Formosa May Move Up Naphtha Cracker Maintenance

Formosa Petrochemical said it may reschedule maintenance at the largest of its three naphtha crackers to second-half August from early September if some downstream units are shut for an extended time following a fire at a pipeline.

"The situation is still unclear because it really depends on the status of the downstream units," a spokesman for the company said on Thursday.

"If the ethylene feedstock cannot be soaked up, we will forward the maintenance of the No. 3 cracker by two weeks." Formosa, Asia's top naphtha buyer, operates three crackers, of which its No. 3 unit has a nameplate capacity of 1.2 million tons per year (tpy) and is operating at 85% capacity.

Its 700,000 tpy No. 1 cracker was taken offline after the fire occurred, and it remains shut with no clear indication when it will restart, said the spokesman. The 1.03 million tpy No. 2 unit is also operating around 85% capacity.

Traders were previously expecting the No. 1 cracker to restart in the second half of June.

"But things are getting increasingly unclear, with traders' opinions being divided," said a North Asian trader.

"The market does not have a clear direction now of where it is going. Some said the market is bottoming out because Formosa is to restart the No. 1 cracker soon. Others disagree and think there will be an extended shutdown."