By Frank Esposito
SENIOR STAFF REPORTER
Published: July 15, 2014 4:46 pm ET
Updated: July 15, 2014 4:54 pm ET
Image By: Chevron Phillips Chemical Co.
Chevron Phillips Chemical Co.'s operation at Port Arthur, Texas.
Polyethylene makers Chevron Phillips Chemical Co. and Equistar have declared force majeureproduction limits on that material after incidents at their Texas plants — including a July 7 fire that injured two workers at a Chevron Phillips ethylene/propylene unit in Port Arthur.
No cause for the fire was given in a July 9 statement from Chevron Phillips, which is based in The Woodlands, Texas. The statement added that the injured workers remained hospitalized. The Port Arthur plant has almost 1.8 billion pounds of annual ethylene capacity and 1.1 billion pounds of annual propylene capacity.
In the release, officials said that reviews are underway to determine when the unaffected areas of the plant can be restarted, and that no timetable has been set for restart of the area affected by the incident.
Equistar — a unit of Houston-based LyondellBasell Industries — has experienced “significant feedstock supply disruptions” at its PE plants in Matagorda and Victoria, according to a July 9 letter to customers. Those two plants are massive PE production sites, with combined annual capacities of about 5.4 billion pounds of high, low and linear low density PE.
LyondellBasell already had declared force majeure on ethylene feedstock made at its plant in La Porte, Texas.
Market sources said the situations at Chevron Phillips and Equistar could tighten supply in a North American PE market where demand has been lackluster so far in 2014. But the outages also could prevent regional PE resin prices from falling in July, as some buyers had anticipated.
Regional PE prices have not seen a decrease since late 2012. Since that point, five price increases have taken hold, leading major PE film extruders to take the rare step of trying to raise prices for their products even without an accompanying resin price increase. | 
