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Methanex to participate in China DME with Xinao Group

08 Nov 2006 - Methanex and China's XinAo Group have entered into a long-term arrangement under which Methanex will, beginning in late 2007, supply an initial quantity of approximately 300,000 tonnes per annum of methanol to XinAo. This methanol is required for a new 200,000 tonne di-methyl ether (DME) production facility that XinAo is developing near Shanghai. The price for methanol under this supply arrangement will be linked to energy prices. Methanex also has an option to take an equity stake of up to 20% in this DME facility.
 
DME, which is produced from methanol, can be blended up to 20% with liquified petroleum gas (LPG) and used for household cooking and heating. DME can also be used as a clean burning substitute for diesel in transportation and as a clean fuel for power generation.