CHEMICAL & ENGINEERING
NEWS OFTHEWEEK OCTOBER 3, 2005 - EDITED BY WILLIAM B. SCHULZ & STEPHEN TRZASKA
in Port Arthur and Port Neches, Texas, also have no power or utilities, and they could be off-line for a month or more. Securities anaryst Frank Mitsch of Fulcrum Global Partners estimates Rita will reduce Huntsman's third-quarter earnings by $20 million. Like many other plants, Dow URRICANE RITA, WHICH tiple declarations of force majeure. Chemical's operations in Texas walloped the oil, gas, and They camefromTotal, Basell, In- and Louisiana, including those in chemical industries along novene, and Sunoco for polypro- Plaquemine and Hahnville, La., the U.S. Gulf Coast a little more pylene; DuPont for ethylene co- damaged in the last storm, so far than a week ago, caused less dam- polymers made in Orange, Texas, appear to have suffered no sigage than originally expected. and aniline, acrylonitrile, hydrogen nificant structural damage from Still, this second blow, follow- cyanide, and acetonitrile made in Hurricane Rita. But Dow points ing close on the heels of Hurri- Beaumont, Texas; Akzo Nobel for out, as do others, that this latest cane Katrina's devastating effects metal alkyls made in Deer Park, storm further complicates fuel, gas, a month ago, again hurt gas and Texas; and PPG Industries for all and raw material supplies, as well oil production, shut down petro- products manufactured in Lake as transportation logistics around chemical plants, and further tightened availability of energy and raw materials. Four days after Rita's landfall along the border ofTexas and Louisiana as a storm packing 120-mileper-hour winds, oil production of 1.5 million barrels per day in the Gulf had not resumed, according to the Department of the Interior's Minerals Management Service. Daily gas production of 10 billion cu ft was just 20% of normal. According to the petrochemical consultancy Chemical Market Associates Inc. (CMAI), the storm "resulted in the largest precautionary shutdown of petrochemi- Charles, La., including caustic the Gulf of Mexico, already sigcal and refinery-related assets in soda, chlorine, vinyl chloride, and nificantly stretched because of Katrina. the history of the U.S. industry." various chlorinated solvents. CMAI's tally of assets off-line due A storm of Rita's magnitude Windows were blown out of to the storm showed significant the administration building at must have an impact on indusreductions in North American PPG's Lake Charles plant, where try earnings, and some firms operating rates. About 34% of the wind also destroyed sheds and have intimated as much. Air propylene capacity was down, as damaged some roofs. Products & Chemicals says the was 56% of ethylene capacity, 55% Other plants close to where Ri- whammy from two major hurof high-density polyethylene, 67% ta made landfall were also compro- ricanes within a month of each of linear low-density polyethylene, mised. Lyondell Chemical says its other will reduce earnings in its 68% of butadiene, 83% of polybu- ethylene glycol plant in Beaumont fiscal fourth quarter by 5 to 7 tadiene, 49% of benzene, 44% of will be out of service for a month. cents per share. Eastman Chemitoluene, and 41% of chlorine. ExxonMobil's refinery, chemical, cal and Cytec Industries have also Shortages created by plant dam- and lubricant plant in Beaumont warned shareholders to expect an age, lack of utilities,flooding,and is still without water and electric- impact on earnings since Katrina scarcity of manpower led to mul- ity. Huntsman's ethylene plants hit.—MARC REISCH
HURRICANE
AFTERMATH
ASSESSING RITA
Storm exacerbates energy, raw material woes, but damage not as bad as Katrina's
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WWW.CEN-0NLINE.ORG
DELUGE Petrochemical facilities in Port Arthur, Texas, lie inundated in Rita's wake.
C & E N / OCTOBER 3. 2005
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