Rebuilding of Huntsman's Port Arthur plant doubtful

06-Jul-06

Damage caused by a fire in April at Huntsman Chemicals' Port Arthur facility, accounting for 30% of the company's ethylene production, has rendered the plant shut. Huntsman, USA's fifth largest chemical may not rebuild this plant, if damage caused by the fire exceeds anticipation. The rebuilding assessment, expected to be complete by the end of the month, has been delayed by damage that prevented flaring of combustible chemicals. Huntsman's long term plans encompass selling or spinning off itscommodity chemicals business to focus on specialty chemicals, where demand is robust and growing. As part of its focus on specialty chemicals, Huntsman plans to commence operations at a new MDI (diphenylmethane diisocyanate) plant in China. As MDI continues to record spectacular growth in China, the country could face a supply crunch in the coming years. Huntsman is the world's biggest producer of MDI, sales of which helped boost profit in the polyurethanes business by 86% last year to US$676.3 million.