US ethylene spot prices rose slightly today on the first day of trading after more than a dozen Gulf coast ethylene units shut down amid a burst of sub-freezing weather.
US spot EPC ethylene at Mont Belvieu, Texas, for December traded at least three times at 19.75¢/lb in morning trading, up by 0.5¢/lb from its prior assessment. By the afternoon, another December EPC ethylene deal traded lower at 19.5¢/lb.
Operators of Gulf coast ethane and liquefied petroleum gas (LPG) crackers approached last week's freeze differently, with some shutting down fully ahead of the cold weather, others reducing rates, and still others seeing unplanned upsets as they tried to continue to run.
Motiva Chemical's 700,000 metric tonne (t)/yr mixed-feed cracker in Port Arthur, Texas, had an unplanned shutdown as a result of the freeze, but began restart activities on 26 December, according to a company filing with the Texas Commission on Environmental Quality (TCEQ). That process should run through 31 December.
Chevron Phillips Chemical began to restart its two Cedar Bayou, Texas, crackers on 24 December after shutting them down ahead of the freeze. Start up of the 871,000 t/yr mixed-feed cracker and the larger 1.725mn t/yr ethane cracker is expected to last until 31 January, per a company filing with TCEQ.
Other units affected by the freeze include:
- Bayport Polymers' 1mn t/yr ethane cracker in Port Arthur shut down on 23 December as a precautionary measure but has yet to start up.
- Ingleside Ethylene's 550,000 t/yr ethane cracker had a loss of ethane supply stemming from frozen pressure transmitters on its ethane heater on 23 December, the company said in a filing with TCEQ.
- CP Chem's 807,000 t/yr ethane-propane cracker in Port Arthur reported flaring on 27 December.
- BASF-TotalEnergies' 1.14mn t/yr mixed-feed cracker in Port Arthur reported flaring.
- ExxonMobil's two 450,000 t/yr crackers in Beaumont, Texas, were flaring per a 26 December filing with the Southeast Texas Alert Network (STAN).
- Indorama Venture's small 181,000 ethane-propane cracker in Port Neches, Texas, reported flaring according to a 26 December filing.
- ExxonMobil reduced operations and flared in response to the freeze at its 1.5mn t/yr ethane cracker in Baytown, Texas, the company said in a filing with the Community Awareness Emergency Response (CAER) online reporting system.
- LyondellBasell's 1.18mn t/yr mixed-feed cracker in LaPorte, Texas, began flaring on 22 December, according to a CAER line filing.
- LyondellBasell's two 930,000 t/yr crackers in Channelview, Texas, loss compressors and flared after freezing temperatures affected operations of its lube oil turbine and transmitters.
- Ineos' two 930,000 t/yr mixed-feed crackers in Chocolate Bayou, Texas, lost steam generators on 23 December, resulting in flaring. Maintenance teams are working on their restoration.
- Dow's 590,000t/yr LHC-7 ethane-propane cracker in Freeport, Texas, had a process upset after its compressors shutdown as a result of water saturation of its steam supply.
- Dow's larger 1.5mn t/yr ethane-propane LHC-9 cracker in Freeport had an equipment failure that caused a pressure buildup that required flaring.
Formosa Plastic fared better than most, with reductions in operating rates on its 862,000 t/yr mixed-feed OL-2 cracker and its 1.25mn t/yr OL-3 ethane cracker. The 771,000 t/yr mixed feed OL-1 unit has been shut since July.
High inventory and sluggish demand have helped the US ethylene market avoid a post-freeze price-spike on the scale seen in the wake of the freeze that hit the region in January 2021, when prices rose by 107pc from 28.5¢/lb in late January to a record-high 64.25¢/lb by early March. That freeze also helped plant operators prepare and take seriously the threat of freezing temperatures.
"I was on the phone with my operations team all through Christmas," said one market participant, "but we thankfully got through this with just rate reductions."
