Closure of Houston Ship Channel Points to Importance of Waterway

Researched by Industrial Info Resources (Sugar Land, Texas)--A shutdown of a portion of the Houston Ship Channel in the wake of a massive petrochemical and oil products fire serves as a reminder of the importance of the waterway for energy-related and chemical industries.

The U.S. Coast Guard began this week to lift some of the restrictions that had blocked much of the ship traffic on what is known as the busiest U.S. oil port, according to Reuters. The Coast Guard had shut down a stretch of the channel starting on March 22 due to contaminants from a fire at Intercontinental Terminals Company (ITC) LLC's facility in Deer Park, Texas. ITC is part of Mitsui & Co. (Tokyo, Japan).

The shutdown caused a traffic backlog of nearly 60 ships on the 50-mile waterway, according to news media reports. The channel, which runs along or through parts of Harris and Galveston counties, is the lifeline for area energy-related and petrochemical facilities.

Industrial Info is tracking more than $32 billion worth of Oil & Gas Production Terminals, Petroleum Refining, Pipelines and Chemical Processing industries project activity surrounding the ship channel. This includes projects worth more than $10 billion that are assessed as having a high probability of moving forward as planned.

One of the larger chemical projects is LyondellBasell Industries NV's (NYSE:LYB) (Houston, Texas) propylene oxide/tertiary butyl alcohol unit addition at the company's Channelview, Texas, facility. Now under construction, the unit has a planned production capacity of 500,000 tons per year of propylene oxide and 1 million tons per year of tertiary butyl alcohol. WorleyParsons Limited (North Sydney, Australia) is overseeing the project's design and procurement. Fluor Corporation (NYSE: FLR) (Irving, Texas) and Zachry Group (San Antonio, Texas) also are providing services for the project, which is planned to reach completion in first-quarter 2021. For more information, see Industrial Info's project report. LyondellBasell also has its 1.1 billion-pound-per-year Hyperzone polyethylene under construction at its nearby La Porte complex, with Bechtel Corporation (Reston, Virginia) providing engineering and procurement services. For more information on the polyethylene unit addition, see Industrial Info's project report.

In Pasadena, construction of Magellan Midstream Partners' (NYSE:MMP) (Tulsa, Oklahoma) Houston Ship Channel Refined Petroleum Products and Ethanol Marine Terminal has reached completion. The terminal has at least 11 tanks to store petroleum products and fuel, along with a marine dock capable of handling Panamax-sized ships with up to a 40-foot draft. Burns & McDonnell provided the engineering. For more information, see Industrial Info's project report.

In Deer Park, Royal Dutch Shell plc's (NYSE:RDS.A) (The Hague, Netherlands) Deer Park Refining is performing preliminary engineering for an upgrade to its 70,000-barrel-per-day Crude Distillation Unit 2 to improve feedstock flexibility. The unit currently processes only heavy sour crude. Construction kickoff is planned for fourth-quarter 2019, with completion by the end of the year. For more information, see Industrial Info's project report.

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.