Trinidad Takes Mega-Project Slice of Global Market as Methanol Holdings Makes Move into Oman

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Researched by Industrialinfo (Industrial Information Resources, Incorporated; Houston, Texas). In a broad policy initiative in 2004, the Trinidad and Tobago government announced that approval for the construction of stand-alone ammonia and methanol plants would no longer be granted and that it would only consider new methanol and ammonia production if it were part of multi-use, multi-product 'mega-projects.'

As the world's leading exporter of both products, which use natural gas as the feedstock, it was decided to re-emphasize the sale of the gas in the form of LNG to the U.S., building on its already major 75% share of all LNG imported by the U.S. The motivation behind this shift was that the gas exports would generate more income as LNG than as a feedstock for single-product chemical output.

This was followed by the government's making an agreement with a consortium led by Clico Energy (Port of Spain, Trinidad) for the construction of a $700 million ammonia, urea, and melamine complex at the Point Lisas Industrial estate. The facility will create revenues of $190 million a year and create 235 permanent jobs. Colonial Life Insurance/Clica will hold 40% of the complex, Clico Energy 30% and Ferrostaal Essen, Germany) 30%. All three partners already have a well established presence in petrochemical projects on the island.

In June/July 2005, the Methanol Holdings (MH) (Trinidad) M5000 plant will begin production, and with a 5,400 ton daily capacity (1.89 million tons per year) will see Trinidad and Tobago producing over 22% of global methanol demand. MH is a part of the Clico conglomerate. The M5000 output will be almost double the current annual output from MH's four existing methanol plants in Point Lisas. MH's total annual production of over four million tons in 2005-2006 will represent 12% of world production.

The new plant is located between MH's existing CMC and TTMC 1 plants. The engineering procurement contractor for the $550 million plus project is Ferrostaal with sub contractor Proman Technology (Dallas, Texas) and plant designer Davy Process Technologies (Pratteln, Switzerland). This team constructed MH's previous three methanol plants.

A long-term contract has been negotiated for the sale of M5000 output to the US market and the balance will go to other international clients. As the plant nears mechanical completion (end of March), MH and the contracting team are actively looking for a site to build another methanol plant, possibly in Trinidad. The new plant would exceed the investment required for M5000, as the price of raw materials has risen.

Another megaproject is under negotiation between the government and BP Trinidad and Tobago (NYSE:BP) (London, U.K.). This project plan is for a gas reformer to produce synthetic gas for several methanol and ammonia plants.

In a strategic move to access the potential of the Far East markets MH has taken a 50% interest in the Sohar Methanol project in Oman. The overall project plan has two phases which, when both are complete, will see a 6,000-ton-per-day, 2.1-million-ton-per-year, facility. This is a pioneer move for MH and the country as it is the first global expansion of a majority-owned Trinidadian company. Oman Methanol Company is a special purpose company owned by MH, Ferrostaal and the local holding company.

Toyo Engineering (Toyota:6330)(Chiba, Japan) has been contracted for the basic and detailed engineering for the first phase 3,000 tpd plant .The company will also provide other technical services for the erection, construction, pre-commissioning, commissioning and start-up of the project.

The plant will employ Johnson Matthey's (LSE:JMAT ) (London, U.K.) low pressure methanol process incorporated with Toyo's MRF-Z reactor for methanol synthesis and steam reforming and syngas generation technology. The reactor is the only one in the world, designed within the mechanical restrictions imposed by manufacturing, to be capable of producing 5,000 tpd of methanol in a single reactor vessel and in the same process raising steam in an energy-saving design.

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