Boom times are back for Taranaki's multi-million dollar methanol industry, with production set to reach record levels.
Methanex New Zealand has restarted its Waitara Valley methanol plant, which had lain idle since 2005 when it was shut down because of a lack of natural gas.
But now there's plenty of available gas again, thanks to new-age drilling techniques and fracking which have resulted in significant discoveries both on and off the shore in Taranaki.
This has in turn resulted in Methanex signing new long-term gas supply agreements, allowing it to spend more than $240 million on capital projects including the restart of Waitara Valley.
Last month Methanex also successfully restarted an idle methanol distillation unit, which will "debottleneck" production capacity from both Waitara Valley and the nearby Motunui methanol plant. Up until now the company hasn't had the ability to distill the same amount of crude methanol as it could produce.
Methanex is now able to produce up to 2.4 million tonnes a year - 6500 tonnes a day - almost all of which will be exported through Port Taranaki.
The upgrade has also created 50 new full-time jobs, the majority of them operator positions at the restarted production plant.
In a statement from Vancouver, Methanex Corporation president and chief executive John Floren said the company was excited to be restarting Waitara Valley and to have improved the distillation capacity in Taranaki.
"These initiatives represent important milestones in reaching our growth objectives," he said.
Yesterday Port Taranaki chief executive Roy Weaver confirmed methanol exports are expected to grow by at least a third, which will almost certainly result in the port having to invest in larger tugs.
"The extra methanol production won't necessarily increase the frequency of tanker calls, because since methanol exports last peaked in 2000 we have increased the Port Taranaki draught from 10 metres to 12.5 metres, and this has allowed Methanex to increase its liftings by 50 per cent per ship," he said.
The Waitara Valley restart project provided work for a number of Taranaki contractors.
The job exceeded 500,000 man hours, with more than 400 on the site each day.
And now that the upgrade project is complete, it will continue to prove lucrative for Taranaki.
A Berl economic report released in March this year forecast that at full production, Methanex will annually contribute $440m to Taranaki's GDP and $650m to the New Zealand GDP. This includes generating 650 jobs in Taranaki and more than 1200 jobs throughout New Zealand per year.
- © Fairfax NZ News
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