Shale gas to methanol possible if natgas cost remains low

09 December 2009 18:28  [Source: ICIS news]

MIAMI (ICIS news)--Developing methanol from the US' vast reserves of natural gas locked in shale is possible, but only if the cost of natural gas stays under $5/MMBtu, a methanol industry advocate said on Wednesday.

Speaking on the sidelines of the CMAI World Methanol Conference in Miami, Florida, Greg Dolan, vice president of the Methanol Institute, indicated that while producing methanol from shale gas in the US was possible, it was “unlikely”.

 “At [a natural gas cost of] $8-9/MMBtu, no, but at a natgas cost of $3-4/MMBtu, the answer is yes,” Dolan said.

However, some market players brought an attitude of resentment regarding the notion of domestic methanol production ramping up, hinting that market share would likely be cut.

“The producers from Trinidad and Tobago may have something to say about that, and they will not like it,” a US seller said.

According to the US International Trade Commission (ITC), Trinidad and Tobago is the largest exporter of methanol to the US.

Consultant Darryl Rogers of Purvin & Gertz called the vast reserves of shale gas in the US a “gamechanger”.

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By: Steven McGinn
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