U.S.-based Transition Industries LLC signed a long-term agreement with Mitsubishi Gas Chemical Co. on Thursday for the purchase and sale of low carbon methanol, marking a key milestone in expanding the global supply of low-emission fuels.

Under the agreement, Transition Industries will supply MGC with about 1 million metric tons of ultra low carbon methanol annually from its Pacifico Mexinol project in Topolobampo, Sinaloa, Mexico.

The project, currently under development, is expected to begin operations in 2029 and will have a production capacity of 6,130 metric tons per day.

The agreement will take effect after the project reaches its final investment decision. Transition Industries is developing Pacifico Mexinol in partnership with the International Finance Corp., a member of the World Bank Group.

Driving Low-Carbon Chemical Markets

Rommel Gallo, CEO of Transition Industries, said the deal endorses the company’s commitment to advancing low-carbon chemical feedstocks and accelerating the shift toward cleaner industrial practices.

“We are honored to collaborate with MGC in our shared mission to address climate change and supply ultra-low carbon methanol to the Pacific Basin market,” Gallo said. “Through partnerships with innovative companies like MGC, Transition Industries is driving the global adoption of sustainable industry practices.”

For MGC, the deal represents its first major long-term procurement of ultra-low carbon methanol, positioning the company as a key offtake partner for Pacifico Mexinol.

Masahiko Naito, division director of C1 Chemicals at MGC, said the partnership aligns with the company’s Carbopath initiative, which promotes carbon circularity across industries.

“By ensuring a stable supply of ultra-low carbon methanol, we will help reduce greenhouse gas emissions and support the transition toward a more sustainable society in Japan and the Asia-Pacific region,” Naito said.

Global Collaboration for Carbon Reduction

A signing ceremony was held in Tokyo and attended by representatives from the U.S. and Mexican embassies, Japan’s Ministry of Economy, Trade and Industry, the Ministry of Foreign Affairs and the State of Sinaloa.

Other stakeholders, including IFC, Techint, Samsung E&A, MAIRE Group, SIAD Group, Macquarie Capital, and Siemens Energy, also participated.

When operational, Pacifico Mexinol will become the world’s largest single ultra-low carbon chemicals facility.

It is also projected to produce about 350,000 metric tons of green methanol and 1.8 million metric tons of blue methanol annually, using natural gas with carbon capture technology.

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Nirmal Menon

Nirmal Menon is a journalist with more than 20 years of experience covering business and technology for mainstream publications in India and abroad. In his previous role, he served as business desk editor at Arab News. He is currently the editor of ESG Times. He can be reached at nirmal.menon@esgtimes.in.