A novel method and system for liquefying and distilling natural gas into high purity liquid methane (LNG) and NGL product streams. Heat exchangers and distillation towers are configured to produce high purity liquefied natural gas (LNG) and NGL product streams, while also rejecting excess nitrogen contained in the inlet gas stream, utilizing liquid nitrogen as the process refrigerant. A molecular sieve pretreatment system is configured to utilize the vaporized nitrogen stream for regeneration of the molecular sieve beds which are designed for removing water and carbon dioxide from the inlet gas stream