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Gas-low Trinidad losing up to four methanol units

09 Mar 2017 21:29 GMT
Gas-low Trinidad losing up to four methanol units

Kingston, 9 March (Argus) — Trinidad and Tobago's biggest methanol producer MHTL will close four of its five local plants "if there is no improvement in gas supplies," the company managing the plants told the government in a letter seen by Argus.

Four of the MHTL´s units have been receiving 25pc of the gas they need to operate at full capacity, management company IPSL said in the 1 March letter.

The first two plants will be mothballed around 21 April 2017, IPSL said, without indicating when the other two would close.

Prime minister Keith Rowley MHTL had told Trinidad´s parliament on 6 March that MHTL is closing two of its five plants because of the gas shortage.

MHTL is owned by Switzerland-based diversified industrial group Proman.

Contract negotiations with state-run gas company NGC for supplies to four of the five methanol plants have been going on since 2013 but have been inconclusive, IPSL said.

The four plants without a gas supply contract have total operational capacity of 2.18mn t/yr, according to energy ministry data.

The plant that still has a gas supply contract with NGC is 1.9mn t/yr M5000, the newest and most modern of the five units. M5000 was commissioned in 2005.

The four plants that are out of contract require 217.79mn cf/d (6.1mn m3/d) of gas to deliver at operational capacity, but have been receiving 49.5mn cf/d, IPSL told the government.

"Of a combined possible production of 1,431 days for 2016, because of the shortfall in gas, only 947.6 days were possible," IPSL said.

The gas supplied by NGC is sufficient to operate only one of the four units that are out of contract and "… in the event that there is any further curtailment (which given recent history, is very possible) then MHTL will have to bring down the fourth plant."

MHTL's five plants have total operational capacity of 4.1mn t/yr, and produced 2.53mn t in 2016, down 24pc from a year earlier.

Although contracts for the four MHTL plants are not in effect, NGC "continues to supply MHTL with as much gas as is available from upstreamers given the prevailing gas supply environment," the gas company said.

Priority is being given to downstream buyers with existing contracts, NGC said. The firm will continue "to act fairly, reasonably and in good faith toward MHTL, and to negotiate terms that are beneficial to MHTL, NGC and the people of Trinidad and Tobago."

Trinidad has seven methanol plants that have total operational production capacity of 6.6mn t/yr. The operator of the other two plants is Canada´s Methanex.

The country´s methanol exports fell by 15.3pc to 4.63mn t in 2016 compared with the year before, according to energy ministry data.

Methanol production in 2016 fell to 4.65mn t, 15.6pc lower than the previous year.

Trinidad´s now-routine gas supply curtailments have also suppressed production of ammonia and LNG.

National gas output in 2016 averaged 3.327bn cf/d, down by 13.2pc year on year.

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