Methanex Signs a Long-Term Natural Gas Supply Agreement With Painted Pony Energy Ltd. for Its Existing Methanol Plant in Medi...
November 08 2017 - 6:30PM
Methanex Corporation (the “Company”) (TSX:MX) (NASDAQ:MEOH) and
Painted Pony Energy Ltd. announced today the execution of a 14-year
agreement to supply the majority of the natural gas required for
Methanex’s existing 600,000 tonne methanol plant in Medicine Hat,
Alberta. This agreement will commence in 2018 and features a
competitive fixed price for natural gas. Contracted
quantities will be lower in earlier years to allow for Methanex’s
pre-existing natural gas forward purchase contracts, and will
increase to roughly 50,000 MMbtu/day or approximately 80-90% of the
plant’s natural gas requirements from 2023.
John Floren, President and CEO of Methanex
commented, “Having a long-term agreement in place to support our
Medicine Hat facility underpins a competitive cost position for
years to come. 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. This agreement,
combined with the 2015 refurbishment of our Medicine Hat plant,
solidifies the long-term future of Methanex’s methanol operation in
Canada.”
Mr. Patrick Ward, President and CEO of Painted
Pony added, “The Agreement with Methanex will yield a stable stream
of cash flow to Painted Pony while providing additional market
diversification which will help mitigate the impact of market
volatility on our realized prices. By providing Methanex with
a long-term, secure and reliable supply of natural gas volumes to
their Medicine Hat plant, we believe this is truly a “win-win”
arrangement for both companies.”
Methanex is a Vancouver-based, publicly traded
company and is the world's largest producer and supplier of
methanol to major international markets. Methanex shares are listed
for trading on the Toronto Stock Exchange in Canada under the
trading symbol "MX" and on the NASDAQ Global Select Market in the
United States under the trading symbol "MEOH".
Painted Pony Energy Ltd. is a Calgary-based
publicly traded company, and is a growth-oriented natural gas
producer, operating in the Montney formation in Northeast British
Columbia. The Company is listed in the Toronto Stock Exchange
under the trading symbol “PONY”.
FORWARD-LOOKING INFORMATION
WARNING
This press release contains certain
forward-looking statements with respect to us and our industry.
These statements relate to future events or our future performance.
All statements other than statements of historical fact are forward
looking statements. Statements that include the words "expect", and
"continue" or other comparable terminology and similar statements
of a future or forward-looking nature identify forward-looking
statements. More particularly and without limitation, any
statements regarding the following are forward-looking
statements:
- expected levels and timing of natural gas supply to our
Medicine Hat facility, and
- expected operating costs, including natural gas feedstock costs
and logistics costs.
We believe that we have a reasonable basis for
making such forward-looking statements. The forward-looking
statements in this document are based on our experience, our
perception of trends, current conditions and expected future
developments as well as other factors. Certain material factors or
assumptions were applied in drawing the conclusions or making the
forecasts or projections that are included in these forward-looking
statements, including, without limitation, future expectations and
assumptions concerning the following:
- the supply of, demand for, and price of methanol, methanol
derivatives, natural gas, coal, oil and oil derivatives,
- operating rates of the Medicine Hat facility,
- the Medicine Hat facility’s operating costs including natural
gas feedstock costs, logistics costs, tax rates, foreign exchange
rates and interest rates, and
- global and regional economic activity (including industrial
production levels).
However, forward-looking statements, by their
nature, involve risks and uncertainties that could cause actual
results to differ materially from those contemplated by the
forward-looking statements. The risks and uncertainties primarily
include those attendant with producing and marketing methanol and
successfully carrying out major capital expenditure projects in
various jurisdictions, including without limitation:
- conditions in the methanol and other industries including
fluctuations in the supply, demand for and price of methanol and
its derivatives, including demand for methanol for energy
uses,
- world-wide economic conditions, and
- other risks described in our 2016 Annual Management's
Discussion and Analysis and our Third Quarter 2017 Management's
Discussion and Analysis.
Having in mind these and other factors,
investors and other readers are cautioned not to place undue
reliance on forward-looking statements. They are not a substitute
for the exercise of one's own due diligence and judgment. The
outcomes anticipated in forward-looking statements may not occur
and we do not undertake to update forward-looking statements except
as required by applicable securities laws.
For further information, contact:
Methanex CorporationDean RichardsonVice
President, Treasury and Investor RelationsTel: 604 661 2600
Painted Pony Energy Ltd.Jason FleuryDirector,
Investor RelationsTel: 403 776 3261
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