EMethanex agrees on shareholding

18 May 2006

Egyptian Methanex Methanol Company (EMethanex) has agreed on a final shareholding structure and is expected to sign all related agreementsin the next few weeks, according to the company's chief executive officer, Hussein Khattab. The company is also evaluating preliminary proposals submitted by three shortlisted contractors for the engineering, procurement and construction(EPC) contract to buildthe company's estimated $620 million greenfield methanol plant in Damietta port (MEED 3:3:06).

Under the new shareholder structure, Canada's Methanex Corporation will hold a 60 per cent equity stake in the project company, reducing its original share by 16 per cent, which will be held by a group of local shareholders. Negotiations to conclude the transaction are ongoing. Methanex' joint venture partner in the project, state-owned Egyptian Petrochemicals Holding Company (ECHEM), will transfer half of its 24 per cent stake to Egyptian Natural Gas Holding Company (EGAS).

EMethanex is also reviewing preliminary proposals submitted by Paris-based Technip, Italy-based Techint and Germany's Uhde with Oslo-based Aker Kvaerner for the EPC contract to build the 1.3 million-tonne-a-year methanol plant. Once the review is completed, EMethanex will invite final technical and commercial proposals.

London-based Davy Process Technology is the front-end engineering and design (FEED) contractor on the scheme. Davy and the UK's Johnson Matthey will provide combined reforming technology. An agreement with EGAS to provide gas feedstock for the plant has been concluded and is due to be signed soon. Methanex has agreed to offtake 100 per cent of the methanol output.

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