More Globe & Mail 10:38 AM EDT, 07/16/2021 (MT Newswires) -- Methanex Corp. (MX.TO) said Friday that its board approved the construction restart of the Geismar 3 project as well as an increase in the quarterly dividend to $0.125 per share from $0.0375 per share. The company at last look rose 2.7% in U.S. trading and was up 2.6% in Canada trading early Friday.
Methanex made the announcement after saying overnight Thursday that it has concluded the key commercial terms for the sale of a 40% stake in its Waterfront Shipping subsidiary to Mitsui O.S.K. Lines Ltd. for US$145 million.
Under the terms, Methanex will retain the remaining 60% in Waterfront Shipping, which owns a fleet of about 800 vessels. The company said no changes are expected to the subsidiary's day-to-day operations, and Paul Hexter will remain president. The definitive agreements are subject to approval by Mitsui's board and deal's close is expected by the end of the year.
Estimated capital costs for Geismar are in the range of $1.25 billion to $1.35 billion, lower than the previous estimate of $1.3 billion to $1.4 billion. About $435 million will be committed as of the end of the third quarter through the care and maintenance period, and the remaining $800 million to $900 million will be allocated after resuming construction in October.
Commercial operations are targeted in late 2023 or early 2024.
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