Ghaibi provided important explanations regarding the damages caused by gas restrictions on petrochemicals in winter. This restriction can have significant impacts on the production of petrochemical products and is calculated based on nominal capacities.
Impact of Gas Restrictions on Production
Gas restrictions, especially in methanol units where gas is the main feedstock, have a significant impact on production. For example, if a methanol complex with an annual nominal capacity of one million tons faces a production reduction for 15 days, it will produce about 20,500 tons less product. Assuming a selling price of $250 per ton of methanol, the potential lost sales value would be approximately $5.1 million. However, this figure does not represent the actual loss to the company. According to Ghaibi, if we hypothetically consider the difference between the selling price and variable costs per ton to be $50, the reduction in the unit's participation margin would be about $1 million.
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Calculations and Additional Costs
Ghaibi emphasized that to accurately estimate damages, the usual utilization rate, production costs, and recoverable production levels must be examined. For this reason, two complexes with similar capacities may experience different damages from the same gas restriction. He also explained the impact of gas restrictions on urea complexes, stating that this restriction first affects ammonia production and then urea. The extent of production decline in such complexes depends on the operational conditions of the ammonia unit, urea production capacity, and the ability to manage feedstock.
Ghaibi further warned about the hidden costs of production stoppage, stating that the duration of gas restrictions is not necessarily equal to the duration of production decline. He also referred to the role of sales contracts, noting that if the complex has sufficient inventory, a reduction in production may not immediately lead to export delays, but product reserves will decrease.
This petrochemical industry expert stated that production planning for this winter should be based on the actual capacity of gas supply, infrastructure status, and consumption scenarios during cold days. Ghaibi concluded by emphasizing that to calculate the actual damages, four indicators for each complex must be specified: the amount and duration of gas restrictions, lost production after accounting for recoverable amounts, additional costs of stoppage and startup, and costs arising from delays in sales commitments.
Read more: Analysis of the Damages from Gas Restrictions on Petrochemicals in Winter by Samaneh Ghaibi · Ghaempanah: The Necessity of Energy Consumption Management in Production Units During Winter
