Project Update. Egyptian Dimethyl Ether Company S.A.E. 4th International DME Conference Hilton Stockholm Slussen Stockholm September 7, 2010

Transcription

1 1 Project Update Egyptian Dimethyl Ether Company S.A.E. Presented By: Steve Sopora, Methanex Corp. 4th International DME Conference Hilton Stockholm Slussen Stockholm September 7, 2010

2 2 Agenda Brief introduction to EMethanex DME production from Egyptian Natural Gas EDME project update

3 EMethanex 3

4 EMethanex Methanol Plant (Damietta) 4

5 DME Production from Egyptian Gas 5

6 6 The Egyptian DME Opportunity Egypt presently consumes 3.8 million t/y of LPG for cooking/heating, 2 million t/y of which are imported the Ministry of Petroleum (through EGPC) controls all LPG production, import, and distribution LPG is subsidized through Egypt s social programs; 12 kg cylinders retail for 3 EGP; about $40/t the subsidy costs the Egyptian government over $1 billion per year Egypt has plentiful natural gas reserves that can be converted to DME most LPG consumers can not afford to bear the cost of connecting to pipeline gas

7 7 LPG has a Higher Value than Natural Gas 15-Year Historical Relative Value of LPG and Natural Gas NYMEX Propane/Gas Price Premium (Btu Basis) 200% 150% 100% 50% 0% -50% Average Date historically, propane has been worth 70% more than natural gas on a Btu basis in the US the premium is even higher in Egypt due to freight differentials

8 8 DME Production is a Good Gas Monetization Strategy in Egypt large and growing LPG imports abundant proven low-cost gas reserves large domestic methanol industry with expansion opportunities favorable freight cost differential LPG import prices are increased due to freight costs LNG (or methanol) netbacks are reduced due to freight costs economies of scale can be easily realized concentrated population widespread LPG distribution pipeline network enables large centralized DME production sites

9 9 Some Key Numbers production of 200 kt/y of DME from methanol will: reduce Egyptian LPG imports by $100 million USD/y provide the Egyptian government with direct cash savings of $11 million USD/y create 50 high paying permanent jobs create temporary construction jobs and numerous indirect jobs with local suppliers production of 1 million t/y of DME from gas will: improve Egypt s Balance of Payments by approximately $460 million USD/y

10 10 Indirect Benefits of DME Production from Natural Gas improved energy security through production of a strategic energy product (LPG blendstock) from domestic resources (natural gas) benefits society by using domestic resources in Egypt creates jobs and economic activity through manufacture of a down-stream product instead of exporting resources product diversification reduces the Ministry of Petroleum s gas revenue volatility

11 EDME Project Update 11

12 12 EDME Commercial Structure Current Ownership Methanex 20% Egyptian MoP Companies 80% Train#1 Production Capacity 200,000 t/y EGPC will off-take 100% of the DME production Methanol Supply Methanex will supply 100% of the methanol demand from its EMethanex subsidiary

13 13 Project Status the JVA is signed company formation/registration is in progress site has been selected technology provider has been selected (XinAo) EPC contractor consortium has been selected (CNCEC/ENPPI/Petrojet) FEED is complete environmental approval in principle has been granted for the site, subject to completion of EIA and QRA the EIA is in progress other key permit applications have been initiated commercial agreements are in progress EPC contract award is targeted for Q1/2011

14 14 Plant Location EDME Plant Site El-Max Petroleum Complex Alexandria, Egypt EMethanex Plant Site Port of Damietta Damietta, Egypt Echem/EMethanex Head Offices Cairo, Egypt

15 15 Site Location, Alexandria EGPC PetroPort El-Max Petroleum Complex

16 Site Plan New LPG Storage Facility Under Construction by EGPC N Major Road Pipeline Corridor Methanol Storage Facility Minor Road Vacant Land for Future Expansion EDME Phase 1&2 16

17 EDME Plant 17

18 18 Questions and Discussion Shokran! (thank you)