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25-07-2012

Methanex proceeds with Louisiana project

Methanex Corporation announced today that it has reached a final investment decision to proceed with the relocation of a one million tonne methanol plant from its Chile site to Geismar, Louisiana. The Louisiana plant is targeted to be operational by the end of 2014 and the expected cost of the project including all Owners' and pre-start up costs is approximately US$550 million.

Bruce Aitken, President and CEO of Methanex commented, "We are delighted to move forward with this excellent project which we believe will create significant value for shareholders and add an important new supply source for our customers. We have completed the engineering study which reaffirms that the project offers substantial capital savings compared to a greenfield methanol plant. In addition, it can be executed in significantly less time, which allows us to capitalize on the current low natural gas price environment in North America."

Mr. Aitken added, "Geismar is an excellent location for a methanol project. It possesses world-class infrastructure, skilled workers and is a positive, low-risk environment in which to do business. It is also a large methanol-consuming region which offers the potential for substantial logistics cost savings. We have commenced dismantling of the plant and expect to receive all key permits by the end of 2012."

Mr. Aitken concluded, "The timing of this project is also excellent. The demand outlook for methanol is strong and there is little new production capacity being added to the industry over the next several years."

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