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January 21, 2015 01:00 AM

Ineos equipment failure may affect short-term PP supplies

Frank Esposito
Senior Staff Reporter
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    Ineos Group
    Ineos Group's Chocolate Bayou plant in Alvin, Texas.

    A recent equipment failure at a polypropylene resin plant operated by Ineos Group could affect short-term supplies of that material in North America.

    Ineos declared force majeure sales limits on PP after the Jan. 6 event at its Chocolate Bayou plant in Alvin, Texas. Company officials notified customers of the incident and of the force majeure in a Jan. 13 letter.

    The site has annual capacity of almost 1 billion pounds of PP. The equipment failure caused the unit to have “limited operations,” officials said in the letter.

    The shortage comes as PP prices in the region are plummeting because lower oil prices have brought down prices of feedstocks used to make PP. Regional prices fell a total of 15 cents per pound in November and December. North American demand for the material also wasn't strong in 2014, finishing flat through November.

    Ineos is based in Rolle, Switzerland, with North American headquarters in Houston. The global petrochemicals firm employs 17,000 worldwide and has annual sales of around $54 billion.

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