Eastman’s specialty copolyester, acetate tow business hardest hit by Jan. 31 mishap

KINGSPORT, Tenn. (WJHL) – Eastman Chemical Co. will need a month or more to bring its specialty copolyester production back to full operations following a Jan. 31 steam line failure that shut down operations across its Kingsport plant.

In a news release detailing expected financial impacts, the company said all areas of the massive plant “are safely returning to operations as quickly as possible.” Eastman noted specialty copolyesters was “the primary impacted area.” It expects a four to six-week recovery period.

Eastman has opted to bring forward a normal four-week maintenance shutdown that normally occurs in late March to decrease the financial impact to that segment.

The release also included the first set of public comments from Eastman CEO Mark Costa, who said he was “incredibly thankful that no one was seriously injured.”

Costa’s comments come one week after the line failure injured five workers, scattered pipe insulation and other debris over several blocks of adjoining neighborhoods and shook the ground over a radius of several miles.

Eastman “continues to assess the financial impact of the incident,” the release said. The company is pulling forward fixed and maintenance costs into its first-quarter report. It also expects “modest impact on sales volume in specialty copolyesters and acetate tow.”

The earnings projection for all of 2022 was unchanged from Eastman’s Jan. 27 earnings report for 2021, which projected 2022 earnings of $9.50 to $10 per share. That report came just four days before the steam line failure.

Monday’s release said strong earnings in January “reflecting robust underlying business conditions” leave the company estimating first-quarter earnings of between $2.05 and $2.25 per share.

In his statement, Costa thanked Eastman employees “for their quick response to the situation.” He said he’s confident Eastman “will restore the site to normal operations safely and expeditiously.”

Costa also included a message to the Kingsport community and the global company’s vast array of customers.

“We are committed to being a caring and responsible community neighbor and a reliable supplier,” he said. “We greatly appreciate the support and understanding of our Kingsport community, particularly our near neighbors, and our global customers, as we work through this incident.”