00:00Trinidad and Tobago's National Gas Company says gas supply volumes were not the issue during its negotiations with Canada-based
00:09Methanex Corporation.
00:11This was NGC's response on Tuesday to Methanex's statement on Monday that it has been unable to agree to a
00:18new natural gas contract for its Titan methanol plant in Trinidad and Tobago and, as a result, will begin the
00:25process of indefinitely idling the facility.
00:28Methanex said that its Atlas methanol plant, a joint venture in which it holds a 63.1 percent economic interest,
00:37remains indefinitely idled in a preserved state.
00:41Methanex said that Titan has a production capacity of 860,000 tons of methanol per year.
00:48The NGC said it offered Methanex the same contracted gas volume provided under the expiring gas sales contract and indicated
00:57its willingness to consider an increase in volume if required.
01:01The NGC said Methanex indicated to NGC that a reduced gas price was the only economical way of continuing its
01:10operations.
01:11In its latest update on its Trinidad and Tobago operations, Methanex quoted its president and CEO as having said that
01:19what he called this difficult decision reflects the company's focus on preserving long-term shareholder value in a challenging environment
01:27where the structurally tight gas supply and demand balances in Trinidad and Tobago are making operations commercially unviable.
01:37Methanex also quoted its top executive as having said that ahead of this decision, Methanex engaged extensively with the government
01:45of Trinidad and Tobago
01:47and the National Gas Company of Trinidad and Tobago and recognize and appreciate their ongoing efforts to address the country's
01:54gas supply challenges.
01:56Methanex said that Titan's existing natural gas contract expires in the third quarter of this year, 2026.
02:03The NGC said Methanex sought a gas price that was significantly lower than that contained in the expiring gas sales
02:12contract.
02:13The NGC further said that the requested price was also below NGC's acquisition cost of gas and below the prices
02:21applied to NGC's light industrial and commercial customers
02:24as well as to companies within the NGC group.
02:27The NGC said that given NGC's responsibility to operate on a commercially sustainable basis and to maximize value from Trinidad
02:35and Tobago's natural gas resources,
02:38it was not in a position to agree to a price below its acquisition cost but had sought to bridge
02:45the gap between the parties.
02:46The NGC said it revised its pricing proposals on more than one occasion and was also prepared to maintain the
02:53pricing under the expiring contract for an interim period until the end of the year while discussions continued.
02:59The state-owned company added that those options did not align with Methanex's commercial requirements.
03:06However, Methanex said they will undertake a preservation process at the Titan plant to provide optionality for a future restart
03:14should conditions materially improve,
03:16while their president said they are now focused on supporting their team members during this challenging period and safely idling
03:24and preserving the facility.
03:26The NGC said while the parties were ultimately unable to reach agreement, NGC respects Methanex's commercial decisions and appreciates the
03:35many years of partnership between the two companies.
03:38The NGC further said it remains open to continued dialogue should opportunities arise to reach a commercially sustainable arrangement that
03:46reflects the interests of both parties.
03:50Jewel Brown, TV6 News.
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