22 June 2011 19:27 [Source: ICIS news]
HOUSTON (ICIS)--Methanex is considering moving one of its shuttered methanol plants in Chile to North America, a company executive said on Wednesday.
Speaking at an investor conference, Methanex senior vice president John Floren said that the company also is studying whether to restart one of its three closed plants in the South American country with coal instead of natural gas.
“We’ll make a decision by the end of the year,” Floren said.
In April, Methanex CEO Bruce Aitken said there was a “low probability” that the company’s lone methanol plant operating in its Chilean complex might have to be shut down in the coming months because of a low natural gas supply during the southern hemisphere’s winter. Aitken said then that Methanex might move the plant in Punta Arenas, Chile.
Floren referred to Methanex’s long-term problem in Chile of obtaining natural gas supplies. “It’s taking longer for us to be successful there than we first imagined,” Floren said.
One option for Methanex would be to move the plant to the US or Canada, where Methanex is headquartered, Floren said.
In April, Methanex restarted a mothballed plant in Medicine Hat, Alberta, for $45m (€31m).
Floren said that Methanex expects to recoup its investment there in six months.
He added that, in relocating the Chilean plant to North America, Methanex would want to become a partner with a company that already has a methanol unit.
Floren said Methanex also would require a natural gas contract for the plant with a term of 5-10 years.
Low natural gas prices in North America have brought renewed interest in old methanol plants this year.
Floren said that the prospect of finding more natural gas from shale discoveries in the US and Canada would make it possible to operate a methanol plant profitably even if natural gas prices rise as high as $7/MMBtu - or 60% higher than current natgas prices, which are around $4.38/MMBtu.
($1 = €0.69)
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