Egypt’s state-run Abu Qir Fertilizers, Helwan Fertilizer Company, and Al Ahly Capital Holding Company, part of the National Bank of Egypt (NBE), have signed on Wednesday a shareholder agreement for the establishment of Misr Methanol and Petrochemicals Company.

Misr Methanol and Petrochemicals Company will manage the anticipated mega project to produce methanol and derivatives, which will be established in the Suez Canal Economic Zone in Ain al​-Sokhna.

The first phase of the project will produce 1 million tonnes of methanol and 400,000 tonnes of ammonia per year, with an investment cost estimated at $1.6 billion.

The agreement was signed by Saad Abu Al Maaty, chairman of Abu Qir Fertilizers; Hassan Abdel-Alim, chairman of Helwan Fertilizer Company; and Karim Saada, managing director of Al Ahly Capital Holding.

The signing ceremony was witnessed by Egyptian Petroleum Minister Tarek el-Molla, Yehia Zaki, chairman of Suez Canal Economic Zone (SCZone), Hisham Okasha, chairman of the NBE, and Abed Ezz El Regal, CEO, Egyptian General Petroleum Corporation (EGPC).

Under the agreement, Abu Qir Fertilizers Company and Helwan Fertilizer Company will each hold 35 percent while Al Ahly Capital Holding will hold the remaining 30 percent stake in the new company.

In a bourse filling on Wednesday, Abu Qir Fertilizers said that the authorised capital of the new company is worth $200 million and its issued capital amounts to $20 million.