News Code : 43034

Lotte Chemical shut its 700,000 mt/year monoethylene glycol plant in Louisiana amid ethylene supply issues stemming from reduced flows because of ongoing steam cracker turnarounds in Texas, a source familiar with company operations said Friday.

Petrotahlil:The source said the MEG plant at Lotte's Lake Charles, Louisiana, complex, which started up in January, has at times run above its nameplate capacity. But as minor operational issues accumulated since January, the company had been on the lookout for an opportune time for a relatively short shutdown to address them.


Recent reductions in spot ethylene flows from Texas to Louisiana amid ongoing Texas cracker turnarounds provided that window, the source said.


"This was a good time to take an outage," the source said.


Lotte shut the MEG facility on June 8, and expected to restart it next week.


According to market sources, the cracker turnarounds are at ExxonMobil's 827,808 mt/year facility at its Beaumont, Texas, refining and chemical complex, and the 1 million mt/year joint-venture BASF-Total cracker at Total's refining complex in Port Arthur, Texas.


During turnarounds, their ethylene pipelines that connect to systems moving material to Louisiana typically shut down, reducing those eastward flows.


In addition, Lotte's new 1 million mt/year joint-venture cracker at Lake Charles has faced some issues during start-up efforts, so the company has stepped back to work out such problems, the source familiar with the company's operations added.


"We had hoped to be up and running by now, and we've gotten very close, and then there's an issue," the source said.


The company has been examining the cracker's systems to make any necessary adjustments to ensure a smooth startup, the source said.


"They tried to start up a couple of times," a US ethylene market source said, but found issues that needed attention during that process.


On May 9, Lotte held a dedication ceremony for the Lake Charles cracker and MEG plant. Westlake Chemical owns 10% of the cracker, and has an option to increase its stake to 50% within its first three years of operation.


Steve Bender, Westlake's chief financial officer, told a conference on June 5 the cracker was "going through a mode of startup right now as we speak" and that the company expected the plant to be "running on stream and at full operating rates as we get through the second quarter this year."


Neither Lotte nor Westlake responded to requests for company comment on the cracker or MEG plant on Friday.



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