's transition plan, but these and similar incidents have not swayed him from an energy policy based on not awarding new oil and gas exploration contracts, even with slightly less than two years left in his term. Ratcheting down on hydrocarbon use before cleaner sources of power are in place could put Colombia at risk of an even wider gap in its energy supply. Bogota forecasts relatively flat crude production for 2025, at 763,000 b/d — just 2pc higher than this year but 2pc lower than in 2023. Output will begin to decline in 2027 without new exploration contracts, Colombian petroleum association ACP says, which is sooner than the finance ministry's projection that it will start falling in 2030. This would reduce the roughly 400,000 b/d of crude available for export as well as the approximately 360,000 b/d used to feed its refineries, according to data from the government and state-controlled Ecopetrol. Oil and oil products represented 32pc of the country's export value in 2023, ACP calculates. Frac cocaine This outlook is not deterring the Petro administration from its path. The president — who has referred to hydrocarbons as a poison like cocaine — recently opposed a deal with US firm Occidental Petroleum that would have added 65,000 b/d to Ecopetrol's production in the Permian basin in Texas, because of his opposition to hydraulic fracturing. The administration is also pushing for congress to approve a complete ban on the drilling method in Colombia owing to environmental concerns. The government has proposed adding a new tax on oil as well as coal producers — another key Colombian export — that many in the industry have said will further reduce investment incentives even under existing contracts. Without more investment — and a return to new exploration contracts — Colombia is putting its energy security at risk needlessly, producers warn. The administration of the country's previous president, Ivan Duque, had outlined an energy transition strategy that was more akin to Brazil's push under President Luiz Inacio Lula da Silva — to increase hydrocarbon production temporarily, to help pay for the costs of later moving to cleaner energies. But Ecopetrol — long seen as a regional leader in terms of its transition strategy — had to reduce green spending planned for this year because of budget constraints. Petro's strategy would see Colombia fall in its ranking as a leading regional oil producer. Guyana's output is likely to surpass Colombia's in 2025, and possibly more than double it in 2026. Petro is up for re-election in 2026, but his popularity has declined while in office because of changes to health care, energy shortages and corruption allegations. Colombia's crude production looks set for a similar decline. Colombia crude production forecast Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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