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Friday, June 06, 2014 2:09:23 PM
- demand/ prices rising as a result of weather
- mechanical issues resulting from the weather
In actuality, dealing with temperature changes with this equipment is fairly simple. All you have to do is to wrap a conductor around the pipe, and ,let Ohm's law go to work. That is why refinery equipment is usually outside, because this is easily dealt with. There are companies that specialize in this, and here is an example:
http://www.pentairthermal.ca/
The way that this is done, it is an Enginmeering function to write a Specification for the vendor describing the operating conditions that have to be dealt with (temperatures, pressures), and the equipment (like condensers) is ordered to suit.
Usually this is foolproof. That company (I worked for them once briefly) does 2 outages/ year, where they check and refurbish as necessary all of the pipe tracing in the plant at Fort Macmurray. It hits -50 there on a regular basis. So, your references were in the American Midwest, likely not as cold as that.
I think what happened this winter is that it was unusual. As a comparison, New Orleans had dykes in place before that storm hit. They talk about "100 year" storms. That means a storm that only occurs naturally, statistically, once every 100 years. They were not ready for Katrina. Now, that it happened, they are ready.
This has been a problem. One of my other stocks, Essential Energy Services, was impacted by severe weather as well.
In the case of JBI.. they are blaming this for shutting them down. The fact that their plant is indoors raises questions, but more importantly they cannot recover from it because of their finances.
What seems strange is that if proper enginmeering practices were followed, this should not have happened to this extent. If the parts were not specced properly, it is JBI's falt. If not, it is the vendor's fault and would be covered by warranty. If they were specced properly and it was just an unexpectedly bad winter... JBI should have been able to recover from it.
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