SOCAR Methanol names reasons restraining production growth

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    The Baku methanol plant, operated by SOCAR Methanol LLC of Azerbaijan’s state oil company SOCAR, expects to reach the annual capacity of 500,000 tons of methanol by 2019, Elnur Mustafayev, the company’s CEO, said.

    He made the remarks during the Methanol 2017 Conference in Moscow, Plastinfo portal reported.

    “Since October 2016, when SOCAR acquired the methanol plant, the enterprise has manufactured 80,000 tons of products, and it is planned to produce 250,000 tons this year,” Mustafayev said. “In general, the design capacity of the plant is 650,000-700,000 tons per year.”

    Mustafayev named restrictions on raw materials and demand the main reasons restraining the growth of production volumes.

    “The expected increase of gas production in Azerbaijan in 2019 will make it possible to significantly increase the volume of output,” he noted. “To this end, the enterprise will be overhauled in 2017.”

    The methanol plant was built by AzMeCo company and is one of the largest investments in the non-oil sector of Azerbaijan. The plant, which is the only one in the South Caucasus and Central Asia region, started selling products in January 2014.

    AzMeCo for the debts was handed over to Aqrarkredit CJSC non-bank credit institution in accordance with a decision of Azerbaijan’s Cabinet of Ministers. (Aqrarkredit CJSC manages the distressed assets of the International Bank of Azerbaijan).

    SOCAR acquired the plant from Aqrarkredit CJSC.

    The need to transfer AzMeCo to SOCAR arose due to AzMeCo’s debts to the International Bank of Azerbaijan.

    The cost of the plant was estimated at $520 million.