South African energy group Sasol temporarily shuts its chemical complex in Lake Charles, Louisiana, the company said. Industry sources said the company was assessing damages before determining whether to resume operation. Sasol said that it would continue to monitor the situation and restart production when the condition is safe.
Sasol’s $13-billion Lake Charles Chemicals Project (LCCP) includes 1.5 million tons/year cracker, a 470,000 tons/year LLDPE unit, a 380,000 tons/year EO/MEG unit, and a new 420,000 tons/year LDPE plant which is expected to start up in September. The project experienced repeated delays due to mismanagement and other issues. Its estimated costs also swole from $8.1 billion when announced in 2014 to $12.9 billion.
Hurricane Harvey caused construction delays at the project’s expansion in 2017. The startup of the LDPE unit was also delayed due to fire earlier this year. It remains unclear whether Laura caused significant damages on LCCP, which will put additional pressure on Sasol.
Sasol reports a $5.2 billion loss in the fiscal year of 2019-2020 as troubles at this project incurred massive writedowns. The company is now working on raising $2 billion to shore up its balance sheet through asset divestiture. Hanwha Solutions, Ineos, CPChem, and LyondellBasell had reportedly submitted bids to acquire a large stake in LCCP.
