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Released May 01, 2017 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--LyondellBasell Industries NV (NYSE:LYB) (Houston, Texas) expects to ramp up production to full rates this quarter at the newly expanded Corpus Christi, Texas, ethylene facility and is turning its attention to starting construction on a big polyethylene plant in La Porte, Texas, company executives said Friday.
The expanded Corpus Christi facility ran at 80% capacity on average during the first quarter, Chief Executive Officer Bob Patel said last week during the company's first-quarter 2017 earnings presentation.
LyondellBasell announced the completion of the 800 million-pound-per-year Corpus Christi expansion in January, increasing capacity there by more than 50% to 2.5 billion pounds per year. It was the final in a series of planned expansions to increase LyondellBasell's U.S. ethylene capacity 20%. For related information, see February 6, 2017, article - LyondellBasell Looks to Gulf Coast Ethylene Buildout after Rough 2016 Ends on High Note.
In all, LyondellBasell expects to produce an additional 2 billion pounds of ethylene this year versus 2016.
"A year ago, many industry consultants were predicting a more severe reduction in [ethylene] operating rates as new U.S. capacity was expected to start up during 2017 and '18," Patel said. "But with continued global demand growth and project delays, the decline from today's very high operating rates is forecast to be relatively shallow and short."
He added: "Focus is now turned toward 2019 and 2020, where it appears that capacity utilization could exceed the high levels of 2015 and '16."
On the polyethylene front, the company expects to break ground in May on a $650 million plant project in La Porte. The 1.1 billion-pound-per-year, multi-modal polyethylene resin unit would make use of LyondellBasell's proprietary Hyperzone PE technology, a cascade gas-phase process that will allow the facility to produce a wide range of high-performance, high-density polyethylene (HDPE) product, with a lower amount of polyethylene resin per unit produced. The project is expected to see completion in late 2019. Patel said the company may consider more polyethylene expansions following the completion of the La Porte project. Industrial Info eight LyondellBasell capital projects worth a combined $3.2 billion that are expected to kick off construction this year. For more information on the La Porte polyethylene project, see Industrial Info's project report.
LyondellBasell reported $787 million in net earnings for the just-ended first quarter, compared with $1.03 billion in first-quarter 2016. During the just-ended quarter, the company incurred unusually high maintenance-related expenses. In all, the revenue impact was about $250 million, including lost profit from the units that were down.
Planned maintenance at the company's 268,000-barrel-per-day Houston, Texas, refinery reduced first-quarter results by $100 million, Patel said. The refinery is now operating at near nameplate capacity and no major maintenance is planned for the facility in the second quarter, he added. Also, two months of planned maintenance was performed at a co-product processing unit at the company's Channelview, Texas, complex, which impacted results by $110 million, he said.
Capital expenditures for the first quarter, including growth projects, maintenance turnarounds, catalyst and information technology-related expenditures, were $421 million.
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/.
The expanded Corpus Christi facility ran at 80% capacity on average during the first quarter, Chief Executive Officer Bob Patel said last week during the company's first-quarter 2017 earnings presentation.
LyondellBasell announced the completion of the 800 million-pound-per-year Corpus Christi expansion in January, increasing capacity there by more than 50% to 2.5 billion pounds per year. It was the final in a series of planned expansions to increase LyondellBasell's U.S. ethylene capacity 20%. For related information, see February 6, 2017, article - LyondellBasell Looks to Gulf Coast Ethylene Buildout after Rough 2016 Ends on High Note.
In all, LyondellBasell expects to produce an additional 2 billion pounds of ethylene this year versus 2016.
"A year ago, many industry consultants were predicting a more severe reduction in [ethylene] operating rates as new U.S. capacity was expected to start up during 2017 and '18," Patel said. "But with continued global demand growth and project delays, the decline from today's very high operating rates is forecast to be relatively shallow and short."
He added: "Focus is now turned toward 2019 and 2020, where it appears that capacity utilization could exceed the high levels of 2015 and '16."
On the polyethylene front, the company expects to break ground in May on a $650 million plant project in La Porte. The 1.1 billion-pound-per-year, multi-modal polyethylene resin unit would make use of LyondellBasell's proprietary Hyperzone PE technology, a cascade gas-phase process that will allow the facility to produce a wide range of high-performance, high-density polyethylene (HDPE) product, with a lower amount of polyethylene resin per unit produced. The project is expected to see completion in late 2019. Patel said the company may consider more polyethylene expansions following the completion of the La Porte project. Industrial Info eight LyondellBasell capital projects worth a combined $3.2 billion that are expected to kick off construction this year. For more information on the La Porte polyethylene project, see Industrial Info's project report.
LyondellBasell reported $787 million in net earnings for the just-ended first quarter, compared with $1.03 billion in first-quarter 2016. During the just-ended quarter, the company incurred unusually high maintenance-related expenses. In all, the revenue impact was about $250 million, including lost profit from the units that were down.
Planned maintenance at the company's 268,000-barrel-per-day Houston, Texas, refinery reduced first-quarter results by $100 million, Patel said. The refinery is now operating at near nameplate capacity and no major maintenance is planned for the facility in the second quarter, he added. Also, two months of planned maintenance was performed at a co-product processing unit at the company's Channelview, Texas, complex, which impacted results by $110 million, he said.
Capital expenditures for the first quarter, including growth projects, maintenance turnarounds, catalyst and information technology-related expenditures, were $421 million.
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/.
