President and chief executive officer, Pierre Choquette, waxed lyrical about the overall Methanex performance in the world methanol market during the past three years and predicted continuing good times for the corporation and its shareholders, primarily because of its Chile and Trinidad expansions.
The two Tasman neighbors were almost glossed over, however.
Australia got good marks for its abundant natural gas reserves and its proximity to the growing Asian markets, which accounted for about 33% of global Methanex sales. However, its "very high" labour costs had had a "huge" impact on capital costs.
Methanex announced in March that foreign exchange blowouts had caused the corporation to put a hold on the original proposed $A2 billion greenfields project at the Burrup Peninsula.
New Zealand also ranked poorly. Methanex had lost over one million tonnes of low-cost methanol production capacity this year, because of the Maui redetermination, and it was unlikely the Taranaki plants would be returned to full production in the future.
Choquette said Methanex was no longer working to self-imposed deadlines regarding its decision to build a methanol plant on the Western Australian peninsula, as it had to be sure any project met strict investment guidelines.
It was working hard, though, on finding solutions to its Australian and New Zealand problems.
Methanex Asia-Pacific vice-president Bruce Aitken told EnergyReview.Net in April that he hoped to have some positive news for both countries within the next month or so.
He hoped Methanex would be able to get enough contractual gas in New Zealand to keep at least one of three methanol trains operating to perhaps 2006. He also wanted to be able to take a good enough proposal to the July Methanex board meeting for it to approve a smaller scale Burrup project than the original proposed two-million tonne plant.
Choquette said the expanded facilities at Trinidad and Chile were expected to produce a total of 5.7 million tonnes of methanol a year once expansions in both countries had been completed by early 2004 and early 2005 respectively. This output would be equivalent to total Methanex world production in 2002.
These "superb" new low-cost Chile and Trinidad production hubs were expected to operate well in excess of a 14% rate of return.
Choquette said the sun was shining on the Methanex "parade", with the great production, cashflows and liquidity predicted to continue. During 2000-02 income had been $US340 million, with cashflows (EBITDA) of $US740 million. Equity had approximately tripled in value during that time and had increased by about 25% during the past year.
Also, the Methanex board of directors today declared a quarterly dividend of $US0.05 per share, payable on June 30, and yesterday announced Methanex was to purchase 9.0 million of common shares from Nova Chemicals Corporation, the largest Methanex shareholder, holding 46.9 million shares or 37% of the outstanding stock.
