November 10, 2017
On Nov. 8, Methanex announced that it has signed a long-term natural gas supply agreement with Painted Pony Energy. The agreement secures the future of Methanex’s 600,000 tonne methanol plant, located in Medicine Hat.
“We are delighted to have entered into this agreement with Painted Pony, a company with a very competitive cost position in the prolific Montney play in Western Canada,” says John Floren, president and CEO of Methanex. “This agreement, combined with the 2015 refurbishment of our Medicine Hat plant, solidifies the long-term future of Methanex’s methanol operation in Canada.”
Headquartered in Vancouver, Methanex is the world’s largest producer and supplier of methanol to international markets. The company’s only Canadian production facility is located in Medicine Hat. From this plant, Methanex ships methanol to clients in North America.
To make methanol, a steam and distilling process is used to turn natural gas into methanol. Methanol is a clear liquid that is water soluble and biodegradable. It is a building block for countless everyday products such as building materials, foams, resins, plastics, paints, polyester and a variety of health and pharmaceutical products. It’s also a cleaner burning, alternative source of energy, making it an attractive alternative fuel for vehicles and ships.
Signed on Nov. 8, the agreement includes a competitive fixed rate for natural gas. By 2023, Painted Pony will supply Methanex with roughly 80-90% of the plant’s requirements.
Located in Brier Park Industrial Estates, Methanex is part of Medicine Hat’s petrochemical cluster, which also includes CF Industries, Cancarb and Goodyear. Also in the Brier Park area, the City of Medicine Hat recently commissioned a brand new, 43-megawatt power plant to ensure a sufficient power supply is available to residents and industry.
“We commend Methanex for its long-term commitment to continuing its Medicine Hat operation,” says Ryan Jackson, CEO of Invest Medicine Hat. “It is a strong vote of confidence in the future of petrochemical manufacturing in our community.”