Ethylene Review 2015: Capacity Investments Advance, Maintenance & Repairs Drop

Researched by Industrial Info Resources (Sugar Land, Texas)--Despite the retraction and slowdown of the Oil and Gas market in 2015, North American ethylene producers moved ahead with new capacity investments, reduced the number of days offline for maintenance or repairs and confirmed even more new capacity additions planned for future years. Industrial Info tracked 50 planned and unplanned offline events across 31 operational production units in the U.S. and Canada during the past year. The offline events equaled nearly 850 days of down time, which is a major improvement from 2014, which totaled almost 1,300 days.

The year 2015 started with three outages that began in the previous year, and the first quarter of the year experienced the most down time, with 120 planned and 245 unplanned days of idle time. Two of the largest first-quarter events were a furnace fire at Exxon Mobil Corporation's (NYSE:XOM) (Irving, Texas) 800 million pound-per-year USC I cracker in Beaumont, Texas and the continued restart effort of Williams Olefins' expanded 1.95 billion pound-per-year cracker in Geismar, Louisiana.

Exxon Mobil's Beaumont plant experienced another fire incident at the end of March on a propylene line that shut down both ethylene units at the site and contributed a 40 days to the total 191 days of lost production time during the second quarter. The third and fourth quarters were relatively even, with 150 and 140 days of down time respectively. Planned turnaround activity in the second half of the year slowed as a small number of planned maintenance events were rescheduled for 2016.

The year ended on a high note by adding more than 1 billion pounds per year of capacity through the expansion of existing ethylene plants. The Williams Companies Incorporated's (NYSE:WMB) (Tulsa, Oklahoma) Williams Olefins Plant in Geismar brought 600 million pounds per year online, and LyondellBasell Industries NV (NYSE:LYB) (Houston, Texas) added two new furnaces at its Channelview, Texas plant, adding a total of 400 million pounds per year online. Sasol North America, a division of Sasol Limited (NYSE:SSL) (Johannesburg, South Africa), Formosa Plastics Corporation (Kaohsiung, Taiwan) and Shintech Louisiana, a division of Shintech Incorporated (Houston, Texas) each began construction last year on a new ethylene unit. Sasol and Formosa are aiming to complete construction of their projects in late 2017, while Shintech is anticipating a 2019 completion.

PTT Global Chemical PCL (Bangkok, Thailand); Total Petrochemicals & Refining USA Incorporated (Houston, Texas), a subsidiary of Total SA (NYSE:TOT) (Paris, France); and Indorama Ventures PCL (Bangkok, Thailand) joined the collection of companies evaluating plans for the construction of new ethane crackers in the U.S. LACC LLC (Seoul, South Korea), a joint venture between Lotte Chemical Corporation (Seoul) and minority partner Axiall Corporation (NYSE:AXLL) (Atlanta, Georgia) reached a final investment decision in December 2015 to move forward with construction of a new 1 million metric-ton-per-year (2.205 billion pounds per year) ethane cracker in Lake Charles, Louisiana. Meanwhile, Shell Chemicals, the petrochemical arm of Royal Dutch Shell plc (NYSE: RDS.A) (The Hague, Netherlands), continues to evaluate the construction of a proposed 3 billion pound-per-year ethylene plant and derivative complex in Pennsylvania.

Industrial Info is tracking 93 maintenance and capital ethylene projects in the U.S. and Canada worth approximately $60.59 billion.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.