U.S. and Canadian Ethylene Producers Plan 17 Maintenance Turnarounds for the Remainder of 2003

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Industrialinfo.com is tracking seventeen individual ethylene unit maintenance turnarounds still planned to kick-off this year totaling nearly 500 days of down time and 24.2 billion pounds of product. This large number of turnarounds comes at a time when producers are battling increased feedstock costs and shortfalls in demand as derivative markets are not forecast to show significant improvements until the second quarter.

Click on the image at right to view the 2003 Ethylene Unit Turnarounds by Month Chart.

Previously, ethylene producers were optimistic that large turnarounds during the last half of 2002 combined with positive forecasts for olefins during 2003 would bring the opportunity for greater plant capacity utilization along with increased margins and profits. Currently, producers are banking on the same thing they were in 2002, long and numerous turnarounds that will hopefully tighten supply and increase contract prices.

ExxonMobil's Houston ethylene unit has been idle since September of last year waiting for demand for polymer grade propylene to improve. "This production unit like so many others is being evaluated to determine the cost and feasibility of upgrading it to meet new emission reduction standards such as a 90% reduction in nitrogen oxide (NOx) proposed by the Texas Natural Resource Conservation Commission (TCEQ)," commented Trey Hamblet, Chemical Group Manager with Industrialinfo.com. "ExxonMobil, BP, Dow and Shell are bringing on new capacity between this fall and 2007, all due to NOx emission reduction requirements and the cost to convert older furnace technology competitively. Almost all capital dollars planned over the next four years in ethylene furnaces will be targeted at NOx reduction projects or control upgrades," Mr. Hamblet added.

Many ethylene producers will defer or cancel planned turnarounds (ethylene turnarounds) until next year if the market doesn't hold up. Already, Industrialinfo.com has identified ten planned maintenance turnarounds for 2004 and even more for 2005 and beyond, as turnarounds for NOx related project tie-ins will begin.