Methanex eyeing new methanol build in Canada

18 March 2014 16:19  [Source: ICIS news]

WASHINGTON (ICIS)--Methanex is considering building a new, greenfield methanol plant at its Medicine Hat, Alberta, site and relocating some of the company’s China production facilities to the US, chief executive John Floren said on Tuesday.

Speaking at the annual Methanol Policy Forum, Floren told industry executives that in addition to moving two of the company’s four methanol production facilities in Chile to Geismar, Louisiana, “it is possible we’ll be moving a third Chile plant to Geismar, and we’re also looking at a new build in Medicine Hat”.

He did not say what capacity was being considered for a new methanol plant in Canada, but that the possibility was based on greatly increasing applications and demand for methanol worldwide.

Floren also said that of the five US methanol plants that Methanex moved offshore in the mid-2000s, three went to China.

But, citing the shale gas revolution, he said that those China-based plants “might come back to the US".

He said that moving an overseas methanol plant back to the US made more sense than building new capacity here.  Moving a plant from overseas to the US, he said, “takes about half the time of a new build and costs only 60% of a new build”.

Noting that 20 years ago there used to be only one main application for methanol in production of methyl tertiary butyl ether (MTBE), there are now six different applications, including fuel blending, DME, methanol to olefins and marine fuels, among others.

He said that increasing applications for methanol will demand production growth of three to four million tonnes annually, or about two to four new plants added each year for the near future.

“We are committed to growing here in the US,” Floren said. To help facilitate that expansion, he said, “We require government support, but not subsidies.”

“There’s now a lot of talk about building more capacity here in the US,” he said.

“We expect a lot of new plants to be built here in the US going forward,” he said, citing the upsurge in US petrochemical projects that also is drawing on the shale gas revolution.

As a consequence, he said, “we see a crunch for labour and engineering coming at us”.

The one-day Methanol Policy Forum is sponsored by the Methanol Institute.

Paul Hodges studies key influences shaping the chemical industry in his Chemicals and the Economy blog

By: Joe Kamalick
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