Methanex Departure Set to Ease Gas Prices in New Zealand

Methanex's decision to close its New Zealand operations and sell off gas contracts will have a significant impact on the country's energy market. As the single biggest gas consumer, Methanex used nearly half of New Zealand's total natural gas supply.

The company's departure releases a large amount of gas into the market, which has struggled in recent years due to supply constraints. Genesis Energy has picked up major gas contracts that will run from March next year through to December 2029.

Ben Gerritsen, general manager of customer and regulation at Clarus, said the loss of Methanex's business is a 'big shift' for the local Taranaki economy. However, he notes it's not surprising given the decline in gas production in New Zealand.

Gerritsen expects an easing in prices in the near-term for both industrial and household consumers due to increased supply. However, he cautions that this may change in the long-term as known gas fields are in a pattern of decline and some are expected to close soon.