Ronnie Lim Business Times 19 May 11;
SHELL is this week trying to re-start its stalled ethylene cracker on Pulau Bukom - the core of its new US$3 billion petrochemicals complex. The cracker has been out of action for two months now, with this hitting Shell's feedstock supplies to downstream customers.
The latter includes plants like Ellba Eastern on Jurong Island which rely on ethylene from Shell for its production, with Ellba up to yesterday still unable to resume normal product deliveries to its own customers. Another plant earlier reported to be affected is Shell's monoethylene glycol plant there.
Giving an update of the cracker outage which started on March 18, a Shell spokesman said this week that 'we are in the process of restarting sometime from the middle of May. During the start-up stage, the cracker will gradually increase its operating rates'.
'After start-up, we will monitor the performance of the cracker to determine if we can lift force majeure (FM). We will keep our customers regularly updated on the situation so they can make informed decisions.'
The unplanned shutdown of the new cracker - which Shell had just barely started up in March - was due to unspecified 'technical problems', Shell said.
'Our manufacturing and technology teams have been working round the clock and continue to work hard to fix these technical problems.'
The cracker outage caused Shell to declare force majeure on contracted supplies to its customers on March 21. This is a common clause in contracts that frees both parties from liability or obligations when an extraordinary event or circumstance beyond the control of the parties prevents one or both from fulfilling their contractual obligations.
A BASF spokesman told BT yesterday that Ellba Eastern - a BASF-Shell joint venture - has still not received word on exactly when ethylene supplies from the Shell cracker will resume.
This means that Ellba's own force majeure notice to its customers for its styrene monomer - which are used to make various plastics and rubber products - remains in place, the spokesman added.
Ellba first issued its FM to customers on March 22 - with this due to a technical outage at its own catalyst plant, and not because of the Shell cracker problem. But after completing an unscheduled two to three- week maintenance of its plant in mid-April, Ellba has still been unable to lift the FM, as it has not been able to secure ethylene from Shell since.
Apart from 800,000 tonnes per annum of ethylene, the Shell cracker has a design capacity to produce 450,000 tpa of propylene and 230,000 tpa of benzene.
