ENERGY OF THE FUTURE

Today when the problem of finding alternative energy sources is important not only for states experiencing a crisis with traditional fuel, but also for countries that have enough of it, each discovery in this sphere is of particular importance. In this sense, the project for the production of methanol in Azerbaijan, which is considered one of the best alternative energy sources and is widely used in various industries - furniture, hosiery, automotive, light industries, etc., is certainly one of the most successful business ventures in recent years.

Methanol - a chemical compound of carbon monoxide or carbon dioxide with hydrogen - is regarded as the most environmentally friendly fuel of the 21st century because its production does not produce any emissions into the atmosphere or bodies of water. Adding it to gasoline can reduce emissions as a result of complete combustion. In world industry, it has confidently become an irreplaceable ingredient in the manufacture of a wide range of products in various fields - laminated boards used in the furniture industry, synthetic bodices for the production of artificial leather and knitwear products and even acetic acid. Applying elements of liquid fuel, it is possible to use methanol to ensure the work of computers, mobile phone batteries, etc. After all, it is a source of energy widely used in the defence industry and in energy supplies to buildings.

All of these useful and important properties of methanol formed the basis of the idea of creating a plant for its production in Azerbaijan. The raw material for the production of methanol is natural gas whose production in our country is growing year by year. In fact, the Azerbaijani methanol plant - AzMeCo - will be the first enterprise using gas as the feedstock. The uniqueness of the project does not end there - the plant, which is being built in Qaradag district of Baku and has a triple safety system, is designed to withstand earthquakes with a magnitude of up to 9 points. If there are any signals about danger, its operation will be halted automatically. In other words, this company can become quite a good example for other subjects of local industry, encouraging them to ensure a safe and environmentally friendly manufacturing process.

AzMeCo itself plans to build new production facilities, and the chairman of the company's board of directors, Nizami Piriyev, told R+ about it.

- In what stage is the construction of the plant and when will it begin production?

- By the end of December this year, the plant will be 90 per cent complete. After that, work will be carried out for another 3-3.5 months to ensure power supplies and prepare for the start of the production process. I think that from the second half of 2012, the plant can start producing products and achieve a design production capacity of 560,000 tons by July-August. In December of next year, we plan to increase the plant's capacity to 720,000 tons, which will be achieved through the return and recycling of carbon dioxide (CO2) discharged into the atmosphere during primary production. By the way, this very point will allow us to take "carbon loans" from the Multilateral Carbon Credit Fund created on the joint initiative of the European Bank for Reconstruction and Development and European Investment Bank.

- Did AzMeCo thus manage to secure the financial side of this large and complex project or were other sources involved as well?

- As this project was implemented, the International Bank of Azerbaijan gave us substantial support. Not only did it financially help us to establish the company and build the plant, it also made an investment. Banks of Europe, Russia and Canada also acted as partners. It must be noted that the project is estimated at $ 380 million.

Here I would like to emphasize another point. While implementing the project, we came to the conclusion that it is necessary to set up a bank in Azerbaijan to help finance international trade transactions by residents of Azerbaijan - Eximbank, which would allocate loans to businesses of other countries on condition that they spend 60-65 per cent of this money to buy Azerbaijani products. For example, while building the methanol plant, we received strong support from the eximbanks of other states, using the financial resources of which we purchased manufacturing equipment from those countries.

Speaking of partners, I would like to note that since the very first day, we have been cooperating with government agencies on safety issues, as well as with emergencies ministries and ministries of ecology and natural resources.

- How will you sell the methanol produced by AzMeCo?

- In the first stage, we plan to sell 90 per cent of our products on the foreign market and 10 per cent on the domestic market. But in the future, following the launch of new production sites where methanol is used as the raw material, this ratio will, of course, change. We also hope that in Azerbaijan, methanol will be widely used as an alternative source of energy, and its properties will also be used in gasoline, etc.

With regard to foreign markets, the closest market to us is Turkey, where the annual demand for methanol reaches 500,000 tons. In Europe, this figure is even higher. Our products will be exported by rail to the Georgian port of Poti and from there to Europe by sea.

- You mentioned new plants. What specific areas of production is AzMeCo going to open?

- Another project in our company will be a formaldehyde plant and then, a paraformaldehyde plant. We also plan to build a plant for the production of acetic acid. After that, we are going to start negotiations with local and foreign companies regarding the possibility of producing new products based on methanol - we are ready to be partners in projects in this area.