Huntsman Corp. is counting its blessings this week, as it continues efforts to bring facilities in Texas and Louisiana back online following Hurricane Rita.
As of Monday, Huntsman spokesman Don Olsen said that all of the company's facilities outside Jefferson County, Texas, were in "various stages of startup" and should be operational again by Wednesday. Four manufacturing facilities — one in Port Arthur and three in nearby Port Neches — remain dark as the communities attempt to restore electricity, water and sewer services, Olsen said.
The company's administrative offices are in The Woodlands, Texas, about 30 miles from Houston. Its headquarters remain in Salt Lake City.
"We feel very fortunate," Olsen said Monday. "None of our employees suffered any injuries. The eye of the storm went right over our facilities in Jefferson County, and none suffered serious structural damage."
Two facilities in Louisiana also were shuttered — a titanium dioxide plant in Lake Charles and a facility near Baton Rouge. The Lake Charles plant was without power but is now operating via generator. The Baton Rouge plant wasn't significantly impacted and is operational, Olsen said.
Most of the 2,000 employees who were affected by the evacuations have returned to work, he said. Some of the remaining workers, mostly from Port Arthur and thereabouts, are in transit and should be back to work by midweek.
And the company's "logistics are in full swing" in Jefferson County, Olsen said. The company is bringing in mobile homes for employee use and generators to provide some power for limited operations.
"We've been assured by Jefferson County authorities that we, and the industry, are at the top of the list for power," he said. "We feel confident that we'll be able to restart operations sooner rather than later."
Though facilities should come back online relatively quickly, the company remains concerned about the availability of raw materials to make its products and the concomitant effect on consumer prices. Huntsman products are used in a bevy of consumer goods — from tires to toothpaste, laundry detergent to carpeting.
"We still have issues of raw materials supply," Olsen said. "We do not know to what extent our suppliers have been impacted. That will be ongoing. It is, I was going to say hour-by-hour, but in fact we are getting minute-by-minute updates as to the availability of raw materials. At this point, we are optimistic."
Rita may allow chemical makers to raise prices faster than raw-material costs after plants shut ahead of the storm.
"There has never been a time when this much capacity was shut down at any one time," CEO Peter Huntsman told Bloomberg News in a telephone interview from the company's Salt Lake headquarters Monday. "That should allow the chemical industry to enjoy better margins."
The industry probably will lose about 1 billion pounds of ethylene production from Rita, equivalent to the annual output of a major plant, Peter Huntsman said. Demand from manufacturers in the Midwest and elsewhere was little changed, and supplies probably will tighten further following plant shutdowns after Hurricane Katrina, he said.
"We are going to see a situation where product prices in the fourth quarter are going up, and raw-materials prices have plateaued or are going down," Huntsman said.
Other chemical companies with plants in the Gulf area also reported relatively minor storm-related problems Monday.
PPG Industries Inc., based in Pittsburgh, canceled deliveries of chlorine and related products from Lake Charles, La., its largest production site, after damage that included flooding, spokesman Jeff Worden said Monday. BASF AG spokesman Bob Guenther said a cooling tower at a plant in Port Arthur, Texas, had minor damage. Dow Chemical Co., Celanese Corp. and Eastman Chemical Co. said damage was minimal.
Westlake Chemical Corp. said its ethylene and styrene complex in Lake Charles, the Houston-based company's largest, had "minor physical damage." Westlake's vinyls plant in Geismar, La., sustained "minimal hurricane-related damage" and will resume production once natural-gas service is restored, the company said in a statement.
Contributing: Bloomberg News
E-mail: jnii@desnews.com