Global green methanol market is expected to witness a period of rapid expansion
2023/6/30
The Egyptian Ministry of Petroleum and Mineral Resources has announced a green methanol production project with Norway, in which both sides will invest $450 million. Once the project is completed, it is expected to become the first green methanol production project in Egypt and the whole Middle East.
In fact, in addition to the Middle East, Europe, North America and other regions have also opened green methanol production plans, not only for green methanol production technology for research and development investment, but also actively explore green methanol application scenarios.
Green methanol related projects have been landed in the world one after another. In the second half of last year, global shipping giant Maersk reached a cooperation agreement with the Egyptian government. The Egyptian government said it would invest $15 billion in the production of green and clean fuel for ships. In the same year, Maersk also signed a memorandum of understanding with the Jordanian government on green marine fuels. In addition, energy companies in Spain, Singapore, the United States and other countries are also actively planning green methanol-related projects. All signs indicate that the global green methanol market is expected to see rapid expansion.
Bringing new export opportunities
According to Egypt's Pyramids newspaper, Egypt's Alexandria National Refining and Petrochemical Company has reached a cooperation agreement with Norwegian renewable energy developer Scatec to build a green methanol production plant in Egypt's Damietta Port, which is expected to produce 40,000 tons of green methanol per year and increase its annual production capacity to 200,000 tons in the future.
According to a public statement issued by the Egyptian Ministry of Petroleum and Mineral Resources, the green methanol production project will be accompanied by a photovoltaic power plant with an installed capacity of 40,000 kilowatts and a 120,000 kilowatt wind farm, a desalination plant and a methanol fuel storage station, and will be equipped with 60 megawatts of green hydrogen capacity.
The Egyptian government stressed that the green methanol production project, when completed, will bring new export opportunities for the Egyptian chemical industry and help Egypt become a global supplier of green fuel for ships.
May become a powerful tool for decarbonization
Compared with the use of traditional fossil fuels to produce methanol, green methanol production often uses renewable energy sources such as scenery, and the carbon emissions generated by the whole process are negligible.
Green methanol production is a major measure to achieve green and low-carbon development in Egypt. since 2022, the Egyptian government has announced a series of energy and climate policies to vigorously promote energy transition. The Integrated Sustainable Energy Strategy 2035 developed by the Egyptian government shows that Egypt's renewable energy generation will increase to 42% by 2035. Last May, the Egyptian government released the National Climate Strategy 2050, which proposes to reduce national carbon emissions and increase the amount of renewable energy, and green hydrogen and green methanol are favored low-carbon energy sources.
Chairman of Skatec Pierschkeag said that the development of green methanol industry will provide a boost to Egypt's economic growth, and will help Egypt become a green chemical production and export country, and a global shipping industry green fuel production distribution center.
The green methanol market has warmed up significantly globally. In order to achieve the set climate goals, the EU needs to make a big push to reduce carbon in the maritime transportation sector, and green methanol is its chosen decarbonization tool.
Market potential to be explored
Although the current production cost of green methanol is still higher than that of traditional methanol, the production of green methanol is expected to grow significantly under the impetus of policy stimulation and capital investment. The International Renewable Energy Agency has predicted that the supply of green methanol is expected to reach 385 million tons by 2050.
Meanwhile, green methanol downstream application scenarios are also expanding. Global demand for green methanol is already growing, especially for the shipping industry, where green methanol has become the preferred alternative to fossil fuels.
Messenius, the world's largest methanol producer, forecasts that global methanol demand will increase by 14 million tons per year in the next five years, with the increment mainly being green methanol. The latest data released by DNV shows that by the end of March, 25 methanol-fueled ships have been put into service worldwide and 81 new methanol-fueled ships have placed orders.
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