US PureCycle to miss output goal on shutdown at R-PP plant

HOUSTON (ICIS)–PureCycle will miss a production goal stipulated in its bonds because of another shutdown at its recycled polypropylene (R-PP) plant, the company said on Monday.

PureCycle’s Ironton bonds calls for the company’s plant to produce 4.45m lb (2,019 metric tonnes) of recycled PP pellets in a 30-day period at its plant in Ironton, Ohio, the company said.

The plant will not meet that production goal, so PureCycle will trigger on a 90-day cure period under its agreement with bondholders, the company said.

Shares of PureCycle were trading down by more than 35% to slightly above $3 in mid-morning trading.

PureCycle had shut down the plant because of a couple of mechanical problems that arose last week, the company said.

“The primary issues surrounded a leaking block valve and a mechanical seal failure,” PureCycle said. “The Ironton facility was safely shut down following the seal failure with no further equipment damage.”

The company is conducting maintenance at the plant, and it should be completed in the near term, PureCycle said. The company did not specify a timeframe.

PureCycle will complete that maintenance before it returns the plant to continuous operations.

The company stressed that these issues are unrelated to its core technology.

The latest production problems come less than two weeks after PureCycle announced that it had restarted following earlier work to address what it described as key reliability issues.

Under this project, the company installed a screen changer on the final product extruder. This will help with continuous pellet production. “Other operational improvements are evidenced by increased removal of impurities in the form of co-product one and co-product two through the purification process,” the company said.

PureCycle announced the startup of the Ironton plant midyear. It can produce 107m lb/year of R-PP.

PureCycle uses an alkane-based solvent process that removes all the pigments and dyes out of the recycled material and produces a relatively clear product. Unlike other solvent-based processes, PureCycle’s process does not produce a by-product. Instead, it uses butane in a closed loop-type system.

Thumbnail shows a container made of PP. Image by Shutterstock.