EghtesadOnline: Global methanol demand will grow by 6.5% in the next three years based on data from Methanex, the world’s largest producer and supplier of methanol.
Regarding the increase of methanol output in Iran, new projects are underway to help complete the value chain of the chemical, a board member of Ayandeh Institute of Methanol and Ammonia said.
According to the National Petrochemical Company's news agency NIPNA, Muhammad Ebrahim Yousefzadegan was speaking at the first conference and exhibition of methanol and value chain, held last week in the Shiraz Petrochemical Plant in southern Fars Province.
Held with the aim of helping expand knowledge and sharing experience between methanol producing companies, the event was attended by executives from petrochemical and methanol manufacturers who discussed cooperation, the market conditions, factors affecting methanol prices and the impact of US sanctions on the methanol industry, according to Financial Tribune.
Technological achievements in methanol value chain plus developments related to and emanating from the methanol market were among topics of the conference.
“Up until 2007 methanol was used only as a chemical. But completion of methanol value chain gained momentum soon after as methanol to olefin and methanol to propylene projects were accelerated and have a bigger profit margin,” Yousefzadegan was quoted as saying by NIPNA.
With the recently launched petrochemical complexes, including Marjan, Kharg, Fanavaran, Kaveh and Zagros, Iran now produces 6.6 million tons of methanol per annum of which 400,000 tons are exported.
Six more methanol projects will come on stream by 2020 and add 12 million tons to the total annual output.
Among projects to complete the methanol value chain three are in southern Bushehr Province. Sabalan Methanol Project has made 80% progress and Dena Methanol Project is 60% through while Siraf Methanol Project’s progress is reported at 40%.
Sabalan and Dena projects in Asaluyeh will have an annual production capacity of 1,650 million tons a piece.
The Siraf methanol project will produce the same amount in Dayyer County and focus mainly on exports.
NPC data show Iran accounts for 8% of the world's total methanol production and its exports are seen in international markets mainly in Iraq, China, the UAE, India and South Korea.
Between March 2017 and 2018, Iran’s methanol exports generated $1 billion (the USD exchange rate then was 35,000 rials).
Availability of relatively cheap feedstock plus demand from Asia has contributed to robust growth of Iran's methanol industry production in the past decade.
However, the new US oil sanctions could delay implementation of some methanol projects on the back of technology and investment constraints, and hinder exports amid banking and currency restrictions.
China, which has a large methanol-to-olefin capacity, is a natural target market for Iranian supplies. Its top five importers account for 60% of Iranian methanol.
Companies in the world’s second largest economy too are citing banking difficulties in trade with Iran due to the US restrictions imposed after President Donald Trump abandoned the Iran nuclear deal in May and reimposed economic and oil sanctions.
According to Globe Newswire, the global methanol market was worth $ 24.7 billion in 2018, registering a compound annual growth rate of 7.7% during 2011-2018. According to estimates, the market is expected to reach a CAGR of 11.1% during the forecast period (2019-2024).
Since methanol is readily available and extremely efficient, it is extensively used in the automotive industry as a transportation fuel and antifreeze agent for automobile radiators.
In addition, it is used in manufacturing dimethyl ether (DME) and methyl tert-butyl ether (MTBE), which are safer alternatives to traditional gasoline. It also forms an essential component of biodiesel and is used in internal combustion engines.
Apart from this, the alcohol also finds numerous applications in the manufacturing of formaldehyde, acetic acid and methyl acetate. These chemicals are further used in the production of adhesives, paints, plywood, solvents, foams, plastics and explosives.
Since methanol biodegrades easily and is eco-friendly in nature, it is preferred over counterparts like crude oil, gasoline and diesel.