This research investigates a novel approach to methanol production from methane. The high use of fossil fuels in New Zealand and around the world causes global warming. Using clearer, renewable fuels the problem could potentially be reduced. Biomass energy is energy stored in organic matter such as plants and animals and is one of the options for a cleaner, renewable energy source. A common biofuel is methane that is produced by anaerobic digestion. Although methane is a good fuel, the energy is more accessible if it is converted to methanol. While technology exists to produce methanol from methane, these processes are thermo-chemical and require large scale production to be economic. Nitrosomonas europaea, a nitrifying bacterium, has been shown to oxidize methane to methanol (Hyman and Wood 1983). This research investigates the possibility of converting methane into methanol using immobilized N. europaea for use in smaller applications. A trickle bed bioreactor was developed, containing a pure culture of N. europaea immobilized in a biofilm on ceramic raschig rings. The reactor had a biomass concentration of 7.82 ± 0.43 g VSS/l. This was between 4 – 15 times higher than other systems aimed at biologically producing methanol. However, the immobilization dramatically affected the methanol production ability of the cells. Methanol was shown to be produced by the immobilized cells with a maximum production activity of 0.12 ± 0.08 mmol/gVSS.hr. This activity was much lower than the typical reported value of 1.0 mmol/g dry weight.hr (Hyman and Wood 1983). The maximum methanol concentration achieved in this system was 0.129 ± 0.102 mM, significantly lower than previous reported values, ranging between 0.6 mM and 2 mM (Chapman, Gostomski, and Thiele 2004). The results also showed that the addition of methane had an effect on the energy gaining metabolism (ammonia oxidation) of the bacteria, reducing the ammonia oxidation capacity by up to 70%. It was concluded, because of the low methanol production activity and the low methanol concentrations produced, that this system was not suitable for a methanol biosynthesis process.