Methanex Corporation has announced that it will indefinitely idle its Titan methanol plant in Trinidad and Tobago after failing to secure a new natural gas contract.
The Vancouver-based company said today that the existing gas supply agreement for the Titan facility, which has a production capacity of 860,000 tonnes per year, expires in the third quarter of 2026 and no replacement agreement could be reached.
Methanex said it would preserve the plant to allow for a possible restart if conditions improve in the future. The Atlas methanol plant, in which Methanex holds a 63.1 per cent economic interest, also remains indefinitely idled.
Methanex president and chief executive officer Rich Sumner said the decision was driven by the country’s ongoing gas supply challenges.
“We have a long history in Trinidad and Tobago with an outstanding organization that has played an important role in our Company’s history. This difficult decision reflects our focus on preserving long-term shareholder value in a challenging environment where the structurally tight gas supply and demand balances in Trinidad and Tobago are making operations commercially unviable,” Sumner said.
He said the company had held extensive discussions with the Government and the National Gas Company of Trinidad and Tobago before reaching the decision.
“We recognise and appreciate their ongoing efforts to address the country’s gas supply challenges. We will monitor future developments closely, with a view to reassessing conditions and our position over the coming years. We are now focused on supporting our team members during this challenging period and safely idling and preserving the facility,” he said.
Methanex said Titan is not currently contributing to its adjusted earnings before interest, taxes, depreciation and amortisation or adjusted free cash flow, and the company does not expect to incur material cash costs as a result of the move.
Any updates to production or financial guidance will be released with the company’s second-quarter financial results on July 28.
