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Methanex focused on potential Louisiana expansion; Medicine Hat facility expansion still possible

Apr 27, 2018 | 3:46 PM

 

MEDICINE HAT, AB — A proposed expansion in Medicine Hat has not yet been ruled out by Methanex, even as the company is focusing on expanding its facilities in Louisiana.

During a conference call with shareholders on Thursday, Methanex CEO John Floren announced the company has acquired land next to its two plants in Geismar, Louisiana for a third methanol plant.

Medicine Hat and Louisiana have both been discussed as locations for an expanded facility.

During the conference call, Floren said its easier to ship methanol from Louisiana to Asia than it is from Alberta, which requires moving it by rail to a port for overseas shipment.

Despite the announcement, the proposed $1 billion expansion for Medicine Hat is not dead yet.

CHAT News Today reached out to the company on Friday to discuss the two plants. The company did not grant an interview, but issued a statement.

“We are making good progress on potential growth initiatives in North America, including building a third methanol facility in Geismar, Louisiana,” the statement reads. “We believe that the potential Geismar 3 project would be advantaged relative to other projects being contemplated or under construction in the US Gulf.”

Methanex adds the Medicine Hat project will continue to be considered, as the company already has the required land for a potential second production facility.

In addition, the provincial government has also announced another proposed round of royalty credits under the Petrochemicals Diversification Program.

“If launched, we would consider this program as part of our review of a potential project in Medicine Hat,” the statement reads.

Methanex supported the diversification program when it was first announced, but wasn’t one of the final selections in 2016. The initial round of funding went to Pembina Pipeline and Inter Pipeline near Edmonton.

Methanex says the final decision on an expansion won’t be made until 2019.