MEO Australia Updates on Tassie Shoal Methanol Project

MEO Australia has provided update in relation to the commercialisation of the first Tassie Shoal Methanol Plant.

Reports recently commissioned from major international engineering firms Davy Process Technology, WorleyParsons and Arup to assess the technology basis and provide updated development costs estimates for TSMP1 for a range of feedstock gas qualities have been received.

The TSMP1 cost estimate is for an overall capital spend of US$1.5 Billion (including contingency of 20%) for the first of two plants that will each have nameplate capacity of 1.75 million tonnes per annum (MTA) of methanol. The cost estimates are on a +/-25% basis, consistent with the detailed pre-FEED status of the TSMP1 project.

From a business development perspective, since MEO received Expressions of Interest in April, 2012 for long term supply of 8.3MTA of methanol from TSMP1, MEO has been actively engaged in negotiations to shortlist its preferred buyers by defining the commercial basis for long term sales.

Methanol pricing and indicative commercial terms have been received from major industry participants and are currently in the process of being evaluated. Exploratory discussions for broader strategic partnerships across the value chain continue in parallel.

MEO’s Executive Manager Business Development Robert Zammit commented: “The technology and cost estimate review by leading international engineering firms has confirmed the economic fundamentals of the design basis and its suitability as a commercialisation option for gas resources with high CO2. The updated cost estimate coupled with market pricing and commercial terms underpins the project economics and supports our ongoing maturing of the commercial framework for TSMP1.”

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LNG World News Staff, November 16, 2012