The Vancouver-headquartered company is also hopeful that the Ocean Patriot drill rig’s scheduled wildcat exploration program off Taranaki will include a sizeable gas strike – something that could keep the Waitara Valley methanol plant operating into the next decade or even see the partial restart of the mothballed Motunui complex.
Last November, Methanex said it had secured enough domestic gas to keep the Waitara Valley plant operating until the end of March.
But today Methanex New Zealand managing director Harvey Weake said he was confident of securing further short-term gas supply contracts to keep the facility operating at full capacity for all of 2007.
At full capacity, the valley plant uses about 20 petajoules of gas to produce about 520,000 tonnes of methanol in a year.
“Nothing is confirmed yet, nothing definite, but we are pretty hopeful we will be able to secure enough additional gas to keep us going for all of this year,” Weake told PetroleumNews.net from Auckland.
“The short-term gas market is looking pretty good in New Zealand right now.”
Likely sources for the gas include Contact Energy and Vector subsidiary NGC, which are entitled to a total of 275PJ of additional Maui right of first refusal (ROFR) gas until 2014.
Both companies can on-sell Maui ROFR gas that is surplus to their requirements and near-record world methanol prices, currently about $US520 per tonne in the Asia-Pacific region, are enabling Methanex to pay the higher market-priced ROFR gas while still running the valley plant profitably.
Weake also said he was encouraged by the level of offshore exploration taking place off Taranaki.
While most of the 10 wells scheduled to be drilled by the semi-submersible Ocean Patriot were development or exploration wells targeting oil, two should be targeting gas.
Those two are scheduled to be drilled by Houston-headquartered Pogo Producing Company, in northern offshore Taranaki licences PEP 38488-490, towards the end of the Patriot’s campaign.
“We are obviously very excited about these offshore drilling campaigns, though we will just have to wait and see,” he said.
“These licences are not too far offshore and two are not that far away from the Pohokura gas-condensate field. But any gas find would have to be close to existing infrastructure and at economic prices for Methanex to be interested in signing any long-term contracts.”
Methanex has also finished its study into the feasibility of restarting one of the two methanol trains at the large Motunui complex that was mothballed two years ago in response to a lack of gas.
“We know we can do it, but there needs to be a change in upstream markets before that could happen,” Weake said.
“At present, I have to say the probability of such a restart is low.”
Other options included shipping parts from Motunui overseas to other Methanex plants, or spending money on maintenance to preserve the Motunui asset for a possible restart later this decade.
