Texas Petrochemicals, affiliates file Chapter 11

Texas Petrochemicals LP and its affiliates, Texas Petrochemical Holdings Inc., Petrochemical Partnership Holdings Inc., TPC Holding Corp. and Texas Butylene Chemical Corp., announced Monday they have voluntarily filed for Chapter 11 bankruptcy. Houston-based TPLP owns and operates petrochemical manufacturing facilities in Houston and operates product terminals in Baytown and Lake Charles, La. The companies said the Chapter 11 filings will facilitate financial restructuring made necessary by declining demand for the additive MTBE in gasoline due to regulatory changes. In addition, the companies said higher raw material and energy costs will likely result in their future cash flows being insufficient to meet subordinated bond debt obligations over the long term. The Chapter 11 filings will allow the companies to reduce significantly and restructure their debt while permitting TPLP to continue to operate its core profitable business sectors of butadiene, specialty chemicals and gasoline alkylate. No plant closures are expected as a result of the filings, and the restructuring will have only minimal impact on day-to-day business operations, according to a report by Market Wires. E. Joseph Grady, TPLP's chief financial officer, said the company "will have more than sufficient liquidity to fund the restructuring process and the cash requirements necessary for our ongoing businesses, including its operating needs, working capital, capital expenditures and other purposes during the bankruptcy case." TPLP specializes in hydrocarbon products that are used as chemical building blocks for synthetic rubber, nylon carpets, adhesives, catalysts and additives used in high-performance polymers. TPLP also manufactures fuel products used in the formulation of cleaner burning gasoline.