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Methanex to shut Taranaki plant and sell gas contracts
Methanex, New Zealand's largest gas user, will cease methanol production at its Motonui facility by February 2027 and sell its gas entitlements, citing declining natural gas supply. The closure expected to cost around 300 jobs in the region, prompting political reactions over the government's LNG import plans.
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Methanex to shut Taranaki plant and sell gas contracts
New Zealand's largest gas user, Methanex, has announced it will close its Taranaki plant and sell off its gas contracts, citing a lack of natural gas and no clear pathway to new supplies.
The Canada-based company said it had agreed to sell substantially all of its New Zealand natural gas contractual entitlements, commencing in the first quarter of 2027 and continuing through the end of the decade when those entitlements expire. Methanex expected to "indefinitely idle" its production facilities at Motonui, north of Waitara, with methanol manufacturing ceasing at the end of February 2027, after 32 years of operation in the country.
The company, which employs around 200 people (not including contractors and suppliers), has in the past been responsible for taking around 30 to 40 percent of all of New Zealand's natural gas production. About 95% of its production is exported to customers in the Asia Pacific region.
Methanex said it had been managing declining gas availability for several years and, with "no clear path to meaningful new supply", was no longer confident it could continue production. Rich Sumner, president and chief executive of Methanex Corporation, said the New Zealand operations had made "significant contributions to the Company’s global operations and the New Zealand energy sector". He added that the company had been preparing for this eventuality given declining gas availability, and would focus on operating the plant over the coming months and supporting staff before "safely idling and preserving the facility for long-term optionality should future circumstances support a restart of operations".
Local impact
New Plymouth Mayor Max Brough said the announcement was disappointing but not unexpected. "They've got no continuity of supply. They don't have enough gas coming and they're making the best of a bad situation," he told 1News. He said the loss of around 300 "high paying jobs" would be felt well beyond the plant itself, affecting the engineering and electrical instrumentation industries, which are highly technical and well-paying.
Brough said many of those losing jobs would struggle to find similar work. "There's no alternative here for those roles. They will be heading to where [they can] support their families, and it probably won't be in New Zealand. So that's very disappointing," he said.
The mayor also linked the closure to a longer trend since the Labour Government's 2018 decision to ban new offshore oil and gas exploration. "It takes seven to 10 years to bring a well on line," he noted. He disputed the suggestion that an LNG terminal was ever meant to keep Methanex running, saying "LNG is there for firming the electricity market in dry years. It's not there to power Methanex – never was."
Despite the setback, Brough remained optimistic about other gas exploration projects in the city. "I've rolled out the red carpet and the welcome mat actually, because New Zealand needs gas," he said. "Whatever your political persuasion is, the reality is, we still need gas to power industry in a lot of places in this country and earn export dollars."
Political reaction
The Green Party said the closure left the government no reason to push on with its plans to build a $1 billion liquified natural gas (LNG) import facility. Co-leader Chlöe Swarbrick said it was time for the government to cancel the project. "Methanex leaving takes the country's largest gas user out of the market and frees up gas supply through to the end of the decade for electricity generation," she said. "The 'gas shortage' the government has been talking up to try and justify this fossil fuel project is now about to be a great deal smaller."
Swarbrick said if the government was not prepared to "do the rational thing" and cancel the project, then Prime Minister Christopher Luxon "must return to the drawing board before signing any daft deal".
The government has set out to build the LNG terminal, saying it is necessary to shore up energy supply. RNZ has approached Energy Minister Simeon Brown for comment.
Energy market implications
Genesis Energy said it had secured additional gas supplies from a third party for the period of March 2027 and 2029. The additional gas is 11.4 Petajoules, about 10 percent of national gas production. Genesis has not said who it got the gas from.
How each outlet told it
A framing line is our reading of that outlet's own text — an interpretation, not a quotation and not a fact we assert. Check it against what the outlet published.
Framing: The headline emphasizes Methanex's decision to close the Taranaki plant and attributes it to a 'decline' in gas supply.
Facts Included:
Methanex announced it will close its Taranaki plant after more than three decades of operation, saying New Zealand's declining natural gas supply has made continuing operations unsustainable (source: 1News article body, sentence [1])
Methanex expected to 'indefinitely idle' its production facilities at Motonui, north of Waitara, with methanol manufacturing ceasing at the end of February 2027 (body sentence [3])
Framing: Highlights Methanex's action to effectively close and sell off gas contracts
Facts Included:
Methanex is to effectively close its plant and sell off its gas contracts
Methanex said a lack of natural gas and a clear pathway to new supplies meant operations in New Zealand were no longer sustainable
The Canadian-owned company said it had now entered into an agreement to sell all of its New Zealand natural gas contractual entitlements, commencing in the first quarter of next year
It said it then planned to safely idle and preserve the facility for long-term optionality, should future circumstances support a restart of operations
The company has in the past been responsible for taking around 30 to 40 percent of all of New Zealand's natural gas production
ln recent years the country's natural gas production has declined rapidly with little new supply coming on board
The company, which employs around 200 people, not including contractors and suppliers, said it would work closely with employees, contractors, suppliers, customers, and government stakeholders during the transition period
Rich Sumner, president and chief executive of Methanex Corporation, said the company had been preparing for this eventuality, given declining gas availability in the country
Sumner said the company was now focused on supporting its team members during the transition period,and safely operating the plant over the next several months
New Plymouth Mayor Max Brough said the announcement was disappointing but not unexpected
Brough said many people who would lose their jobs as a result of the closure would struggle to find similar work
The Green Party said the closure left the government no reason to push on with its plans to build a liquified natural gas (LNG) import facility
The government has set out to build the $1 billion terminal, saying it is necessary to shore up energy supply
co-leader Chlöe Swarbrick said the gas shortage the government has been talking up to try and justify this fossil fuel project is now about to be a great deal smaller
Swarbrick said if the government did not cancel its plans, it should at least return to the drawing board before signing a deal
RNZ has approached Energy Minister Simeon Brown for comment
Genesis Energy said it had secured additional gas supplies from a third party for the period of March 2027 and 2029
AI-extracted; can misattribute a claim — see Methodology.
Each row is one claim, attributed to the outlet whose wording states it most clearly. Confidence rates how directly the source text states the claim — explicit and unhedged rates high; hedged, pieced-together, or internally inconsistent statements rate lower. It does not measure whether the claim is true. Status is Contested when two claims on this page negate each other; otherwise it counts the distinct outlets we found asserting that specific claim — so a single-source claim can still show high confidence, and a multi-source claim can show medium. Every one of those outlets is named beside the status, so you can check the count against the list. For claims extracted before we began storing that list, the row says so: it names the outlet the claim is quoted from and states that we have not recorded which outlets backed it. Outlets wrote at different times, so a figure that evolves — a casualty count, for example — can legitimately differ between rows; check the "as of" time next to each claim's source.
Claim
Confidence
Status
ClaimMethanex announced it will close its Taranaki plant after more than three decades of operation, saying New Zealand's declining natural gas supply has made continuing operations unsustainable.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimMethanex will cease methanol manufacturing at its Motonui facility at the end of February 2027.
ClaimMethanex has agreed to sell substantially all of its New Zealand natural gas contractual entitlements commencing in the first quarter of 2027 and continuing through the end of the decade when such entitlements expire.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimMethanex expects to 'indefinitely idle' its production facilities at Motonui, with methanol manufacturing to cease at the end of February 2027.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimMethanex employs more than 200 people, not including contractors and suppliers.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimAbout 95% of Methanex's production is exported to customers in the Asia Pacific region.
ClaimMethanex said it had been managing declining gas availability for several years, and with 'no clear path to meaningful new supply', was no longer confident it could continue production.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimMethanex president and chief executive Rich Sumner said the New Zealand operations had made 'significant contributions to the Company’s global operations and the New Zealand energy sector'.
ClaimSumner said Methanex would focus on operating the plant over the coming months and supporting staff before 'safely idling and preserving the facility for long-term optionality should future circumstances support a restart of operations'.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimNew Plymouth mayor Max Brough told 1News the closure had been expected for some time, but that did not soften the blow of losing about 300 'high paying jobs' in the region.
ClaimBrough said the loss would be felt well beyond the plant itself: it's the engineering industry as well, it's the electrical instrumentation industry – it's all sort of support industries that are all highly technical and they're well-paying jobs and careers.
ClaimThe Green Party said Methanex closure also shuts the door on any arguable reason for the Government to build an LNG import terminal – and called on the Government to cancel the project.
ClaimGreen Party co-leader Chlöe Swarbrick said it was time for the Government to cancel their plans to use $1 billion of taxpayer money to underwrite the LNG import facility.
ClaimSwarbrick said if the Government wasn't prepared to 'do the rational thing' and cancel the project then Prime Minister Christopher Luxon 'must return to the drawing board before signing any daft deal'.
ClaimSwarbrick said 'Methanex leaving takes the country's largest gas user out of the market and frees up gas supply through to the end of the decade for electricity generation'.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimSwarbrick said the 'gas shortage' the Government has been talking up to try and justify this fossil fuel project is now about to be a great deal smaller.
ConfidenceHigh
StatusMulti-source (2 outlets · 2 distinct) via 1News , RNZ
ClaimBrough disputed the suggestion that an LNG terminal was ever meant to keep Methanex running, saying 'LNG is there for firming the electricity market in dry years. It's not there to power Methanex – never was'.
ClaimRich Sumner, president and chief executive of Methanex Corporation, said the company had been preparing for this eventuality, given declining gas availability in the country.
ClaimBrough said 'They recognise New Zealand has a gas shortage. This will free it [gas] up for other users, but the price will go up. You need a baseline consumer to keep the price down for others because make no mistake, they've subsidised New Zealand's gas at a retail level and for other users for decades.'
ClaimBrough said 'There's no alternative here for those roles. They will be heading to where [they can] support their families, and it probably won't be in New Zealand. So that's very disappointing.'
ClaimBrough said 'Whatever your political persuasion is, the reality is, we still need gas to power industry in a lot of places in this country and earn export dollars.'