Phillips 66 delays Sweeny startup after mechanical failure

Sweeny is the largest refinery by capacity in the portfolio of Phillips 66, Houston’s biggest Fortune 500 company. (Ryan Holeywell/Houston Chronicle)
Sweeny is the largest refinery by capacity in the portfolio of Phillips 66, Houston’s biggest Fortune 500 company. (Ryan Holeywell/Houston Chronicle)

A temporary mechanical failure caused Phillips 66 to delay the startup of its new natural gas liquids fractionator southwest of Houston from the beginning of October until later this year, spokesman Dennis Nuss confirmed.

The 100,000-barrel-a-day Fractionator One project at Phillips 66’s Sweeny complex is part of a $3 billion capital expansion project in southern Texas launched last year. A fractionator takes natural gas liquids and separates them out into individual component products like ethane, butane and propane.

“We experienced a mechanical issue with a furnace during startup of the Sweeny Fractionator One,” Nuss said in an email response. “We are working on repairs and expect to start up by the end of the fourth quarter. The associated storage caverns and pipelines have been completed and are ready to support the fractionator.”

Houston-based Phillips 66 had planned to build a second fractionator, but it was delayed because of weak market conditions. The project is still in the works though and a final investment decision on the project is expected in 2016, Nuss said. The same timeline applies to a potential Eagle Ford pipeline.

In the spring, Phillips 66 shelved plans for building a condensate splitter at the Sweeny complex, and Nuss said the project “remains on hold while we reevaluate the opportunities the current market presents.”

However, construction is ongoing for Phillips 66’s 4.4-million-barrel-per-month liquid petroleum gas export terminal in Freeport. It’s expected to be done in the second half of 2016. The Freeport and Fractionator One projects combine to cost about $3 billion.

Phillips 66 said Monday it is cutting its 2016 capital spending by nearly 20 percent, although its growth is focused largely on pipeline, storage and terminal projects. The company is building more pipelines to carry crude from North Dakota’s Bakken Shale, while also increasing storage capacity closer to home at its Beaumont terminal in Nederland. Phillips 66 is building the Bayou Bridge pipeline to move crude from Texas to Louisiana markets.

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