OR WAIT null SECS
The companies will jointly develop IFC’s Pacifico Mexinol project, which is a 6,145 MT per day methanol production facility in Sinaloa, Mexico.
Announced at the United Nations’ COP28 climate conference, Transition Industries and the International Finance Corporation (IFC) signed a joint project development agreement (JPDA) to develop the Pacifico Mexinol project. IFC’s Pacifico Mexinol project is a 6,145 MT per day methanol production facility located near Topolobampo, Sinaloa, Mexico.
When operations commence, Pacifico Mexinol is expected to be a large-scale single ultra-low carbon chemicals facility that produces approximately 300,000 MT of green methanol from captured carbon and green hydrogen. In addition to green methanol production, Pacifico Mexinol will produce 1.8 million MT of blue methanol per year from natural gas with CO2 capture.
“We are pleased to announce our JPDA with the IFC and proud to partner on this project,” said Rommel Gallo, CEO of Transition Industries. “Together, we expect to set a new standard in ESG for the development of large industrial and chemicals projects that addresses climate change, sustainably manages natural resources such as water, and works in partnership with local communities to achieve shared value.”
According to the terms of the JPDA, IFC will share a portion of the project development costs, provide expertise for environmental compliance, and leverage its experience to support project financing. As a result, IFC retains the right to invest in a pro rata percentage of the project’s common equity and lead the financing of at least 50% of the debt.
For the past four years, the Pacifico Mexinol project has been engaging with local stakeholders and community members to gauge needs and concerns. The local communication resulted in several design solutions—the use of municipal wastewater to eliminate competition with local freshwater needs; keeping the nearby bay free of water removal or discharge; and export of methanol through a current port, reducing the requirement for additional dredging and infrastructure.
“By mobilizing capital, we amplify the impact of our financing on the lives of people in developing countries,” said Alfonso García Mora, IFC’s Vice President for Europe, Latin America and the Caribbean. “With this agreement, we contribute to the development of a project with the potential to reduce natural gas flaring, treat recycled wastewater, diversify Mexico’s chemicals capacity, increase exports and generate employment. At least 40% of the global production of methanol comes from coal. Decarbonizing methanol production is an imperative for IFC.”
Pacifico Mexinol is expected to reach a final investment decision (FID) in 2024 and commercial operations will begin in late 2027. IFC’s project is expected to create approximately 3,500 jobs during construction and up to 450 jobs during operations.