Methanex to indefinitely idle Titan plant amid gas supply woes

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.