Methanex ( MEOH) signed a memorandum of understanding with GeoPark Holdings for the long-term supply, development and acquisition of new natural gas reserves in Chile.

The preliminary deal includes a 10-year gas supply and purchase commitment from GeoPark's Fell Block in southern Chile beginning in May. The agreement is subject to a final contract and required Chilean government approvals.

Methanex's methanol plant site in Chile produces about 10% of the world's methanol supply. GeoPark is the only private-sector oil and gas producer in Chile and has been supplying natural gas to Methanex in Chile since May 2006.