North American Ethylene Unit Turnarounds Hold Steady in 2011

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Researched by Industrial Info Resources (Sugar Land, Texas)--In 2011, the number of planned ethylene unit turnarounds is expected to remain constant, with 12 planned turnarounds identified so far. This is a slight revision from as many as 15 individual unit turnarounds that were originally planned for the year only a few months ago. Considering that each turnaround can last a month or more and costs millions of dollars to complete, the downward revision signals a decline in the number of investments expected in this segment next year. One contributor to this slight decline is the result of several unplanned maintenance turnarounds that took place in 2010, bringing some units down earlier than planned.

The number of planned turnarounds for 2010 was once as low as 10, and by the end of the third quarter this had increased to 23 turnarounds and more than 750 days of total downtime, compared to an original estimate of only 350 days. Despite this large increase in turnaround activity in 2010, at least four maintenance turnarounds originally planned for 2010 have been postponed to 2011, representing a combined 120 days of downtime. Considering that almost all ethylene production in North America is centrally located in Texas and Louisiana, it's interesting to note that all but one of these four delayed turnarounds are located states other than these two. The postponed turnarounds are planned in Mexico, Kentucky, Louisiana and Western Canada.

A vast majority of ethylene producers have invested significantly in the last decade to incorporate flexible feedstock options that allow for the swing between heavy liquids such as naphtha and lighter streams such as ethane, depending on what economics and demand dictate. With a decreased demand for plastics, polymers and resins in the United States, many producers are capitalizing on the consumption of low cost and swelling inventories of ethane to boost profits. The price of natural gas is expected to remain relatively low in 2011 and will aid producers in realizing profits as feedstock costs remain fairly constant.

The year will start with three turnarounds in the first quarter, representing a total of 64 days of downtime. Three turnarounds are also expected to kick off in the second quarter, although the number of days offline will increase sharply to 140 days. As unplanned events occur related to weather, mechanical problems and economics, the shift of when these turnarounds will take place is constantly changing. Industrial Info's Ethylene Database helps identify, pursue, and track opportunities associated with maintenance turnaround work on ethylene units in North America and South America.

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