Methanex Reports Q2 2014 Earnings

 NEWS RELEASE TRANSMITTED BY Marketwired  FOR: Methanex Corporation  TSX SYMBOL:  MX NASDAQ SYMBOL:  MEOH  JULY 30, 2014  Methanex Reports Q2 2014 Earnings  VANCOUVER, BRITISH COLUMBIA--(Marketwired - July 30, 2014) - For the second quarter of 2014, Methanex (TSX:MX)(NASDAQ:MEOH) reported Adjusted EBITDA(1) of $160 million, compared to Adjusted EBITDA(1) of $255 million reported in the first quarter of 2014 and $157 million reported in the quarter ended June 30, 2013. Adjusted net income(1) was $91 million ($0.94 per share on a diluted basis) in the second quarter of 2014, compared to Adjusted net income(1) of $160 million ($1.65 per share on a diluted basis) for the first quarter of 2014 and $99 million ($1.02 per share on a diluted basis) for the second quarter of 2013.    John Floren, President and CEO of Methanex commented, "Methanol prices are lower in Q2 2014 compared to Q1 2014, resulting in lower Q2 earnings as compared to the first quarter. We believe pricing is now stabilizing at current levels." Mr. Floren added, "At these methanol prices, Methanex continues to generate strong EBITDA and cash flows. The methanol industry environment remains favourable, with steady demand and limited new supply additions expected in the near to medium term."   Mr. Floren added, "We are making excellent progress on the relocation of two of our Chile plants to Geismar, Louisiana, and are targeting methanol production from our Geismar 1 facility in late 2014 and Geismar 2 in early 2016. Each of these plants will add an incremental one million tonnes to our operating capacity."   "In the second quarter we also reached a settlement agreement with Total Austral S.A. of Argentina and received a lump sum payment of US$42 million, or $27 million net of tax, to terminate their obligations under their former long-term natural gas supply agreement with Methanex in Chile. This payment is not included in our Q2 2014 Adjusted EBITDA or Adjusted net income but has been recorded in Q2 2014 Net income attributable to Methanex shareholders."    "During the quarter, we returned over $100 million in cash to shareholders in the form of dividends and share repurchases. With over $600 million of cash on hand, an undrawn credit facility, robust balance sheet, and strong cash flow generation, we are well positioned to meet our financial commitments, invest to grow the Company and return excess cash to shareholders through dividends and our share buyback program."    A conference call is scheduled for July 31, 2014 at 12:00 noon ET (9:00 am PT) to review these second quarter results. To access the call, dial the conferencing operator ten minutes prior to the start of the call at (416) 340-2218, or toll free at (866) 226-1793. A playback version of the conference call will be available until August 21, 2014 at (905) 694-9451, or toll free at (800) 408-3053. The passcode for the playback version is 2070181. Presentation slides summarizing Q2-14 results and a simultaneous audio-only webcast of the conference call can be accessed from our website at www.methanex.com. The webcast will be available on the website for three weeks following the call.   Methanex is a Vancouver-based, publicly traded company and is the world's largest producer and supplier of methanol to major international markets. Methanex shares are listed for trading on the Toronto Stock Exchange in Canada under the trading symbol "MX" and on the NASDAQ Global Market in the United States under the trading symbol "MEOH".  FORWARD-LOOKING INFORMATION WARNING   This Second Quarter 2014 press release contains forward-looking statements with respect to us and the chemical industry. Refer to Forward-Looking Information Warning in the attached Second Quarter 2014 Management's Discussion and Analysis for more information.  /T/  (1) Adjusted EBITDA, Adjusted net income and Adjusted net income per common   share are non-GAAP measures which do not have any standardized meaning    prescribed by GAAP. These measures represent the amounts that are         attributable to Methanex Corporation shareholders and are calculated by   excluding the mark-to-market impact of share-based compensation as a      result of changes in our share price and items considered by management   to be non-operational. Refer to the Additional Information -              Supplemental Non-GAAP Measures section of the attached Interim Report     for the three months ended June 30, 2014 for reconciliations to the most  comparable GAAP measures.                                                 /T/  Interim Report for the Three Months Ended June 30, 2014     At July 30, 2014 the Company had 94,323,459 common shares issued and outstanding and stock options exercisable for 1,585,616 additional common shares.  Share Information   Methanex Corporation's common shares are listed for trading on the Toronto Stock Exchange under the symbol MX and on the Nasdaq Global Market under the symbol MEOH.   Transfer Agents & Registrars   /T/  CIBC Mellon Trust Company                                                    320 Bay Street                                                               Toronto, Ontario Canada M5H 4A6                                              Toll free in North America: 1-800-387-0825                                    /T/  Investor Information   All financial reports, news releases and corporate information can be accessed on our website at www.methanex.com.   Contact Information   /T/  Methanex Investor Relations                                                  1800 - 200 Burrard Street                                                    Vancouver, BC Canada V6C 3M1                                                 E-mail: invest@methanex.com                                                  Methanex Toll-Free: 1-800-661-8851                                            /T/  SECOND QUARTER MANAGEMENT'S DISCUSSION AND ANALYSIS  Except where otherwise noted, all currency amounts are stated in United States dollars.  FINANCIAL AND OPERATIONAL HIGHLIGHTS  /T/  --  A reconciliation from net income attributable to Methanex shareholders  to Adjusted net income(1) and the calculation of Adjusted net income per  common share(1) is as follows:   Three Months Ended         Six Months Ended    ------------------------------ -------------------- ($ millions except number                                                     of shares and per share    Jun 30     Mar 31    Jun 30   June 30    June 30  amounts)                     2014       2014      2013      2014       2013 ------------------------------------------------------- --------------------  Net income attributable                                                       to Methanex shareholders $    125   $    145  $     54  $    270   $    114   Mark-to-market impact                                                       of share-based                                                             compensation, net of                                                       tax                          (7)        15         9         8         36   Argentina gas                                                               settlement, net of tax      (27)         -         -       (27)         -   Write-off of oil and                                                        gas rights, net of tax        -          -        14         -         14   Geismar project                                                             relocation expenses,                                                       net of tax                    -          -        22         -         22 ------------------------------------------------------- -------------------- Adjusted net income (1)   $     91   $    160  $     99  $    251   $    186 ------------------------------------------------------- -------------------- Diluted weighted average                                                      shares outstanding                                                           (millions)                     97         97        96        97         96 Adjusted net income per                                                       common share (1)         $   0.94   $   1.65  $   1.02  $   2.59   $   1.94 ------------------------------------------------------- --------------------  --  We recorded Adjusted EBITDA(1) of $160 million for the second quarter of  2014 compared with $255 million for the first quarter of 2014. The  decrease in Adjusted EBITDA(1) was primarily due to a decrease in our  average realized price to $450 per tonne for the second quarter of 2014  from $524 per tonne for the first quarter of 2014 and a decrease in  sales of Methanex-produced methanol.  --  Production for the second quarter of 2014 was 1,216,000 tonnes compared  with 1,226,000 tonnes for the first quarter of 2014. Refer to the  Production Summary section.  --  Sales of Methanex-produced methanol were 1,143,000 tonnes in the second  quarter of 2014 compared with 1,228,000 in the first quarter of 2014.  --  We continue to progress our Geismar relocation projects. We are  targeting to be producing methanol from Geismar 1 in late 2014 and from  Geismar 2 in early 2016.   --  During the quarter, we reached a settlement with Total Austral S.A.  ("Total") for $42 million ($27 million net of tax) in relation to  Total's natural gas delivery obligations pursuant to a long-term natural  gas supply agreement in Chile.   --  During the second quarter of 2014, we paid a $0.25 per share dividend to  shareholders for a total of $24 million.  --  During the second quarter of 2014, we repurchased 1,371,447 common  shares for $82 million for an average buyback price of $59.99 per share  under the Normal Course Issuer Bid approved by the Board in late April.  The shares repurchased in the quarter represent 28% of the total shares  approved to be repurchased.   (1) These items are non-GAAP measures that do not have any standardized       meaning prescribed by GAAP and therefore are unlikely to be comparable    to similar measures presented by other companies. Refer to the            Additional Information - Supplemental Non-GAAP Measures section for a     description of each non-GAAP measure and reconciliations to the most      comparable GAAP measures.                                                 /T/  This Second Quarter 2014 Management's Discussion and Analysis ("MD&A") dated July 30, 2014 for Methanex Corporation ("the Company") should be read in conjunction with the Company's condensed consolidated interim financial statements for the period ended June 30, 2014 as well as the 2013 Annual Consolidated Financial Statements and MD&A included in the Methanex 2013 Annual Report. Unless otherwise indicated, the financial information presented in this interim report is prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The Methanex 2013 Annual Report and additional information relating to Methanex is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.  FINANCIAL AND OPERATIONAL DATA  /T/  Three Months Ended      Six Months Ended   --------------------------- ------------------ ($ millions, except per share    Jun 30   Mar 31   Jun 30    Jun 30   Jun 30  amounts and where noted)          2014     2014     2013      2014     2013 --------------------------------------------------------- ------------------  Production (thousands of                                                      tonnes) (attributable to                                                     Methanex shareholders)           1,216    1,226    1,052     2,442    2,115  Sales volumes (thousands of                                                   tonnes):                                                                    Methanex-produced methanol                                                    (attributable to Methanex                                                    shareholders)                    1,143    1,228    1,039     2,371    2,069   Purchased methanol                643      654      749     1,297    1,337   Commission sales                  206      296      242       502      461 --------------------------------------------------------- ------------------   Total sales volumes (1)         1,992    2,178    2,030     4,170    3,867  Methanex average non-                                                         discounted posted price ($                                                   per tonne) (2)                     523      613      494       569      484 Average realized price ($ per                                                 tonne) (3)                         450      524      425       488      418  Adjusted EBITDA (attributable                                                 to Methanex shareholders) (4)      160      255      157       415      307 Cash flows from operating                                                     activities                         240      179      125       419      243 Adjusted net income                                                           (attributable to Methanex                                                    shareholders) (4)                   91      160       99       251      186 Net income attributable to                                                    Methanex shareholders              125      145       54       270      114  Adjusted net income per common                                                share (attributable to                                                       Methanex shareholders) (4)        0.94     1.65     1.02      2.59     1.94 Basic net income per common                                                   share (attributable to                                                       Methanex shareholders)            1.30     1.51     0.57      2.81     1.21 Diluted net income per common                                                 share (attributable to                                                       Methanex shareholders)            1.24     1.50     0.56      2.79     1.19  Common share information                                                      (millions of shares):                                                         Weighted average number of                                                  common shares                     96       96       95        96       95   Diluted weighted average                                                    number of common shares           97       97       96        97       96   Number of common shares                                                     outstanding, end of period        95       97       95        95       95 --------------------------------------------------------- ------------------  (1) Methanex-produced methanol includes volumes produced by Chile using       natural gas supplied from Argentina under a tolling arrangement.          Commission sales represent volumes marketed on a commission basis         related to 36.9% of the Atlas methanol facility and the portion of the    Egypt methanol facility that we do not own.                               (2) Methanex average non-discounted posted price represents the average of    our non-discounted posted prices in North America, Europe and Asia        Pacific weighted by sales volume. Current and historical pricing          information is available at www.methanex.com.                             (3) Average realized price is calculated as revenue, excluding commissions    earned and the Egypt non-controlling interest share of revenue but        including an amount representing our share of Atlas revenue, divided by   the total sales volumes of Methanex-produced (attributable to Methanex    shareholders) and purchased methanol.                                     (4) These items are non-GAAP measures that do not have any standardized       meaning prescribed by GAAP and therefore are unlikely to be comparable    to similar measures presented by other companies. Refer to the            Additional Information - Supplemental Non-GAAP Measures section for a     description of each non-GAAP measure and reconciliations to the most      comparable GAAP measures.                                                 ----------------------------------------------------------------------------  /T/  PRODUCTION SUMMARY  /T/  Q2 2014              Q1 2014      Q2 2013 (thousands of tonnes)     Capacity(1)   Production   Production   Production ----------------------------------------------------------------------------  New Zealand (2)                   608          559          500          361 Atlas (Trinidad) (63.1%                                                       interest)                        281          191          249          201 Titan (Trinidad)                  218          203          149          169 Egypt (50% interest)(3)           158           99          139          163 Medicine Hat (Canada)             140          138          122          129 Chile I and IV                    430           26           67           29 Geismar 1 and 2                                                               (Louisiana, USA)(4)                -            -            -            - ----------------------------------------------------------------------------  1,835        1,216        1,226        1,052 ----------------------------------------------------------------------------  YTD Q2 2014     YTD Q2 2013 (thousands of tonnes)           Production      Production ----------------------------------------------------------  New Zealand (2)                      1,059             670 Atlas (Trinidad) (63.1%                                     interest)                             440             449 Titan (Trinidad)                       352             350 Egypt (50% interest)(3)                238             296 Medicine Hat (Canada)                  260             260 Chile I and IV                          93              90 Geismar 1 and 2                                             (Louisiana, USA)(4)                     -               - ----------------------------------------------------------  2,442           2,115 ----------------------------------------------------------  (1) The production capacity of our facilities may be higher than original     nameplate capacity as, over time, these figures have been adjusted to     reflect ongoing operating efficiencies. Actual production for a facility  in any given year may be higher or lower than annual production capacity  due to a number of factors, including natural gas composition or the age  of the facility's catalyst.                                              (2) The annual production capacity of New Zealand represents the two Motunui  facilities and the Waitara Valley facility (refer to New Zealand section  below).                                                                  (3) On December 9, 2013, we completed a sale of 10% equity interest in the    Egypt facility. Production figures prior to December 9, 2013 reflect a    60% interest.                                                            (4) We are relocating two 1.0 million tonne idle Chile facilities to          Geismar, Louisiana and are targeting to be producing methanol from        Geismar 1 in late 2014 and Geismar 2 by early 2016.                       /T/  New Zealand   Our New Zealand methanol facilities produced 559,000 tonnes of methanol in the second quarter of 2014 compared with 500,000 tonnes in the first quarter of 2014. With all three facilities now operating, we are able to produce up to 2.4 million tonnes annually, depending on natural gas composition.   Trinidad   In Trinidad, we own 100% of the Titan facility with an annual production capacity of 875,000 tonnes and have a 63.1% interest in the Atlas facility with an annual production capacity of 1,125,000 tonnes (63.1% interest). The Titan facility produced 203,000 tonnes in the second quarter of 2014 compared with 149,000 tonnes in the first quarter of 2014. The Atlas facility produced 191,000 tonnes in the second quarter of 2014 compared with 249,000 tonnes in the first quarter of 2014. The Atlas facility had ongoing production interruptions due to mechanical problems with the air separation unit.   We continue to experience some natural gas curtailments to our Trinidad facilities due to a mismatch between upstream commitments to supply the Natural Gas Company of Trinidad and Tobago (NGC) and downstream demand from NGC's customers including Atlas and Titan, which becomes apparent when an upstream supplier has a technical issue or planned maintenance that reduces gas delivery. We are engaged with key stakeholders to find a solution to this issue, but in the meantime expect to continue to experience gas curtailments to the Trinidad site. Gas curtailments in Q2 2014 were slightly higher than in Q1 2014.  Egypt   On a 100% basis, the Egypt methanol facility produced 198,000 tonnes in the second quarter of 2014 (Methanex share of 99,000 tonnes) compared with 278,000 tonnes (Methanex share of 139,000 tonnes) in the first quarter of 2014. Production during the second quarter of 2014 continued to be impacted by natural gas supply restrictions and we idled the plant in mid-June due to a lack of natural gas availability. We believe that we will be able to restart the plant after the peak summer electricity consumption period ends.    The Egypt facility has experienced periodic natural gas supply restrictions since mid-2012 which have resulted in production below full capacity. This situation may persist in the future and becomes more acute during the summer months when electricity demand is at its peak. Refer to page 23 of the Risk Factors and Risk Management section of our 2013 Annual Report for further details.  Medicine Hat, Canada   During the second quarter of 2014, we produced 138,000 tonnes at our Medicine Hat facility compared with 122,000 tonnes during the first quarter of 2014.   Chile   During the second quarter of 2014, we produced 26,000 tonnes in Chile compared with 67,000 tonnes in the first quarter of 2014, supported by natural gas supplies from Chile and from Argentina through a tolling arrangement.   As a result of insufficient natural gas feedstock from Chile and Argentina during the southern hemisphere winter, we idled our Chile operations in May 2014. We are optimistic that we will secure sufficient natural gas from Chilean sources supplemented by Argentine gas to restart our operations later in 2014.   The future of our Chile operations is primarily dependent on the level of natural gas exploration and development in southern Chile and our ability to secure a sustainable natural gas supply to our facilities on economic terms from Chile and Argentina.  Geismar, Louisiana   We continue to progress our two Geismar relocation projects. We are targeting to be producing methanol from the 1.0 million tonne Geismar 1 facility in late 2014 and from the 1.0 million tonne Geismar 2 facility in early 2016. During the second quarter of 2014, we incurred $100 million of capital expenditures related to these projects, excluding capitalized interest.  FINANCIAL RESULTS   For the second quarter of 2014 we recorded Adjusted EBITDA of $160 million and Adjusted net income of $91 million ($0.94 per share on a diluted basis). This compares with Adjusted EBITDA of $255 million and Adjusted net income of $160 million ($1.65 per share on a diluted basis) for the first quarter of 2014.   For the second quarter of 2014, we reported net income attributable to Methanex shareholders of $125 million ($1.24 per share on a diluted basis) compared with net income attributable to Methanex shareholders for the first quarter of 2014 of $145 million ($1.50 income per share on a diluted basis).   We calculate Adjusted EBITDA and Adjusted net income by including amounts related to our equity share of the Atlas (63.1% interest) and Egypt (50% interest) facilities and by excluding the mark-to-market impact of share-based compensation as a result of changes in our share price and items which are considered by management to be non-operational. Refer to the Additional Information - Supplemental Non-GAAP Measures section for a further discussion on how we calculate these measures. Our analysis of depreciation and amortization, finance costs, finance income and other expenses and income taxes is consistent with the presentation of our consolidated statements of income and excludes amounts related to Atlas.    A reconciliation from net income attributable to Methanex shareholders to Adjusted net income and the calculation of Adjusted net income per common share is as follows:   /T/  Three Months Ended         Six Months Ended    ------------------------------ -------------------- ($ millions except number                                                     of shares and per share    Jun 30     Mar 31    Jun 30   June 30    June 30  amounts)                     2014       2014      2013      2014       2013 ------------------------------------------------------- --------------------  Net income attributable                                                       to Methanex shareholders $    125   $    145  $     54  $    270   $    114   Mark-to-market impact                                                       of share-based                                                             compensation, net of                                                       tax                          (7)        15         9         8         36   Argentina gas                                                               settlement, net of tax      (27)         -         -       (27)         -   Write-off of oil and                                                        gas rights, net of tax        -          -        14         -         14   Geismar project                                                             relocation expenses,                                                       net of tax                    -          -        22         -         22 ------------------------------------------------------- -------------------- Adjusted net income (1)   $     91   $    160  $     99  $    251   $    186 ------------------------------------------------------- -------------------- Diluted weighted average                                                      shares outstanding                                                           (millions)                     97         97        96        97         96 Adjusted net income per                                                       common share (1)         $   0.94   $   1.65  $   1.02  $   2.59   $   1.94 ------------------------------------------------------- --------------------  (1) These items are non-GAAP measures that do not have any standardized       meaning prescribed by GAAP and therefore are unlikely to be comparable    to similar measures presented by other companies. Refer to the            Additional Information - Supplemental Non-GAAP Measures section for a     description of each non-GAAP measure and reconciliations to the most      comparable GAAP measures.                                                 /T/  We review our financial results by analyzing changes in Adjusted EBITDA, mark-to-market impact of share-based compensation, depreciation and amortization, Argentina gas settlements, write-off of oil and gas rights, Geismar project relocation expenses, finance costs, finance income and other expenses and income taxes. A summary of our consolidated statements of income is as follows:  /T/  Three Months Ended        Six Months Ended    ----------------------------- -------------------  Jun 30    Mar 31    Jun 30    Jun 30    Jun 30  ($ millions)                   2014      2014      2013      2014      2013  -------------------------------------------------------- -------------------  Consolidated statements of                                                    income:                                                                       Revenue                   $   792   $   968   $   733   $ 1,760   $ 1,385    Cost of sales and                                                           operating expenses,                                                        excluding mark-to-market                                                   impact of share-based                                                      compensation                (618)     (692)     (571)   (1,310)   (1,068)   Adjusted EBITDA of                                                          associate (Atlas) (1)         11        17        18        28        27  ----------------------------------------------------------------------------  185       293       180       478       344  Comprised of:                                                                  Adjusted EBITDA                                                             (attributable to                                                           Methanex shareholders)                                                     (2)                          160       255       157       415       307    Attributable to non-                                                        controlling interests         25        38        23        63        37  -------------------------------------------------------- -------------------  185       293       180       478       344  Mark-to-market impact of                                                      share-based compensation         8       (18)       (9)      (10)      (40) Depreciation and                                                              amortization                   (33)      (35)      (29)      (68)      (59) Argentina gas settlement         42         -         -        42         -  Write-off of oil and gas                                                      rights                           -         -       (17)        -       (17) Geismar project relocation                                                    expenses and charges             -         -       (34)        -       (34) Earnings of associate,                                                        excluding amount included                                                    in Adjusted EBITDA (1)          (9)       (9)      (12)      (18)      (20) Finance costs                    (9)      (11)      (15)      (20)      (30) Finance income and other                                                      expenses                         1         -         3         1         1  Income tax expense              (46)      (52)       (1)      (98)      (13) ---------------------------------------------------------------------------- Net income                  $   139   $   168   $    66   $   307   $   132  ---------------------------------------------------------------------------- Net income attributable to                                                    Methanex shareholders      $   125   $   145   $    54   $   270   $   114  ----------------------------------------------------------------------------  /T/  /T/  (1) Earnings of associate has been divided into an amount included in         Adjusted EBITDA and an amount excluded from Adjusted EBITDA. The amount   excluded from Adjusted EBITDA represents depreciation and amortization,   finance costs, finance income and other expenses and income tax expense   relating to earnings of associate.                                       (2) This item is a non-GAAP measure that does not have any standardized       meaning prescribed by GAAP and therefore is unlikely to be comparable to  similar measures presented by other companies. Refer to the Additional    Information - Supplemental Non-GAAP Measures section for a description    of the non-GAAP measure and reconciliation to the most comparable GAAP    measure.                                                                  /T/  Adjusted EBITDA (Attributable to Methanex Shareholders)   Our operations consist of a single operating segment - the production and sale of methanol. We review the results of operations by analyzing changes in the components of Adjusted EBITDA. For a discussion of the definitions used in our Adjusted EBITDA analysis, refer to the How We Analyze Our Business section.   The changes in Adjusted EBITDA resulted from changes in the following:   /T/  Q2 2014           Q2 2014         YTD Q2 2014   compared with     compared with       compared with  ($ millions)                  Q1 2014           Q2 2013         YTD Q2 2013  ----------------------------------------------------------------------------  Average realized                                                              price                  $        (134)    $          44       $         252  Sales volume                      (12)               (1)                 26  Total cash costs                   51               (40)               (170) ---------------------------------------------------------------------------- Increase (decrease)                                                           in Adjusted EBITDA     $         (95)    $           3       $         108  ----------------------------------------------------------------------------  /T/  Average realized price  /T/  Three Months Ended      Six Months Ended   -------------------------- ------------------  Jun 30   Mar 31   Jun 30    Jun 30   Jun 30 ($ per tonne)                      2014     2014     2013      2014     2013 --------------------------------------------------------- ------------------  Methanex average non-discounted                                               posted price                       523      613      494       569      484 Methanex average realized price     450      524      425       488      418 --------------------------------------------------------- ------------------  /T/  Methanol pricing for the second quarter was lower compared to the first quarter as the industry recovered from very tight market conditions experienced in late 2013 and early 2014 with multiple suppliers resuming operations after extended periods of closure or reduced operating rates. As a result of these and other factors, prices moderated from the high levels in Q1 and began to stabilize late in the quarter and into the third quarter of 2014. We believe that pricing is now stabilizing at current levels (refer to the Supply/Demand Fundamentals section). Our average non-discounted posted price for the second quarter of 2014 was $523 per tonne compared with $613 per tonne for the first quarter of 2014 and $494 per tonne for the second quarter of 2013. Our average realized price for the second quarter of 2014 was $450 per tonne compared with $524 per tonne for the first quarter of 2014 and $425 per tonne for the second quarter of 2013. The change in average realized price for the second quarter of 2014 decreased Adjusted EBITDA by $134 million compared with the first quarter of 2014 and increased Adjusted EBITDA by $44 million compared with the second quarter of 2013.   Sales volume   Methanol sales volumes excluding commission sales volumes were lower in the second quarter of 2014 compared with the first quarter of 2014 by 96,000 tonnes and with the second quarter of 2013 by 2,000 tonnes. Lower methanol sales volumes excluding commission sales volumes for these periods decreased Adjusted EBITDA by $12 million and $1 million, respectively. For the six month period ended June 30, 2014 compared with the same period in 2013, methanol sales volumes excluding commission sales volumes were higher by 262,000 tonnes and this resulted in higher Adjusted EBITDA by $26 million.  Total cash costs   The primary drivers of changes in our total cash costs are changes in the cost of methanol we produce at our facilities (Methanex-produced methanol) and changes in the cost of methanol we purchase from others (purchased methanol). All of our production facilities except Medicine Hat are underpinned by natural gas purchase agreements with pricing terms that include base and variable price components linked to the price of methanol. We supplement our production with methanol produced by others through methanol offtake contracts and purchases on the spot market to meet customer needs and support our marketing efforts within the major global markets.   We have adopted the first-in, first-out method of accounting for inventories and it generally takes between 30 and 60 days to sell the methanol we produce or purchase. Accordingly, the changes in Adjusted EBITDA as a result of changes in Methanex-produced and purchased methanol costs primarily depend on changes in methanol pricing and the timing of inventory flows.   In a rising price environment, our margins at a given price are higher than in a stable price environment as a result of timing of methanol purchases and production versus sales. Conversely, the opposite applies when methanol prices are decreasing.  The impact on Adjusted EBITDA from changes in our cash costs are explained below:   /T/  Q2 2014           Q2 2014        YTD Q2 2014   compared with     compared with      compared with  ($ millions)                   Q1 2014           Q2 2013        YTD Q2 2013  ----------------------------------------------------------------------------  Methanex-produced                                                             methanol costs           $         18     $         (25)     $         (75) Proportion of Methanex-                                                       produced methanol                                                            sales                              (4)               20                 24  Purchased methanol                                                            costs                              33               (37)              (114) Other, net                           4                 2                 (5) ----------------------------------------------------------------------------  $         51     $         (40)     $        (170) ----------------------------------------------------------------------------  /T/  Methanex-produced methanol costs   We purchase natural gas for the New Zealand, Trinidad, Egypt, and Chile methanol facilities under natural gas purchase agreements where the unique terms of each contract include a base price and a variable price component linked to the price of methanol to reduce our commodity price risk exposure. The variable price component of each gas contract is adjusted by a formula related to methanol prices above a certain level. For the second quarter of 2014 compared with the first quarter of 2014, Methanex-produced methanol costs were lower by $18 million, primarily due to the impact of lower realized methanol prices on the variable portion of our natural gas costs. For the three and six month periods ended June 30, 2014 compared with the same periods in 2013, Methanex-produced methanol costs were higher by $25 million and $75 million, respectively, primarily due to the impact of higher realized methanol prices on our natural gas costs and changes in the mix of production sold from inventory.  Proportion of Methanex-produced methanol sales   The cost of purchased methanol is directly linked to the selling price for methanol at the time of purchase and the cost of purchased methanol is generally higher than the cost of Methanex-produced methanol. Accordingly, an increase in the proportion of Methanex-produced methanol sales results in a decrease in our overall cost structure for a given period. For the second quarter of 2014 compared with the first quarter of 2014, a lower proportion of Methanex-produced methanol sales decreased Adjusted EBITDA by $4 million. For the second quarter of 2014 compared with the same period in 2013, sales of Methanex-produced methanol made up a higher proportion of our total sales and this increased Adjusted EBITDA by $20 million.  Purchased methanol costs   Changes in purchased methanol costs for all periods presented are primarily as a result of changes in methanol pricing.  Other, net   We have commenced the process of building a manufacturing organization in Geismar, Louisiana. Under IFRS, costs incurred related to organizational build-up are not eligible for capitalization and are charged directly to earnings as incurred. During the second quarter of 2014, we incurred approximately $2 million of Geismar organizational build-up costs compared to $3 million in the first quarter of 2014 and nil in the second quarter of 2013. The remaining organizational build-up costs are estimated to be approximately $20 million.   Mark-to-Market Impact of Share-based Compensation   We grant share-based awards as an element of compensation. Share-based awards granted include stock options, share appreciation rights, tandem share appreciation rights, deferred share units, restricted share units and performance share units. For all the share-based awards, share-based compensation is recognized over the related vesting period for the proportion of the service that has been rendered at each reporting date. Share-based compensation includes an amount related to the grant-date value and a mark-to-market impact as a result of subsequent changes in the Company's share price. The grant-date value amount is included in Adjusted EBITDA and Adjusted net income. The mark-to-market impact of share-based compensation as a result of changes in our share price is excluded from Adjusted EBITDA and Adjusted net income and analyzed separately.   /T/  Three Months Ended         Six Months Ended   ------------------------------ ------------------- ($ millions except share     Jun 30     Mar 31    Jun 30    Jun 30    Jun 30  price)                        2014       2014      2013      2014      2013 -------------------------------------------------------- -------------------  Methanex Corporation share                                                    price (1)                 $  61.78   $  63.94  $  42.84  $  61.78  $  42.84  Grant-date fair value                                                         expense included in                                                          Adjusted EBITDA and                                                          Adjusted net income              7          7         6        14        12 Mark-to-market impact due                                                     to change in share price        (8)        18         9        10        40 -------------------------------------------------------- ------------------- Total share-based                                                             compensation expense                                                         (recovery)                $     (1)  $     25  $     15  $     24  $     52 -------------------------------------------------------- -------------------  (1) US dollar share price of Methanex Corporation as quoted on NASDAQ Global  Market on the last trading day of the respective period.                  /T/  The Methanex Corporation share price decreased from US $63.94 per share at March 31, 2014 to US $61.78 per share at June 30, 2014. As a result of the decrease in the share price and the resulting impact on the fair value of the outstanding units, we recorded an $8 million mark-to-market recovery on share-based compensation in the second quarter of 2014 compared with an $18 million mark-to-market expense in the first quarter of 2014 and a $9 million expense in the second quarter of 2013.   Depreciation and Amortization    Depreciation and amortization was $33 million for the second quarter of 2014 compared with $35 million for the first quarter of 2014 and $29 million for the second quarter of 2013. Depreciation and amortization was lower in the second quarter of 2014 compared with the first quarter of 2014 primarily due to lower sales volumes of Methanex-produced methanol.   Finance Costs  /T/  Three Months Ended        Six Months Ended    ----------------------------- -------------------  Jun 30    Mar 31    Jun 30    Jun 30    Jun 30  ($ millions)                   2014      2014      2013      2014      2013  -------------------------------------------------------- -------------------  Finance costs before                                                          capitalized interest       $    15   $    16   $    17   $    31   $    33  Less capitalized interest        (6)       (5)       (2)      (11)       (3) -------------------------------------------------------- -------------------  Finance costs               $     9   $    11   $    15   $    20   $    30  -------------------------------------------------------- -------------------  /T/  Finance costs before capitalized interest primarily relate to interest expense on the unsecured notes and limited recourse debt facilities. Capitalized interest relates to interest costs capitalized for the Geismar projects.  Finance Income and Other Expenses  /T/  Three Months Ended        Six Months Ended   ----------------------------- -------------------  Jun 30    Mar 31    Jun 30    Jun 30    Jun 30 ($ millions)                    2014      2014      2013      2014      2013 -------------------------------------------------------- -------------------  Finance income and other                                                      expenses                     $    1    $    -    $    3    $    1    $    1 ----------------------------------------------------------------------------  /T/  The change in finance income and other expenses for all periods presented was primarily due to the impact of changes in foreign exchange rates.  Income Taxes   A summary of our income taxes for the second quarter of 2014 compared with the first quarter of 2014 is as follows:   /T/  Three Months Ended           Three Months Ended       June 30, 2014               March 31, 2014         ---------------------------- ---------------------------  Adjusted                    Adjusted  ($ millions, except          Net            Net          Net            Net   where noted)             Income     Income (1)       Income     Income (1)  ------------------------------------------------ ---------------------------  Amount before income                                                          tax                  $      185    $       120   $      220    $       210  Income tax expense           (46)           (29)         (52)           (50) ------------------------------------------------ --------------------------- Amount after income                                                           tax                  $      139    $        91   $      168    $       160  ------------------------------------------------ ---------------------------  Effective tax rate            25%            24%          24%            24% ----------------------------------------------------------------------------  (1) This item is a non-GAAP measure that does not have any standardized       meaning prescribed by GAAP and therefore is unlikely to be comparable to  similar measures presented by other companies. Refer to the Additional    Information - Supplemental Non-GAAP Measures section for a description    of the non-GAAP measure and reconciliation to the most comparable GAAP    measure.                                                                  /T/  For the second quarter of 2014, the effective tax rate was 25% compared with 24% for the first quarter of 2014. Adjusted net income represents the amount that is attributable to Methanex shareholders and excludes the mark-to-market impact of share-based compensation and items that are considered by management to be non-operational. The effective tax rate related to Adjusted net income was 24% for the second quarter of 2014 compared with 24% for the first quarter of 2014.   We earn the majority of our earnings in Trinidad, Egypt, Chile, Canada and New Zealand. In Trinidad and Chile, the statutory tax rate is 35%. The statutory rates in Canada and New Zealand are 25% and 28%, respectively. During the quarter, there was a temporary change to the Egypt statutory tax rate to 30% from 25% for the years 2014 to 2016. As the Atlas entity is accounted for using the equity method, any income taxes related to Atlas are included in earnings of associate and therefore excluded from total income taxes.   SUPPLY/DEMAND FUNDAMENTALS   /T/  Methanex Non-Discounted Regional Posted Prices (1)               Jul         Jun         May         Apr (US$ per tonne)                     2014        2014        2014        2014 ----------------------------------------------------------------------------  United States                        482         532         565         599 Europe (2)                           440         565         565         565 Asia Pacific                         410         430         460         480 ---------------------------------------------------------------------------- (1) Discounts from our posted prices are offered to customers based on        various factors.                                                         (2) EUR322 for Q3 2014 (Q2 2014 - EUR412) converted to United States          dollars.                                                                 ----------------------------------------------------------------------------  /T/  We estimate that methanol demand, excluding methanol demand from integrated methanol to olefins facilities, is currently approximately 57 million tonnes on an annualized basis.   In the fourth quarter of 2013 and into the first quarter of 2014, we experienced very tight methanol market conditions and high methanol pricing primarily as a result of major industry supply issues in Asia and the Middle East. As several of these plants returned to operation late in the first quarter, pricing moderated through the quarter, stabilizing in June and into Q3. As a result, our average non-discounted price in the second quarter of 2014 was $523 per tonne compared with $613 per tonne in the first quarter of 2014 and we recently announced our North American non-discounted price for August at $482/tonne, and our Asia Pacific price at $410/tonne, both unchanged from July. In June, we announced the Q3 European contract price at EUR322 or approximately $440/tonne.   The medium term outlook for methanol demand growth continues to be strong, led by the growing use of methanol in energy-related applications which today represent approximately 40% of global methanol demand. The wide disparity between the price of crude oil and that of natural gas and coal has resulted in an increased substitution of methanol into energy-related applications, such as direct methanol blending into gasoline, DME and biodiesel production. Growth of direct methanol blending into gasoline in China has been particularly strong and we believe that future growth in this application is supported by numerous provincial fuel-blending standards, such as M15 or M85 (15% methanol and 85% methanol, respectively). Fuel blending is also starting to gain interest outside of China with several countries currently conducting demonstration programs to test the use of methanol-blended fuels.   China is also leading the commercialization of methanol's use as a feedstock to manufacture olefins. Methanol-to-olefins (MTO) technology, at current energy prices, is proving to be cost competitive relative to the traditional production of olefins from naphtha. There are now three MTO plants operating in China which are dependent on merchant methanol supply and which have the capacity to consume over 3 million tonnes of methanol annually, and there are a number of other plants at various stages of construction which we expect will commence operations in the 2014-15 timeframe. There are other coal-to-olefins (CTO) plants which make methanol using coal as a feedstock and are integrated with olefins production facilities. These plants occasionally purchase methanol to supplement their production when required. We believe demand potential into energy-related applications and olefins production will continue to grow.   Traditional chemical derivatives consume about 60% of global methanol demand and growth is correlated to industrial production growth rates.   The methanol price will ultimately depend on the strength of the global economy, industry operating rates, global energy prices, new supply additions and the strength of global demand. Over the next few years, there is a modest level of new capacity expected to come on-stream relative to demand growth expectations. We are relocating two idle Chile facilities to Geismar, Louisiana and are targeting to be producing methanol from the first 1.0 million tonne facility by late 2014 and the second 1.0 million tonne facility in early 2016. In addition, a 1.3 million tonne Celanese plant is currently under construction in Bishop, Texas. We expect that production from new capacity in China will be consumed in that country and that higher cost production capacity in China will need to operate in order to satisfy demand growth.  LIQUIDITY AND CAPITAL RESOURCES   Cash flows from operating activities in the second quarter of 2014 increased by $61 million to $240 million compared with $179 million for the first quarter of 2014 and increased by $115 million compared to $125 million for the second quarter of 2013. The changes in cash flows from operating activities resulted from changes in the following:   /T/  Q2 2014         Q2 2014     YTD Q2 2014   compared with   compared with   compared with  ($ millions)                        Q1 2014         Q2 2013     YTD Q2 2013  ----------------------------------------------------------------------------  Change in Adjusted EBITDA                                                     (attributable to Methanex                                                    shareholders)                 $        (95)   $          3    $        108  Exclude change in Adjusted                                                    EBITDA of associate (Atlas)              6               7              (1) Dividends received from                                                       associate                               25              25              25  Cash flows attributable to                                                    non-controlling interests              (13)              2              26  Non-cash working capital                 67              13             (30) Income taxes paid                        (1)             (5)             (8) Argentina gas settlement                 42              42              42  Geismar project relocation                                                    expenses                                 -              34              34  Share-based payments                     33              (4)            (23) Other                                    (3)             (2)              3  ---------------------------------------------------------------------------- Increase in cash flows from                                                   operating activities          $         61    $        115    $        176  ----------------------------------------------------------------------------  /T/  During the second quarter of 2014, we paid a quarterly dividend of $0.25 per share, or $24 million. On April 29, 2014, the Board of Directors approved a 5% normal course issuer bid, which allows us to repurchase for cancellation up to 4.8 million shares. In the second quarter of 2014 we repurchased 1.4 million shares for cancellation under the normal course issuer bid at an average price of $59.99 per share.   We operate in a highly competitive commodity industry and believe it is appropriate to maintain a conservative balance sheet and retain financial flexibility. At June 30, 2014, our cash balance was $647 million, including $65 million related to the 50% non-controlling interest in Egypt. We invest our cash only in highly rated instruments that have maturities of three months or less to ensure preservation of capital and appropriate liquidity. We have a strong balance sheet and an undrawn $400 million credit facility that expires in late 2016.   Our planned capital maintenance expenditure program directed towards maintenance, turnarounds and catalyst changes for existing operations is currently estimated to be $130 million for the 18 month period to the end of 2015. Capital expenditures during the second quarter, excluding the Geismar projects, were $16 million. We are relocating two methanol plants from our Chile site to Geismar, Louisiana. During the second quarter of 2014, capital expenditures related to the Geismar projects were $100 million, excluding capitalized interest. The remaining budgeted capital expenditures related to the Geismar projects are $405 million, excluding capitalized interest.   We believe we are well positioned to meet our financial commitments, invest to grow the Company and continue to deliver on our commitment to return excess cash to shareholders.  SHORT-TERM OUTLOOK   Methanol prices moderated through the second quarter. Entering the third quarter, methanol prices have been relatively stable. We recently announced our August contract prices for Asia at US$410/MT and for North America at US$482/MT, unchanged at the previous month's levels. Methanol prices will ultimately depend on the strength of the global economy, industry operating rates, global energy prices, new supply additions and the strength of global demand. We believe that our financial position and financial flexibility, outstanding global supply network and competitive-cost position will provide a sound basis for Methanex to continue to be the leader in the methanol industry and to invest to grow the Company.  CONTROLS AND PROCEDURES   For the three months ended June 30, 2014, no changes were made in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  ADDITIONAL INFORMATION - SUPPLEMENTAL NON-GAAP MEASURES   In addition to providing measures prepared in accordance with International Financial Reporting Standards (IFRS), we present certain supplemental non-GAAP measures. These are Adjusted EBITDA, Adjusted net income, Adjusted net income per common share and operating income. These measures do not have any standardized meaning prescribed by generally accepted accounting principles (GAAP) and therefore are unlikely to be comparable to similar measures presented by other companies. These supplemental non-GAAP measures are provided to assist readers in determining our ability to generate cash from operations and improve the comparability of our results from one period to another. We believe these measures are useful in assessing operating performance and liquidity of the Company's ongoing business on an overall basis. We also believe Adjusted EBITDA is frequently used by securities analysts and investors when comparing our results with those of other companies.  Adjusted EBITDA (attributable to Methanex shareholders)   Adjusted EBITDA differs from the most comparable GAAP measure, net income attributable to Methanex shareholders, because it excludes depreciation and amortization, finance costs, finance income and other expenses, income tax expense, mark-to-market impact of share-based compensation, Geismar project relocation expenses and charges, write-off of oil and gas rights, and the Argentina gas settlement. Adjusted EBITDA includes an amount representing our 63.1% interest in the Atlas facility and our 50% interest in the methanol facility in Egypt.   Adjusted EBITDA and Adjusted net income exclude the mark-to-market impact of share-based compensation related to the impact of changes in our share price on share appreciation rights, tandem share appreciation rights, deferred share units, restricted share units and performance share units. The mark-to-market impact related to performance share units that is excluded from Adjusted EBITDA and Adjusted net income is calculated as the difference between the grant date value determined using a Methanex total shareholder return factor of 100% and the fair value recorded at each period end. As share-based awards will be settled in future periods, the ultimate value of the units is unknown at the date of grant and therefore the grant date value recognized in Adjusted EBITDA and Adjusted net income may differ from the total settlement cost.   The following table shows a reconciliation from net income attributable to Methanex shareholders to Adjusted EBITDA:  /T/  Three Months Ended         Six Months Ended    -----------------------------  -------------------  Jun 30    Mar 31    Jun 30     Jun 30    Jun 30  ($ millions)                  2014      2014      2013       2014      2013  -------------------------------------------------------  -------------------  Net income attributable to                                                    Methanex shareholders     $   125   $   145   $    54    $   270   $   114    Mark-to-market impact of                                                    share-based                                                                compensation                 (8)       18         9         10        40    Depreciation and                                                            amortization                 33        35        29         68        59    Argentina gas settlement     (42)        -         -        (42)        -    Write-off of oil and gas                                                    rights                        -         -        17          -        17    Geismar project                                                             relocation expenses and                                                    charges                       -         -        34          -        34    Finance costs                  9        11        15         20        30    Finance income and other                                                    expenses                     (1)        -        (3)        (1)       (1)   Income tax expense            46        52         1         98        13    Earnings of associate,                                                      excluding amount                                                           included in Adjusted                                                       EBITDA (1)                    9         9        12         18        20    Non-controlling                                                             interests adjustment                                                       (1)                         (11)      (15)      (11)       (26)      (19) -------------------------------------------------------  ------------------- Adjusted EBITDA                                                               (attributable to Methanex                                                    shareholders)             $   160   $   255   $   157    $   415   $   307  -------------------------------------------------------  -------------------  (1) These adjustments represent depreciation and amortization, finance        costs, finance income and other expenses and income tax expense           associated with the non-controlling interest in the methanol facility in  Egypt and our 63.1% interest in the Atlas methanol facility.              /T/  Adjusted Net Income and Adjusted Net Income per Common Share   Adjusted net income and Adjusted net income per common share are non-GAAP measures because they exclude the mark-to-market impact of share-based compensation and items that are considered by management to be non-operational, including Geismar project relocation expenses and charges, write-off of oil and gas rights, and the Argentina gas settlement. The following table shows a reconciliation of net income attributable to Methanex shareholders to Adjusted net income and the calculation of Adjusted net income per common share:   /T/  Three Months Ended         Six Months Ended    -----------------------------  ------------------- ($ millions except number                                                     of shares and per share    Jun 30    Mar 31    Jun 30     Jun 30    Jun 30   amounts)                     2014      2014      2013       2014      2013  -------------------------------------------------------  -------------------  Net income attributable to                                                    Methanex shareholders     $   125   $   145   $    54    $   270   $   114    Mark-to-market impact of                                                    share-based                                                                compensation                 (8)       18         9         10        40    Argentina gas settlement     (42)        -         -        (42)        -    Write-off of oil and gas                                                    rights                        -         -        17          -        17    Geismar project                                                             relocation expenses and                                                    charges                       -         -        34          -        34    Income tax expense                                                          (recovery) related to                                                      above items                  16        (3)      (15)        13       (19) -------------------------------------------------------  ------------------- Adjusted net income        $    91   $   160   $    99    $   251   $   186  -------------------------------------------------------  ------------------- Diluted weighted average                                                      shares outstanding                                                           (millions)                     97        97        96         97        96  Adjusted net income per                                                       common share              $  0.94   $  1.65   $  1.02    $  2.59   $  1.94  -------------------------------------------------------  -------------------  /T/  Operating Income   Operating income is reconciled directly to a GAAP measure in our consolidated statements of income.  QUARTERLY FINANCIAL DATA (UNAUDITED)   A summary of selected financial information for the prior eight quarters is as follows:  /T/  Three Months Ended               -------------------------------------------- ($ millions, except per share        Jun 30     Mar 31     Dec 31     Sep 30  amounts)                              2014       2014       2013       2013 ----------------------------------------------------------------------------  Revenue                            $    792   $    968   $    881   $    758 Adjusted EBITDA (1 2)                   160        255        245        184 Net income (1)                          125        145        128         87 Adjusted net income (1 2)                91        160        167        117 Basic net income per common                                                   share (1)                             1.30       1.51       1.33       0.91 Diluted net income per common                                                 share (1)                             1.24       1.50       1.32       0.90 Adjusted net income per share (1                                              2)                                    0.94       1.65       1.72       1.22 ----------------------------------------------------------------------------  Three Months Ended               -------------------------------------------- ($ millions, except per share        Jun 30     Mar 31    Dec 31     Sep 30   amounts)                              2013       2013      2012       2012  ----------------------------------------------------------------------------  Revenue                            $    733   $    652   $   668    $   608  Adjusted EBITDA (1 2)                   157        149       119        104  Net income (loss) (1)                    54         60      (140)        (3) Adjusted net income (1 2)                99         88        61         36  Basic net income (loss) per                                                   common share (1)                      0.57       0.64     (1.49)     (0.03) Diluted net income (loss) per                                                 common share (1)                      0.56       0.63     (1.49)     (0.03) Adjusted net income per share (1                                              2)                                    1.02       0.92      0.64       0.38  ----------------------------------------------------------------------------  (1) Attributable to Methanex Corporation shareholders.                       (2) These items are non-GAAP measures that do not have any standardized       meaning prescribed by GAAP and therefore are unlikely to be comparable    to similar measures presented by other companies. Refer to the            Additional Information - Supplemental Non-GAAP Measures section for a     description of each non-GAAP measure and reconciliations to the most      comparable GAAP measures.                                                 /T/  FORWARD-LOOKING INFORMATION WARNING   This Second Quarter 2014 Management's Discussion and Analysis ("MD&A") as well as comments made during the Second Quarter 2014 investor conference call contain forward-looking statements with respect to us and our industry. These statements relate to future events or our future performance. All statements other than statements of historical fact are forward-looking statements. Statements that include the words "believes", "expects", "may", "will", "should", "potential", "estimates", "anticipates", "aim", "goal" or other comparable terminology and similar statements of a future or forward-looking nature identify forward-looking statements.   More particularly and without limitation, any statements regarding the following are forward-looking statements:  /T/  --  expected demand for methanol and its derivatives,  --  expected new methanol supply or restart of idled capacity and timing for  start-up of the same,  --  expected shutdowns (either temporary or permanent) or restarts of  existing methanol supply (including our own facilities), including,  without limitation, the timing and length of planned maintenance  outages,  --  expected methanol and energy prices,  --  expected levels of methanol purchases from traders or other third  parties,  --  expected levels, timing and availability of economically priced natural  gas supply to each of our plants,  --  capital committed by third parties towards future natural gas  exploration and development in the vicinity of our plants,  --  our expected capital expenditures,  --  anticipated operating rates of our plants,  --  expected operating costs, including natural gas feedstock costs and  logistics costs,  --  expected tax rates or resolutions to tax disputes,  --  expected cash flows, earnings capability and share price,  --  availability of committed credit facilities and other financing,  --  ability to meet covenants or obtain or continue to obtain waivers  associated with our long-term debt obligations, including, without  limitation, the Egypt limited recourse debt facilities that have  conditions associated with the payment of cash or other distributions  and the finalization of certain land title registration and related  mortgages that require action by Egyptian governmental entities,  --  our shareholder distribution strategy and anticipated distributions to  shareholders,  --  commercial viability and timing of, or our ability to execute, future  projects, plant restarts, capacity expansions, plant relocations, or  other business initiatives or opportunities, including the planned  relocation of idle Chile methanol plants to Geismar, Louisiana  ("Geismar"),  --  our financial strength and ability to meet future financial commitments, --  expected global or regional economic activity (including industrial  production levels),  --  expected outcomes of litigation or other disputes, claims and  assessments,  --  expected actions of governments, government agencies, gas suppliers,  courts, tribunals or other third parties, and  --  expected impact on our operations in Egypt or our financial condition as  a consequence of civil unrest or actions taken or inaction by the  Government of Egypt and its agencies.   /T/  We believe that we have a reasonable basis for making such forward-looking statements. The forward-looking statements in this document are based on our experience, our perception of trends, current conditions and expected future developments as well as other factors. Certain material factors or assumptions were applied in drawing the conclusions or making the forecasts or projections that are included in these forward-looking statements, including, without limitation, future expectations and assumptions concerning the following:   /T/  --  the supply of, demand for and price of methanol, methanol derivatives,  natural gas, coal, oil and oil derivatives,  --  our ability to procure natural gas feedstock on commercially acceptable  terms,  --  operating rates of our facilities,  --  receipt or issuance of third-party consents or approvals, including,  without limitation, governmental registrations of land title and related  mortgages in Egypt, governmental approvals related to rights to purchase  natural gas,  --  the establishment of new fuel standards,  --  operating costs including natural gas feedstock and logistics costs,  capital costs, tax rates, cash flows, foreign exchange rates and  interest rates,  --  the availability of committed credit facilities and other financing,  --  timing of completion and cost of our Geismar project,  --  global and regional economic activity (including industrial production  levels),  --  absence of a material negative impact from major natural disasters,  --  absence of a material negative impact from changes in laws or  regulations,  --  absence of a material negative impact from political instability in the  countries in which we operate, and  --  enforcement of contractual arrangements and ability to perform  contractual obligations by customers, natural gas and other suppliers  and other third parties.   /T/  However, forward-looking statements, by their nature, involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. The risks and uncertainties primarily include those attendant with producing and marketing methanol and successfully carrying out major capital expenditure projects in various jurisdictions, including, without limitation:  /T/  --  conditions in the methanol and other industries including fluctuations  in the supply, demand for and price of methanol and its derivatives,  including demand for methanol for energy uses,  --  the price of natural gas, coal, oil and oil derivatives,  --  the success of natural gas exploration and development activities in  southern Chile,  --  our ability to obtain natural gas feedstock on commercially acceptable  terms to underpin current operations and future production growth  opportunities,  --  the ability to successfully carry out corporate initiatives and  strategies,  --  actions of competitors, suppliers and financial institutions,  --  conditions within the natural gas delivery systems that may prevent  delivery of our natural gas supply requirements,  --  our ability to meet timeline and budget targets for our Geismar project,  including cost pressures arising from labour costs,  --  competing demand for natural gas, especially with respect to domestic  needs for gas and electricity in Chile and Egypt,  --  actions of governments and governmental authorities, including, without  limitation, the implementation of policies or other measures that could  impact the supply of or demand for methanol or its derivatives,  --  changes in laws or regulations,  --  import or export restrictions, anti-dumping measures, increases in  duties, taxes and government royalties, and other actions by governments  that may adversely affect our operations or existing contractual  arrangements,  --  world-wide economic conditions,  --  satisfaction of conditions precedent contained in the Geismar 1 natural  gas supply agreement, and  --  other risks described in our 2013 Management's Discussion and Analysis  and this Second Quarter 2014 Management's Discussion and Analysis.    /T/  Having in mind these and other factors, investors and other readers are cautioned not to place undue reliance on forward-looking statements. They are not a substitute for the exercise of one's own due diligence and judgment. The outcomes anticipated in forward-looking statements may not occur and we do not undertake to update forward-looking statements except as required by applicable securities laws.  HOW WE ANALYZE OUR BUSINESS   Our operations consist of a single operating segment - the production and sale of methanol. We review our results of operations by analyzing changes in the components of Adjusted EBITDA (refer to the Additional Information - Supplemental Non-GAAP Measures section for a description of each non-GAAP measure and reconciliations to the most comparable GAAP measures).   In addition to the methanol that we produce at our facilities ("Methanex-produced methanol"), we also purchase and re-sell methanol produced by others ("purchased methanol") and we sell methanol on a commission basis. We analyze the results of all methanol sales together, excluding commission sales volumes. The key drivers of changes in Adjusted EBITDA are average realized price, cash costs and sales volume which are defined and calculated as follows:   /T/  PRICE     The change in Adjusted EBITDA as a result of changes in average     realized price is calculated as the difference from period to       period in the selling price of methanol multiplied by the current   period total methanol sales volume excluding commission sales       volume plus the difference from period to period in commission      revenue.                                                            CASH COST The change in Adjusted EBITDA as a result of changes in cash costs  is calculated as the difference from period to period in cash       costs per tonne multiplied by the current period total methanol     sales volume excluding commission sales volume in the current       period. The cash costs per tonne is the weighted average of the     cash cost per tonne of Methanex-produced methanol and the cash      cost per tonne of purchased methanol. The cash cost per tonne of    Methanex-produced methanol includes absorbed fixed cash costs per   tonne and variable cash costs per tonne. The cash cost per tonne    of purchased methanol consists principally of the cost of methanol  itself. In addition, the change in Adjusted EBITDA as a result of   changes in cash costs includes the changes from period to period    in unabsorbed fixed production costs, consolidated selling,         general and administrative expenses and fixed storage and handling  costs.                                                              VOLUME    The change in Adjusted EBITDA as a result of changes in sales       volume is calculated as the difference from period to period in     total methanol sales volume excluding commission sales volumes      multiplied by the margin per tonne for the prior period. The        margin per tonne for the prior period is the weighted average       margin per tonne of Methanex-produced methanol and margin per       tonne of purchased methanol. The margin per tonne for Methanex-     produced methanol is calculated as the selling price per tonne of   methanol less absorbed fixed cash costs per tonne and variable      cash costs per tonne. The margin per tonne for purchased methanol   is calculated as the selling price per tonne of methanol less the   cost of purchased methanol per tonne.                               /T/  We own 63.1% of the Atlas methanol facility and market the remaining 36.9% of its production through a commission offtake agreement. A contractual agreement between us and our partners establishes joint control over Atlas. As a result, we account for this investment using the equity method of accounting, which results in 63.1% of the net assets and net earnings of Atlas being presented separately in the consolidated statements of financial position and consolidated statements of income, respectively. For purposes of analyzing our business, Adjusted EBITDA, Adjusted net income and Adjusted net income per common share include an amount representing our 63.1% equity share in Atlas.   On December 9, 2013, we completed the sale of a 10% equity interest in the Egypt methanol facility. At June 30, 2014, we own 50% of the 1.26 million tonne per year Egypt methanol facility and market the remaining 50% of its production through a commission offtake agreement. We account for this investment using consolidation accounting, which results in 100% of the revenues and expenses being included in our financial statements with the other investors' interests in the methanol facility being presented as "non-controlling interests". For purposes of analyzing our business, Adjusted EBITDA, Adjusted net income and Adjusted net income per common share exclude the amount associated with the other investors' non-controlling interests.  /T/  Methanex Corporation                                                         Consolidated Statements of Income (unaudited)                                (thousands of U.S. dollars, except number of common shares and per share     amounts)                                                                      Three Months Ended          Six Months Ended       -------------------------- --------------------------  Jun 30       Jun 30        Jun 30       Jun 30   2014         2013          2014         2013  ---------------------------------------------------------------------------- ----------------------------------------------------------------------------  Revenue                 $   791,310  $   733,099   $ 1,759,788  $ 1,384,998  Cost of sales and                                                             operating expenses        (610,294)    (580,116)   (1,320,166)  (1,108,111) Depreciation and                                                              amortization               (33,113)     (28,953)      (67,924)     (58,770) Argentina gas                                                                 settlement (note 11)        42,000            -        42,000            -  Write-off of oil and                                                          gas rights                       -      (16,859)            -      (16,859) Geismar project                                                               relocation expenses                                                          and charges                      -      (33,867)            -      (33,867) ---------------------------------------------------------------------------- Operating income            189,903       73,304       413,698      167,391  Earnings of associate                                                         (note 4)                     3,293        6,017        10,704        7,303  Finance costs (note 6)       (9,570)     (14,618)      (20,408)     (30,069) Finance income and                                                            other expenses               1,277        2,698           914        1,071  ---------------------------------------------------------------------------- Income before income                                                          taxes                      184,903       67,401       404,908      145,696  Income tax recovery                                                           (expense):                                                                    Current                   (27,275)     (23,276)      (53,653)     (27,667)   Deferred                  (19,154)      21,726       (44,442)      14,055  ----------------------------------------------------------------------------  (46,429)      (1,550)      (98,095)     (13,612) ---------------------------------------------------------------------------- Net income              $   138,474  $    65,851   $   306,813  $   132,084  ---------------------------------------------------------------------------- Attributable to:                                                               Methanex Corporation                                                        shareholders             124,784       53,999       269,886      114,266    Non-controlling                                                             interests                 13,690       11,852        36,927       17,818  ----------------------------------------------------------------------------  $   138,474  $    65,851   $   306,813  $   132,084  ----------------------------------------------------------------------------  Income per share for                                                          the period                                                                   attributable to                                                              Methanex Corporation                                                         shareholders                                                                  Basic net income per                                                        common share (note                                                         7)                   $      1.30  $      0.57   $      2.81  $      1.21    Diluted net income                                                          per common share                                                           (note 7)             $      1.24  $      0.56   $      2.79  $      1.19   Weighted average number                                                       of common shares                                                             outstanding (note 7)    96,124,565   95,116,950    96,212,652   94,817,234  Diluted weighted                                                              average number of                                                            common shares                                                                outstanding (note 7)    97,322,144   96,260,035    96,818,731   95,998,786   See accompanying notes to condensed consolidated interim financial            statements.                                                                  Methanex Corporation                                                         Consolidated Statements of Comprehensive Income (unaudited)                  (thousands of U.S. dollars)                                                   Three Months Ended      Six Months Ended     ---------------------- ----------------------  Jun 30     Jun 30      Jun 30     Jun 30   2014       2013        2014       2013  ---------------------------------------------------------------------------- ----------------------------------------------------------------------------  Net income                      $ 138,474  $  65,851   $ 306,813  $ 132,084    Other comprehensive income                                                  (loss), net of taxes:                                                      Items that may be                                                         reclassified to income:                                                  Change in fair value of                                                 forward exchange                                                       contracts                      128     (4,262)        276     (4,446)  Change in fair value of                                                 interest rate swap                                                     contracts                      744         (4)        478       (300)  Realized loss on interest                                               rate swap contracts                                                    reclassified to finance                                                costs                        2,213      2,792       4,426      5,383  ----------------------------------------------------------------------------  3,085     (1,474)      5,180        637  ---------------------------------------------------------------------------- Comprehensive income            $ 141,559  $  64,377   $ 311,993  $ 132,721  ---------------------------------------------------------------------------- Attributable to:                                                               Methanex Corporation                                                        shareholders                   126,393     51,410     272,121    112,870    Non-controlling interests        15,166     12,967      39,872     19,851  ----------------------------------------------------------------------------  $ 141,559  $  64,377   $ 311,993  $ 132,721  ----------------------------------------------------------------------------  See accompanying notes to condensed consolidated interim financial            statements.                                                                  Methanex Corporation                                                         Consolidated Statements of Financial Position (unaudited)                    (thousands of U.S. dollars)                                                   Jun 30         Dec 31  AS AT                                                   2014           2013  ---------------------------------------------------------------------------- ----------------------------------------------------------------------------  ASSETS                                                                       Current assets:                                                                Cash and cash equivalents                     $    647,482   $    732,736    Trade and other receivables                        487,791        534,130    Inventories (note 2)                               279,048        313,809    Prepaid expenses                                    28,743         20,533  ----------------------------------------------------------------------------  1,443,064      1,601,208  Non-current assets:                                                            Property, plant and equipment (note 3)           2,431,390      2,230,938    Investment in associate (note 4)                   201,872        216,095    Other assets                                        70,484         65,253  ----------------------------------------------------------------------------  2,703,746      2,512,286  ----------------------------------------------------------------------------  $  4,146,810   $  4,113,494  ----------------------------------------------------------------------------  LIABILITIES AND EQUITY                                                       Current liabilities:                                                           Trade, other payables and accrued                                           liabilities                                  $    512,186   $    618,181    Current maturities on long-term debt (note                                  5)                                                 42,723         41,504    Current maturities on other long-term                                       liabilities                                       101,486         85,648  ----------------------------------------------------------------------------  656,395        745,333  Non-current liabilities:                                                       Long-term debt (note 5)                          1,106,861      1,126,802    Other long-term liabilities                        127,300        188,520    Deferred income tax liabilities                    193,073        147,506  ----------------------------------------------------------------------------  1,427,234      1,462,828  Equity:                                                                        Capital stock                                      533,794        531,573    Contributed surplus                                  3,283          4,994    Retained earnings                                1,278,741      1,126,700    Accumulated other comprehensive loss                (3,309)        (5,544) ----------------------------------------------------------------------------   Shareholders' equity                             1,812,509      1,657,723    Non-controlling interests                          250,672        247,610  ----------------------------------------------------------------------------   Total equity                                     2,063,181      1,905,333  ----------------------------------------------------------------------------  $  4,146,810   $  4,113,494  ----------------------------------------------------------------------------  See accompanying notes to condensed consolidated interim financial            statements.                                                                  Methanex Corporation                                                         Consolidated Statements of Changes in Equity (unaudited)                     (thousands of U.S. dollars, except number of common shares)                   Accumulated   Number of                                           Other   Common  Capital  Contributed   Retained  Comprehensive   Shares    Stock      Surplus   Earnings           Loss  ---------------------------------------------------------------------------- Balance,                                                                      December 31,                                                                 2012            94,309,970 $481,779 $     15,481 $  805,661 $      (13,045) Net income                -        -            -    114,266              -  Other                                                                         comprehensive                                                                income (loss)            -        -            -          -         (1,396) Compensation                                                                  expense                                                                      recorded for                                                                 stock options            -        -          441          -              -  Issue of shares                                                               on exercise of                                                               stock options    1,018,520   24,151            -          -              -  Reclassification                                                              of grant date                                                                fair value on                                                                exercise of                                                                  stock options            -    7,135       (7,135)         -              -  Dividend                                                                      payments to                                                                  Methanex                                                                     Corporation                                                                  shareholders             -        -            -    (36,591)             -  Distributions to                                                              non-controlling                                                              interests                -        -            -          -              -  Equity                                                                        contributions                                                                by non                                                                       controlling                                                                  interests                -        -            -          -              -  ---------------------------------------------------------------------------- Balance, June                                                                 30, 2013        95,328,490  513,065        8,787    883,336        (14,441) Net income                -        -            -    214,901              -  Other                                                                         comprehensive                                                                income                   -        -            -      5,362          7,444  Compensation                                                                  expense                                                                      recorded for                                                                 stock options            -        -          281          -              -  Sale of partial                                                               interest in                                                                  subsidiary               -        -            -     61,447          1,453  Issue of shares                                                               on exercise of                                                               stock options      772,479   14,434            -          -              -  Reclassification                                                              of grant date                                                                fair value on                                                                exercise of                                                                  stock options            -    4,074       (4,074)         -              -  Dividend                                                                      payments to                                                                  Methanex                                                                     Corporation                                                                  shareholders             -        -            -    (38,346)             -  Distributions to                                                              non-controlling                                                              interests                -        -            -          -              -  ---------------------------------------------------------------------------- Balance,                                                                      December 31,                                                                 2013            96,100,969  531,573        4,994  1,126,700         (5,544) Net income                -        -            -    269,886              -  Other                                                                         comprehensive                                                                income                   -        -            -          -          2,235  Compensation                                                                  expense                                                                      recorded for                                                                 stock options            -        -          464          -              -  Issue of shares                                                               on exercise of                                                               stock options      430,287    7,701            -          -              -  Reclassification                                                              of grant date                                                                fair value on                                                                exercise of                                                                  stock options            -    2,175       (2,175)         -              -  Payment for                                                                   shares                                                                       repurchased     (1,371,447)  (7,655)           -    (74,617)             -  Dividend                                                                      payments to                                                                  Methanex                                                                     Corporation                                                                  shareholders             -        -            -    (43,228)             -  Distributions to                                                              non-controlling                                                              interests                -        -            -          -              -  ---------------------------------------------------------------------------- Balance, June                                                                 30, 2014        95,159,809 $533,794 $      3,283 $1,278,741 $       (3,309) ----------------------------------------------------------------------------  Non-                      Shareholders'         Controlling              Total   Equity           Interests             Equity  ---------------------------------------------------------------------------- Balance,                                                                      December 31,                                                                 2012             $        1,289,876   $         187,861   $      1,477,737  Net income                   114,266              17,818            132,084  Other                                                                         comprehensive                                                                income (loss)                (1,396)              2,033                637  Compensation                                                                  expense                                                                      recorded for                                                                 stock options                   441                   -                441  Issue of shares                                                               on exercise of                                                               stock options                24,151                   -             24,151  Reclassification                                                              of grant date                                                                fair value on                                                                exercise of                                                                  stock options                     -                   -                  -  Dividend                                                                      payments to                                                                  Methanex                                                                     Corporation                                                                  shareholders                (36,591)                  -            (36,591) Distributions to                                                              non-controlling                                                              interests                         -             (13,024)           (13,024) Equity                                                                        contributions                                                                by non                                                                       controlling                                                                  interests                         -               1,000              1,000  ---------------------------------------------------------------------------- Balance, June                                                                 30, 2013                  1,390,747             195,688          1,586,435  Net income                   214,901              30,015            244,916  Other                                                                         comprehensive                                                                income                       12,806               1,734             14,540  Compensation                                                                  expense                                                                      recorded for                                                                 stock options                   281                   -                281  Sale of partial                                                               interest in                                                                  subsidiary                   62,900              47,100            110,000  Issue of shares                                                               on exercise of                                                               stock options                14,434                   -             14,434  Reclassification                                                              of grant date                                                                fair value on                                                                exercise of                                                                  stock options                     -                   -                  -  Dividend                                                                      payments to                                                                  Methanex                                                                     Corporation                                                                  shareholders                (38,346)                  -            (38,346) Distributions to                                                              non-controlling                                                              interests                         -             (26,927)           (26,927) ---------------------------------------------------------------------------- Balance,                                                                      December 31,                                                                 2013                      1,657,723             247,610          1,905,333  Net income                   269,886              36,927            306,813  Other                                                                         comprehensive                                                                income                        2,235               2,945              5,180  Compensation                                                                  expense                                                                      recorded for                                                                 stock options                   464                   -                464  Issue of shares                                                               on exercise of                                                               stock options                 7,701                   -              7,701  Reclassification                                                              of grant date                                                                fair value on                                                                exercise of                                                                  stock options                     -                   -                  -  Payment for                                                                   shares                                                                       repurchased                 (82,272)                  -            (82,272) Dividend                                                                      payments to                                                                  Methanex                                                                     Corporation                                                                  shareholders                (43,228)                  -            (43,228) Distributions to                                                              non-controlling                                                              interests                         -             (36,810)           (36,810) ---------------------------------------------------------------------------- Balance, June                                                                 30, 2014         $        1,812,509   $         250,672   $      2,063,181  ----------------------------------------------------------------------------  See accompanying notes to condensed consolidated interim financial            statements.                                                                  Methanex Corporation                                                         Consolidated Statements of Cash Flows (unaudited)                            (thousands of U.S. dollars)                                                   Three Months Ended       Six Months Ended      ----------------------- -----------------------  Jun 30      Jun 30      Jun 30      Jun 30   2014        2013        2014        2013  ---------------------------------------------------------------------------- ----------------------------------------------------------------------------  CASH FLOWS FROM OPERATING                                                     ACTIVITIES                                                                  Net income                    $ 138,474   $  65,851   $ 306,813   $ 132,084  Deduct earnings of associate     (3,293)     (6,017)    (10,704)     (7,303) Dividends received from                                                       associate                       25,240           -      25,240           -  Add (deduct) non-cash items:                                                   Depreciation and                                                            amortization                  33,113      28,953      67,924      58,770    Write-off of oil and gas                                                    rights                             -      16,859           -      16,859    Income tax expense             46,429       1,550      98,095      13,612    Share based compensation                                                    expense (recovery)            (1,121)     15,694      24,125      52,007    Finance costs                   9,570      14,618      20,408      30,069    Other                             701        (765)        424        (301) Income taxes paid               (12,068)     (6,568)    (23,426)    (15,351) Other cash payments,                                                          including share-based                                                        compensation                    (5,627)       (440)    (40,336)    (17,995) ---------------------------------------------------------------------------- Cash flows from operating                                                     activities before undernoted   231,418     129,735     468,563     262,451  Changes in non-cash working                                                   capital (note 9)                 8,754      (3,986)    (49,320)    (19,023) ----------------------------------------------------------------------------  240,172     125,749     419,243     243,428  ----------------------------------------------------------------------------  CASH FLOWS FROM FINANCING                                                     ACTIVITIES                                                                    Payments for repurchase of                                                  shares                       (77,324)          -     (77,324)          -    Dividend payments to                                                        Methanex Corporation                                                       shareholders                 (23,933)    (19,057)    (43,228)    (36,591)   Interest paid, including                                                    interest rate swap                                                         settlements                   (5,810)     (6,546)    (26,811)    (27,757)   Repayment of long-term debt                                                 and limited recourse debt       (913)     (1,213)    (20,433)    (19,480)   Cash distributions to non-                                                  controlling interests        (18,713)     (7,759)    (36,810)    (13,024)   Proceeds on issue of shares                                                 on exercise of stock                                                       options                          133      11,063       7,701      24,151    Proceeds from limited                                                       recourse debt                      -           -           -      10,000    Other                          (1,034)       (936)     (2,049)       (855)  -----------------------------------------------  (127,594)    (24,448)   (198,954)    (63,556) ----------------------------------------------------------------------------  CASH FLOWS FROM INVESTING                                                     ACTIVITIES                                                                    Property, plant and                                                         equipment                    (15,936)    (62,613)    (31,764)    (96,232)   Geismar plants under                                                        construction                 (98,453)    (53,679)   (226,367)    (97,077)   Other assets                   (4,056)     (4,958)     (8,919)     (5,750)   Changes in non-cash working                                                 capital related to                                                         investing activities (note                                                 9)                           (55,864)      1,612     (38,493)        316  ----------------------------------------------------------------------------  (174,309)   (119,638)   (305,543)   (198,743) ---------------------------------------------------------------------------- Decrease in cash and cash                                                     equivalents                    (61,731)    (18,337)    (85,254)    (18,871) Cash and cash equivalents,                                                    beginning of period            709,213     726,851     732,736     727,385  ---------------------------------------------------------------------------- Cash and cash equivalents,                                                    end of period                $ 647,482   $ 708,514   $ 647,482   $ 708,514  ----------------------------------------------------------------------------  See accompanying notes to condensed consolidated interim financial            statements.                                                                  Methanex Corporation                                                         Notes to Condensed Consolidated Interim Financial Statements (unaudited)     Except where otherwise noted, tabular dollar amounts are stated in thousands of U.S. dollars.                                                              /T/  1. Basis of presentation:   Methanex Corporation (the Company) is an incorporated entity with corporate offices in Vancouver, Canada. The Company's operations consist of the production and sale of methanol, a commodity chemical. The Company is the world's largest producer and supplier of methanol to the major international markets of Asia Pacific, North America, Europe and South America.  These condensed consolidated interim financial statements are prepared in accordance with International Accounting Standards (IAS) 34, Interim Financial Reporting, as issued by the International Accounting Standards Board (IASB) on a basis consistent with those followed in the most recent annual consolidated financial statements.   These condensed consolidated interim financial statements do not include all of the information required for full annual financial statements and were approved and authorized for issue by the Audit, Finance & Risk Committee of the Board of Directors on July 30, 2014.  2. Inventories:   Inventories are valued at the lower of cost, determined on a first-in first-out basis, and estimated net realizable value. The amount of inventories included in cost of sales and operating expenses and depreciation and amortization for the three and six month periods ended June 30, 2014 is $545 million (2013 - $544 million) and $1,236 million (2013 - $1,013 million), respectively.  3. Property, plant and equipment:   /T/  Buildings,                                                 Plant                                                 Installations  Plants Under   Oil & Gas                       & Machinery  Construction  Properties    Other       Total ----------------------------------------------------------------------------  Cost at June 30,                                                              2014            $  3,129,409  $    630,051  $   87,974  $85,360  $3,932,794 Accumulated                                                                   depreciation at                                                              June 30, 2014      1,381,954             -      79,963   39,487   1,501,404 ---------------------------------------------------------------------------- Net book value                                                                at June 30,                                                                  2014            $  1,747,455  $    630,051  $    8,011  $45,873  $2,431,390 ----------------------------------------------------------------------------  Cost at December                                                              31, 2013        $  3,100,597  $    393,044  $   86,312  $82,556  $3,662,509 Accumulated                                                                   depreciation at                                                              December 31,                                                                 2013               1,317,329             -      78,228   36,014   1,431,571 ---------------------------------------------------------------------------- Net book value                                                                at December 31,                                                              2013            $  1,783,268  $    393,044  $    8,084  $46,542  $2,230,938 ----------------------------------------------------------------------------  /T/  The Company is relocating two idle Chile facilities to Geismar, Louisiana with Geismar 1 targeted to be producing methanol by late 2014 and Geismar 2 in early 2016. During the three months ended June 30, 2014, the Company incurred capital expenditures related to the Geismar projects of $100 million, excluding capitalized interest. The remaining budgeted capital expenditures for these projects are $405 million, excluding capitalized interest.  4. Interest in Atlas joint venture:   a) The Company has a 63.1% equity interest in Atlas Methanol Company Unlimited (Atlas). Atlas owns a 1.8 million tonne per year methanol production facility in Trinidad. The Company accounts for its interest in Atlas using the equity method. Summarized financial information of Atlas (100% basis) is as follows:   /T/  Consolidated statements of financial                Jun 30           Dec 31   position as at                                       2014             2013  ----------------------------------------------------------------------------  Cash and cash equivalents                   $       15,722   $       20,776  Other current assets                               126,352          161,765  Non-current assets                                 365,722          378,890  Current liabilities                                (34,199)         (47,359) Long-term debt, including current                                             maturities                                        (44,831)         (56,752) Other long-term liabilities, including                                        current maturities                               (131,213)        (136,730) ---------------------------------------------------------------------------- Net assets at 100%                          $      297,553   $      320,590  ----------------------------------------------------------------------------  Net assets at 63.1%                         $      187,756   $      202,292  Long-term receivable from Atlas                     14,116           13,803  ----------------------------------------------------------------------------  Investment in associate                     $      201,872   $      216,095  ----------------------------------------------------------------------------  Three Months Ended         Six Months Ended       ------------------------- ------------------------- Consolidated statements      Jun 30       Jun 30       Jun 30       Jun 30    of income                      2014         2013         2014         2013  -------------------------------------------------- -------------------------  Revenue                   $   80,738   $   78,415   $  196,765   $  163,781  Cost of sales and                                                             depreciation and                                                             amortization                (71,820)     (62,146)    (170,218)    (141,444) ---------------------------------------------------------------------------- Operating income               8,918       16,269       26,547       22,337  Finance costs, finance                                                        income and other                                                             expenses                     (2,756)      (3,451)      (5,506)      (6,872) Income tax expense              (943)      (3,283)      (4,077)      (3,892) ---------------------------------------------------------------------------- Net earnings at 100%      $    5,219   $    9,535   $   16,964   $   11,573  ---------------------------------------------------------------------------- Earnings of associate at                                                      63.1%                    $    3,293   $    6,017   $   10,704   $    7,303  ----------------------------------------------------------------------------  ---------------------------------------------------------------------------- Dividends received from                                                       associate                $   25,240            -   $   25,240            -  ----------------------------------------------------------------------------  /T/  b) Contingent liability:   The Board of Inland Revenue of Trinidad and Tobago has issued assessments against Atlas in respect of the 2005, 2006 and 2007 financial years. All subsequent tax years remain open to assessment. The assessments relate to the pricing arrangements of certain long-term fixed price sales contracts that extend to 2014 and 2019 related to methanol produced by Atlas. Atlas had partial relief from corporation income tax until late July 2014.   The Company has lodged objections to the assessments. Based on the merits of the cases and legal interpretation, management believes its position should be sustained.  5. Long-term debt:   /T/  Jun 30         Dec 31  As at                                                   2014           2013  ---------------------------------------------------------------------------- Unsecured notes                                                               $350 million at 3.25% due December 15, 2019   $    344,946   $    344,530    $250 million at 5.25% due March 1, 2022            246,813        246,650    $150 million at 6.00% due August 15, 2015          149,707        149,581  ----------------------------------------------------------------------------  741,466        740,761  Egypt limited recourse debt facilities               387,036        404,722  Other limited recourse debt facilities                21,082         22,823  ---------------------------------------------------------------------------- Total long-term debt (1)                           1,149,584      1,168,306  Less current maturities                              (42,723)       (41,504) ----------------------------------------------------------------------------  $  1,106,861   $  1,126,802  ----------------------------------------------------------------------------  (1) Long-term debt is presented net of deferred financing fees.               /T/  During the three months ended June 30, 2014, the Company has made repayments on its other limited recourse debt facilities of $0.9 million.   At June 30, 2014, management believes the Company was in compliance with all significant terms and default provisions related to long-term debt obligations.  6. Finance costs:   /T/  Three Months Ended       Six Months Ended      ----------------------- -----------------------  Jun 30      Jun 30      Jun 30      Jun 30   2014        2013        2014        2013  ---------------------------------------------------- -----------------------  Finance costs                 $  15,527   $  16,278   $  31,048   $  32,796  Less capitalized interest                                                     related to Geismar plants                                                    under construction              (5,957)     (1,660)    (10,640)     (2,727) ----------------------------------------------------------------------------  $   9,570   $  14,618   $  20,408   $  30,069  ----------------------------------------------------------------------------  /T/  Finance costs are primarily comprised of interest on borrowings and finance lease obligations, the effective portion of interest rate swaps designated as cash flow hedges, amortization of deferred financing fees, and accretion expense associated with site restoration costs. Interest during construction of the Geismar plants is capitalized until the plants are substantially completed and ready for productive use.   The Company has interest rate swap contracts on its Egypt limited recourse debt facilities to swap the LIBOR-based interest payments for an average aggregated fixed rate of 4.8% plus a spread on approximately 75% of the Egypt limited recourse debt facilities for the period to March 31, 2015.  7. Net income per common share:   Diluted net income per common share is calculated by considering the potential dilution that would occur if outstanding stock options and, under certain circumstances, tandem share appreciation rights (TSARs) were exercised or converted to common shares.   Outstanding TSARs may be settled in cash or common shares at the holder's option and for purposes of calculating diluted net income per common share, the more dilutive of the cash-settled and equity-settled method is used, regardless of how the plan is accounted for. Accordingly, TSARs that are accounted for using the cash-settled method will require adjustments to the numerator and denominator if the equity-settled method is determined to have a dilutive effect on diluted net income per common share. For the periods presented, the equity settled method was more dilutive for the three months ended June 30, 2014.   A reconciliation of the numerator used for the purpose of calculating diluted net income per common share is as follows:   /T/  Three Months Ended        Six Months Ended     ------------------------ -----------------------  Jun 30       Jun 30      Jun 30      Jun 30  2014         2013        2014        2013 ---------------------------------------------------- -----------------------  Numerator for basic net                                                       income per common share     $  124,784   $   53,999  $  269,886  $  114,266   Adjustment for the effect                                                   of TSARs:                                                                  Cash settled recovery                                                     included in net income      (1,990)           -           -           -  Equity settled expense       (1,874)           -           -           - ---------------------------------------------------------------------------- Numerator for diluted net                                                     income per common share     $  120,920   $   53,999  $  269,886  $  114,266 ----------------------------------------------------------------------------  /T/  Stock options and, if calculated using the equity-settled method, TSARs are considered dilutive when the average market price of the Company's common shares during the period disclosed exceeds the exercise price of the stock option or TSAR. A reconciliation of the denominator used for the purposes of calculating basic and diluted net income per common share is as follows:  /T/  Three Months Ended        Six Months Ended      ------------------------ ------------------------  Jun 30      Jun 30       Jun 30      Jun 30  2014        2013         2014        2013 --------------------------------------------------- ------------------------  Denominator for basic net                                                     income per common share     96,124,565  95,116,950   96,212,652  94,817,234   Effect of dilutive stock                                                    options                      516,169   1,143,085      606,079   1,181,552   Effect of dilutive TSARs      681,410           -            -           - ---------------------------------------------------------------------------- Denominator for diluted net                                                   income per common share     97,322,144  96,260,035   96,818,731  95,998,786 ----------------------------------------------------------------------------  /T/  For the three month and six month periods ended June 30, 2014 and 2013, basic and diluted net income per common share attributable to Methanex shareholders were as follows:  /T/  Three Months Ended    Six Months Ended    -------------------- --------------------  Jun 30    Jun 30     Jun 30    Jun 30  2014      2013       2014      2013 ------------------------------------------------------- --------------------  Basic net income per common share      $ 1.30    $ 0.57     $ 2.81    $ 1.21 Diluted net income per common share    $ 1.24    $ 0.56     $ 2.79    $ 1.19 ----------------------------------------------------------------------------  /T/  8. Share-based compensation:   a) Share appreciation rights (SARs), tandem share appreciation rights (TSARs) and stock options:   (i) Outstanding units:  Information regarding units outstanding at June 30, 2014 is as follows:  /T/  SARs                     TSARs           ------------------------ ------------------------  Weighted                 Weighted  Average                  Average  Number     Exercise      Number     Exercise (per share amounts in USD)    of Units        Price    of Units        Price --------------------------------------------------- ------------------------  Outstanding at December 31,                                                   2013                        1,093,117   $    32.02   1,858,585   $    31.83 Granted                        203,190        73.13     303,850        72.66 Exercised                     (190,229)       28.90    (283,750)       30.21 Cancelled                      (10,750)       33.95      (6,900)       35.69 --------------------------------------------------- ------------------------ Outstanding at March 31,                                                      2014                        1,095,328   $    40.17   1,871,785   $    38.69 --------------------------------------------------- ------------------------ Exercised                      (11,700)       34.59     (71,400)       27.39 Cancelled                       (5,500)       51.56      (8,600)       35.97 ---------------------------------------------------------------------------- Outstanding at June 30,                                                       2014                        1,078,128   $    40.17   1,791,785   $    39.15 ----------------------------------------------------------------------------  Stock Options              -------------------------------------  Weighted Average (per share amounts in USD)             Number of Units        Exercise Price ----------------------------------------------------------------------------  Outstanding at December 31, 2013             1,219,420      $          19.15   Granted                                       45,600                 73.13   Exercised                                   (422,987)                17.72   Cancelled                                     (2,500)                35.90   Expired                                      (22,835)                22.82 ---------------------------------------------------------------------------- Outstanding at March 31, 2014                  816,698      $          22.75 ----------------------------------------------------------------------------   Exercised                                     (7,300)                18.24 ---------------------------------------------------------------------------- Outstanding at June 30, 2014                   809,398      $          22.79 ----------------------------------------------------------------------------  Units Outstanding at           Units Exercisable at    June 30, 2014                  June 30, 2014       ------------------------------------ ------------------------ Range of                                                                      Exercise           Weighted                                                  Prices              Average               Weighted                 Weighted (per share         Remaining      Number    Average        Number    Average  amounts in      Contractual    of Units   Exercise      of Units   Exercise  USD)           Life (Years) Outstanding      Price   Exercisable      Price --------------------------------------------------- ------------------------ SARs:                                                                          $23.36 to                                                                   31.74                 3.9     540,638 $    29.11       421,957 $    28.47   $31.88 to                                                                   73.13                 6.1     537,490      51.29       102,800      38.24 ----------------------------------------------------------------------------  5.0   1,078,128 $    40.17       524,757 $    30.38 ---------------------------------------------------------------------------- TSARs:                                                                         $23.36 to                                                                   31.74                 3.8     954,045 $    29.03       742,978 $    28.28   $31.88 to                                                                   73.13                 6.0     837,740      50.68       180,890      38.03 ----------------------------------------------------------------------------  4.9   1,791,785 $    39.15       923,868 $    30.19 ---------------------------------------------------------------------------- Stock options:                                                                 $6.33 to                                                                    25.22                 1.8     384,035 $     8.79       384,035 $     8.79   $28.43 to                                                                   73.13                 3.1     425,363      35.43       303,863      29.65 ----------------------------------------------------------------------------  2.5     809,398 $    22.79       687,898 $    18.01 ----------------------------------------------------------------------------  /T/  (ii) Compensation expense related to SARs and TSARs:   Compensation expense for SARs and TSARs is measured based on their fair value and is recognized over the vesting period. Changes in fair value each period are recognized in net income for the proportion of the service that has been rendered at each reporting date. The fair value at June 30, 2014 was $72.9 million compared with the recorded liability of $66.1 million. The difference between the fair value and the recorded liability of $6.8 million will be recognized over the weighted average remaining vesting period of approximately 1.7 years. The weighted average fair value was estimated at June 30, 2014 using the Black-Scholes option pricing model.  For the three and six month periods ended June 30, 2014, compensation expense related to SARs and TSARs included a recovery in cost of sales and operating expenses of $2.7 million (2013 - expense of $6.9 million) and an expense of $15.5 million (2013 - expense of $23.9 million), respectively. This included a recovery of $5.8 million (2013 - expense of $4.1 million) and an expense of $8.6 million (2013 - expense of $19.1 million), respectively, related to the effect of the change in the Company's share price for the three and six month periods ended June 30, 2014.   (iii) Compensation expense related to stock options:   For the three and six month periods ended June 30, 2014, compensation expense related to stock options included in cost of sales and operating expenses was $0.2 million (2013 - $0.2 million) and $0.4 million (2013 - $0.4 million), respectively. The fair value of each stock option grant was estimated on the grant date using the Black-Scholes option pricing model.  b) Deferred, restricted and performance share units:   Deferred, restricted and performance share units outstanding at June 30, 2014 are as follows:  /T/  Number of      Number of     Number of   Deferred     Restricted   Performance   Share Units    Share Units   Share Units  ----------------------------------------------------------------------------  Outstanding at December 31, 2013       346,814         44,131       946,446    Granted                                4,200          7,000       139,160    Granted performance factor (1)             -              -        55,677    Granted in-lieu of dividends           1,012            152         2,381    Redeemed                             (27,052)             -      (334,062)   Cancelled                                  -              -        (6,663) ---------------------------------------------------------------------------- Outstanding at March 31, 2014          324,974         51,283       802,939  ----------------------------------------------------------------------------   Granted in-lieu of dividends           1,315            207         3,200    Cancelled                                  -              -       (10,885) ---------------------------------------------------------------------------- Outstanding at June 30, 2014           326,289         51,490       795,254  ----------------------------------------------------------------------------  (1) Performance share units have a feature where the ultimate number of       units that vest are adjusted by a performance factor of the original      grant as determined by the Company's total shareholder return in          relation to a predetermined target over the period to vesting. These      units relate to performance share units redeemed in the quarter ended     March 31, 2014.                                                           /T/  Compensation expense for deferred, restricted and performance share units is measured at fair value based on the market value of the Company's common shares and is recognized over the vesting period. Changes in fair value are recognized in net income for the proportion of the service that has been rendered at each reporting date. The fair value of deferred, restricted and performance share units at June 30, 2014 was $75.5 million compared with the recorded liability of $65.4 million. The difference between the fair value and the recorded liability of $10.1 million will be recognized over the weighted average remaining vesting period of approximately 1.4 years.   For the three and six month periods ended June 30, 2014, compensation expense related to deferred, restricted and performance share units included in cost of sales and operating expenses was an expense of $1.5 million (2013 - expense of $8.6 million) and an expense of $8.3 million (2013 - expense of $27.7 million), respectively. This included a recovery of $2.1 million (2013 - expense of $5.2 million) and an expense of $1.0 million (2013 - expense of $20.9 million) related to the effect of the change in the Company's share price for the three and six month periods ended June 30, 2014.   9. Changes in non-cash working capital:   Changes in non-cash working capital for the three and six month periods ended June 30, 2014 and 2013 were as follows:  /T/  Three Months Ended       Six Months Ended      ----------------------- -----------------------  Jun 30      Jun 30      Jun 30      Jun 30   2014        2013        2014        2013  ---------------------------------------------------- ----------------------- Decrease (increase) in non-                                                   cash working capital:                                                         Trade and other receivables $  88,196   $ (35,677)  $  46,339   $ (60,105)   Inventories                    25,718      18,531      34,761     (14,596)   Prepaid expenses               (6,371)     (9,531)     (8,210)     (5,640)   Trade, other payables and                                                   accrued liabilities,                                                       including long-term                                                        payables included in other                                                 long-term liabilities       (131,221)     49,264    (124,954)     86,972  ---------------------------------------------------- -----------------------  (23,678)     22,587     (52,064)      6,631  Adjustments for items not                                                     having a cash effect and                                                     working capital changes                                                      relating to taxes and                                                        interest paid                  (23,432)    (24,961)    (35,749)    (25,338) ---------------------------------------------------- ----------------------- Changes in non-cash working                                                   capital having a cash effect $ (47,110)  $  (2,374)  $ (87,813)  $ (18,707) ---------------------------------------------------- -----------------------  These changes relate to the                                                   following activities:                                                         Operating                   $   8,754   $  (3,986)  $ (49,320)  $ (19,023)   Investing                     (55,864)      1,612     (38,493)        316  ---------------------------------------------------- ----------------------- Changes in non-cash working                                                   capital                      $ (47,110)  $  (2,374)  $ (87,813)  $ (18,707) ---------------------------------------------------- -----------------------  /T/  10. Financial instruments:   Financial instruments are either measured at amortized cost or fair value. Held-to-maturity investments, loans and receivables and other financial liabilities are measured at amortized cost. Held-for-trading financial assets and liabilities and available-for-sale financial assets are measured on the Consolidated Statements of Financial Position at fair value. Derivative financial instruments are classified as held-for-trading and are recorded on the Consolidated Statements of Financial Position at fair value unless exempted. Changes in fair value of held-for-trading derivative financial instruments are recorded in earnings unless the instruments are designated as cash flow hedges.   The euro hedges and Egypt interest rate swaps designated as cash flow hedges are measured at fair value based on industry-accepted valuation models and inputs obtained from active markets.   The Egypt limited recourse debt facilities bear interest at LIBOR plus a spread. The Company has interest rate swap contracts to swap the LIBOR-based interest payments for an average aggregated fixed rate of 4.8% plus a spread on approximately 75% of the Egypt limited recourse debt facilities for the period to March 31, 2015. These interest rate swaps had an outstanding notional amount of $302 million as at June 30, 2014. The notional amount decreases over the expected repayment period. At June 30, 2014, these interest rate swap contracts had a negative fair value of $13.3 million (December 31, 2013 - negative $19.8 million) recorded in current liabilities. The fair value of these interest rate swap contracts will fluctuate until maturity.   The Company also designates as cash flow hedges forward exchange contracts to sell euro at a fixed USD exchange rate. At June 30, 2014, the Company had outstanding forward exchange contracts designated as cash flow hedges to sell a notional amount of EUR37.0 million in exchange for US dollars. The euro contracts had a positive fair value of $0.2 million recorded in current assets. Changes in fair value of derivative financial instruments designated as cash flow hedges have been recorded in other comprehensive income.   The carrying values of the Company's financial instruments approximate their fair values, except as follows:  /T/  June 30, 2014          ------------------------------ As at                                          Carrying Value     Fair Value ----------------------------------------------------------------------------  Long-term debt excluding deferred financing                                   fees                                             $ 1,163,348    $ 1,221,601 ----------------------------------------------------------------------------  /T/  There is no publicly traded market for the limited recourse debt facilities. The fair value disclosed on a recurring basis and categorized as Level 2 within the fair value hierarchy is estimated by reference to current market prices for debt securities with similar terms and characteristics. The fair value of the unsecured notes disclosed on a recurring basis and also categorized as Level 2 within the fair value hierarchy was estimated by reference to a limited number of small transactions in June 2014. The fair value of the Company's unsecured notes will fluctuate until maturity.  11. Argentina gas settlement:   During the quarter, we reached a settlement with Total Austral S.A. ("Total") for $42 million in relation to Total's natural gas delivery obligations pursuant to a long-term natural gas supply agreement in Chile.   /T/  Methanex Corporation                                                         Quarterly History                                                            (unaudited)                                                                   YTD     Q2     Q1                                 2014   2014   2014   2013    Q4    Q3    Q2    Q1 ----------------------------------------------------------------------------  METHANOL SALES VOLUMES                                                       (thousands of tonnes)                                                         Methanex-produced(1)      2,371  1,143  1,228  4,304 1,190 1,045 1,039 1,030 Purchased methanol        1,297    643    654  2,715   663   715   749   588 Commission sales (1)        502    206    296    972   274   237   242   219 ----------------------------------------------------------------------------  4,170  1,992  2,178  7,991 2,127 1,997 2,030 1,837 ----------------------------------------------------------------------------  METHANOL PRODUCTION                                                          (thousands of tonnes)                                                         New Zealand               1,059    559    500  1,419   400   349   361   309 Atlas, Trinidad (63.1%)     440    191    249    971   268   254   201   248 Titan, Trinidad             352    203    149    651   173   128   169   181 Egypt (50%) (2)             238     99    139    623   159   168   163   133 Medicine Hat                260    138    122    476    86   130   129   131 Chile                        93     26     67    204   108     6    29    61 ----------------------------------------------------------------------------  2,442  1,216  1,226  4,344 1,194 1,035 1,052 1,063 ----------------------------------------------------------------------------  AVERAGE REALIZED                                                              METHANOL PRICE (3)                                                          ($/tonne)                   488    450    524    441   493   438   425   412 ($/gallon)                 1.47   1.35   1.58   1.33  1.48  1.32  1.28  1.24  PER SHARE INFORMATION ($                                                      per share) (4)                                                              Basic net income (loss)    2.81   1.30   1.51   3.46  1.33  0.91  0.57  0.64 Diluted net income                                                            (loss)                    2.79   1.24   1.50   3.41  1.32  0.90  0.56  0.63 Adjusted net income (5)    2.59   0.94   1.65   4.88  1.72  1.22  1.02  0.92  ----------------------------------------------------------------------------  2012         Q4        Q3        Q2        Q1 ----------------------------------------------------------------------------  METHANOL SALES VOLUMES                                                       (thousands of tonnes)                                                         Methanex-produced(1)          4,039      1,059     1,053     1,001       926 Purchased methanol            2,565        664       641       569       691 Commission sales (1)            855        176       205       276       198 ----------------------------------------------------------------------------  7,459      1,899     1,899     1,846     1,815 ----------------------------------------------------------------------------  METHANOL PRODUCTION                                                          (thousands of tonnes)                                                         New Zealand                   1,108        378       346       210       174 Atlas, Trinidad (63.1%)         826        180       255       264       127 Titan, Trinidad                 786        189       186       196       215 Egypt (50%) (2)                 557        129        62       164       202 Medicine Hat                    481        132       117       118       114 Chile                           313         59        59        82       113 ----------------------------------------------------------------------------  4,071      1,067     1,025     1,034       945 ----------------------------------------------------------------------------  AVERAGE REALIZED                                                              METHANOL PRICE (3)                                                          ($/tonne)                       382        389       373       384       382 ($/gallon)                     1.15       1.17      1.12      1.15      1.15  PER SHARE INFORMATION ($                                                      per share) (4)                                                              Basic net income (loss)      (0.73)     (1.49)    (0.03)      0.56      0.24 Diluted net income                                                            (loss)                      (0.73)     (1.49)    (0.03)      0.50      0.23 Adjusted net income (5)        1.90       0.64      0.38      0.47      0.41  ---------------------------------------------------------------------------- (1) Methanex-produced methanol includes volumes produced by Chile using       natural gas supplied from Argentina under a tolling arrangement.          Commission sales represent volumes marketed on a commission basis         related to the 36.9% of the Atlas methanol facility and the portion of    the Egypt methanol facility that we do not own.                           (2) On December 9, 2013, we completed a sale of 10% equity interest in the    Egypt facility. Production figures prior to December 9, 2013 reflect a    60% interest.                                                             (3) Average realized price is calculated as revenue, excluding commissions    earned and the Egypt non-controlling interest share of revenue but        including an amount representing our share of Atlas revenue, divided by   the total sales volumes of Methanex-produced (attributable to Methanex    shareholders) and purchased methanol.                                     (4) Per share information calculated using amounts attributable to Methanex   shareholders.                                                             (5) This item is a non-GAAP measure that does not have any standardized       meaning prescribed by GAAP and therefore is unlikely to be comparable to  similar measures presented by other companies. Refer to the Additional    Information - Supplemental Non-GAAP Measures section for a description    of the non-GAAP measure and reconciliation to the most comparable GAAP    measure.                                                                  /T/  -30- FOR FURTHER INFORMATION PLEASE CONTACT:  Sandra Daycock Director, Investor Relations Methanex Corporation 604-661-2600  INDUSTRY:  Chemicals - Commodity Chemicals, Chemicals - Petrochemicals, Chemicals - Plastics and fibers, Chemicals - Specialty Chemicals, Chemicals - Wholesalers and Distributors  SUBJECT:  ERN 
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