Methanex to idle New Zealand plants from 2027 as gas supply outlook worsens

Methanex Corp. plans to indefinitely idle its New Zealand methanol facilities in the first quarter of 2027 after agreeing to sell substantially all of its remaining natural gas contractual entitlements through the end of the decade, the company said Sept. 2.

The world's largest methanol producer has entered into an agreement to divest most of its New Zealand gas entitlements starting in the first quarter of 2027 and continuing until the contracts expire at the end of the decade, it said.

Methanex said the decision was driven by the sharp decline in domestic natural gas availability and the absence of a clear pathway for significant new gas supply in the country.

"Methanex has determined that continued operations in New Zealand are not sustainable and as such has taken steps to optimize value from its remaining New Zealand gas position." the company said in the statement.

President and CEO Rich Sumner said the company had for several years contributed to managing New Zealand's declining gas environment by matching its operating rates to available supply and, when appropriate, sold gas into the New Zealand energy markets.

The company would, over the next several months, focus on "safely idling and preserving the facility for long-term optionality should future circumstances support a restart of operations," Sumner added.

The company did not disclose financial details of the agreement or identify the buyer of the gas entitlements.

Methanex is a Vancouver-based, publicly traded company and is the world's largest supplier of methanol.