Sources contacted by SSESSMENTS.COM commented on the impact behind the fire accident at Taiwan Formosa’s RDS unit. As reported, Taiwan’s Formosa Petrochemical Corp. No.2 residue desulphuriser (RDS) unit with a capacity of 80,000 barrels-per-day (bpd) was caught on fire on Wednesday morning, July 15. Upon the incident, the company shut the residue desulphuriser (RDS) unit at its 540,000 barrels-per-day (bpd) Mailiao refinery. Mailiao is counted as one of the 10 largest standalone refining plants based in Asia.
To date, the producer’s spokesman has yet to give an official statement regarding the impact. However, some market players told SSESSMENTS.COM that the accident will primarily affect the propylene supply. Some others heard that it might affect the company’s PE plant. Meanwhile, the rest said that the outage should not affect PVC production unless they shut the whole complex. On the other hand, the company may be forced to shut the entire complex for investigation purposes. If so, the company will likely reschedule the maintenance shutdown rather than losing more volume due to the shutdown stemming from the fire accident.
Furthermore, SSESSMENTS.COM noted that the impact of the accident will also hit the output of low-sulphur residual fuels used either in blending to make very low sulphur fuel oil (VLSFO) for bunkering, or fed into other secondary units for gasoline or gas-oil production. Sources added that Formosa has cut the export of VLSFO this month due to squeezing margins.
