Methanol Output to Drop in 2005 (NZ)

Methanex Corporation, which runs two methanol plants in Taranaki (NZ) says these may produce only 375,000 tonnes of methanol in 2005.
Vancouver’s Methanex announced last year that its plants – with a production capacity of 2.4 million tonnes – would produce only 1m tonnes, or 40% of capacity in 2003, because it had effectively used its allocations from the failing Maui field, due to run out in 2007.

In June, Methanex’s president and chief executive Bruce Aitken said the Maui gas it had been able to secure, along with gas from other [smaller] fields, would allow it to produce about 1m tonnes in 2004.
The firm said renegotiation of the Maui gas contracts would provide Methanex with the right to buy up to 40 PJ of gas.
New Zealand uses about 1PJ of gas a day.
Until 2002, Methanex had been buying about 80PJs a year of cheap Maui gas to run its Taranaki methanol plants.
The company could now produce up to 500,000 tonnes of methanol next year if economic conditions warranted it, Aitken said. But on Friday [29 Oct], Crown Minerals reported in a newsletter that Methanex said it had the potential to produce up to 375,000 tonnes of methanol in 2005.
Aitken also said world methanol prices had risen strongly with average realised prices at US$245 per tonne for the September quarter, up from US$222 per tonne for the second quarter of 2004. Current US spot prices had risen to about US$305 per tonne.

Source: The Press NZ 1 Nov 2004 reported by NZPA

It’s interesting to note this plant, one of the largest in the world, is now operating at less than 16% of output due to NG shortages in this part of the world. It may be mothballed in 2007.