Methane aggregation in water has been studied by simulation for thirteen systems of different sizes and compositions. It was found that favourable cluster formation only occurs after a certain critical cluster size has been reached. The effect of urea on hydrophobic clustering was studied for two urea concentrations. High urea concentrations result in slightly enhanced methane cluster formation, rather than a reduction of the hydrophobic effect. Structural analysis of the Kirkwood-Buff excess coordination and preferential solvation points at a mechanism in which urea pushes the methane into the water, locally increasing methane concentration and hence promoting cluster formation.