July 6, 2009 / 5:47 PM / 10 years ago

UPDATE 1-Sunoco says shutting Marcus Hook ethylene complex

(Adds quotes, comment from union)

NEW YORK, July 6 (Reuters) - Sunoco Inc (SUN.N) said on Monday it will permanently shut the ethylene complex at its 178,000-barrel-per-day Marcus Hook, Pennsylvania, refinery due to insufficient demand, resulting in the layoff of 40-50 employees.

“Sunoco will permanently shut down production at the ethylene complex due to insufficient demand for ethylene, ethylene oxide, and cyclohexane which does not justify repairing or replacing equipment damaged in the recent fire,” spokesman Thomas Golembeski said in a statement.

The complex was the site of a May 17 fire caused by a pipe failure. The root cause of that failure is still being investigated, Golembeski said.

Sources said that the closure of the ethylene plant was not a complete surprise given that after the fire there was no money put back into the fire-damaged section of the plant.

Sunoco said it has begun negotiating with Local 10-901 of the United Steelworkers Union, which represents employees at the refinery, to finalize severance.

The union said that the 40-50 employees are from operations, maintenance and the lab at the plant, and it is looking to move some of the workers to other sites given that Sunoco has two other refineries in the region. (Reporting by Rebekah Kebede and Janet McGurty)

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