Released March 25, 2020 | SUGAR LAND
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Industrial Info's daily COVID-19 Impact Report gives you the latest related supply and production data relevant to the Energy Industry and others.
Petroleum Refining
Phillips 66 has reduced rates by 35% at its 242,000-barrel-per-day (BBL/d) Lake Charles Refinery in Westlake, Louisiana, as COVID-19 pandemic concerns continue to drive down demand.
Marathon has rescheduled a 35-day plant-wide maintenance turnaround at its 72,000-BBL/d Kenai, Alaska, refinery. The turnaround start has been moved from April 10 to mid-August 2020 due to manpower concerns.
Gunvor Petroleum Rotterdam B.V. has halted an ongoing planned plant-wide maintenance turnaround at its 88,000-BBL/d Rotterdam Refinery in the Netherlands due to the outbreak. The maintenance kicked off in early March 2020 and completion was expected in mid-May. The refinery will now remain closed for an indefinite period.
Power
Germany and France are altering tender schedules for new solar electricity capacity due to COVID-19. The outbreak also is creating some doubt as to whether Chinese equipment manufacturers can deliver orders on time to support coal-fired power plant development in India.
In North America, Entergy Corporation says it does not anticipate any delays to transmission & distribution or generation projects. Basin Electric is continuing operations by allowing employees to work from home when possible and limiting the size of onsite crews to keep their assets operating efficiently and safely. American Transmission Company is proceeding with maintenance and construction projects as planned.
Petrochemical
Dow Chemical is instituting alternating staffing schedules in an effort to keep its ethylene plant in Argentina running at normal rates.
Dow Chemical has postponed a major planned turnaround for its Fort Saskatchewan, Canada, ethylene unit to 2021 due to COVID-19 concerns. Planned turnarounds for polyethylene trains at the site likely will be moved out to next year as well.
Pinova in Brunswick, Georgia, is having operators working and sleeping onsite for two days. Geo Specialty Chemicals in Bastrop, Louisiana, is running normally, but is discussing a lock-in and having employees sleep onsite. The lock-in has not yet been put into place.
Sontara in Old Hickory, Tennessee, has all office employees working from home. However, the plant still is in full production, and there are no plans to stop or slow production, because its products are considered critical.
Producers of soap and disinfectants, specifically companies like ZEP, confirmed they are running plant operations at 100% and already have orders booked for several months.
In India, the government has designated all agricultural chemical plants as essential producers that must run at full capacity. Security teams are conducting temperature checks for everyone entering plant sites. Workers are wearing respirators as preventative measures.
Oil & Gas Production
Canadian offshore projects are feeling the impact of low oil prices. Equinor has delayed its Bay du Nord FPSO project, which is expected to have a capacity of 94,000 to 188,000 BBL/d. Equinor had expected that an investment decision would be made in 2021, with the first oil in 2025. Equinor is evaluating options to reduce the development costs and make the project more attractive in the current pricing environment.
Husky Energy has suspended construction on its West White Rose project in Newfoundland as a precaution due to COVID-19 concerns. Construction of the 75,000-BBL/d platform began in mid-2018, with first oil scheduled for 2022. It was more than 60% complete at the time of the work stoppage. The concrete gravity structure is being constructed at a purpose-built graving dock in Argentia, Newfoundland and Labrador. The structure is estimated to be 476 feet tall, weigh 210,000 metric tons and features 2.69 million cubic feet of concrete.
As with almost all oil-related projects in today's low-price environment, the timelines will be revised.
Metals & Minerals
The Metals & Minerals Industry's reaction to government mandates in response to COVID-19 is ratcheting up day by day. Most companies continue to operate, but some have reduced production or implemented temporary shuttering, especially those that own assets in jurisdictions where lockdown or shelter-in-place orders have been mandated. We are seeing mining assets placed on care and maintenance (shuttered) or operated at lower production rates in direct response to COVID-19 containment precautions. These actions also are due to reductions in staffing related to travel restrictions or a reaction to slowing demand for metals and minerals because of the economic slowdown caused by the pandemic. In some cases, equipment deliveries for projects have been delayed.
To date, most of the temporary plant closures or project delays are happening in Argentina, Canada, Colombia, Chile, Peru, the U.S. and South Africa.
The industry is working remotely where possible, but many construction projects have slowed or have been postponed due to the virus. To date, there have been more than 40 mines placed on care and maintenance and 137 Metals & Minerals Industry projects delayed around the world due to the COVID-19 response.
Low oil prices are impacting steel mills and other businesses that supply energy infrastructure. U.S. Steel plans to idle steel pipe and tube mills in Ohio and Texas indefinitely by the end of May. The company says its other mills in the U.S. are continuing to operate, and it is proceeding with installation of a new electric arc furnace at its Fairfield works in Alabama.
Food & Beverage
Coca-Cola expects to remain strong throughout the pandemic. Layoffs and job restructurings are not part of its plans to get through the outbreak. It does anticipate major second-quarter impacts around the world, but feels strongly about having started this pandemic in a "robust" position and anticipating emerging stronger as they have after other world crises.
The Dean Foods milk plant in De Pere, Wisconsin, is having a hard time keeping up with the sudden spike in demand. As a result, the plant is being pushed to its limit. Moreover, all capital expenditures are on hold for the remainder of 2020.
Pulp & Paper
Pulp and paper manufacturers are increasingly concerned about the availability of labor resources (contractors and craftsmen) for projects that are approved and scheduled to start construction in the second quarter.
Pharmaceutical & Biotech
Several companies have offered up large amounts of the drug chloroquine (and variations), a malaria drug developed in the 1930s, pending approvals on its effectiveness in combating COVID-19. Amneal, Bayer, Novartis, Mylan and Teva are among those pledging hundreds of millions of doses of the drug to governments and hospitals. Chloroquine currently is not approved as a treatment for COVID-19.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 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.
Petroleum Refining
Phillips 66 has reduced rates by 35% at its 242,000-barrel-per-day (BBL/d) Lake Charles Refinery in Westlake, Louisiana, as COVID-19 pandemic concerns continue to drive down demand.
Marathon has rescheduled a 35-day plant-wide maintenance turnaround at its 72,000-BBL/d Kenai, Alaska, refinery. The turnaround start has been moved from April 10 to mid-August 2020 due to manpower concerns.
Gunvor Petroleum Rotterdam B.V. has halted an ongoing planned plant-wide maintenance turnaround at its 88,000-BBL/d Rotterdam Refinery in the Netherlands due to the outbreak. The maintenance kicked off in early March 2020 and completion was expected in mid-May. The refinery will now remain closed for an indefinite period.
Power
Germany and France are altering tender schedules for new solar electricity capacity due to COVID-19. The outbreak also is creating some doubt as to whether Chinese equipment manufacturers can deliver orders on time to support coal-fired power plant development in India.
In North America, Entergy Corporation says it does not anticipate any delays to transmission & distribution or generation projects. Basin Electric is continuing operations by allowing employees to work from home when possible and limiting the size of onsite crews to keep their assets operating efficiently and safely. American Transmission Company is proceeding with maintenance and construction projects as planned.
Petrochemical
Dow Chemical is instituting alternating staffing schedules in an effort to keep its ethylene plant in Argentina running at normal rates.
Dow Chemical has postponed a major planned turnaround for its Fort Saskatchewan, Canada, ethylene unit to 2021 due to COVID-19 concerns. Planned turnarounds for polyethylene trains at the site likely will be moved out to next year as well.
Pinova in Brunswick, Georgia, is having operators working and sleeping onsite for two days. Geo Specialty Chemicals in Bastrop, Louisiana, is running normally, but is discussing a lock-in and having employees sleep onsite. The lock-in has not yet been put into place.
Sontara in Old Hickory, Tennessee, has all office employees working from home. However, the plant still is in full production, and there are no plans to stop or slow production, because its products are considered critical.
Producers of soap and disinfectants, specifically companies like ZEP, confirmed they are running plant operations at 100% and already have orders booked for several months.
In India, the government has designated all agricultural chemical plants as essential producers that must run at full capacity. Security teams are conducting temperature checks for everyone entering plant sites. Workers are wearing respirators as preventative measures.
Oil & Gas Production
Canadian offshore projects are feeling the impact of low oil prices. Equinor has delayed its Bay du Nord FPSO project, which is expected to have a capacity of 94,000 to 188,000 BBL/d. Equinor had expected that an investment decision would be made in 2021, with the first oil in 2025. Equinor is evaluating options to reduce the development costs and make the project more attractive in the current pricing environment.
Husky Energy has suspended construction on its West White Rose project in Newfoundland as a precaution due to COVID-19 concerns. Construction of the 75,000-BBL/d platform began in mid-2018, with first oil scheduled for 2022. It was more than 60% complete at the time of the work stoppage. The concrete gravity structure is being constructed at a purpose-built graving dock in Argentia, Newfoundland and Labrador. The structure is estimated to be 476 feet tall, weigh 210,000 metric tons and features 2.69 million cubic feet of concrete.
As with almost all oil-related projects in today's low-price environment, the timelines will be revised.
Metals & Minerals
The Metals & Minerals Industry's reaction to government mandates in response to COVID-19 is ratcheting up day by day. Most companies continue to operate, but some have reduced production or implemented temporary shuttering, especially those that own assets in jurisdictions where lockdown or shelter-in-place orders have been mandated. We are seeing mining assets placed on care and maintenance (shuttered) or operated at lower production rates in direct response to COVID-19 containment precautions. These actions also are due to reductions in staffing related to travel restrictions or a reaction to slowing demand for metals and minerals because of the economic slowdown caused by the pandemic. In some cases, equipment deliveries for projects have been delayed.
To date, most of the temporary plant closures or project delays are happening in Argentina, Canada, Colombia, Chile, Peru, the U.S. and South Africa.
The industry is working remotely where possible, but many construction projects have slowed or have been postponed due to the virus. To date, there have been more than 40 mines placed on care and maintenance and 137 Metals & Minerals Industry projects delayed around the world due to the COVID-19 response.
Low oil prices are impacting steel mills and other businesses that supply energy infrastructure. U.S. Steel plans to idle steel pipe and tube mills in Ohio and Texas indefinitely by the end of May. The company says its other mills in the U.S. are continuing to operate, and it is proceeding with installation of a new electric arc furnace at its Fairfield works in Alabama.
Food & Beverage
Coca-Cola expects to remain strong throughout the pandemic. Layoffs and job restructurings are not part of its plans to get through the outbreak. It does anticipate major second-quarter impacts around the world, but feels strongly about having started this pandemic in a "robust" position and anticipating emerging stronger as they have after other world crises.
The Dean Foods milk plant in De Pere, Wisconsin, is having a hard time keeping up with the sudden spike in demand. As a result, the plant is being pushed to its limit. Moreover, all capital expenditures are on hold for the remainder of 2020.
Pulp & Paper
Pulp and paper manufacturers are increasingly concerned about the availability of labor resources (contractors and craftsmen) for projects that are approved and scheduled to start construction in the second quarter.
Pharmaceutical & Biotech
Several companies have offered up large amounts of the drug chloroquine (and variations), a malaria drug developed in the 1930s, pending approvals on its effectiveness in combating COVID-19. Amneal, Bayer, Novartis, Mylan and Teva are among those pledging hundreds of millions of doses of the drug to governments and hospitals. Chloroquine currently is not approved as a treatment for COVID-19.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 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.
