DuPont sacks CEO citing unmet targets; Bolivia mulls options for idled urea plant; Braskem Idesa begins ethane imports
DuPont removes CEO, CFO citing unmet growth targets
DuPont said on Feb. 18, 2020 its board of directors appointed chairman Edward Breen to the additional role of CEO and investor relations vice president Lori Koch as CFO following unmet targets.
“While we made some progress in 2019, we did not meet our own expectations and we now need to move aggressively to secure our foundation for growth,” Breen said.
Marc Doyle and Jeanmarie Desmond, who served as CEO and CFO respectively, will depart the company, DuPont said.
Restoring Breen to the chief executive role will help to draw more directly on his substantial operating experience, it added.
Breen had taken the role of chairman and CEO in 2015. In September 2018 Doyle was named CEO, reporting to Breen.
Bolivian government weighs future of troubled fertilizer plant
Bolivia’s new government will work to restart an ammonia and urea plant opened two years ago with a $953-million investment but currently idle due to operating and logistic problems, the country’s hydrocarbon ministry said Feb. 14.
Proposals to move the plant to another location to solve logistic issues would take too long and cost too much, while closing it permanently also isn’t an option, it added.
“We haven’t considered closing the plant, given the investment. On the contrary, we are advancing in solving problems related to transportation, logistic, maintenance and commercial strategy,” the ministry said.
According to a Jan. 8, 2020 report in Bolivian newspaper Pagina Siete, the plant lost a total $34 million in 2018 and 2019, in spite of having access to subsidized natural gas prices, due to operational problems.
Former President Evo Morales inaugurated the plant in 2017. It had produced fertilizer for domestic consumption as well as for export, mainly to Brazil.
Morales resigned to the Bolivian presidency in November as a series of protests against his rule resulted in deadly confrontations, and sought asylum. Morales became president in 2006 and was re-elected in 2009, and then again later in 2014.
In 2006 Morales nationalized the country’s hydrocarbon industry, enacting legislation where Bolivia needed at least 51% ownership of gas production assets.
After the nationalization, Bolivia saw a fast increase in royalties due to the increase of export prices. This compared with levels that had been a fraction of international prices under foreign majority ownership.
That revenue was used to begin efforts to try to build a petrochemical industry.
Several other countries in the region, like Peru, are raw hydrocarbon exporters with mostly foreign ownership of extraction and export assets. Like Peru, they need to import large volumes of urea as they lack a petrochemical industry but have significant agricultural production.
In South America only Argentina, Brazil and Venezuela have a relatively developed petrochemical industry. In Central America only Trinidad and Tobago, as well as Mexico, have petrochemical production assets.
Braskem Idesa begins ethane imports
Braskem said in a Feb. 10, 2020 filing with Brazilian stock authorities that its Mexican ethylene/polyethylene joint venture with Idesa started ethane imports.
The Brazilian-Mexican venture Braskem Idesa received its first ethane shipment as part of a plan that includes a $4 million investment that will bring up to 12,800 barrels per day of ethane. This represents 19% of the cracker processing capacity.
Braskem Idesa had been working well under capacity after the Mexican state owned company failed to supply agreed volumes.
Port Houston says Army Corps completes feasibility study
(On Feb. 27 wording of the fourth paragraph was changed compared with what was published on Feb. 26. The original had incorrectly stated funding for the second half would come from public funds. The story has been corrected as it would be from private funds.)
Port Houston said on Feb. 13 that the U.S. Army Corps of Engineers has completed a feasibility study toward its planned ship channel expansion.
Roger Guenther, the Port Houston executive director, said that the next step is the release of an Army Corps Chief’s report.
The Army Corps full year 2020 work plan allocated $70 million towards channel maintenance this year that would also help prepare the channel for the planned widening and deepening.
Port Houston has committed funding for one half of the $1 billion expansion cost. "Private funds from industry" are expected to finance the other half, a Port Houston spokesperson said.
The Houston ship channel is the busiest waterway in the nation. More than $28 million have already been invested in this effort, Port Houston said.
Port Houston officials are carrying out lobbying efforts in Washington D.C. to obtain federal approval.
Canada’s Inter Pipeline investment in PDH/PP complex at C$2.2 billion
Canada’s Inter Pipeline said on Feb. 20 that as of the end of 2019 its total investment in the propane dehydrogenator and polypropylene complex under construction in Alberta was C$1.2 billion.
The company has budgeted a total C$2.2 billion investment in this complex, with the PDH facility on track to be complete by the end of 2020 and the polypropylene plant by the third quarter of 2021.
Westlake CEO Chao dodges question on possible Orbia purchase
Westlake President and CEO Albert Chao said on Feb. 18 during an earnings discussion that the company is cautiously evaluating how to deploy capital, as he dodged a question related to any possible purchase of Mexico’s Orbia assets.
“Can't comment about any particular activity that we might look at or any particular trend that we see in terms of assets in the marketplace. But we're going to take a conservative stance in terms of how we deploy capital,” Chao said.
Orbia officials said earlier this year that the company, formerly known as Mexichem, was in the process of analyzing alternatives, such as strategic alliances, for its vinyl business.
That comment came after media reports of a potential asset sale to Westlake increased share prices.
Indorama Venture starts operations in Westlake, Louisiana
Indorama Ventures Public Co. Ltd. confirmed in February it started operations of its gas cracker and olefins plant in Westlake, Louisiana.
“The site has an ethylene production capacity of 440 kilotons per annum and is highly integrated with the U.S. Gulf Coast ethylene pipeline infrastructure,” it said.
The cracker will supply an oxide and glycol plant in Clear Lake and the recently acquired integrated ethylene oxide/propylene oxide plant in Port Neches, both in Texas.
By Petrochemical Update