OCI Texas methanol unit going down for 40 days in Q4 for expansion

HOUSTON (ICIS)–OCI Partners’s Texas methanol plant will go down for 40 days in Q4 2014 to complete a debottlenecking project, a top executive at the company said on Tuesday.

The $178m project will increase the size of the Beaumont methanol unit by 25% to 912,500 tonnes/year of capacity from the current 730,000 tonnes/year, said Frank Bakker, chief executive officer of OCI Partners.

The expansion will also increase the ammonia unit’s capacity by 15% to 305,000 tonnes.

The plant’s ownership last year converted to a master limited partnership – OCI Partners – with public shareholders owning 21.7% and a subsidiary of OCI owning 78.3%.

OCI Partners earned a profit of $29m in the first quarter, a decline of almost 36% from $45m in the same quarter last year.

In a conference call, Bakker attributed the earnings decline to an unplanned outage at the unit and the recent plunge in methanol prices from higher production rates in Asia and the Middle East.

The shutdown at the OCI unit stemmed from an electrical power outage due to human error, Bakker said.

The methanol and ammonia plants operated for only 76 days in the first quarter, Bakker said, compared with 90 days during the same period of 2013. The plants were repaired in early February.

“Both plants for April and May have been running smoothly,” the CEO said.

OCI restarted the formerly mothballed unit in July 2012, marking the first new US methanol plant in more than a decade.

Earlier this year, Bakker said at a meeting in Toronto that OCI bought the Beaumont plant for $26m, essentially its scrap value. By the time the plant was up and running in 2012, OCI’s total investment had jumped to $300m, he said.

Major US methanol suppliers include Methanex, LyondellBasell, OCI and Southern Chemical.