Methanol manufacturer Methanex Corp. plans to restart construction on the company's Geismar 3 project in Ascension Parish.
The total capital cost for the Geismar 3 project is now expected to be $1.25 billion-$1.35 billion, compared to the previous estimate of $1.3 billion-$1.4 billion.
The updated estimate is based on a significant reduction in the project's execution risk profile. It expects $800 million-$900 million of remaining capital costs after restarting construction in October 2021. Methanex expects the project to benefit from positive methanol industry fundamentals underpinned by higher methanol demand and prices.
The Vancouver-based company expects to begin manufacturing methanol from the plant by the end of 2023 or early 2024, which is later than previously planned in 2022.
The plant is expected to create 62 permanent jobs for a total of 230 jobs across all three plants in Geismar.
The company intends to fund construction with cash on hand and future cash flow (without incurring incremental debt) at methanol prices of around $275 per ton and higher. Commercial operations are expected to commence by the end of 2023 or early 2024.
