Broker discounts Huntsman's talk of investing in US methanol unit

01 May 2013 23:11  [Source: ICIS news]

HOUSTON (ICIS)--A brokerage analyst in Canada on Wednesday discounted talk by the top executive at Huntsman this week that the producer wants to invest in a US-based methanol plant.

CEO Peter Huntsman’s comments in a conference call about a possible methanol plant investment sounded “a bit surprising” to Steve Hansen, an analyst at Raymond James in Vancouver, British Columbia.

In a note to clients, Hansen said the huge costs of building a new plant - easily around $1bn (€760m) for a large unit - plus a significant list of projects in the works made it unlikely that Huntsman would follow through on the plan.

“Given Huntsman’s steep feedstock needs, these remarks might just be a negotiating tactic to try and secure what they characterise as an 'advantaged' methanol price, although it is admittedly difficult to determine at this point,” Hansen said in his note.

Huntsman did not elaborate on what kind of investment the company might make in a methanol plant, only that his company was considering the idea.

($1 = €0.76)

By: Lane Kelley
+1 713 525 2653

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