Williams Cos., the owner of a Louisiana chemical plant that remains shut after a fatal explosion, said insurance will cover most of the loss.
An explosion June 13 at Williams Partners LP’s Geismar plant killed two people and caused an undetermined amount of property damage, Tulsa-based Williams said at an investors’ presentation today. The company has $500 million in property- damage and business-interruption insurance and $610 million in liability insurance, according to company slides.
The plant would need to be closed until the middle of next year to exceed coverage limits, which is unlikely, according to a note today from Tudor Pickering Holt & Co. in Houston. Analysts at Tudor Pickering upgraded Williams to hold.
Williams is waiting for investigations by the U.S. Chemical Safety Board and the Occupational Safety and Health Administration to end and doesn’t know when the plant will reopen, Chief Financial Officer Donald Chappel said today at a Credit Suisse conference.
The company, which expected $190 million profit in the second half of this year from the plant, plans to issue updated financial guidance July 31.
The facility, 60 miles (97 kilometers) northwest of New Orleans, processes natural gas liquids into ethylene and propylene, which are raw materials for the chemical industry.
Editors: Jasmina Kelemen, Charles Siler