10182017Wed
Last updateWed, 18 Oct 2017 2pm

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Harvey Puts World’s Ethylene Supply in Jeopardy

“Texas alone produces nearly three-quarters of the country’s supply of one of the most basic chemical building blocks. Ethylene is the foundation for making plastics essential to U.S. consumer and industrial goods,” Bloomberg reports.

“With Harvey’s floods shutting down almost all the state’s plants, 61 percent of U.S. ethylene capacity has been closed, according to PetroChemWire. Production may not return to pre-storm levels until November, according to Jefferies.” 


China Creating World's Largest Power Company

“The government of President Xi Jinping approved the merger of Shenhua Group Corp., the country’s top coal miner, with China Guodian Corp., among its largest power generators, the State-owned Assets Supervision and Administration Commission said Monday. With assets of 1.8 trillion yuan ($271 billion), the new entity will be the world’s second-biggest company by revenue and largest by installed capacity,” Bloomberg is reporting.

“The new company will have installed capacity of more than 225 gigawatts, topping Electricite de France SA and Enel SpA, according to Frank Yu, an analyst at Wood Mackenzie Ltd. EDF, as the French generator is known, had net installed capacity of 137.5 gigawatts last year, according to a company presentation. Italy’s Enel had total installed capacity of 83 gigawatts as of June 30, it said.” 

Chemical Plants in Peril in Aftermath of Hurricane Harvey

“Pressure valves on one or more containers of volatile organic peroxides "popped" late Thursday at the flooded Arkema plant in Crosby” and Texans “are on high alert for explosions like the ones that shot plumes of smoke into the air and caused an hours-long fire at the chemical plant early Thursday,” according to Emergency Management.

“Hurricane Harvey's winds and floodwaters have created emergencies at chemical facilities across the Houston area, from an Exxon Mobil roof collapse at its massive Baytown complex to the risk of an explosion at a chemical plant northeast of Houston.” 

Harvey Cutting Off Chemical Supply to Manufacturers

“Shutdowns at specialty chemical plants along the Texas Gulf Coast caused by Tropical Storm Harvey threaten to snarl supply chains across the United States,” CNBC reports.

“Roughly 40% of the U.S. petrochemicals market was offline as of Tuesday morning as Harvey continued to drench the region” and 37% of “total U.S. ethylene production has been disrupted since August 21, according to live monitoring by ICIS.” 

Nearly One-Quarter of U.S. Fuel Output Shut, And Harvey Isn't Done

The heart of the U.S. energy industry has suffered considerable damage from Tropical Storm Harvey and supply constraints could last for weeks with nearly one-quarter of U.S. fuel output knocked out.

Harvey's disruption has driven gasoline futures prices up nearly 17% since August 23, as a total of 4.2 MMb of U.S. refining capacity has been shut down. The latest shutdowns, carried out on Tuesday evening and on early Wednesday, were in Port Arthur, and included the nation's largest refinery. Restarts following a storm are often the most dangerous times for refiners.

Shale production has also been sharply curtailed in the Eagle Ford region of Texas and major pipelines carrying fuel to Midwest and East Coast markets have been either throttled back or shut entirely. 

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