BASF Addresses Questions of Ludwigshafen Blast
Ten days after the deadly explosion that rocked its Ludwigshafen, Germany, headquarters site on Oct.17, BASF executives held a press briefing on the current state of play. As of Oct. 27 the group said all but eight of the 20 plants that had been shut down immediately after the blast were back on stream. The larger of the site’s two steam crackers had been restarted, with the smaller cracker due go back up imminently. The unspecified production facilities still off stream – said to be mostly along the ethylene chain – are to be ramped up again as soon as sufficient feedstock becomes available. The intermodal transport terminal is expected to reopen next week.
Despite the progress made, it will be some time before operations can return to normal, said managing board member Margret Suckale, who has responsibility for the Ludwigshafen site. Around a quarter of the site’s 200 production plants are still producing below capacity as their access to raw material has been capped. Ludwigshafen’s North Harbor, where the accident that produced four fatalities and seriously injured eight workers occurred, is expected to be out of service for a prolonged period, requiring a partial shift of supply routes to road and rail.
In the next several days, the Rhineland Palatinate public prosecutor’s office in Frankenthal, near Ludwigshafen, will begin its formal investigation into the chain of events that began with a fire, followed by an explosion. BASF chief Kurt Bock said the authority has waited to begin its work until it was sure that the site presented no further danger.
While authorities investigating the deadliest accident at BASF in decades will seek to determine the cause, the public prosecutor’s office in a preliminary report, on Oct. 26 said a pipeline containing a butylene mixture apparently had been cut just as maintenance was taking place in an adjacent pipeline. BASF management believes the butylene may have leaked and been ignited by sparks from an angle grinder used to carry out repairs.
In both cases, contractors – one of them a pipeline engineering firm that has worked for the chemical giant for 25 years – were carrying out the work. The explosion touched off subsequent fires at various points along a pipeline trench, Bock said. Pipelines used to transport ethylene, propylene, a butylene product mix (raffinate), pyrolysis gasoline and ethylhexanol were burned, and the Ethylene-Pipeline-Süd, which connects several German chemical sites, also was affected.
With numerous plants offline or operating below capability, BASF’s chief financial officer, Hans-Ulrich Engel, said sales from Ludwigshafen operations are currently averaging 10-15% below the usual level; however, the group hopes to be able to take up some of the slack as production is ramped up again. He confirmed management’s earlier forecast that EBIT before special items will be slightly below the 2015 figure.
While visibly shaken, board members addressing journalists sought to quell speculation that poor safety practices or inadequate oversight of outside firms working inside the complex may have paved the way for the Oct. 17 accident as well as an unusual string of other events occurring this year, including a leak of the toxic isocyanate feedstock phosgene in June.
Bock stressed that safety has always had the highest priority at BASF, and Suckale pointed to the high level of competence of the contractors working on-site, along with regular maintenance and inspections by supervisory authorities. She also underscored remarks made earlier by site manager Uwe Liebelt, that the start-up of a large number of new plants may have increased the risk of unexpected events.
Finally, Bock defended management against criticism of management’s communication policies in the aftermath of the incident, saying the public in the affected areas had been kept abreast of developments and local journalists informed via press releases as well as at press conference organized together with the local fire brigades. The Oct. 27 briefing – at which BASF presented additional third quarter figures – was the first time the CEO had addressed the press, however.
Due to the growing importance of social media, Bock said BASF may have to rethink and possibly broaden its crisis communication practices. The production complex’s neighbors and in part international media were informed via Twitter and Facebook as well as postings on the group’s German website.
Bock announced also that, parallel to the investigation by state authorities, BASF plans to conduct its own in-depth probe into the cause of the accident and draw conclusions for the future. Several “prominent experts” have been hired to draft a report, which he said will be made public.