TRINIDAD AND TOBAGO-ENERGY: Methanol Brought in the Bucks in '94

• by IPS Correspondents (port of spain)
• Friday, December 30, 1994
• Inter Press Service

PORT OF SPAIN, Dic 30 (IPS) - For the methanol industry here 1994 was a bumper year and there are expectations that 1995 will be even better.

With the price of the product having soared throughout the latter part of the year, investors like Lawrence Duprey of the CL Financial Group, one of the Caribbean's largest conglomerate, are laughing at critics who had told them they were mad to go that route.

Duprey launched the Caribbean Methanol Company (CMC) in late October 1993 after a string of business failures and many thought his 200 million dollar investment would surely be lost, afterall what did an insurance executive know of the petrochemical industry.

But profits for CMC stood at 58 million dollars at the end of November and should be around 75 million dollars at the end of the year, say officials at Colonial Life Insurance Company (CLICO), the flagship of the CL Group.

The source said CMC had set its 1994 budget at a projected price of between 140 and 150 dollars per tonne. However spot prices are now just over 500 dollars per tonne. Last month it averaged 441 dollars per tonne and the price is still slowly rising.

The government is also looking to rake in big bucks with the rise in methanol prices, a fact that has banished last year's dismal profit of 3.7 million dollars from the minds of officials at the Trinidad and Tobago Methanol Company (TTMC).

The state owns 45 percent of this company; its partners are two Germany companies, Ferrostaal AG and Helm AG.

In addition to the profits the government will certainly get from its association with TTMC, the possibility exists that it could also use the tax route to get more of the methanol windfall by moving in on CMC.

Although CMC is exempt from most taxes as it operates in the free zone area, the government is entitled to 38 percent of the company's profits through a special corporation tax.

Methanol has done this well on the international market because of problems with other suppliers of the product.

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