Mailiao PX unit runs at reduced rate after fire

OREANDA-NEWS. Taiwan's Formosa Chemical & Fibres (FCFC) is running its largest 870,000 t/yr Mailiao No.3 paraxylene (PX) unit as a standalone facility at reduced rates, only using isomer-grade mixed xylenes (MX) as feedstock following a fire earlier in the week.

An upstream reformer remains shut amid continuing safety checks and investigations into the cause of the fire on 22 September. There is no estimate as to when operations at the reformer will resume.

FCFC has resumed production at the PX facility to continue feeding two of its downstream purified terephthalic acid (PTA) facilities in Taiwan and another in east China's Ningbo. It is working towards resuming operations at the reforming unit as soon as possible because of squeezed MX-PX spreads. The company has also bought an undisclosed amount of MX and PX to supplement feedstock requirements for production following the fire on Tuesday.

A significant portion of Formosa's PX production in Taiwan is exported to its PTA unit in Ningbo as its PX is exempt from a 2pc import tariff, giving the company a feedstock cost advantage over other China-based PTA producers.

The September average naphtha-PX spread stood at \\$342.75/t on the day of the fire, according to Argus data, well above the \\$270-280/t that most other PX producers consider required to cover costs and breakeven. But the September average MX-PX spread was at \\$128.19/t, which is below the \\$150-160/t differential that most other standalone PX producers need to breakeven.