NOVELTY - Recovering a natural gas contaminated with high levels of carbon dioxide (CO2) and converting the natural gas into methanol, comprises: extracting gas comprising CO2 and methane; scrubbing the extracted gas with wash; oxidizing the produced washed extracted gas with an oxygen containing gas in the presence of partial oxidation catalyst to give an oxidation product gas; contacting the oxidation product gas with methanol synthesis catalyst to give a methanol product gas comprising methanol and carbon dioxide; and separating a first liquid methanol product from the methanol product gas.    USE - The process is useful for recovering a natural gas contaminated with high levels of carbon dioxide and converting the natural gas into methanol (claimed).    ADVANTAGE - The process is highly efficient and recovers at least 90%, on a molar basis, of carbon present in the hydrocarbons of the extracted gas in the liquid methanol product.    DETAILED DESCRIPTION - Recovering a natural gas contaminated with high levels of carbon dioxide (CO2) and converting the natural gas into methanol, comprises: extracting a gas comprising CO2 and methane from a reservoir containing natural gas, where CO2 comprises greater than 40 vol.% of the extracted gas; scrubbing the extracted gas with a wash to produce a washed extracted gas containing less CO2 than the extracted gas and to produce a carbon dioxide contaminated wash product, where the washed extracted gas contains at least 20 vol.% CO2 and the CO2 contaminated wash product contains more CO2 than the wash; oxidizing the washed extracted gas with an oxygen containing gas in the presence of a partial oxidation catalyst at 900 degrees C or less to produce an oxidation product gas containing hydrogen, carbon monoxide, and CO2, where the molar ratio of oxygen from the oxygen containing gas to carbon from the hydrocarbons in the extracted gas is less than 1; optionally contacting the oxidation product gas with steam and a water-gas shift catalyst at 200-400 degrees C and a pressure of 0.1-15 MPa to produce a water-gas shifted oxidation product gas; contacting the oxidation product gas or the water-gas shifted oxidation product gas with a methanol synthesis catalyst at 200-300 degrees C and a pressure of 5-15 MPa to produce a methanol product gas comprising methanol and carbon dioxide; and separating a first liquid methanol product from the methanol product gas.