Controversial proposed methanol plant at Port of Kalama in Washington is nixed

A methanol plant that was in the planning for the Port of Kalama for seven years was cancelled last week, several months after the Washington Department of Ecology (DOE) denied a necessary shoreline permit earlier this year.

That was the most recent in a series of setbacks for the project. Northwest Innovation Works (NWIW), the developer of the proposed $2.3bn refinery, had intended to produce methanol from fracked natural gas imported from Canada and ship it to Asia.

Tanker operator Hafnia and Japan’s Mitsui O.S.K. Lines (MOL) had both invested in the project in exchange for long-term charters to carry the methanol.

The project had been strongly supported by the port, labour groups and local politicians for the jobs and economic development it would bring to the area, and strongly opposed by environmentalists for the greenhouse gases it would produce.

In December 2020, the Washington DOE said the refinery would have emitted almost a million metric tons of carbon dioxide into the air each year. It was because of those anticipated emissions that the Department denied the permit in January 2021. NWIW had earlier released its own report, indicating the project would have a net decrease of global GHG emissions.

It took several months for NWIW to decide to pull the plug on the project. Its apparent initial response after the DOE decision was to continue to press for the plant; the company extended its lease at the port just days later. It has now, however, terminated its lease. The port said in a press release that NWIW had spent tens of millions of dollars addressing state agency permitting concerns.

Announcing its decision, the company said, “Together with our partners, we remain committed to addressing the global climate challenge, creating jobs and economic growth, and are moving forward in developing other innovative net zero projects to produce zero carbon hydrogen and related products.”