Workers returned to the site of an $11 billion chemical project for Sasol Ltd. in Lake Charles this week. But according to a report in Bloomberg, construction workers turned up at “lower-than-usual” levels.
The site closed on Aug. 26 as Hurricane Harvey bore down on the Gulf region of Texas and Louisiana.
The project, which includes a world-scale ethane cracker with the capacity to produce 1.5 million tons of ethylene a year, has already been delayed by weather and “poorer-than-anticipated subsurface conditions.” Last year, the company raised the estimated costs to build the plant and lowered its expected returns.
Meanwhile in Texas, the Houston Chronicle reports that many chemical makers are also struggling to get petrochemical plants running again. In fact, 54 percent of the country’s total capacity for gas-derived ethylene remains offline — a situation that has led to a shrinking supply of this key chemical and rising prices.
About 41 percent of propylene production is also still offline.
According to a report from IHS Markit this week, many plants are still being examined for damage. Several ports in the area are also still closed or restricted.
The trucking industry has also been hampered by flooding and IHS expects that the costs for chemical and plastics producers to “secure truck capacity and move backlogged freight will rise.”