Vancouver-based Methanex, the world’s largest supplier of methanol to major international markets, is to relocate one of its plants from Chile to Louisiana in the United States.
Methanex has four plants at its Cabo Negro complex in southern Chile, but they are operating significantly below capacity, mainly due to curtailments of natural gas supply from Argentina.
Methanex is supporting the acceleration of natural gas exploration and development in areas of southern Chile, but the timelines for significant increases in gas production are longer than had originally been anticipated and existing gas fields are experiencing declines.
“We are planning to relocate one of the idle Chile methanol plants with a capacity of approximately 1.0 million tonnes to the Gulf Coast area of the United States,” the company said in a statement.
“We have secured land in Geismar, Louisiana and are progressing site-specific engineering works. We expect to make a final investment decision in Q3 2012 and the plant to be operational in late 2014. We are also continuing to examine the viability of utilizing coal gasification as an alternative feedstock in Chile.”
The announcement was made during the presentation of the company’s results for Q1 2012, in which it reported first quarter profits of $39 million, up from $37 million in the same quarter of 2011, but down from $65 million in the final quarter of last year.
"Our earnings for the first quarter were impacted by lower sales of Methanex-produced methanol and one-off items and we expect to deliver stronger earnings as the year progresses,” said Bruce Aitken, President and CEO.
“Methanol demand has remained healthy, the pricing environment has been stable and we reported another good quarter of cash flow generation. The outlook for the industry also looks very attractive, as demand growth is expected to significantly exceed new capacity additions over the next few years."
