We analysed previously the interaction of silver with oxygen and characterised three different atomic oxygen species. The present communication uses TPRS data to assign a chemical function to each of these three species prepared on a sample of practical electrolytic silver particles. With stationary and instationary conversion experiments close to practical conditions we confirmed the conclusions from the TPRS data also to hold qualitatively for the stationary operating catalyst. Surface oxygen was found to react in an oxydehydrogenation reaction with adsorbed methanol with a significant selectivity to total oxidation. "Sub-surface" oxygen catalyses the dehydrogenation of the adsorbed methanol with no selectivity to total oxidation. Dissolved atomic oxygen from the bulk replenishes both surface species via "sub-surface" oxygen. The interconversion of all three species at the high reaction temperatures required to overcome the barriers for the formation and motion of the various atomic oxygen species limits the overall selectivity of the formaldehyde production.