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Formosa declares force majeure for PP in Point Comfort, Texas

By: Frank Esposito

June 12, 2013

Formosa Plastics Corp. USA has declared force majeure for polypropylene resin at its plant in Point Comfort, Texas — while already operating under similar conditions for high density polyethylene resin at the site.

In a June 11 letter to customers, Formosa polyolefins vice president and general manager Ken Mounger said that the firm’s PP units in Point Comfort “have experienced unplanned outages” and was declaring force majeure as a result.

“The quantity of [PP] product that will be allocated is under evaluation, and will be communicated as soon as this information is available,” Mounger said in the letter.

Formosa spokesman Steve Rice said in a June 12 phone interview that no date has been set for a full re-start of PP production at the site. He declined to provide details as to the reasons for the outages.

The outage comes at a time when U.S./Canadian PP demand is far from robust. Through April, regional PP sales were down more than 5 percent, according to the American Chemistry Council in Washington. A domestic drop of almost 4 percent was worsened by a drop of more than 37 percent in export sales in that four-month period.

Livingston, N.J.-based Formosa already was operating under force majeure for HDPE in Point Comfort after a May 2 fire at the site. Several workers were injured in that incident, which resulted in all three of the firm’s HDPE production lines being closed.

Two of the three HDPE lines were up and running by May 15, while officials earlier said the third line — which makes high molecular-weight bimodal grades of Formosa's Formolene-brand HDPE — would be back in production in late June. Rice confirmed June 12 that the site’s HDPE production levels remain below where they were before the fire.

North American PE supply also has been impacted by force majeure conditions for the material at a plant operated by Chevron Phillips Chemical Co. in Baytown, Texas. The firm — based in The Woodlands, Texas — declared force majeure after a minor emissions event at the site on May 9 and 10.