Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Methanex (MEOHF) -- Ignore unavailable to you. Want to Upgrade?

To: chicoman who wrote (195)	11/22/1999 12:30:00 AM
From: raisinkane	Read Replies (1) \| Respond to of 213

Methanex To Pursue GTL Opportunities Nov 19 1999 23:52 The world's largest methanol producer is now seeking opportunities in the GTL business. Canada's Methanex Corp., the only pure?play methanol producer, is restructuring its business in order to pursue other opportunities including GTL. Faced with falling profits and a bleak outlook for the global methanol market, Methanex established an Emerging Energy Applications division. Methanex is looking to diversify into GTL, synthesis gas technology and fuel cell development. "We will start to look at diversification," said Pierre Choquette, Methanex chairman and CEO. "Our objective is to create a business that is about equal size to the business we have to date and to do that in a 10?15 gear time frame. We will be very prudent in how we look at doing that." Methanex has a number of gas?based technologies that it intends to pursue, explained Michael McDonald, vice president of strategic planning. The company has a proprietary emulsifier used to make a lower emission oxygenated diesel fuel and is working with engine manufacturers to create cleaner fuels. "Our gas?based technologies can bring cleaner fuels to the market," he said. Most of the company's technological advancements have been in the area of syngas production, McDonald noted. "We have increased our scale and our cost efficiency he said. Methanex already has a partnership with a leading technology and catalyst vendor, he said. "We are looking for opportunities to work with others to develop relationships where synergies exist." While Methanex is the first methanol producer to date to announce it is looking at GTL opportunities, technology provider Rentech has been pursuing methanol producers for several months. It believes ailing methanol producers are prime candidates for GTL production since they already possess synthesis gas production units, which typically account for about 60X of the overall cost of GTL production. "This is an exciting development and it confirms our thinking about conversion from methanol to GTL," said Dick Sheppard, director of marketing, Rentech. He noted that there are other methanol producers that are very interested in GTL production. "We believe there are a lot of opportunities with methanol producers," he said. But Methanex doesn't appear to be pursuing partnerships with technology providers like Rentech or Syntroleum. While those companies have FT technology "the retail fuels market is controlled by the oil companies," McDonald said. The same thinking applies to methanol, where it makes sense to work in the existing fuel infrastructure. In pursuing the GTL and fuel cell markets, Methanex will try to form partnerships with companies that are working within the existing infrastructure, he said. Methane is a very uncooperative molecule and syngas production is a wag to use methane to produce useful liquid fuels, McDonald said. Methanex already has vast experience and proprietary technology for syngas production and is currently trying to increase economies of scale for the process. Both capital costs and operating costs have come down, and now Methanex is looking for new wags to make use of that technology.