Coastal to Close Montreal Facility

The Coastal Corporation recently announced that its subsidiary, Petrochimie Coastal du Canada, will temporarily suspend operations at its facility in Montreal East, Quebec.

This action is being taken because current market conditions for paraxylene are very depressed, and forecasts indicate that these conditions will continue for the near term.

The facility will begin terminating operations early next month. Currently, Petrochimie du Canada employs 88 people; 16 employees are expected to be retained after operations at the facility are temporarily suspended.

While Coastal remains optimistic about the long term prospects for paraxylene, which is a key component in the manufacture of polyester, market conditions have degenerated due to the excess production capacity of paraxylene and the impact of the Asian financial crisis.

Coastal plans to restart the Montreal East paraxylene plant as soon as the supply/demand conditions provide the necessary economic support.

The Coastal Corporation is a Houston, TX-based energy holding company with operations in natural gas transmission, storage, gathering, processing and marketing; petroleum refining and marketing; oil and gas exploration and production; chemicals; power production; and coal.