However, it still wants a substantive hearing later this year - of its claims that the Maui partners and the New Zealand government have not met their obligations to provide sufficient information on the remaining Maui reserves.

After nearly two full days of legal argument in the High Court at Wellington on Wednesday and Thursday, Methanex decided to call it quits.

However, Asia-Pacific vice-president Bruce Aitken was far from discouraged.

"We felt it (the court case) was going nowhere, but we also felt we could get all the parties to hear the basis of our claim. We decided to withdraw to ensure things would continue to head in the right direction," Aitken said from Auckland.

"We are going to get our claim heard and we are very pleased with that. We are happy for the redetermination process to continue and we will make a positive contribution to that.'

Aitken denied the urgent High Court application had been a waste of time and money. "Everybody is reasonably happy, we are certainly. It's a win-win situation."

Methanex had sought an urgent hearing its application for a judicial injunction ordering a temporarily stop the Maui redetermination procedure.

One of the other parties to the court proceedings, Natural Gas Corporation welcomed the Methanex decision not to proceed with the interim injunction application.

Communications manager Keith FitzPatrick said NGC still believed an early clarification of the current gas supply position and the timely development of future gas reserves was in New Zealand's best interests.

A substantive hearing of the Methanex claims that the Maui Mining Companies and the Crown have not met their obligations to provide sufficient information on the reserves issue to start sometime in August.

The redetermination of the remaining Maui reserves - essentially who gets what scraps from the faltering field - could prove to be the largest and most important fight in the New Zealand energy industry for years.

However, industry commentators say the conciliatory tones being expressed by the parties auger well for a peaceful settlement, as opposed to all-out war.

One also said it was good to see Methanex standing up for what it believed to be a fair and reasonable outcome.

Perhaps it was also time, even at this late stage, for the government and big three users - Methanex, NGC and Contact - to try to persuade the Maui owners to explore for and develop previously overlooked pockets of gas, even prospects, within the Maui mining licence.

Accessing more gas within the field could prolong the life of Maui, this country's largest single energy resource, by one or two years, which could prove critical to an smooth transition into the "post-Maui" age.

Last November Maui Development Ltd told the New Zealand government that detailed field studies had revealed total expected recoverable Maui reserves, from the developed parts and easily accessible undeveloped parts within the mining licence, were now expected to be only 3800PJ and not the 4085PJ on which the original Maui contract between MDL and the Crown was based.

This could see the field finish as early as mid-2007 and not the contracted 2009.