north america methanol “in the spotlight”€¦ · north america methanol “in the spotlight...
TRANSCRIPT
North America Methanol “In the Spotlight”
Presented to
Foro Pemex Petroqimica 2013
BY Jim Jordan
Jim Jordan & Associates An Argus Media Company
Topics for Discussion
• A Look at History • Will New and Restarted capacity in North America create a Methanol Glut? - Expansion Outlook (Real or Not???) - Can New Applications in North America mitigate a potential Oversupply? - Trade Pattern Change?
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20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2011 2012 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E 2021E
(00
0)
Me
tric
To
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r Y
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FORMALDEHYDE MTBE ACETIC ACID M.METHACRYLATE
MTO/MTP GASOLINE/FUELS SOLVENTS MISCELLANEOUS
Methanol Capacity and Demand in the World
Total Stated Capacity
When is Over-capacity not Over-supply?
History of Supply • 1997 World Methanol Capacity was 28.5 million MT
BUT North America Was King of
Methanol S&D
North America Methanol Capacity in 2007 was:
More Than
10 Million MT
METRIC
TONS
Dec-98 Plaquemine, LA 480,000
Mar-99 570,000
Mar-99 261,000
Aug-99 450,000
Jul-00 450,000
Dec-00 990,000
Apr-01 200,000
Jul-01 570,000
Jul-01 375,000
Nov-03 120,000
Dec-03 180,000
Nov-04 770,000
Dec-04 750,000
Jun-05 600,000
Sep-05 500,000
Nov-05 500,000
Apr-07 850,000
Dec-07 260,000
8,876,000
Beaumont, TX
Clear Lake, TX
Bishop, TX
Canada
Edmonton
Mexico
Fortier, LA
Med Hat, Alberta
Plaquemine, LA
Texas City, TX
Geismar, LA
Delaware City, DE
Med Hat, Alberta
Pasadena, TX
Beaumont Methanol
Lyondell
Pace FL
Cheyenne, WY
Channel View, TX
Deleware City
Medicine Hat
Enron
Air Products
El Paso
Pemex
Celanese Canada
Kitimat
Celanese Bishop Plant
Clear Lake Methanol
CLOSURES LOCATION
North AM Methanol Plant Closures 1998-2007
Georgia Gulf
Fortier (Methanex)
Medicine Hat
Ashland
Sterling
Borden Chem & Plastics
After Devastation of Shutdowns between 1998 and 2005
North America Methanol Capacity was Less than
1 Million MT
Looking Forward
• North American Methanol Capacity on Steep Rise
• Shale Gas Creating major opportunities for Industrial and Energy Expansion Projects
• Announced and Planned Methanol Projects Exceed 15 Million MT
When is Over-capacity not Over-supply?
• When Much of Existing Capacity is Not Effective Capacity
- China has about 40 million metric tons of capacity - China rarely runs at more than 65% operating rates -
at $300/MT (90 CPG) China typically operates below 50% - Major operating problems in Malaysia during the past two years - Significant natural gas interruptions in Trinidad since 2011 - Ongoing lack of gas in Chile. 3.8 million tons of capacity operating as less than 0.8 million tons production - Other unplanned outages
When is Over-capacity not Over-supply?
• When Much of Existing Capacity is Not Effective Capacity • When Prices are not high enough to Generate Profit for High
Cost Producers
- Once again, this drives low operating rates for coal-based producers in China - Eastern Europe with Expensive Gas
When is Over-capacity not Over-supply?
• When Much of Existing Capacity is Not Effective Capacity • When Prices are not high enough to Generate Profit for High Cost
Producers • When Politics interfere with International Trade
- Iran Sanctions - Libya Outage of nearly 2 years (Still unreliable) - Governments setting High Gas Prices (Argentina, Russia, others)
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4,000
6,000
8,000
10,000
12,000
2011 2012 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E 2021E
FORMALDEHYDE MTBE ACETIC ACID M.METHACRYLATE
MTO/MTP GASOLINE/FUELS SOLVENTS MISCELLANEOUS
Methanol Demand in North America
(00
0) M
etr
ic T
on
s p
er
Ye
ar
North America Methanol Expansion
North America Methanol Capacity Expansion Generates Questions
• How much is needed?
North America Methanol Capacity Expansion Generates Questions
• How much is needed? • How much is too much?
- 985,000 MT prior to OCI Beaumont restart last year
Name Location Ownership Capacity Timing Comments
Lyondell Channelview, TX Lyondell 780 Q4-2013 Re-start (Permit APP)
Celanese Clear Lake, TX Celanese + Partner 1,300 Late 2015 Permit June, 2013?
South Louisiana Meth South Louisana
Zero Emission Energy
Plants 1,650 Q4 2015 Announced
Moss Point Methanol Moss Point, MS Leucadia 1,000 2016-2017 Capacity EST.
Lake Charles Clean Energy Lake Charles Leucadia 1,200 2016-2017 Capacity EST.
G2X Energy Lake Charles G2X Energy 1,200 2017 For Gasoline
Total 7,130
Methanex Geismar, LA Methanex 1,000 Q4 2014 Under Construction
Methanex Geismar, LA Methanex 1,000 Early 2016 Announced April, 2013
Un-named Lake Charles Un-named 472 In Planning
Total 2,472
U.S. Gulf Coast 1,000 In Planning
U.S. Gulf Coast 1,000 In Planning
U.S. Gulf Coast 1,000 In Planning
U.S. Gulf Coast 1,200 In Planning
U.S. East Coast 1,200 In Planning
Total 5,400
Grand Total 15,002
(000) Metric Tons
Announced
Unannounced, In Planning
J im Jo r dan & A ssoc ia t es , LP
Relocations
US Methanol Capacity Expansion 2013-2017
With These Additions, We will have 4,850 MT by 2016
If ½ of the above happens, we will have approx. 7,850 MT By
2018 or 2019
BUT WAIT!
Country of Origin MT MT MT Total MT
2010 2011 2012
Trinidad and Tobago 3,699,296 3,756,885 3,432,373 10,888,554
Venezuela 656,910 881,717 1,012,898 2,551,525
Canada 4,475 103,909 150,863 259,247
Equatorial Guinea 383,986 365,898 283,017 1,032,901
Brunei 13,543 37,708 10,290 61,540
Bahrain 193,925 160,578 74,321 428,824
India 114 23 502 639
Japan 458 460 25,391 26,310
Germany 107 388 927 1,422
Switzerland 6 432 214 652
Others 142,592 168,398 86,490 397,480
Total Imports 5,095,410 5,476,396 5,077,288 15,649,094
United States M ethanol Trade 2010-2012
North America Methanol Capacity Expansion Generates Questions
• How much is needed? • How much is too much? • Will there be winners and losers?
- Offshore Producers - Domestic Producers - Consumers - Traders
North America Methanol Capacity Expansion Generates Questions
• How much is needed? • How much is too much? • Will there be winners and losers?
- Offshore Producers Fight for Market Share or Look for Other Markets
North America Methanol Capacity Expansion Generates Questions
• How much is needed? • How much is too much? • Will there be winners and losers?
- Offshore Producers - Domestic Producers Fight for Domestic Market or Export
North America Methanol Capacity Expansion Generates Questions
• How much is needed? • How much is too much? • Will there be winners and losers?
- Offshore Producers - Domestic Producers - Consumers Hope for a “Really” Big Fight
North America Methanol Capacity Expansion Generates Questions
• How much is needed? • How much is too much? • Will there be winners and losers?
- Offshore Producers - Domestic Producers - Consumers - Traders Hope for Volatility which is almost Certain
What is the Key to the Outcome?
• Is it Methanol Prices?
- Of Course Prices are Important
What is the Key to the Outcome?
• Is it New Applications for Methanol?
- Of Course that would help
MTG MTP DME Others
What is the Key to the Outcome?
• Is it Natural Gas Prices?
What is the Key to the Outcome?
YES, IT IS NATURAL GAS PRICES
$0
$5
$10
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$35
$40
$45
J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J
2007 2008 2009 2010 2011 2012
WTI Crude Price $/mmBTU NG $/mmBTU MeOH $/mmBTU
Crude-NG-Methanol Spot Price CorrelationUS 2007-2012 YTD
$ / m
mB
TU
Crude
Methanol
NG
What is the Key to the Outcome?
• Is it China Imports?
What is the Key to the Outcome?
YES, IT IS CHINA IMPORTS TOO
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35000
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012ProjectedAnnual
KT
China Methanol Implied Demand
Net Imports
Production
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2011 2012 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E 2021E
FORMALDEHYDE MTBE ACETIC ACID M.METHACRYLATE
MTO/MTP GASOLINE/FUELS SOLVENTS MISCELLANEOUS
Methanol Demand in China
(00
0) M
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Ye
ar
Imports
In Summary:
1. North America Will Likely have More Than Adequate
Methanol Supply
2. Methanol Producers (Current and Future)
Will Need to Plan Carefully to Avoid
Disaster
THANK YOU!!!!
