Alarm Bells Ring Loud in the US Amid the Season of Jingle Bells

Houston, Texas (USA): Petrochemical companies are on high alert in the US as temperatures are expected to fall well below the freezing point in the US Mid-West and the Southern States. As per several estimations, the minimum temperature on 22nd December 2022, Thursday, can hit as low as 17 F (-8.3 C). This is not the first time since such a sharp decline in temperatures has been measured, and the US must be wary of the 2021 polar storm Uri which caused devastation and unparalleled loss of life and property and laid waste to transportation and communications for weeks.

Christmas is almost around the corner, and there is a chill in the US air, but the ominous one.

The Gulf Coast, mainly Texas, was found ill-prepared when the 2021 polar storm struck the Southern states, but fair to them, up until 2021, Texas never witnessed below-freezing point temperatures. Texas was the land of beating Sun, Crude oil, and Barbeque. However, new realities have shattered that mirage, and a tough test lies ahead as Texas prepares for the worst of the winter. There has been news that the great state of Texas has taken several steps not to repeat the horror of the 2021 polar storm, and this week will check the veracity of those steps and the increased resilience of the Southern state.

Texas, a petrochemical powerhouse not only to the US but to the world, may face disruption as the state’s natural-gas infrastructure seems vulnerable to the freeze, which may hamper power generation and fuel deliveries to production facilities in the state. However, the impact of the freeze and the extent of the disruption remains to be seen.

The US has been amidst a slowdown as the seasonal lull, and sustained spell of weak demand from the downstream industries have shrouded the largest economy in the world. Several organizations have whispered the thought of a mini-recession in 2023.

Many of the US petrochemical producers have announced shutdowns; however, others remained reluctant and looking to endure the freezing temperatures. As of now, petrochemical producers face an intricate conundrum where shutting down plants will, in all likelihood, ensure no damage to any equipment of the production facilities; however, a restart will take a significant amount of time. Meanwhile, keeping the plants online will mean laying them bare to the unrelenting weather and devastating temperatures. Any exposed pipe, tubing, valve, or connection can turn into a device of systematic ruin that will disrupt production for days or maybe weeks.

Indorama Ventures has prematurely closed its Ethylene Oxide and Ethylene Glycol plants in Clear Lake, Texas, as a precautionary measure to prevent any damage to the facility. Following its footsteps, Braskem and Chevron Phillips have also announced the shutdowns of their production facilities in Texas. Braskem stopped its Polypropylene production in Texas, while Chevron Phillips closed its two crackers in Cedar Bayou, Texas.

Transportation in the Mid-West, specifically railroads, is under the biggest threat and remains most vulnerable to winter storms and snowfall. CSX, a major railroad company in the US, has warned of heavy snow and freezing rain in the Midwest, North-eastern US, and the Ohio valley.

The 2021 polar storm caught the US off guard, which in turn caused damages that amounted close to USD 200 billion; now, one can only hope that the US is better prepared for another stiff test presented by the perilous winter.