Under the offtake agreement, the Japanese multinational will be supplied with around one million tonnes of green and blue methanol per year from Mexico, which Transition described as “ultra-low carbon.”

MGC Chemical Division Director, Masahiko Naito, said the agreement will strengthen the company’s Carbopath initiative, which “drives carbon circularity across multiple industries.”

Naito added, “By ensuring a stable supply of ultra-low carbon methanol, we will contribute to reducing greenhouse gas emissions and supporting the transition toward a more sustainable society in Japan and in the broader Asia-Pacific region.”

The agreement will become effective upon the project’s final investment decision (FID). It marks MGC’s first large-scale and long-term procurement contract for low-carbon methanol.

Pacifico Mexinol is scheduled to begin operations in 2029, producing 350,000 tonnes of green hydrogen-based methanol and 1.8 million tonnes of blue methanol from natural gas with carbon capture.

Once operational, Transition claimed it will be the “largest single ultra-low carbon chemicals facility in the world.”

Currently, European Energy’s plant in Kassø, Denmark, is the largest commercial hydrogen-derived e-methanol facility, producing up to 42,000 tonnes per year.

Transition Industries is developing the plant with the International Finance Corporation, a member of the World Bank Group.

“Through strategic partnerships with key stakeholders and innovative companies like MGC and Transition Industries are driving the global adoption of low-carbon chemical feedstocks and leading the advancement of sustainable industry practices,” explained Rommel Gallo, Transition’s CEO.

With global infrastructure for transport and storage already in place, green and blue methanol is emerging as a practical low-carbon fuel for shipping and industry.