---

---

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

FOR THE MONTH OF APRIL 2007

METHANEX CORPORATION

SUITE 1800, 200 BURRARD STREET, VANCOUVER, BC V6C 3M1 CANADA

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82                    .

---

---

 

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on behalf by the undersigned, thereunto duly authorized.

	METHANEX CORPORATION
Date: April 2, 2007	By:	/s/ RANDY MILNER
		Name:	Randy Milner
		Title:	Senior Vice President, General Counsel & Corporate Secretary

 

IMPORTANT INFORMATION FOR SHAREHOLDERS

Notice of the Annual General Meeting of Shareholders

and

Information Circular

March 5, 2007

TABLE OF CONTENTS

March 5, 2007

Invitation to Shareholders

On behalf of the entire Board of Directors of Methanex Corporation, we would like to invite you to join us at our Annual General Meeting of shareholders. The meeting will be held at the Vancouver Convention & Exhibition Centre in Vancouver, British Columbia on Monday, May 7, 2007 at 10:30 a.m.

At the meeting, we will be voting on a number of important matters. We hope you will take the time to consider the information dealing with these matters as set out in the accompanying Information Circular. We encourage you to exercise your vote, either at the meeting or by completing and sending in your proxy. Use of the proxy form is explained in the accompanying Information Circular. If you are a “non-registered” shareholder, you may similarly exercise your vote either at the meeting or by providing a proxy or voting instructions by following the instructions set out in the accompanying Information Circular or that you should otherwise receive as part of the accompanying materials to ensure that your shares get voted at the meeting in accordance with your wishes.

The meeting will provide you with a forum to learn more about our 2006 performance and hear first-hand our strategy for the future. It will also provide you with an excellent opportunity to meet the Company’s Directors and Senior Management and ask them your questions.

We hope that you will attend the Annual General Meeting and we look forward to seeing you there. If you are unable to attend, the meeting will also be webcast live through our website: www.methanex.com.

Sincerely,

Bruce Aitken

President and Chief Executive Officer

METHANEX CORPORATION

NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS

       The Annual General Meeting (“Meeting”) of shareholders of Methanex Corporation (the “Company”) will be held at the following time and place:

      The Meeting is being held for the following purposes:

      If you are a holder of Common Shares of the Company and do not expect to attend the Meeting in person, please complete the enclosed proxy form and either fax it to (416) 368 2502 or toll free in North America 1 866 781 3111 or forward it to CIBC Mellon Trust Company using the envelope provided with these materials. Proxies must be received no later than 24 hours (excluding Saturdays, Sundays and holidays) before the time fixed for commencement of the Meeting or any adjournment thereof.

      DATED at the City of Vancouver, in the Province of British Columbia, this 5th day of March, 2007.

METHANEX CORPORATION

INFORMATION CIRCULAR

Information contained in this Information Circular is given as at March 5, 2007 unless otherwise stated. Except where otherwise noted, all dollar amounts are stated in Canadian dollars.

PART I VOTING

Solicitation of Proxies

      This Information Circular is furnished in connection with the solicitation of proxies by or on behalf of the management and Board of Directors (the “Board”) of Methanex Corporation (the “Company”) for use at the annual general meeting (the “Meeting”) of shareholders of the Company to be held at the time and place (including any adjournment thereof) and for the purposes set forth in the accompanying Notice of Annual General Meeting of Shareholders.

      It is anticipated that this Information Circular and the accompanying proxy form will be mailed on or about April 2, 2007 to holders of common shares of the Company (“Common Shares”).

What will be voted on at the Meeting?

      Shareholders will be voting on those matters which are described in the accompanying Notice of Annual General Meeting of Shareholders. The Notice includes all the matters to be presented at the Meeting that are presently known to management. A simple majority (that is, greater than 50%) of the votes cast, in person or by proxy, will constitute approval of these matters, other than the election of directors and the appointment of auditors.

Who is entitled to vote?

      Only registered holders of Common Shares (“Registered Shareholders”) on March 12, 2007 (the “Record Date”) are entitled to vote at the Meeting or at any adjournment thereof. Each Registered Shareholder has one vote for each Common Share held at the close of business on March 12, 2007. As of March 5, 2007, there were 104,843,367 Common Shares outstanding. As of that date, to the knowledge of the directors and senior officers of the Company, the only person who beneficially owned, directly or indirectly, or exercised control or direction over Common Shares carrying more than 10% of the voting rights of the Company was Capital Group International, Inc., which, based on information filed by them, beneficially owned and exercised control or direction over 15,744,240 Common Shares, representing approximately 15% of the voting rights attached to the Company’s voting securities.

Can I vote Common Shares which I acquired after March 12, 2007?

      No. The Canada Business Corporations Act (“CBCA”) states that only a shareholder whose name is on the list of shareholders as at the Record Date is entitled to vote at the Meeting.

How to vote

      If you are a Registered Shareholder, there are two ways in which you can vote your shares. You can either vote in person at the Meeting or you can vote by proxy.

          Voting by Proxy

      If you do not plan to come to the Meeting, you can have your vote counted by appointing someone who will attend at the Meeting as your proxyholder. In the proxy, you can either direct your proxyholder how you want your shares to be voted or let your proxyholder choose for you. You can always revoke your proxy if you decide to attend the Meeting and wish to vote your shares in person (see “Revoking a Proxy” on page 3).

          Voting in Person

      Registered Shareholders who will attend the Meeting and wish to vote their shares in person should not complete a proxy form. Your vote will be taken and counted at the Meeting. Please register with the transfer agent, CIBC Mellon Trust Company, upon your arrival at the Meeting.

What if I am not a Registered Shareholder?

      Many shareholders are in fact “non-registered shareholders.” Non-registered shareholders are those whose shares are registered in the name of an intermediary (such as a bank, trust company, securities broker, trustee, or custodian). Unless you have previously informed your intermediary that you do not wish to receive material relating to the Meeting, you should receive or have already received from the Company a request for voting instruction form or from your intermediary either a request for voting instructions or a proxy form. In either case you have the right to exercise voting rights attached to the Common Shares beneficially owned by you, including the right to attend and vote the shares directly at the Meeting.

      The documents that you receive and who you receive them from will vary depending upon whether you are a “non-objecting beneficial owner”, or “NOBO”, which means you have provided instructions to your intermediary that you do not object to the intermediary disclosing beneficial ownership information about you to the Company for certain purposes, or an “objecting beneficial owner”, or “OBO”, which means that you have provided instructions to your intermediary that you object to the intermediary disclosing such beneficial ownership information.

      If you are a NOBO, included with these materials is a request for voting instructions and proxy from the Company or its agent.

      These securityholder materials are being sent to both registered and non-registered owners of the securities. If you are a non-registered owner, and the Company or its agent has sent these materials directly to you, your name and address and information about your holdings of securities have been obtained in accordance with applicable securities regulatory requirements from the intermediary holding Common Shares on your behalf. By choosing to send these materials to you directly, the Company has assumed responsibility for (i) delivering these materials to you, and (ii) executing your proper voting instructions. Please return your proxy as specified in the request for voting instructions and proxy.

      If you are a NOBO, you can either vote in person at the Meeting or you can vote by proxy. If you do not intend to attend the Meeting but you wish your shares to be voted, please complete and return the proxy which you should have received. You can choose anyone you want to be your proxyholder. It does not have to be another shareholder. Just fill in the person’s name in the blank space provided on the enclosed proxy form within the time hereinafter specified for receipt of proxies. If you leave the space on the proxy form blank, either Pierre Choquette or Bruce Aitken, both of whom are named in the form, are appointed to act as your proxyholder. Mr. Choquette is the Chairman of the Board and Mr. Aitken is President and Chief Executive Officer of the Company. If Messrs. Choquette and Aitken are appointed as your proxyholder, please provide your specific voting instructions. Otherwise your shares will not be voted.

      If you are an OBO, you should receive or have already received from your intermediary either a request for voting instructions or a proxy form. Intermediaries have their own mailing procedures and provide their own instructions. These procedures may allow providing voting instructions by telephone, on the Internet, by mail or by fax. If you wish to vote in person at the Meeting you should follow the procedure in the directions and instructions provided by or on behalf of your intermediary and insert your name in the space provided on the request for voting instructions or proxy form or request a form of legal proxy which will grant you the right to attend the Meeting and vote in person.

      Whether you are a NOBO or an OBO, if you wish to attend the Meeting and vote in person, do not otherwise complete any voting form you may receive. Please register with the transfer agent, CIBC Mellon Trust Company, upon your arrival at the Meeting.

What is a Proxy?

      A proxy is a document that authorizes someone else to attend the Meeting and cast the votes for you. Registered Shareholders are being sent a form of proxy for the Meeting permitting them to appoint a person to attend and act as proxyholder at the Meeting. In addition, as described above, NOBOs are being sent a form of request for voting instructions and proxy permitting them to appoint a person to attend and act as proxyholder at the Meeting. In either case, Registered Shareholders or NOBOs, as applicable, may use such forms, or any other valid proxy form, to appoint a proxyholder. The enclosed form of proxy authorizes the proxyholder to vote and otherwise act for you at the Meeting including any continuation after adjournment of the Meeting.

      If you complete the enclosed form of proxy by marking the appropriate boxes on the proxy form, your shares will be voted as instructed. If you do not mark any boxes, except as described above in the case of NOBOs, your proxyholder can vote your shares in their discretion.

Appointing a Proxyholder

      Your proxyholder is the person you appoint and name on the proxy form to cast your votes for you. You can choose anyone you want to be your proxyholder. It does not have to be another shareholder. Just fill in the person’s name in the blank space provided on the enclosed proxy form or complete any other valid proxy form and deliver it to CIBC Mellon Trust Company within the time hereinafter specified for receipt of proxies.

      If you leave the space on the proxy form blank, either Pierre Choquette or Bruce Aitken, both of whom are named in the form, are appointed to act as your proxyholder. Mr. Choquette is the Chairman of the Board and Mr. Aitken is President and Chief Executive Officer of the Company.

      For the proxy to be valid, it must be completed, dated and signed by the holder of Common Shares or the holder’s attorney authorized in writing and then delivered to the Company’s transfer agent, CIBC Mellon Trust Company, in the envelope provided or by fax to (416) 368 2502 or toll free in North America 1 866 781 3111 and received no later than 24 hours prior to the Meeting or any adjournment thereof.

How will my shares be voted if I give my Proxy?

      If you have properly filled out, signed and delivered your proxy, then your proxyholder can vote your shares for you at the Meeting. If you have specified on the proxy form how you want to vote on a particular issue (by marking FOR, AGAINST, or WITHHOLD), then your proxyholder must vote your shares accordingly.

      If you have not specified how to vote on a particular issue, except as described above in the case of NOBOs, then your proxyholder can vote your shares as they see fit. However, if you are a Registered Shareholder and have not specified how to vote on a particular issue and Mr. Choquette or Mr. Aitken have been appointed as proxyholder, your shares will be voted in favour of the particular issue. For more information on these issues, see Part II “BUSINESS OF THE MEETING”. The enclosed form of proxy confers discretionary authority upon the proxyholder you name with respect to amendments or variations to the matters identified in the accompanying Notice of Annual General Meeting of Shareholders and other matters which may properly come before the Meeting. If any such amendments or variations are proposed to the matters described in the Notice, or if any other matters properly come before the Meeting except as described above in the case of NOBOs, your proxyholder may vote your shares as they consider best.

Revoking a Proxy

      If you want to revoke your proxy after you have delivered it, you can do so at any time before it is used. You or your authorized attorney may revoke a proxy by (i) clearly stating in writing that you want to revoke your proxy and delivering this revocation by mail to Proxy Department, CIBC Mellon Trust Company, P.O. Box 721, Agincourt, ON M1S 0A1, Canada or by fax to (416) 368 2502 or toll free in North America 1 866 781 3111, or to the registered office of the Company, Suite 1800, 200 Burrard Street, Vancouver, BC V6C 3M1, Attention: Corporate Secretary, at any time up to and including the last business day preceding the day of the Meeting or any adjournment thereof or (ii) in any other manner permitted by law. Revocations may also be delivered to the Chairman of the Meeting on the day of the Meeting or any adjournment thereof. Such revocation will have effect only in respect of those matters upon which a vote has not already been cast pursuant to the authority confirmed by the proxy. If you revoke your proxy and do not replace it with another in the manner provided in “Appointing a Proxyholder” above, you will be able to vote your shares in person at the Meeting.

      Only Registered Shareholders and NOBOs have the right to revoke a proxy. OBOs who wish to change their voting instructions must, in sufficient time in advance of the Meeting, arrange for their intermediaries to change their vote and if necessary revoke their proxy.

Costs of this Solicitation of Proxies

      The cost of this solicitation of proxies is borne by the Company. It is expected that the solicitation will be primarily by mail, but proxies or votes or voting instructions may also be solicited personally or by telephone or other means of communication by directors and regular employees of the Company without special compensation. In

addition, the Company may retain the services of agents to solicit proxies or votes or voting instructions on behalf of management of the Company. In that event, the Company will compensate any such agents for such services, including reimbursement for reasonable out-of-pocket expenses, and will indemnify them in respect of certain liabilities which may be incurred by them in performing their services. The Company may also reimburse brokers or other persons holding Common Shares in their names, or in the names of nominees, for their reasonable expenses in sending proxies and proxy material to beneficial owners and obtaining their proxies or votes or voting instructions.

Who counts the votes?

      The Company’s transfer agent, CIBC Mellon Trust Company, counts and tabulates the proxies. This is done independently of the Company to preserve confidentiality in the voting process. Proxies are referred to the Company only in cases where a shareholder clearly intends to communicate with management or when it is necessary to do so to meet the requirements of applicable law.

How do I contact the transfer agent?

      If you have any inquiries, the transfer agent, CIBC Mellon Trust Company, can be contacted as follows:

PART II BUSINESS OF THE MEETING

RECEIVE THE FINANCIAL STATEMENTS

      The consolidated financial statements for the year ended December 31, 2006 are included in the Annual Report, which has been mailed to Registered Shareholders as required under the CBCA and to non-registered shareholders that have requested such financial statements with the Notice of the Annual General Meeting of Shareholders and this Information Circular.

ELECTION OF DIRECTORS

      The directors of the Company are elected each year at the annual general meeting of the Company and hold office until the close of the next annual general meeting or until their successors are elected or appointed. The articles of the Company provide that the Company have a minimum of 3 and a maximum of 15 directors. The by-laws of the Company provide that when the articles of the Company provide for a minimum and maximum number of directors, the number of directors within the range may be determined from time to time by resolution of the Board of Directors. The Board of Directors, on an annual basis, considers the size of the Board and on March 2, 2007 the directors determined that the Board of Directors shall consist of 11 directors, such size being consistent with effective decision making.

      The Corporate Governance Committee recommends to the Board nominees for election of directors. The process by which the Committee identifies new candidates for nomination to the Board of Directors is described on page 21, under Nomination of Directors. The persons listed below are being proposed for nomination for election at the Meeting. The persons named in the accompanying proxy, if not expressly directed otherwise in such proxy, will vote the Common Shares in respect of which they have been appointed proxyholder in favour of the election of those persons listed below as nominees as directors.

      The following table sets out the names, ages and places of residence of all the persons to be nominated for election as directors and other relevant information including the number of Common Shares⁽¹⁾, Deferred Share Units⁽²⁾ and Restricted Share Units⁽³⁾ held by each of them as at the date of this Information Circular and their market value. In the case of Mr. Aitken, the table also sets out the number of Performance Share Units⁽⁴⁾ and Stock Options⁽⁵⁾ he holds. The table also sets out whether a nominee is independent or not independent. See page 18 for information on how director independence is determined.

     

Summary of Board and Committee Meetings Held

For the 12 month period ending December 31, 2006

Summary of Attendance of Directors at Board and Committee Meetings

For the 12 month period ending December 31, 2006

RE-APPOINTMENT AND REMUNERATION OF AUDITORS

      The directors of the Company recommend the re-appointment of KPMG LLP, Chartered Accountants, Vancouver, as the auditors of the Company to hold office until the termination of the next annual meeting of the Company. KPMG LLP has served as the auditors of the Company for more than five years. As in past years, it is proposed that the remuneration to be paid to the auditors be determined by the directors of the Company.

      The persons named in the accompanying proxy, if not expressly directed to the contrary in such proxy, will vote the Common Shares in respect of which they have been appointed proxyholder for the re-appointment of KPMG LLP, Chartered Accountants, as the auditors of the Company and to authorize the directors to determine the remuneration to be paid to the auditors.

Principal Accountant Fees and Services

Pre-approval policies and procedures

      The Company’s Audit, Finance and Risk Committee (the “Audit Committee”) annually reviews and approves the terms and scope of the external auditors’ engagement. The Audit Committee oversees the Audit and Non-Audit Pre-Approval Policy which sets forth the procedures and the conditions pursuant to which permissible services proposed to be performed by KPMG LLP are pre-approved. The Audit Committee has delegated to the Chair of the Audit Committee pre-approval authority for any services not previously approved by the Audit Committee. All such services approved by the Chair of the Audit Committee are subsequently reviewed by the Audit Committee.

      All non-audit service engagements, regardless of the cost estimate, are required to be coordinated and approved by the Chief Financial Officer to further ensure that adherence to this policy is monitored.

Audit and Non-Audit Fees Paid to the Independent Auditors

      Fees to KPMG LLP during the years ended December 31, 2006 and December 31, 2005 were as follows:

      The nature of each category of fees is described below.

      Audit fees were paid for professional services rendered by the auditors for the audit of the Company’s consolidated financial statements; statutory audits of the financial statements of the Company’s subsidiaries; quarterly reviews of the Company’s financial statements; consultations as to the accounting or disclosure treatment of transactions reflected in the financial statements; and services associated with registration statements, prospectuses, periodic reports and other documents filed with securities regulators.

      Audit fees paid in 2006 are in respect of an “integrated audit” performed by KPMG LLP. The integrated audit encompasses an opinion on the fairness of presentation of the Company’s financial statements as well as opinions on the effectiveness of the Company’s internal controls over financial reporting and on management’s assessment of internal controls over financial reporting. In addition, the understanding and testing of internal controls in the integrated audit is much broader and in more depth than in a financial statement audit.

      Audit-related fees were paid for professional services rendered by the auditors for financial audits of employee benefit plans; procedures and audit or attest services not required by statute or regulation; advice and documentation assistance with respect to internal controls over financial reporting and disclosure controls; and consultations as to the accounting or disclosure treatment of other transactions.

      Tax fees were paid for professional services rendered for tax compliance, tax advice and tax planning. These services consisted of: tax compliance including the review of tax returns; assistance in completing routine tax schedules and calculations; and tax planning and advisory services relating to common forms of domestic and international taxation.

AMENDMENT OF INCENTIVE STOCK OPTION PLAN

      The Company has an Incentive Stock Option Plan (the “Plan”) under which options to purchase Common Shares may be granted by the Company. Information regarding the Plan commences on page 40 under “Incentive Stock Option Plan”.

      In 2006 the Toronto Stock Exchange (the “TSX”) introduced new rules affecting the Plan. The Company is proposing to amend the Plan, in part, to reflect those rules.

Amendment Provisions

      The Plan currently has a general amendment provision which permits the Board of Directors to amend any of the provisions of the Plan subject to obtaining any required approval of any appropriate stock exchange or other regulatory authority. In the past, the TSX has approved amendments to the Plan which had been approved by the Board of Directors and required shareholder approval for amendments where the TSX considered the amendments material.

      In June 2006, however, the TSX announced that it was changing its rules regarding amendments to stock option plans. The TSX is proposing that stock option plans contain a detailed amendment provision that outlines the types of amendments that require shareholder approval and those that can be made without shareholder approval. Under the TSX’s new rules, if a plan does not include a detailed amendment provision, after June 30, 2007 every amendment will require shareholder approval, including simple clerical, administrative or other immaterial amendments.

      The Company is proposing to amend the Plan to include amendment provisions which will require approval by the affirmative vote of not less than a majority of the votes cast by the shareholders voting (excluding, to the extent required pursuant to any applicable stock exchange rules or regulations, votes of securities held by insiders benefiting from the amendment) for the following amendments to the Plan or options granted under it:

provided that shareholder approval will not be required for increases or decreases or adjustment to the number of Common Shares subject to the Plan or deliverable upon the exercise of any option or adjustment in the exercise price for shares covered by options and the making of appropriate provisions for the continuance of the options outstanding under the Plan to prevent their dilution or enlargement in accordance with the section or sections of the Plan which provide for such increase, decrease, adjustments or provisions in respect of certain events, including the subdivision or consolidation of the Common Shares or reorganization, merger, consolidation or amalgamation of the Company, or for the amendment of such section or sections.

      The Board of Directors will have authority to make other amendments to the Plan or any option relating to: (i) clerical or administrative changes (including a change to correct or rectify an ambiguity, immaterial inconsistency, defective provision, mistake, error or omission or clarify the Plan’s provisions or a change to the provisions relating to the administration of the Plan); (ii) changing provisions relating to the manner of exercise of options, including changing or adding any form of financial assistance provided by the Company to participants or, if the Plan has a fixed maximum number of securities issuable, adding provisions relating to a cashless exercise which provides for a full deduction of the underlying Common Shares from the maximum number issuable under the Plan; (iii) changing the eligibility for and limitations on participation in the Plan (other than amendments of the Plan to increase any maximum limit of the number of securities that may be issued or issuable to insiders which may be specified in the Plan or the reintroduction of participation by non-management directors on a discretionary basis); (iv) changing the terms, conditions and mechanics of grant, vesting, exercise and early expiry of options; (v) changing the provisions for termination of options so long as the change does not permit the Company to grant an option with an expiry date of more than 10 years or extend an outstanding option’s expiry date; (vi) additions, deletions or alterations designed to respond to or comply with any applicable law or any tax, accounting, auditing or regulatory or stock exchange rule, provision or requirement or to allow optionholders to receive fair and equitable tax treatment under any applicable tax legislation; and (vii) certain changes to provisions on the transferability of options which do not require shareholder approval as described above.

      No amendment of the provisions of the Plan or any option may, without the consent of the optionee, adversely affect or impair any options previously granted to an optionee under the Plan.

Grants of Options to Non-Management Directors

      The Plan currently permits the Board of Directors to grant options to officers, directors and other employees of the Company and its subsidiaries. Commencing in 2003, non-management directors ceased to be granted options.

      In connection with the amendment to the Plan to change the amendment provisions, and to reflect the decision of the Company to cease granting non-management directors options under the Plan, the Company is also proposing to amend the Plan to provide that, from and after March 2, 2007, the Board of Directors may only grant options to officers and other employees of the Company and its subsidiaries (who in each case must be full-time employees of the Company or a subsidiary and who, in the opinion of the Board of Directors, are key employees).

Expiry Dates and Blackout Periods

      A July 2006 TSX Staff Notice recognizes that for good corporate governance reasons many public companies have internal policies prohibiting certain employees from buying or selling securities or exercising options during specific periods (“blackout periods”). The TSX recognizes that these blackout periods might result in an unintended penalty to employees who are prohibited from exercising options during the blackout period under the policies. As a result, the TSX has provided that listed companies may amend their option plans to provide for situations where an option’s expiration date occurs during or shortly after a blackout period.

      For example, a blackout period would occur (i) before and shortly after the date that a company announces its quarterly or annual earnings; or (ii) during a time that a company has material undisclosed information (as defined

under applicable securities laws), such as information about an important potential transaction the company might be considering.

      The Company is proposing to amend the Plan to provide that, if an option expires or ceases to be exercisable during a blackout period during which trading in Company securities is restricted in accordance with the policies of the Company or its affiliates or within the 10 business days immediately after a blackout period, the expiry date shall become a date which is 10 business days after the last day of the blackout period.

      This amendment will align the proper administration of the Plan with the Company’s current securities trading policies and governance practices. The change has no additional dilutive impact on the Company’s Common Shares and no adverse impact on the Company or its shareholders.

Codifying Current Practices

      The Plan currently provides that each option, unless sooner terminated in accordance with its terms, conditions and limitations, shall expire on an expiry date fixed by the Board of Directors which is not later than 10 years from the date the option was granted, except that, subject to the right of the Board of Directors, in its discretion, to determine that an option may be exercisable during different periods, in respect of a different amount or portion of shares or in a different manner:

      In practice, the Board of Directors has in the past determined that, if an optionee ceases to be a director, officer or employee of the Company or of a subsidiary of the Company as a result of disability or retirement of the optionee prior to the expiry date, the optionee’s options will vest immediately and will be exercisable until the expiry date and in certain circumstances in the case of termination of an optionee’s employment by reason of a major divestiture or disposition of assets, facility closure or major downsizing, the optionee’s options would continue to vest in accordance with their terms but would be exercisable until the expiry date. In addition, in circumstances where an optionee ceases for any other reason to be a director, officer or employee of the Company or of a subsidiary prior to the expiry date, the Board of Directors in its discretion has determined a shorter period for exercise of the options, namely 90 days from the date the optionee ceased to be a director, officer or employee, rather than one year. In connection with the amendments that are otherwise being made to the Plan, the Board of Directors have approved amendments to codify the current practices described above. However, the Company is proposing to amend the Plan to provide that an optionee’s options would continue to vest in accordance with their terms but would be exercisable until the expiry date, in the circumstances where an optionee ceases to be a director, officer or employee of the Company or of a subsidiary of the Company as a result of retirement (where the optionee is at least 55 years of age).

Shareholder Approval

      The amendments to the Plan were approved by the Board of Directors on March 2, 2007. The TSX has reviewed and conditionally approved these proposed amendments, subject to shareholder approval. The amendments are reflected in an amended and restated Incentive Stock Option Plan (the “Amended Incentive Stock Option Plan”). A copy of the Amended Incentive Stock Option Plan is available for inspection at the head office of the Company at 1800 Waterfront Centre, 200 Burrard Street, Vancouver, British Columbia, during normal business hours prior to the Meeting and will be tabled at the Meeting.

      Under the requirements of the TSX and the Nasdaq Global Market (“Nasdaq”), the amendments to the Plan must be approved by the shareholders of the Company. Consequently, at the Meeting, shareholders will be asked to consider and, if deemed appropriate, pass an ordinary resolution ratifying and approving the amendments. The text of the proposed resolution is set out in Schedule A. This resolution must be passed by a simple majority of the votes cast by shareholders entitled to vote in person or by proxy at the Meeting. Under the TSX’s requirements certain insiders of the Company eligible to receive a benefit under the Plan are not eligible to vote their shares in respect of the resolution. The Company believes that such insiders hold an aggregate of approximately 340,000 Common Shares. These shares will

be excluded in determining whether the resolution to approve the amendments to the Plan receives the required approval.

INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON

      None of the directors or officers of the Company, no proposed nominee for election as a director of the Company, none of the persons who have been directors or officers of the Company at any time since the beginning of the Company’s last completed financial year and no associate or affiliate of any of the foregoing has any material interest, direct or indirect, in any matter to be acted upon at the Meeting other than the election of directors and the approval of the amendment to the Incentive Stock Option Plan. Certain directors and officers of the Company hold options granted under the Incentive Stock Option Plan and the officers of the Company are eligible to be granted options in the future under the Incentive Stock Option Plan. As a result, they may be considered to have an interest in the approval of the amendments to the Incentive Stock Option Plan.

INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS

      None of the directors or officers of the Company, no director or officer of a body corporate that is itself an insider or a subsidiary of the Company, no person or company who beneficially owns, directly or indirectly, voting securities of the Company or who exercised control or direction over voting securities of the Company or a combination of both carrying more than 10% of the voting rights attached to any class of outstanding voting securities of the Company entitled to vote in connection with any matters being proposed for consideration at the Meeting, no proposed director or nominee for election as a director of the Company and no associate or affiliate of any of the foregoing has or had any material interest, direct or indirect, in any transaction or proposed transaction since the beginning of the Company’s last financial year which has materially affected or would or could materially affect the Company or any of its subsidiaries.

PART III CORPORATE GOVERNANCE

Board of Directors

      The Board has adopted a set of Corporate Governance Principles to provide for a system of principled goal-setting, effective decision-making and ethical actions. The Principles can be found at Schedule B to this Circular and on our website. In addition, the Board of Directors establishes an annual set of “Board Objectives.” In 2006, the Board established several key objectives which included ensuring that Committee Chairs were given ample time at Board meetings to discuss key committee issues, ensuring that the Board developed a deeper understanding of key markets and geographies in which the Company operates and ensuring vigorous debate on key strategic alternatives. The status and future actions in respect of each objective is discussed at each Board meeting.

Committees of the Board of Directors

      The Board has established five standing Committees with written mandates defining their responsibilities and a requirement to report regularly to the Board. All Committee members have been determined to be independent in accordance with Nasdaq rules and Canadian securities regulations and no Committee member was, during 2006, or is currently, an officer or employee of the Company or any of its subsidiaries.

          Audit, Finance and Risk Committee

      The Company’s Audit, Finance and Risk Committee is appointed by the Board to assist the Board in fulfilling its oversight responsibility relating to: the integrity of the Company’s financial statements; the financial reporting process; the systems of internal accounting and financial controls; the professional qualifications and independence of the external auditors; the performance of the external auditors; risk management processes; financing plans; pension plans; and compliance by the Company with ethics policies and legal and regulatory requirements. Mr. Poole is the “audit committee financial expert.” In 2006, this Committee met nine times. The overall Committee member attendance rate at these meetings was 98%.

      The mandate of this Committee together with the relevant education and experience of its members and other Committee information may be found in the “Audit Committee Information” section of the Company’s Annual Information Form dated March 23, 2007.

          Corporate Governance Committee

      This Committee is responsible for the composition, compensation and governance of the Board and recommends to the Board nominees for election or appointment as directors. The functions of this Committee also include assessing and enhancing the performance of the Board and maintaining an effective working relationship between the Board and management of the Company. It is also responsible for taking a leadership role in shaping the corporate governance of the Company and developing and recommending to the Board corporate governance principles for the Company. In 2006, this Committee met five times. The overall Committee member attendance rate at these meetings was 95% (and includes those directors who did not stand for re-election in 2006).

          Human Resources Committee

      The Human Resources Committee is responsible for approving the goals and objectives of the CEO and evaluating the CEO’s performance; reviewing and recommending to the Board the remuneration of the Company’s senior executives and approving the remuneration of all other employees on an aggregate basis; reporting to the Board on the Company’s organizational structure, officer succession plans, total compensation practices, human resource policies and executive development programs; approving the report on executive compensation; recommending grants and various administrative matters in connection with the long-term incentive plan; and reviewing the operations and administration of the Company’s retirement plans. In 2006, this Committee met three times. The overall Committee member attendance rate at these meetings was 100%.

          Public Policy Committee

      The Public Policy Committee is responsible for reviewing and making recommendations to the Board regarding public policy matters that have a significant impact on the Company including those relating to social investment policies, government relations and public affairs. In 2006, this Committee met twice. The overall Committee member attendance rate at these meetings was 100%.

          Responsible Care Committee

      The Responsible Care Committee is responsible for reviewing and making recommendations to the Board regarding matters relating to the environment and occupational health and safety issues that impact significantly on the Company and has oversight responsibility for the Company’s Corporate Social Responsibility Policy. The Committee also reviews the policies and standards that are in place to ensure that the Company is carrying out all of its operations in accordance with the principles of Responsible Care^®. In 2006, this Committee met three times. The overall Committee member attendance rate at these meetings was 100%.

Statement of Corporate Governance Practices

      Corporate governance has become a significant public policy issue over the past few years. We define corporate governance as having the appropriate processes and structures in place to provide for the proper direction and management of our business and we believe good corporate governance is critical to a company’s effective, efficient and prudent operation.

      The Company is a Canadian reporting issuer with its Common Shares listed on the TSX and Nasdaq. There have been many recent regulatory and legal initiatives aimed at improving corporate governance, increasing corporate accountability and enhancing transparency of public company disclosure. The Company’s management and Board actively monitor and, where appropriate, respond to these initiatives. In 2005, the Canadian Securities Administrators adopted National Instrument 58-101 — Disclosure of Corporate Governance Practices (the “Disclosure Instrument”) and National Policy 58-201 — Corporate Governance Guidelines (the “Guidelines”). The Disclosure Instrument requires us to disclose certain corporate governance practices that we have adopted, while the Guidelines provide guidance on various corporate governance practices that companies like ours should adopt. In this regard, a brief description of our corporate governance practices, with reference to the areas set out in the Disclosure Instrument and the Guidelines follows.

Director Independence

      Nine of the 11 nominees who are standing for election to the Company’s Board have been determined by the Board to be independent in accordance with Nasdaq rules and the Disclosure Instrument. Mr. Aitken is the President and Chief Executive Officer of the Company and is therefore not independent. The Chairman of the Board of the Company, Mr. Choquette, is currently not independent as he was formerly the Chief Executive Officer of the Company. He resigned as the Company’s Chief Executive Officer on May 13, 2004. Mr. Choquette will become independent on May 13, 2007 in accordance with Nasdaq rules and the Disclosure Instrument.

      Of the remaining 9 individuals who are standing for election, the Board has determined that the following 8 have no relationship (material or otherwise) with the Company other than as directors and shareholders and are therefore independent: Mr. Balloch, Mr. Cook, Mr. Hamilton, Mr. Poole, Mr. Reid, Ms. Rennie, Ms. Sloan and Mr. Sweeney. Mr. Hamilton has no relationship (material or otherwise) with the Company and is currently not a director nor a shareholder of the Company.

      Mr. Mahaffy is currently Chairman and CEO of McLean Budden Limited (“MB”). The Company’s defined contribution pension plan makes MB pooled funds available to employees and MB earns fees based on the amount of funds individual employees invest in MB funds. In 2006, MB was paid less than $5,000 in fees as a result of this

arrangement. The other independent directors have reviewed the relationship between the Company and MB and have determined that Mr. Mahaffy is independent.

      Committees of the Board are constituted exclusively of independent directors. However, Mr. Aitken, in his capacity as President and Chief Executive Officer of the Company, and Mr. Choquette, in his capacity as Chairman of the Board, attend Committee meetings.

Other Directorships and Interlocking Relationships

      Several of the nominees are directors of other reporting issuers. For details, please refer to the information about each nominee under “Election of Directors.” There are no nominees who served together as directors on the boards of other corporations or acted as trustees for other entities during the financial year ended December 31, 2006.

In Camera Sessions

      Following each Board meeting, the independent directors hold regularly scheduled “in camera” sessions at which non-independent directors and members of management are not in attendance. These in camera sessions are chaired by the Lead Independent Director. In 2006, there were six Board meetings and in camera sessions followed each one. In camera sessions may, at the discretion of each Committee Chair, follow Committee meetings.

Independence of Board Chair and Lead Independent Director

      The Chairman of the Board, Mr. Choquette, is currently not independent as he was formerly the Chief Executive Officer of the Company. He resigned as the Company’s Chief Executive Officer in May 2004. However, Mr. Choquette will become independent on May 13, 2007 in accordance with Nasdaq rules and the Disclosure Instrument.

      The Board, mindful of the governance issues arising from the Chairman of the Board not being independent, has appointed a Lead Independent Director whose responsibilities are described in a written Terms of Reference and include providing a source of Board leadership complementary to the Chairman of the Board, enhancing Board effectiveness and acting as liaison between the Board, management and among directors, including chairing in camera sessions of the independent directors following Board meetings without the presence of management. Mr. Findlay is the current Lead Independent Director. As Mr. Choquette will become independent on May 13, 2007, the Board has determined that the role of Lead Independent Director should cease to exist on that date.

Meeting Attendance Records

      For information concerning the number of Board and Committee meetings held in 2006 as well as the attendance record of each director for those meetings, please see page 10.

      The Company’s Corporate Governance Principles contains a Board mandate describing the Board’s responsibilities. The Principles can be found at Schedule B to this Circular and on our website.

Board Chair and Committee Chairs

      The Board has developed written position descriptions (which we call “Terms of Reference”) for the Chairman of the Board and each Committee Chair. The Terms of Reference for both the Chairman of the Board of Directors and for Committee Chairs are found on our website.

Individual Directors

      The Board has developed written Terms of Reference for individual directors and they are found on our website. The Corporate Governance Principles also set out responsibilities of each director.

      The Board of Directors has determined that there should not be a determined retirement policy for directors and the Corporate Governance Principles establish that there should not be cumulative term limits for directors. The Company’s Corporate Governance Principles state as follows:

Lead Independent Director

      The Board has developed written Terms of Reference for the Lead Independent Director and they are found on our website.

Chief Executive Officer (“CEO”)

      The CEO has a written position description which sets out the position’s key responsibilities. In addition, the CEO has annual specific corporate and personal performance objectives and incentive compensation targets that the CEO is responsible for meeting. These objectives and targets are reviewed, approved and tracked during the year by the Board through the Human Resources Committee. See page 31 for more complete information on these objectives and targets.

      To familiarize new directors with the role of the Board, its Committees, the directors and the nature and operation of the Company’s business, each new director and, indeed, all directors, are provided with a director’s manual in the form of an electronic CD which contains information regarding these matters as well as information on the responsibilities and liabilities of directors and other relevant information. CDs containing updated information are provided to all directors on an on-going basis. In addition, the Company encourages new directors to meet with senior management and to visit our operations and plant locations.

      The Board recognizes the importance of ongoing education for directors. The Company’s Corporate Governance Principles state that directors are encouraged to attend seminars, conferences and other continuing education programs to help ensure that they stay current on relevant issues. The Company is a member of the Institute of Corporate Directors and our directors have attended courses and programs which it offers. The Company is prepared to contribute to the cost of directors attending appropriate continuing education programming. As well, written materials which are likely to be of interest to directors and which have been published in periodicals, newspapers or by law or accounting firms are routinely forwarded to directors. Such materials are often also included in a “supplemental reading” section in Board and Committee books.

      Board meetings themselves provide directors with educational opportunities. Board meetings often include an educational presentation on a particular aspect of the Company’s operations. The Board also conducts an annual one-day strategy session which provides detailed information on the business environment and trends affecting the Company. Also, at least once annually, a Board meeting is held at a location where the Company has methanol production operations or significant commercial activities. Such site visits give directors an extended opportunity to interact with customers, business associates and high potential employees, tour facilities and generally provide directors with important context which is useful for directors of a company with global operations.

Code of Ethics

      The Company has a Code of Business Conduct (the “Code”) in place which is applicable to all employees, officers and directors. It provides a set of standards meant to assist them in avoiding wrong-doing and to promote honest and ethical behavior while conducting the Company’s business. The Code also establishes a confidential “whistle-blower” hotline for reporting suspected violations of the Code. The Code is reviewed annually by the Board. A copy of our Code of Business Conduct may be found on our website. A printed version is also available upon request to the Corporate Secretary of the Company.

      The Board monitors compliance with the Code primarily through the Audit, Finance and Risk Committee and the Corporate Governance Committee which have as part of their mandates the obligation to annually monitor compliance with the Code. These Committees receive regular updates on matters relating to the Code including an annual report on the activities undertaken by management to maintain and increase Code awareness throughout the organization and results of surveys designed to determine employee awareness of the Code.

      The Code provides that suspected Code violations are to be reported to the General Counsel who shall investigate the matter. The Corporate Governance Committee is made aware of all such reports. Furthermore, the Chair of the Audit, Finance and Risk Committee is advised of all reports which concern accounting or audit matters and the Chair of that Committee and the General Counsel together determine how such a matter is to be investigated and by whom.

      No material change report has been filed since the beginning of the Company’s most recently completed financial year that pertains to any conduct of a director or executive officer that constitutes a departure from the Code.

Transactions involving Directors or Officers

      The Code of Business Conduct contains a specific provision relating to the need for directors, officers and all employees to avoid conflicts of interest with the Company. Furthermore, the Corporate Governance Committee is mandated to consider questions of independence and possible conflicts of interest of directors and officers. To that end, each director and officer completes an annual questionnaire in which they report on all transactions material to the Company in which they have a material interest. These reports, together with management’s knowledge of all transactions involving the Company and the directors and officers, are provided to the Corporate Governance Committee.

Other Measures

      In 2006, the Board took other steps to encourage and promote a culture of ethical business conduct. First, the Company’s Corporate Governance Principles state that the Board has an obligation to satisfy itself as to the integrity of the CEO and other executive officers and that they create a culture of integrity throughout the organization. On an annual basis, the Corporate Governance Committee considers and reports to the Board on this issue. Additionally, the Board-approved 2006 Business Plan includes within it a strategic goal of the Company living and practicing its core values of trust, integrity, respect and professionalism everyday. The Plan also set goals of maintaining best Canadian public corporation corporate governance practices and a focus on maintaining the Company’s reputation in the financial markets. Additionally, the Board has adopted a Corporate Social Responsibility (CSR) policy which covers a host of activities such as social investment, governance, employee engagement and development and community involvement and creates a linkage with the already firmly-established Responsible Care ethic.

CEO Trading Policy

      The Company has implemented a policy stating that if the President and Chief Executive Officer intends to trade in Company securities, including exercise options, a press release will be issued no less than five business days in advance of the date of the intended transaction. The press release shall contain information which includes the maximum amount of shares or options intended to be sold or exercised, the expected date of the transaction, the approximate number of common shares the President and CEO will hold after the intended transaction, the share ownership guideline applicable to the President and CEO and whether it is reasonably expected that the President and CEO will meet the guideline immediately after the anticipated transaction. On February 2, 2007, Mr. Aitken announced through a press release that he plans to sell in the open market up to 200,000 Common Shares through the exercise of stock options. The sale of the shares is expected to occur in one or more transactions between February 12, 2007 and the end of March 2007.

Nominating Committee and Nomination Process

      The Board has established the Corporate Governance Committee as its nominating committee. The Committee is composed entirely of independent directors. A description of the responsibilities, powers and the operation of the Corporate Governance Committee can be found on page 16.

      The Committee is responsible for identifying new candidates to stand as nominees for election or appointment as directors to our Board of Directors. The Committee uses a Board skills matrix to assist in this process. The Committee on an annual basis reviews a matrix which sets out the various skills and experience which are considered to be desirable for the Board to possess in the context of the Company’s strategic direction. The current matrix includes elements such as leadership and experience on other boards, environmental matters, governmental affairs and experience in energy and commodity industries. The Committee then assesses the skills and experience of each current Board member against this matrix. When completed, the matrix helps the Committee identify any skills or experience gaps and provides the basis for a search to be conducted for new directors to fill those gaps.

      In identifying candidates, the Committee also takes into account a broad variety of additional factors it considers appropriate, including board dynamics and personal characteristics. Desirable individual characteristics include integrity, strength of character, the ability to generate public confidence and maintain the goodwill and confidence of our shareholders, sound and independent business judgement, general good health and the capability and willingness to travel to, attend and contribute at Board functions on a regular basis.

      Suitable director candidates have, over the past several years, been identified primarily through the use of an executive search firm retained under the authority of the Committee. The selection process is led by the Chair of the Committee but all Committee members and the Chairman of the Board are routinely updated on the process and the individuals being considered. The recommended candidate is then formally considered by the Committee and if approved, the candidate is recommended to the Board.

Majority Voting for Directors

      In March 2006, the Board adopted a policy which states that any nominee for election as a director at an Annual Meeting for whom the number of votes withheld exceeds the number of votes cast in his or her favour, will be deemed not to have received the support of shareholders. A director elected in such circumstances will tender his or her resignation to the Chair of the Corporate Governance Committee and that Committee will review the matter and make a recommendation to the Board. The Board will, within 90 days of the Annual Meeting, issue a public release either announcing the resignation of the director or justifying its decision not to accept the resignation.

      If a resignation is accepted, the Board may appoint a new director to fill the vacancy created by the resignation. This policy applies only to uncontested director elections, meaning elections where the number of nominees for director is equal to the number of directors to be elected.

Process for Determining Director Compensation

      The Corporate Governance Committee, composed entirely of independent directors, is responsible for reviewing and recommending to the Board for approval director compensation and benefits. The Committee has determined to target director compensation in relation to the 50th percentile of North American-based chemical companies with international operations. This is the same comparator group of companies as the Company uses for executive compensation purposes. The Board has received advice that it is common practice to establish the same comparator group for director compensation as for executive officer compensation. The Committee reviews director compensation and benefits annually.

Process for Determining Officer Compensation

      The Human Resources Committee, composed entirely of independent directors, is responsible for reviewing and recommending to the Board for approval the compensation for the Company’s officers. For further information on this Committee’s responsibilities, powers and operation, please turn to page 16. The Company’s executive compensation policy is designed to provide competitive compensation to enable the Company to attract and retain high-quality and high-performance executives who will significantly contribute to the Company meeting its strategic business objectives. The Committee reviews periodically the levels of compensation for officers and obtains independent advice from consultants with respect to the competitiveness of officer compensation. Please see page 26 for more information on the use of compensation consultants by the Company. The Committee also obtains advice from the Chief Executive Officer with respect to compensation matters pertaining to the Company’s other officers.

      In addition to the Audit, Finance and Risk Committee, the Corporate Governance Committee and the Human Resources Committee, the Board has established a Public Policy Committee and a Responsible Care Committee. A description of their responsibilities can be found on page 17.

      The Company’s Corporate Governance Principles state that

      Our Board of Directors conducts an annual evaluation and the Corporate Governance Committee oversees the process. The process is designed to evaluate the effectiveness and contribution of the Board, its Committees and individual directors. Results of the process are reported to the Board.

      The Company has carried out annual evaluation processes for a number of years. In 2006, the process was comprised of the following:

Evaluation of the Chairman of the Board

      Directors were provided with an opportunity to evaluate the Chairman of the Board’s performance and to make suggestions for improvement. Directors rated the Chairman of the Board and provided comments on issues which addressed the conduct of Board meetings, leadership issues and the Chairman’s ability to facilitate positive contributions from other directors. Results were tabulated by the Corporate Secretary and were provided to the Chair of the Corporate Governance Committee who then had a private conversation with the Chairman of the Board. The content of that conversation was reported by the Chair of the Corporate Governance Committee to the full Committee at its November 2006 meeting.

Evaluation of the Board as a Whole

      Directors were provided with an opportunity to evaluate how the Board is operating and to make suggestions for improvement. Directors rated and provided comments on issues such as how the Board is organized and functions, their satisfaction with their level of understanding of human resources issues, the Company’s strategic objectives, risks faced by the Company and the Company’s financial controls. A separate section addressed the Board’s committees and included questions such as the appropriateness of the current committee structure and quality of reporting from committees to the full Board. Results were tabulated by the Corporate Secretary, provided to the Chairman of the Board and the Chair of the Corporate Governance Committee and then presented to the Corporate Governance Committee at its November 2006 meeting.

Evaluation of Individual Directors

      Directors were provided with an opportunity to examine their own effectiveness, comment on their peers’ effectiveness and have a private conversation with the Chairman of the Board regarding their performance and the performance of their fellow directors. Directors rated themselves and commented on their peers concerning a number of criteria including their satisfaction with their level of contribution on strategic issues and their comfort at being able to express frank and contrary positions at Board meetings. Directors were also asked to provide an overall rating for each of their peers and invited to comment on their performance. The Corporate Secretary received all questionnaires and each director was provided with an individualized report detailing how that director scored him or herself on each question, the combined average director score for each question and comments regarding that director’s performance from peers (on an anonymous basis). These reports were also provided to the Chairman of the Board who then conducted a confidential discussion with each director. The Chairman of the Board reported to the Corporate Governance Committee at its November 2006 meeting regarding this process.

      In addition, each Committee conducts an annual “mandate assurance review” in which it reviews the appropriateness of its own mandate and evaluates whether it is acting in compliance with its mandate. The Corporate Governance Committee is responsible for annually reviewing the mandates and performance of each Committee.

PART IV COMPENSATION

COMPENSATION OF DIRECTORS

Introduction

      Directors’ compensation is paid only to non-management directors and is made up of an annual retainer, meeting fees (except in the case of the Chairman) and a Long-Term Incentive award.

Annual Retainer and Meeting Fees

      During the year ended December 31, 2006, annual retainers and meeting fees were paid to non-management members of the Board on the following basis:

      All retainers and fees are paid in Canadian dollars. Non-management directors are also reimbursed for transportation and other expenses incurred for attending board and committee meetings. In March 2007, the Board determined to increase the Chairman of the Board’s annual retainer from $120,000 to $150,000.

Long-Term Incentive

      Non-management directors ceased to be granted options in 2003. Instead, they are awarded Restricted Share Units (“RSUs”) under the Company’s Restricted Share Unit Plan for Directors as part of the annual Long-Term Incentive component of their compensation. Directors may elect to receive their RSU award in the form of DSUs. The following table summarizes the last two Long-Term Incentive awards granted to directors:

      RSUs are notional shares credited to an “RSU Account.” When dividends are paid on Common Shares, an equivalent value of additional RSUs is calculated and credited to each individual’s RSU Account. RSUs granted in any year will vest on December 1st, in the 24th month following the end of the year in which the award was made. Following vesting, directors are entitled to receive a cash payment based on the price of the Company’s Common Shares at that time, net of applicable withholding tax. RSUs do not entitle participants to any voting or other shareholder rights and are non-dilutive to shareholders.

      The following table sets out what each director received by way of annual retainer, meeting fees and Long-Term Incentive awards for 2006. All amounts shown are in Canadian dollars except where noted.

Directors’ Deferred Share Unit Plan

      Under the Company’s Deferred Share Unit Plan (the “DSU Plan”) (more fully described on page 30), each non-management director elects annually to receive 100%, 50% or 0% of his or her retainer and meeting fees as Deferred Share Units (“DSUs”). The actual number of DSUs granted to a director is calculated at the end of each quarter by dividing the dollar amount elected to the DSU Plan by the five day average closing price of the Common Shares on the TSX during the last five trading days of that quarter. Additional DSUs are credited corresponding to dividends declared on the Common Shares. Under the terms of the DSU Plan, individuals who became directors in 2006 were not eligible to participate in the DSU Plan in 2006.

Directors’ Stock Ownership Guidelines

      Since 1998, the Company has had in place stock ownership guidelines for directors to promote shareholder alignment. In March 2006, the guideline was revised to provide that each non-management director is to own shares having a value equal to at least five times their annual retainer. RSUs and DSUs held by a director are considered when determining whether the individual is meeting the stock ownership guidelines. All new directors have a reasonable period of time within which to meet their stock ownership guideline. Please refer to the section entitled Election of Directors commencing on page 5 for details on the number of Common Shares, RSUs and DSUs held by each director as at March 5, 2007. The following table shows, among other things, the percentage of the guideline achieved for each director based on their holdings on March 5, 2007. The table includes Mr. Findlay who is not standing for re-election at

the Meeting. Only those directors who have been on the Board of Directors for less than one year do not yet meet their stock ownership guidelines.

REPORT ON EXECUTIVE COMPENSATION

Human Resources Committee Report on Executive Compensation

      The Human Resources Committee of the Board of Directors is charged with responsibility for compensation matters in respect of executive officers. The Committee, as of the date of this Information Circular, consists of five members — Ms. Rennie, Ms. Sloan and Messrs. Balloch, Findlay and Mahaffy. None of the members of the Committee is, or was during the most recently completed financial year, an officer or employee of the Company or any of its subsidiaries, was formerly an officer of the Company or any of its subsidiaries, has any indebtedness to the Company or any of its subsidiaries, or has any material interest, or any associates or affiliates which have a material interest, direct or indirect, in any actual or proposed transaction since the commencement of the Company’s most recently completed financial year which has materially affected or would materially affect the Company or any of its subsidiaries.

      As part of its mandate, the Human Resources Committee of the Board reviews and recommends to the Board for approval the remuneration of the Company’s executive officers, including the Named Executive Officers identified in the Summary Compensation Table found on page 34. The Committee reviews periodically the levels of compensation for executive officers and obtains advice from independent consultants in that regard. The last such competitive assessment was conducted by Mercer Human Resource Consulting (“Mercer”) in February 2005 and the results were reviewed by the Committee in March 2005. Mercer provided benchmark market data and general market observations with respect to market trends and issues. Based on the results of this assessment, total cash compensation for executive officers was deemed to be competitive. The Committee also obtains the advice and recommendations of the Chief Executive Officer with respect to compensation matters pertaining to the Company’s other executive officers. Towers Perrin, from time to time, is retained to advise on specific executive compensation matters raised by the Committee. The Committee is responsible for its decisions and may employ factors and considerations other than the information and advice provided by Mercer or Towers Perrin.

      In 2006, Mercer’s fees to the Company for advice regarding executive and director compensation and Black-Scholes values for determining stock option grants was approximately $19,000. Towers Perrin’s fees to the Company for advice regarding CEO compensation and long-term compensation was approximately $9,600. The Company also paid Towers Perrin for consulting and third party administration services in connection with the Company’s Canadian pension plan (approximately $280,000) and executive supplemental retirement plans (approximately $40,000).

Executive Compensation Policy

      The Company’s executive compensation policy is designed to provide competitive compensation to enable the Company to attract and retain high-quality and high-performance executives who will significantly contribute to the Company meeting its strategic business objectives. The Company also believes in the importance of encouraging executives to own Company shares to more fully align management with the interests of shareholders and focus management’s activities on developing and implementing strategies that create and deliver value for shareholders.

      Since 1998, the Company has had share ownership guidelines in place for executive officers to promote meaningful share ownership. The guidelines encourage each executive officer to own shares having a value equal to at least, in the case of the Company’s Chief Executive Officer, 5 times annual base salary and, in the case of each of the other executive officers, 3 times annual base salary. RSUs, PSUs and DSUs held by an executive officer are considered when determining whether the executive is meeting their share ownership guidelines. Executive officers are expected to use the proceeds from the exercise of stock options or the vesting of RSUs or PSUs to meet their share ownership guideline. The guidelines are intended to be met within three to five years from the date that each individual became an executive officer. All other management personnel of the Company are also subject to share ownership guidelines that are related to the level of their position. The following table summarizes the relationship between the share ownership position of each of the Named Executive Officers (as defined on page 34) and the share ownership guideline applicable to each of them.

      Total compensation for executive officers comprises base salary, short-term incentives, long-term incentives and indirect compensation. Total compensation is established to be competitive in proximity to the 50th percentile of the aggregate compensation for organizations in a reference group of companies selected on the basis of size and industry and that represent the market within which the Company competes for leadership talent. Specifically, the reference

group of companies is comprised of large North American-based chemical, industrial and commodity companies having, where possible, significant international operations.

      Base salaries for executive officers are targeted to be competitive in proximity to the 50th percentile of a reference group of North American-based chemical companies, taking into account the growth, size, global complexity and autonomous characteristics of the Company. The Company sources compensation comparison information from Mercer. Base salary ranges are designed so that salary opportunities for a given position will be between 80% and 120% of the midpoint of the base salary established for each range.

      The Company’s Short-Term Incentive Plan is designed to recognize the contributions made by executive officers to the business results of the Company. This plan provides for the potential of an annual cash award based on corporate performance using quantifiable financial and operational objectives and specific personal performance objectives all of which have been established by the Board. A target award equaling 75% of annual base salary for the Chief Executive Officer and 50% of annual base salary for all other executive officers is dependent upon both personal and corporate performance. This plan provides for:

The factor by which the incentive compensation award is calculated is pro-rated between the minimum, target and maximum award depending on actual performance under each of the components.

      The Short-Term Incentive Plan award requires that personal performance and corporate performance be quantified and weighted for calculation purposes. The corporate performance component represents 60% of the potential overall award and is based on strategic corporate targets. The Board determined that the corporate performance component in 2006 be based on two elements: the Company’s return on capital employed, modified to eliminate the distortion of accounting depreciation on new and depreciated assets (“Modified ROCE”), and total fixed cash costs budgeted for the year. The Company uses ROCE as a measure of the quality of the returns to shareholders and in 2006 established 12% Modified ROCE as the target payout. The Company’s management establishes an annual budget for total fixed cash costs. Managing cash costs is important for the Company’s business and being low cost is a key element of the Company’s core strategy. The personal performance component represents 40% of the potential overall award and is based on leadership and business initiatives identified for each executive officer’s area of responsibility. A more detailed review of the Short-Term Incentive Plan as a component of the Chief Executive Officer’s compensation is found on page 31.

      Over the last five years, corporate performance has exceeded the target level four times but has never achieved the maximum performance level. The corporate performance component percentage over the past five years has been between 93% and 183% with an average of 153% of the target award. Generally, the Committee sets the minimum, target and maximum performance levels such that the relative difficulty of achieving the target level is consistent from year to year.

      Each executive officer may elect annually to receive 100%, 50% or 0% of his Short-Term Incentive Plan award as DSUs. No executive officers elected DSUs in respect of their 2006 Short-Term Incentive Plan Award, which is paid in 2007. DSUs are more fully described on page 30.

      The Long-Term Incentive Plan is designed to align the interests of executive officers with those of shareholders, to focus efforts on improving shareholder value and the Company’s long-term financial strength and to provide an

incentive to continue employment with the Company by providing executive officers with the opportunity to acquire an increased financial interest in the Company. The Long-Term Incentive Plan was significantly modified in 2003 with the introduction of the Restricted Share Unit Plan, described below, which serves to reduce stock option grants with a non-dilutive award of RSUs. The plan was further modified for 2006 to replace RSUs with Performance Share Units (“PSUs”).

      The annual grant of stock options and PSUs is always established at the March board meeting and the grant date is the date of that Board meeting. The number of options and PSUs granted to each executive officer in any year is related to responsibility level and may be adjusted to retain key talent and for longer-term potential for upward mobility.

      The Long-Term Incentive Plan has the following two components:

      Under the Incentive Stock Option Plan, executive officers are eligible for grants of Company stock options. Options are granted by the Board on the recommendation of the Committee. The exercise price is set equal to the closing price of the Common Shares on the TSX on the day before the date of the grant and, commencing in 2002, converted to US dollars using the Bank of Canada Daily Noon Rate on the day that the closing price is established. All options granted prior to 2005 expire, in the ordinary course, ten years after their date of grant. Stock options granted in 2005, 2006 and going forward expire seven years after their date of grant. For a more complete description of the Incentive Stock Option Plan, please see pages 12 and 40.

      In 2006 and 2007, all executive officers received 50% of the value of their Long-Term Incentive Award in stock options and 50% in PSUs. In 2007, Mr. Aitken received 207,000 stock options and all other executive officers received 39,000 stock options. Mr. Aitken’s 2007 stock option grant represents less than 20% of the total stock options granted in 2007.

      In 2006, the Company introduced the Performance Share Unit Plan. PSUs are notional shares credited to a “PSU Account”. Additional PSUs corresponding to dividends declared on the Common Shares are also credited to the PSU Account. PSUs granted in any year will normally vest on December 31, in the 24th month following the end of the year in which the award was made. For example, PSUs awarded in 2007 will vest on December 31, 2009. All of the executive officers and other key management personnel are eligible to participate in the PSU Plan. At the time of vesting, a minimum of 50% or a maximum of 120% of PSUs granted will vest depending on the Company’s performance against predetermined criteria. For PSUs granted in 2007, the performance criterion is the compound annual growth rate in total shareholder return (“TSR CAGR”) over the period January 1, 2007 to December 31, 2009 (the “Measurement Period”). TSR CAGR is calculated as the change (if any) in value of an initial hypothetical investment of US$100 in shares expressed as a percentage and determined on an annual and compounded basis over the Measurement Period, with dividends assumed to be reinvested. In determining the number of PSUs that will actually vest based on the degree to which the TSR CAGR has been achieved during the applicable Measurement Period, the following chart shows the TSR CAGR performance levels and the respective portion of the PSUs that will vest:

      The factor by which the PSUs are calculated is pro-rated between the minimum, target and maximum TSR CAGR depending on actual performance. The Company operates within a cyclical industry. PSUs are designed to both focus management efforts on performance while retaining employees in down cycles. As such, a minimum of 50% or a maximum of 120% of PSUs granted will vest at the end of the Measurement Period.

      Mr. Aitken received 60,000 PSUs and all other executive officers received 11,000 PSUs as part of their 2007 Long-Term Incentive award. Mr. Aitken’s 2007 PSU grant represents less than 20% of the total PSUs granted in 2007. A financial model created for the Company predicts that, if the target of 8% TSR CAGR is achieved, the proportion of shareholder value created that will be paid to the CEO as a result of his PSU grant (“sharing rate”) will be 0.28% (or about US$2.76 million per billion dollars of value created). The sharing rate for the total grant of PSUs would be 1.38% (or about US$13.8 million per billion dollars of value created).

      In general, following the vesting of the PSUs, an employee receives an amount of cash equal to one-half of the value of their vested PSUs (less withholding taxes) and a number of Common Shares equal to one-half the number of vested PSUs. These Common Shares are purchased by the Company in the open market and then transferred to the employee. PSUs held by an employee are considered when determining whether the individual is meeting share ownership guidelines. PSUs do not entitle participants to any voting or other shareholder rights.

Restricted Share Unit Plan

      RSUs were replaced by PSUs as a component of the Long-Term Incentive Plan in 2006.

      RSUs are notional shares credited to an “RSU Account”. Additional RSUs corresponding to dividends declared on the Common Shares are also credited to the RSU Account. Prior to 2005, executive officers were entitled to elect to receive 50% or 100% of the value of their annual Long-Term Incentive award in the form of RSUs and, if resident in Canada, they could make a further election to take DSUs in place of their RSU award. In 2005, executives were granted 75% of their Long-Term Incentive value as RSUs. RSUs granted in any year will normally vest on November 1, in the 23rd month following the end of the year in which the award was made. For example, RSUs awarded in 2005 will vest on November 1, 2007. In general, following the vesting of the RSUs, an employee receives an amount of cash equal to one-half of the value of their vested RSUs (less withholding taxes) and a number of Common Shares equal to one-half the number of vested RSUs. These Common Shares are purchased by the Company in the open market and then transferred to the employee. In 2006 employees were provided with the option to settle their vesting 2004 RSUs in 100% cash provided they had achieved their share ownership guidelines. Under the RSU Plan, participating employees who are resident in Canada and participate in the DSU Plan can elect to receive DSUs in lieu of payments the executive would otherwise receive pursuant to the RSU Plan. RSUs held by an employee are considered when determining whether the individual is meeting share ownership guidelines. RSUs do not entitle participants to any voting or other shareholder rights.

Indirect Compensation Benefits and Perquisites

      Indirect compensation of executive officers includes participation in the retirement plans described more fully on page 36 as well as benefits such as extended health and dental care, life insurance and disability benefits. Executive officers may also participate in the Company’s Employee Share Purchase Plan which allows them to regularly contribute up to 15% of base salary into an account in order to purchase Common Shares. The Company contributes into the account an amount of cash equal to one-half of the executive officer’s cash contribution to a maximum of 5% of base salary. The combined funds in the account are, on a semi-monthly basis, used to purchase Common Shares on the open market.

Deferred Share Unit Plan

      Under the DSU Plan, each executive officer may elect annually to receive 100%, 50% or 0% of his Short-Term Incentive Plan award as DSUs. The actual number of DSUs granted to an executive officer with respect to an executive officer’s Short-Term Incentive Plan award is calculated in March of the following calendar year by dividing the dollar amount elected to the DSU Plan by the average daily closing price of the Common Shares on the TSX on the last 90 days of the prior calendar year. Under the Long-Term Incentive Plan, executive officers who are awarded PSUs or RSUs may elect to receive an equivalent number of DSUs in place of their PSU/ RSU settlement at the time of vesting. A DSU account is credited with notional grants of DSUs received by each DSU Plan member. Additional DSUs are credited to DSU Plan members corresponding to dividends declared on the Common Shares. DSUs do not entitle a DSU Plan member to any voting or other shareholder rights. DSUs count towards the achievement of share ownership guidelines.

      The DSUs are redeemable only when the DSU Plan member’s term as a director or employment with the Company ceases or upon death (“Termination Date”) and a lump sum cash payment, net of any withholdings, is made

after the DSU Plan member specifies the valuation date. The lump sum amount is calculated by multiplying the number of DSUs held in the account by the closing price of the Common Shares on the TSX on the valuation date. The valuation date may fall on a date within a period beginning one year before the Termination Date and ending on December 1 of the first calendar year commencing after the Termination Date. The DSU Plan member has from the Termination Date until December 1 of the first calendar year commencing after the Termination Date within which to specify the valuation date and receive payment.

Chief Executive Officer Compensation

      The Chief Executive Officer’s total compensation is targeted to be competitive in proximity to the 50th percentile of a reference group of North American-based chemical companies, taking into account the growth, size, global complexity and autonomous characteristics of the Company. The Company sources compensation comparison information from Mercer. The three components of the Chief Executive Officer’s total compensation are:

      The Chief Executive Officer’s base salary is established within a salary range, the midpoint of which is targeted to be at the 50th percentile of the external market. Initial placement into the range is based on qualifications and experience. The salary may be adjusted based on annual assessments of performance against the demands of the position. Over time, base salary can approach and may exceed the midpoint of the salary range. In Mr. Aitken’s case, initial placement into the range reflected a promotion from a subordinate position and, as he has gained in experience and demonstrated continued achievement, his salary has increased commensurately.

      The Short-Term Incentive Plan award requires that personal performance and corporate performance be quantified for calculation purposes and is weighted 60% for corporate performance and 40% for the Chief Executive Officer’s personal performance. A target award equaling 75% of annual base salary has been established for the Chief Executive Officer.

      The Board determined that the corporate performance component of the Short-Term Incentive Plan in 2006 be based on two elements: the Company’s return on capital employed, modified to eliminate the distortion of accounting depreciation on new and depreciated assets (“Modified ROCE”), and total fixed cash costs budgeted for the year. The Company uses ROCE as a measure of the quality of the returns to shareholders and in 2006 established 12% Modified ROCE as the target payout. The Company’s actual Modified ROCE in 2006 was 31% which resulted in a performance multiplier of 200% (maximum). The Company’s management establishes an annual budget for Total Fixed Cash Costs. The Company considers Total Fixed Cash Costs to be confidential, competitive information and does not make public the exact target and result. Managing cash costs is important for the Company’s business and being low cost is a key element of the Company’s core strategy. In 2006, Total Fixed Cash Costs were slightly over budget. This target was therefore substantially achieved and resulted in a performance multiplier of 90%. The overall corporate performance factor was based ²/3 on the Modified ROCE element and ¹/3 on the Total Fixed Cash Costs element, resulting in a corporate performance factor of 163% ((2 × 200%) + (1 × 90%) / 3).

      The personal performance component of the Short-Term Incentive Plan is based on a number of measures and Mr. Aitken’s 2006 personal performance component was made up of high priority objectives, comprising 30% of his overall performance weighting, and supporting priorities which comprised 10%. High priority objectives included delivering superior shareholder returns, exhibiting continued industry leadership, developing gas supply alternatives for the Chilean assets, achieving Responsible Care objectives, implementing people leadership initiatives in Trinidad and ensuring sound science underpins the regulation of methanol and its derivatives. Supporting priorities included upgrading our knowledge of the China market, maximizing value from flexible high cost assets and obtaining a clean audit opinion from SOX 404 attestation. Following the end of 2006, the Board reviewed Mr. Aitken’s performance and determined that the objectives were exceeded in aggregate which resulted in a personal performance multiplier of 125%. Based on the corporate and personal performance achieved in 2006, the Board awarded Mr. Aitken a short-term

incentive award valued at 148% of the target payout. Consequently, he was awarded a short-term incentive payment of $1,000,000. The calculation of Mr. Aitken’s short-term incentive award is detailed in the table below:

      For 2007, the Board has determined that the corporate performance component in respect of the Chief Executive Officer be based again on Modified ROCE and managing cash costs. The Board has also determined that his high priority personal performance objectives comprise improving gas supply to our plants in Chile, exhibiting continued industry leadership, identifying and executing growth opportunities, demonstrating progress on the development of methanol-to-energy initiatives, delivering superior shareholder returns as benchmarked against peers and certain other criteria.

      The long-term incentives to which the Chief Executive Officer is entitled are described commencing on page 28.

      While annual compensation awards made to the CEO are based on current year corporate and individual performance, the ultimate value from the Long-Term Incentive Plan awards is linked to and dependent upon the Company’s ability to replicate and sustain annual performance over the longer term.

      To ensure that the Company’s long-term compensation program is effective in delivering on this intent, in 2007 the Human Resources Committee reviewed scenarios that illustrated the impact of various future corporate performance outcomes, over 3 and 5 year periods, on the CEO’s current holdings of Methanex shares and previously awarded and outstanding share units and stock options. The Committee determined that the intended relationship between pay and performance was appropriate for the CEO and that, in aggregate, the resulting compensation modeled under various performance scenarios was reasonable, not excessive, and delivered the intended differentiation of compensation value based on corporate performance.

      The following table outlines the value of total compensation awarded to the CEO for 2006.

Submitted by the Human Resources Committee:

R. Findlay (Chair)

H. Balloch

D. Mahaffy

J. Rennie

M. Sloan

EXECUTIVE COMPENSATION

Summary Compensation

      The following table sets forth a summary of compensation earned during the last three years by the Company’s Chief Executive Officer, Chief Financial Officer and its three other executive officers who had the highest aggregate salary and bonus during 2006. (All such officers are herein collectively referred to as the “Named Executive Officers”).

      All amounts shown in this table and elsewhere in this Information Circular are in Canadian dollars unless otherwise noted.

Summary Compensation Table