Methanex's CEO Discusses Q2 2012 Results - Earnings Call Transcript

In New Zealand, the Motunui plant operated at full operating rate and produced 210,000 tons in the second quarter.

The restart of the second plant in Motunui plant was completed on schedule at the beginning of July. I will comment more on the restart and the further initiatives to increase production in New Zealand again later on the call.

In Chile, we operated one plant at low operating rates and produced 82,000 tonnes. We have received reduced volumes of natural gas over the past quarter as we were in the southern Hemisphere winter and residential gas demand in that area is at its peak.

We’re planning a maintenance outage in August and expect to receive larger quantities of gas after this turnaround is complete. I will comment on the outlook for Chile in just a few moments also.

In Egypt, the plant operated at 86% during the quarter and produced 164,000 tonnes based on our 60% interest. The plant was shut down late in the second quarter to complete plant maintenance and inspection activities. In addition, we experienced some natural gas curtailments, as a result of outages at upstream platforms and strong seasonal domestic demand for natural gas for electricity generation.

The plant is currently operating at about 70% and we expect to be back consistently operating at full rates in the coming months. Finally our plant in Medicine Hat, Alberta operated at full capacity and produced 118,000 tons in Q2.

In the current pricing environment for natural gas in North America, Medicine Hat is a particularly valuable asset and we're working on a debottleneck of that plant that will see capacity increase by about 20%.

Turning now to industry conditions. While softness in some derivatives in the current economic environment, overall global methanol demand has remained good and current indications are for relatively stable demand in the third quarter.

They have continued to be a significant number of planned and unplanned outages, affecting methanol supply across the industry and Iran sanctions have continued to negatively impact the level of production in that country.

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