TPC plant explosion's impact on butadiene market still being assessed

A butadiene-fueled fire that broke out following a pair of explosions at a TPC Group butadiene extraction facility in Port Neches, Texas, has been extinguished, but the impact on the surrounding community and the butadiene market overall still is being assessed.

In the wake of the Nov. 27 blast, two of the facility's distillation towers fell and more are likely to have been affected, according to Bill Hyde, executive director of olefins and elastomers at IHS Markit.

Hyde expects the Port Neches plant, which has an annual butadiene extraction capacity of 426,000 metric tons, to be closed throughout 2020 and most likely beyond. That facility, he noted, accounts for 17 percent of U.S. butadiene capacity.

Butadiene is a feedstock for ABS resins and styrenic block copolymers. It also can be used to make adiponitrile, which is a feedstock for nylon 6/6 resin.

TPC Group Chief Executive Edward Dineen told the 175 employees at Port Neches on Nov. 30 that they would be paid until the end of the year, when the facility will be closed indefinitely.

Hyde said the explosion's impact on TPC will be devastating but believes the short-term impact on the total butadiene market will be nominal, namely because butadiene facilities in the U.S. are running at a capacity rate of about 60 percent.

"I've spoken with a number of customers, and they tell me that butadiene inventories are high, while demand is relatively low," he said. "In a steady state, with everything running normally, it looks like this is manageable."

On the other hand, another major break in the butadiene supply system could mean trouble because the built-in capacity excess the industry has had for years is gone, Hyde said.

The TPC fire began after two explosions at the facility on Nov. 27. The blast could be felt by those living near the facility, and many in Port Neches and neighboring communities reported damage to their homes as a result.

Emergency crews battled the blaze for about week by cutting off lines at the plant that may have been fueling the fire, allowing the fire to burn itself out, according to TPC and local news reports.

Response measures are ongoing and the fire continues to be contained, according to the latest TPC press release on the blaze.

"Unified Command remains focused on mitigating the event and maintaining the safety of responders and the community," the company said.

Two Port Neches employees and a contractor were injured in the Nov. 27 incident, and an estimated 60,000 people were evacuated from communities surrounding the plant after the explosion. Residents were allowed to return home Nov. 30, the same day a distillation tower at the plant collapsed.

Officials with the Southeast Texas Alerting Network continue to monitor weather conditions and air quality, providing Port Neches area residents with health and safety updates, including voluntary shelter in place and evacuation details.

TPC is providing an emotional support hotline, staffed by licensed professional counselors from Samaritan Counseling Center of Southeast Texas, for local residents affected by the fire and the evacuations.

TPC said it has sent roughly 100 claims representatives into the field, going door to door in the neighborhoods most severely impacted by the evacuations. Residents who live outside the highest-impact areas and have filed claims will be contacted and visited by appointment.