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July 2009
President’s Message: Climate Change Bill Passes U.S. House
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TCC President & CEO
Hector Rivero |
On Friday, June 27th, the U.S. House of Representatives passed the Waxman-Markey bill (H.R. 2454) intended to address climate change and transform the way the nation produces and uses energy. The Climate Change bill passed 219 to 212, with forty-four Democrats voting against the bill, while eight Republicans crossed the aisle to vote in favor of the measure.
The vote was the first time either house of Congress has approved a bill aimed at curbing greenhouse gases some scientists have linked to climate change. The legislation, which passed despite deep divisions among Democrats, could lead to profound changes in many sectors of the economy, including electric power generation, agriculture, manufacturing and construction.
At the heart of the legislation is a cap-and-trade system that sets a limit on overall emissions of greenhouse gases while allowing utilities, manufacturers and other emitters to trade pollution credits, or allowances, among themselves. The cap would grow tighter over the years, pushing up the price of emissions and presumably providing incentives to industry to find cleaner ways of producing energy.
The final bill has a goal of reducing greenhouse gases in the United States to 17 percent below 2005 levels by 2020, and 83 percent by mid-century.
The bill also sets a national standard of 20 percent for the production of renewable electricity by 2020, although a third of that could be met with efficiency measures rather than renewable energy sources like solar, wind and geothermal power. It also devotes billions of dollars to new energy projects and subsidies for low-carbon agricultural practices, research on cleaner coal and electric vehicle development.
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(left to right) Railrod Commissioner Michael Williams, Governor Rick Perry, TCEQ Commissioner Bryan Shaw and TCC President & CEO Hector Rivero.
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Weeks before the House vote, I attended roundtable discussion – hosted by Texas Governor Rick Perry – with state and industry leaders to discuss concerns about the proposed impact of climate change legislation on the Texas economy. The Governor was joined by Comptroller Susan Combs, Railroad Commissioner Michael Williams, Public Utilities Commission Chairman Barry Smitherman, Texas Commission on Environmental Quality Commissioner Bryan Shaw, and industry leaders from across the state for the discussion.
While industry is divided on the best approach to address climate change on the federal level, the Texas Congressional delegation should carefully and thoughtfully consider the impact of any climate change legislation, particularly on the Texas economy and Texas jobs.
The State of Texas fuels the nation’s economy. Texas is the country’s leading energy producer, supplying 20 percent of the nation’s oil production, one-third of the nation’s natural gas production, a quarter of the nation’s refining capacity and nearly 60 percent of the nation’s chemical manufacturing. Simply put, as a large greenhouse gas emitter, Texas has a lot to lose in the face of costly climate change regulations that could threaten our state’s ability to provide energy and other products to the nation.
Any law regulating greenhouse gas emissions will impact every Texas energy consumer and all aspects of Texas business.
U.S. greenhouse gas regulation will increase the cost of developing and producing domestic energy supplies, leading to a greater dependence on foreign energy sources. As such, any federal legislative attempt to reduce or regulate greenhouse gas emissions must be subject to an honest, thorough and transparent debate, including the impact that such legislation will have on the nation’s economy, international competitiveness and American jobs.
Climate change and the competiveness of our country and the manufacturing sector are too important for trial and error. The economic, trade and employment implications of climate policy are profound and the potential for unintended consequences are limitless.
Members of Congress should aggressively ensure that the Texas economy remains competitive in the global marketplace and protects our industrial and manufacturing investment in Texas and the more than one million jobs that depend on our industries for their livelihood. |
TCC Releases 2009 Legislative Report
The Texas Chemical Council has distributed to members its 2009 TCC Legislative Report. This report is a summary of the major issues of importance to the Texas chemical industry.
“I’d like to recognize and thank the members of our TCC Advocacy Committee and the TCC staff for all their hard work throughout the legislative session,” said TCC President & CEO Hector Rivero. “A special thanks to Christina Wisdom, TCC Vice President & General Counsel, for her tireless work in managing our legislative agenda, providing our members with weekly legislative updates throughout the session, and compiling this Legislative Report.”
To view the report, click here: 2009 TCC Legislative Report
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Gov. Perry Calls Special Session of Legislature for July 1st
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Texas Governor
Rick Perry |
Gov. Rick Perry is summoning lawmakers back to the Texas Capitol on July 1 for a special session to make sure key state agencies keep operating, take up highway bonds and consider public-private transportation partnerships.
These matters were left unaddressed when the Legislature adjourned June 1. Perry recently told reporters he expects lawmakers to finish their work in 72 to 96 hours.
The governor sets the agenda for special sessions and determines when they start. Perry said he would not place the contentious issue of voter identification before lawmakers, even though the call for stricter voter identification is a priority for GOP leaders and lawmakers. A fight over the issue stalled action in the regular session and undoubtedly would tie up the special session, which can last up to 30 days.
Agencies that need legislation to continue include the Texas Department of Transportation, Department of Insurance, Racing Commission, Office of Public Insurance Counsel and State Affordable Housing Corporation. In addition, the Legislature plans to delay the sunset review of most health and human service agencies until 2013 and move sunset review of Article VI agencies (which includes the Texas Commission on Environmental Quality) up to 2011.
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Art Colwell of BASF Elected to Chair Texas Chemical Council
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TCC Chairman
Art Colwell of BASF |
The Texas Chemical Council (TCC) has announced the election of Art Colwell of BASF as its new Chairman of the Board. Colwell, who has served as Vice Chairman, was elected by the Board of Directors to fill the unexpired term for Steve Wood, who recently elected to retire from LyondellBasell. Rick Roberts of Chevron Phillips Chemical was elected as the new TCC Vice Chair. Gary Hockstra of Dow Chemical was elected Secretary-Treasurer.
Colwell is Vice President and General Manager at BASF’s Freeport, Texas site, overseeing operations of 24 plants that manufacture 23 different products including acrylic acid used in textiles, adhesives, and plastics; superabsorbent polymers used in baby diapers; carpolactam used in nylons and solvents; and intermediate chemicals like oxo alcohol and butanols used to produce polyesters, surface coatings and plasticizers. Colwell joined the BASF Corporation as a chemist in 1978. He earned a bachelor’s degree and a master’s of science degree in chemistry from the University of Alabama. Colwell has been an officer on the TCC Executive Committee and has served as Chairman of the TCC Water & Waste Management Committee.
TCC Vice Chair Roberts is the Senior Vice President of Manufacturing at Chevron Phillips Chemical Company LP, headquartered in The Woodlands, Texas. Roberts has a key role in maintaining and upgrading Chevron Phillips Chemical’s U.S. asset portfolio. Roberts graduated with honors from Purdue University in 1976 with a bachelor’s of science degree in chemical engineering and an MBA from Pepperdine University in 1980. He joined Chevron in 1976 holding a variety of engineering and operations positions and several plant manager assignments including Cedar Bayou Plant Manager in Baytown, Texas. Roberts previously served as TCC Secretary-Treasurer and Chairman of the TCC Outreach Committee.
TCC Secretary-Treasurer Hockstra is Vice President & Site Director of Dow Chemical’s Texas operations. Hockstra joined Dow in 1980 working in Research & Development in Midland, Michigan. He has had Dow assignments in the Netherlands and Italy before moving to Texas in 1996. Hockstra earned his degree in Chemical Engineering from Michigan State University. He was named to his current position in 2007. Hockstra has served on the TCC Executive Committee and chairs the TCC Tax Committee.
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Chemical Industry Recognizes Excellence in Safety & Service
The chemical industry recently recognized Texas Chemical Council (TCC) member companies who have excelled in community service and safety operations throughout 2008. Awards were presented at the TCC/ACIT Awards Banquet, held on June 11th, at Moody Gardens Resort in Galveston.
“Caring for Texas” Awards
Fourteen Texas chemical companies were recognized by their industry peers and communities for extraordinary efforts in safety, security, environmental protection and community outreach as part of the annual “Caring for Texas” Awards program.
Those companies are: Albemarle Corporation; BASF Corporation; Bayer MaterialScience, LLC; Champion Technologies, Inc.; Chevron Phillips Chemical Company; The Dow Chemical Company; DuPont; ExxonMobil Chemical Company; Formosa Plastics Corporation; Huntsman Corporation; LyondellBasell Industries; Marathon Petroleum Company; Nalco Company; and OXEA Corporation.
The Texas Chemical Council “Caring for Texas” award program promotes continuous improvement by TCC member companies relative to their performance in community awareness, emergency response, security, and pollution prevention. Applications for the awards are reviewed by judging panels composed of industry leaders and residents of communities near Texas chemical plants.
“Caring for Texas award winners represent the state chemical industry at its very best,” said TCC President and CEO Hector Rivero. “These companies and their employees have demonstrated continued improvements in air quality, reductions in energy consumption, and reusing and recycling a wide range of materials.”
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Sustained Excellence in Caring for Texas:
Chevron Phillips Chemical Company - Port Arthur. (left to right) Vicki Derese, Jim Becker, Steve Wood (Chair), Adrian Stovall and Phil Cuevas. |
Three categories of awards – Excellence, Sustained Excellence and “Caring for Texas” – were presented at the banquet, where winners representing a range of facility sizes were recognized for their efforts in 2008. These companies and their facilities are listed by category at the following awards link, which also includes a link to the award ceremony photographs.
“Best in Texas” Safety Awards
TCC has named four chemical plants the “Best in Texas” for safety in recognition of the facilities’ demonstrated commitment and exemplary results toward safe operations during 2008.
The “Best in Texas” awards program is designed to promote continuous improvement in safety performance by TCC’s 77 member companies, which operate about 200 manufacturing plants throughout the state. To win the award, a facility must demonstrate leadership through implementation of safety-related programs supported by TCC.
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Best in Texas (501+ employees):
BASF Corporation - Freeport
(left to right) Art Colwell, Steve Reed, Bobby Laughlin (Chair), Bryan Stewart and Leonard Schooler. |
“Best in Texas” awards are given in four categories defined by number of employees. Winners in 2008 include:
(1-60 employees)
- Texas Brine Company Baytown LLC, Mont Belvieu
(61-200 employees)
- INEOS Nitriles, Green Lake
(201-500 employees)
- DuPont La Porte Plant, La Porte
(500 or more employees)
- BASF Corporation, Freeport
About two dozen Texas chemical plants qualified to participate in the “Best in Texas” competition, which was judged by a panel of industry peers. Other recognitions for safety were awarded for Zero Incident Rate, Zero Contractor Incident Rate, and Occupational Safety Distinguished Service. Those award winners are listed here, which also includes a link to the award ceremony photographs.
A.D. Cyphers Safety Professional of the Year
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A.D. Cyphers Safety Professional of the Year: Ed Tyler, retired, Albermarle, with Bobby Laughlin (Safety Chair). |
The 2009 A. D. Cyphers Safety Professional of the Year award was presented to Ed Tyler of Albemarle Corporation.
The Occupational Safety Committee’s A. D. Cyphers Safety Professional of the Year award was created in honor of A.D. Cyphers, one of the most dedicated and active chairmen of the Occupational Safety Committee. He increased the recognition of the committee within TCC and was the catalyst for improving the TCC/ACIT Environmental Health & Safety Seminar so industry could be proud of our product.
The design of the award reflects A.D.’s long association with and affection for the Texas Rangers. Industry peers who participate on the TCC Occupational Safety Committee determine the winner. Other nominees were:
- Glenn Johnston, LyondellBasell Industries
- David Womack, Bayer MaterialScience
- Maria Gallegos, Texas Brine Company
- Bob Brennecke, BASF Corporation
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ACIT Awards Regional Members of the Year at Awards Banquet
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ACIT Regional Member of the Year: Region 3: Stephanie Flory, Desselle-Maggard Corporation, with Cherie Laughlin (Chair). |
Each year, the Association of Chemical Industry of Texas (ACIT) recognizes a Regional Member of the Year in each of the four active ACIT regions. These recipients are individuals who have exhibited extraordinary dedication to their ACIT Region in 2008.
Nominees are selected and recognized by the ACIT Board of Directors. This Award is presented to both the individual winners and to their companies for allowing these individuals to actively participate and promote ACIT.
Region 1 – Houston/Ship Channel Member of the Year is Mike Huddleston of Training & Development Systems in Houston.
Region 2 – Mid Coast Member of the Year is Rick Kaufman of Nalco Chemical Company in Pearland.
Region 3 – Golden Triangle Member of the Year is Stephanie Flory of Desselle-Maggard Corporation in Port Arthur.
Region 4 – South Texas Member of the Year is Robert Morris of Repcon in Corpus Christi.
“These members volunteer countless hours in planning and organizing ACIT events and recruiting new members in their region,” said ACIT Chair, Cherie Laughlin of Bayer MaterialScience. “We congratulate each of these winners and their companies for their commitment and support to ACIT,” she added.
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2009 EHS Seminar a Success for Attendees, Exhibitors and Sponsors
The 2009 TCC/ACIT Environmental Health & Safety (EHS) Seminar held June 8 – 11th at Moody Gardens Resort in Galveston brought nearly 550 attendees, 117 speakers, 100 sessions, more than 45 exhibitors.
A special thank you to our EHS sponsors this year:
• ABS Consulting • Formosa Plastics
• Baker Engineering & Risk Consultants • MB Industries
• BASF • RPS JDC, Inc.
• Bayer MaterialScience • RSC Equipment Rental
• BEI Engineers • Team Industrial Services
• Chevron Phillips Chemical Company • VisionMonitor Software
• Cole Chemical & Distributing • Webb, Murray & Associates
• Eastman Chemical Company • Westex
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EHS Seminar Committee
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TCC/ACIT would also like to thank the EHS Seminar Committee for all their hard work in planning this seminar and delivering another excellent seminar. Presentations will be available to attendees on June 22nd at www.ehs-seminar.com.
Next year, additional exhibitor booths will be available, which go quickly, so please sign up early if you are interested. Please mark your calendars for the 2010 EHS Seminar which will take place June 7 – 10, 2010, at Moody Gardens in Galveston.
The EHS Seminar Committee photo from left to right:
Front Row:
Mark Hernandez, OSHA, Kristy Stewart, RMT, Inc. (2011 Chair), Steve Mason, US EPA Region 6, Stephanie King, GB Biosciences and Larry Hensley, INEOS
Second Row:
Leslie Ray, LyondellBasell Industries, Nicole Porter, Repcon, Inc., Kim Hubenak, LyondellBasell Industries, Darlyne Harlan, Texas Chemical Council, Kimberly Dejmek, Baker Engineering & Risk Consultants (2009 Chair), Kari Teague, Castolon LLC, Ray Supak, INEOS and Steve Reed, BASF
Third Row:
Phil Cuevas, Chevron Phillips, Sheryl Kuhfeldt, Webb, Murray & Associates, Doreen Harvey, Nalco Company, Maria Gallegos, United Brine Services, Jim Thompson, ABS Consulting and Lee Ethridge, Castolon LLC
Fourth Row:
Buster Keasler, LyondellBasell Industries, Brandt DeLany, Process Safety & Reliability Group, Larry Green, DuPont, Robert Brennecke, BASF (2010 Chair) and Lee Haring, The Lubrizol Corporation (2008 Chair)
Those on the committee not present in the photo are:
Desiree Evans, BIC Alliance, Kathey Ferland, Center for Energy and Environmental Resources, Melinda Fowler, Nalco Company, Jim Hosel, Securitas Security Services, Dan Lehtola, Huntsman, Brady McCollum, Rohm & Haas, Jack McVaugh, Environmental Technology Management, Dewey Miles, Rohm & Haas, Kathy Pearson, Rohm & Haas, Angie Rochen, Weston Solutions and Sterling Simoneaux, BASF
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ACIT South Texas Hosts Another Successful Luncheon at Flint Hills in Corpus Christi
The ACIT South Texas 2nd Quarter Luncheon was held on June 3rd at Flint Hills Resources in Corpus Christi, with more than 100 attendees.
The luncheon’s guest speaker was Adam Cohen, Southwest Development Manager for E.ON Climate and Renewables, which constructs wind farms throughout the world. He gave a report on the Wind Farm currently being built outside of Taft, TX. E.ON started working on the Taft project located in San Patricio County in 2006, completed in September 2009 and expects to provide enough power for over 100,000 homes in the area. Special thanks to our sponsors:
• Flint Hills Resources • KnightHawk Engineering
• Houston 2-Way Radio • Repcon, Inc.
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ACIT Golden Triangle Hosts Golf Tournament in Beaumont
The ACIT Golden Triangle Region held their golf tournament on June 26th at the Bayou Din Golf Course in Beaumont. The tourney had more than 60 players in attendance, with 14 sponsors:
• AltairStrickland • MMR Constructors
• AXion Logistics • RSC Equipment Rental
• Baker Concrete Construction • Sunbelt Supply
• CBS Catering • Superior Supply
• CHEMTREAT • The Mundy Companies
• ENGlobal Engineering • Tiger Tower Services
• Huntsman • Triangle Waste
The 1st place winners were Kenneth Holder, Ron Landry, Chris Pulyer and David Ess of Baker Concrete. All photos of the event can be found here.
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Harris County Commissioners Court Approves Houston Ship Channel Security District
The Harris County Commissioners Court recently approved a measure to further improve security for employees, residents and facilities surrounding the Houston Ship Channel.
The unanimous court vote gave final approval for creation of the Houston Ship Channel Security District, a public-private partnership that will fund enhancements to security technology, infrastructure and processes in the area. The district was created in legislation that passed in 2007. TCC was heavily involved in the negotiations of that bill.
Supported by private industry, law enforcement and public officials, the district is intended to deter terrorism, theft and other safety and security issues. Security district projects and services apply to members within the district who have waterside and landside facilities, as well as associated supply chain and support industries surrounding the Ship Channel.
The improved processes and technology, along with additional personnel, will be applied during hurricanes, evacuations or plant upsets. Plans will mitigate disruptions and help members recover and restore normal operations more quickly.
“I’m proud of local industry leaders who were instrumental in establishing the nation’s first port security district,” said TCC President & CEO Hector Rivero. “The Houston Ship Channel Security District is already proving to be a model public-private partnership for other industrial complexes across the country.”
A board of directors, to be elected by the security district members, will govern the district. At least eight directors from private industry will be selected to represent the district’s security zones. Three other directors will include one representative each from the port authority, the county, and the Harris County Mayors and Council Association.
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ACC Economist: Chemicals Production Will Rise in 2010 & 2011
For 2008 as a whole, overall chemistry output in the U.S. slipped 4.7% and Thomas Kevin Swift, chief economist of the American Chemistry Council, now expects chemicals production to fall 8.1% in 2009 before recovering 1.6% growth in 2010 and 2.2% in 2011.
“The U.S. chemical industry has experienced the worst decline since the 1980s,” says Swift, “but the decline has moderated. Along the supply chain, inventories-to-sales ratios for chemicals have improved over the past few months, but remain historically high,” says Swift. Still, “it appears that the massive destocking of 2008 and into the first quarter of 2009 is dissipating.”
The economist says the global chemical industry appears to be recovering led by the emerging Asian economies. “Global chemical output is expected to slip 6.3% in 2009 before recovering in 2010 and 2011,” Swift says. “Growth in developing economies will outpace that in developed countries which saw steeper output declines.”
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Huntsman Reaches $1.7 Billion Settlement with Lenders
The Huntsman Corporation reached a settlement with two banks – Credit Suisse and Deutsche Bank – it had sued in relation to failed acquisition deals with Dutch chemical maker Basell and Hexion Specialty Chemicals Inc. of Columbus.
The settlement is worth about $1.73 billion in cash, debt financing and other costs. The case involving The Woodlands, Texas-based company went to trial in mid-June in Texas state court, with Huntsman seeking $4.6 billion in damages.
Under the terms of the agreement, the banks were to give $620 million in cash to Huntsman along with $500 million senior secured term loan financing, $600 million in unsecured note financing, and $12 million for reimbursement of litigation fees.
The deal follows a $1 billion settlement with Hexion and its parent company, Apollo Management LP, in December 2008. Private equity firm Apollo had led a proposed deal for Hexion to acquire Huntsman, but that transaction fell apart in 2008 when the banks backed away from the deal. Huntsman in 2007 had been in talks to be acquired by Basell but walked from the deal in favor of a higher offer from Hexion.
Huntsman said the proceeds would be used to repay debt and reduce the size of the company’s revolving credit facility. “The cash and financing will enhance our already enviable cash position to more than approximately $1.7 billion and provide us much greater flexibility as we manage our business,” CEO Peter Huntsman said in a statement.
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Enterprise and TEPPCO Agree to Merge
Enterprise and TEPPCO have announced definitive agreements to merge to form the largest publicly traded energy partnership with an enterprise value of more than $26 billion. The combined partnership, which will retain the name Enterprise Products Partners L.P., will access the largest producing basins of natural gas, natural gas liquids (NGLs) and crude oil in the U.S., and serve some of the largest consuming regions for natural gas, NGLs, refined products, crude oil and petrochemicals.
The combined partnership will own almost 48,000 miles of pipelines comprised of over 22,000 miles of NGL, refined product and petrochemical pipelines, over 20,000 miles of natural gas pipelines and more than 5,000 miles of crude oil pipelines. The combined partnership would also be one of the largest inland tank barge companies in the U.S.
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LyondellBasell to Cut U.S. MTBE by Two-Thirds
LyondellBasell will cut methyl-tertiary butyl-ether (MTBE) production by nearly two-thirds once it begins making bio-ethyl tertiary butyl ether (ETBE) at its Channelview complex in Texas in the fourth quarter, sources said recently.
MTBE capacity at the Channelview complex is about 42,000 bbl/day, market sources told ICIS news, but following the switch to ETBE, only about 12,000-15,000 bbl/day of MTBE will be made at the site.
LyondellBasell spokesman David Harpole confirmed that the Netherlands-based company would still produce the gasoline additive MTBE at Channelview, as it remains committed to producing ethers. But he would not comment on capacity, future or present, at the Texas plant.
Traders said they anticipated MTBE production cutbacks and expected that the move would significantly decrease the availability of MTBE on the spot market. “This will definitely make the South American market tighter,” said a US Gulf coast-based trader.
The US has largely phased out MTBE in gasoline, favoring ethanol as an oxygenate for gasoline. However, MTBE is still used as a gasoline additive in the rest of the world.
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SMRP Symposium: August 27 & 28 in Galveston
The Houston Chapter of the Society for Maintenance and Reliability Professionals (SMRP) will present the 3rd Annual Maintenance & Reliability Symposium (MaRS) on August 27 & 28, 2009 at Moody Gardens in Galveston. TCC and ACIT encourage its members to attend the Symposium.
Program highlights include technical presentations dealing with Real Time Issues on topics from the SMRP 5 Pillars of the Body of Knowledge: Business Management; Process Reliability; Equipment Reliability; People Skills; and Work Management.
Six papers will be presented in each of the tracks – 30 in all. Attendees will have a multitude of opportunities for professional development and interaction with industry professionals about the latest strategies and techniques for boosting the performance of their facility. Presentations by representatives from: Bayer; BP; Cargill; Shell; Total; Siemens; Kirby Logistics; etc.
To register click here.
Advance registration is $200 per person. Registration will be $250 after August 1st. To exhibit or sponsor the event, please contact Bobby Massengale at (281) 960-7957. The exhibitor fee is $525; sponsorships are platinum $2,000; gold $1,000; and silver $525.
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Upcoming TCC & ACIT Events
July 23 – ACIT Houston Ship Channel is hosting a dinner cruise on July 23 on the FantaSea Yacht Charters in League City. The registration fee of $125 includes dinner and unlimited beverages. To register click here.
August 20 – Golden Triangle Regional Dinner, Beaumont
August 26 – South Texas 3rd Quarter Luncheon – Flint Hills Resources, Corpus Christi
August 27 & 28 – SMRP 3rd Annual Maintenance & Reliability Symposium at Moody Gardens in Galveston
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