En­er­gy Min­is­ter Kevin Ram­nar­ine yes­ter­day signed an agree­ment with two Japan­ese com­pa­nies and the Neal & Massy group for the es­tab­lish­ment of an US$850 mil­lion petro­chem­i­cal plant at the Union In­dus­tri­al Es­tate in La Brea.If the methanol-to-di­methyl ether (DME) project goes ahead, it would be the first new down­stream en­er­gy plant in T&T since the com­ple­tion of the AUM I project in 2010.

The project aims to pro­duce, by 2016, 1 mil­lion tonnes of methanol and 100,000 tonnes of DME per year with an in­vest­ment of US$850 mil­lion or $5.4 bil­lion.The project will ini­tial­ly use 100 mil­lion stan­dard cu­bic feet per day of nat­ur­al gas to pro­duce the 1 mil­lion tonnes of methanol, of which 140,000 tonnes will be used to pro­duce the 100,000 tons of DME.

Con­sid­ered a clean fu­el, DME is used as a sub­sti­tute for propane (cook­ing gas) and diesel in Eu­rope, Chi­na and Japan. Methanol, made main­ly from nat­ur­al gas, is used as a raw ma­te­r­i­al in the man­u­fac­ture of a wide range of prod­ucts in­clud­ing ad­he­sives, agro­chem­i­cals, paints and syn­thet­ic resins. Neal & Massy Group CEO Ger­vase Warn­er said that he was ex­cit­ed about the project be­cause for his group, which op­er­ates through­out the Caribbean, it would mean re­duced fu­el costs.

The stake­hold­ers in the project are the Mit­subishi Cor­po­ra­tion (33 per cent), the Mit­subishi Gas Chem­i­cal Com­pa­ny (33 per cent), Neal & Massy Hold­ings Lim­it­ed (10 per cent), IC­CL of Hous­ton (4 per cent) and the gov­ern­ment of T&T (20 per cent) through its state agen­cies, the Na­tion­al Gas Com­pa­ny of T&T (NGC) and the Na­tion­al En­er­gy Cor­po­ra­tion of T&T (NEC).

"This project presents sev­er­al dis­tinct but unique op­por­tu­ni­ties for Trinidad and To­ba­go with re­spect to the fur­ther di­ver­si­fi­ca­tion of the en­er­gy sec­tor, growth of the econ­o­my, de­vel­op­ment of the South West­ern penin­su­la, re­gion­al en­er­gy se­cu­ri­ty and lo­cal con­tent. Let me add that we are ex­treme­ly pleased with the in­volve­ment of Neal & Massy in this project.

I want to per­son­al­ly com­mend Ger­vase Warn­er and Arthur Lok Jack (Neal & Massy chair­man) for their vi­sion and re­solve which has seen us reach this ad­vanced stage here to­day with this project," En­er­gy Min­is­ter Kevin Ram­nar­ine said.

Dur­ing the con­struc­tion phase of the plant, the project will cre­ate about 3,000 con­struc­tion jobs and even­tu­al­ly lead to the cre­ation of 180 per­ma­nent jobs in south west Trinidad, the min­is­ter said."A lot more re­mains to be done and we will be here to as­sist along the way. If all goes to plan we can ex­pect that con­struc­tion will com­mence by the sec­ond quar­ter of 2014," he said.

In a pre­pared state­ment, Mit­subishi Gas Chem­i­cal Com­pa­ny of­fi­cials Ryu­ji Ide­no and Masahi­ro Deguchi said: "The glob­al de­mand for methanol is cur­rent­ly 60 mil­lion tonnes per year and this de­mand is ex­pect­ed to see a 4 to 5 per cent growth in the com­ing years.

By us­ing nat­ur­al gas pro­duced in T&T, as the main source of raw ma­te­ri­als for pro­duc­ing methanol, a ba­sic chem­i­cal; and di­methyl ether, a liq­ue­fied gas, the project will be mak­ing a con­tri­bu­tion to eco­nom­ic growth in T&T and the Caribbean re­gion while at the same time help­ing to sat­is­fy the grow­ing glob­al de­mand for methanol."

Asked if he was con­cerned about the 15 bil­lion yen loss that the Mit­subishi Gas Chem­i­cal Com­pa­ny post­ed at the end of its fis­cal year on March 31, 2013, Neal & Massy's Warn­er said, "No, what you have to look at is their bal­ance sheet."