Methanex Shutdown Highlights Severity of New Zealand's Gas Shortage
New Zealand's gas shortage has already begun to take its toll on the economy, with Methanex announcing it will idle its Motunui plant and sell all of its New Zealand gas entitlements from the first quarter of 2027. This move is expected to cost around 300 jobs directly, but the ripple effects are likely to be felt across other sectors as well.
The shortage has been exacerbated by the decline of proven plus probable gas reserves, which fell by 23% in a single year to 731 petajoules at January 1, 2026. Net production in 2025 was down 14%, and gas-fired electricity generation is at its weakest since 1981.
The Maui field is expected to reach the end of its life by the end of 2026, and Turangi now holds over half of what remains. Energy Minister Simeon Brown attributed the situation to Labour's 2018 ban on new offshore exploration.