Canada-headed Methanex Corporation (Methanex) and Japan-headed Mitsui O.S.K. Lines, Ltd (MOL) have recently announced that the parties have concluded Key Commercial Terms for the purchase and sale of an equity position in, and the establishment of a strategic partnership involving Methanex’s Waterfront Shipping (WFS) subsidiary, a global marine transportation company that operates the world’s largest methanol ocean tanker fleet.
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With a fleet of approximately 800 vessels, MOL is one of the world’s largest shipping companies. According to the agreement, MOL will acquire a 40 percent minority interest in WFS for US$145 million. Methanex will retain the remaining 60 percent majority interest in WFS and continue to operate WFS as a key element of its global supply chain capabilities.
Through this transaction, Methanex, WFS, and MOL will establish a strategic partnership, which will enable Methanex and WFS to benefit from MOL’s broad shipping experience to further strengthen its already excellent shipping operations and capabilities.
The strategic partnership strengthens a relationship established over 30 years between Methanex, WFS, and MOL who, in 2016 in conjunction with other key partners, jointly built the first ocean-going dual-fuel vessel capable of running on methanol.
With Methanex as the world-leading methanol producer, WFS as the world’s leading methanol shipper, and MOL’s vast shipping experience, the parties intend to advance the commercialization of methanol, including renewable methanol, as a viable marine fuel.
We are pleased to expand our relationship with MOL, a world-leading shipping company, which will enable Waterfront Shipping to enhance its capabilities by leveraging MOL’s extensive global shipping experience. We have worked with MOL for over 30 years on methanol shipping since the era of Cape Horn Methanol Ltd., a predecessor to Methanex’s Chile operations, and we are confident that our new strategic relationship will help develop the market for methanol as a lower emission marine fuel, said John Floren, President and CEO of Methanex.
Proven marine fuel
Methanol is a safe, proven, cost-competitive marine fuel for the commercial shipping industry that can meet current and future emissions regulations. Methanol as a marine fuel can reduce sulphur oxides (SOx) by up to 99 percent, particulate matter (PM) emissions by up to 95 percent, and nitrogen oxides (NOx) by up to 80 percent compared to conventional marine fuels.
As a marine fuel, methanol also reduces carbon dioxide (CO2) emissions during combustion by up to 15 percent. Methanol produced from renewable sources can reduce CO2 emissions by up to 95 percent compared to conventional marine fuels, providing a pathway to meet the International Maritime Organization’s (IMO) decarbonization goals without further investment or compatibility issues with the current dual-fuel engine technology.
There will be no change to Waterfront Shipping’s day-to-day operations due to this transaction, and Paul Hexter will remain President. The definitive agreements are subject to formal approval by MOL’s Board of Directors. The closing is subject to regulatory approval and is expected by the end of the year after all customary conditions are met.
MOL is pleased to partner and deepen our long-standing relationship with Methanex, the leader in the methanol industry. This transaction is consistent with MOL’s Environmental Vision 2.1., which regards our active involvement in methanol-fueled ships as one of the measures for adopting clean alternative fuels, said Takeshi Hashimoto, President of MOL.