21 Feb 2012

Refining NZ plans $400m Marsden Point upgrade

9:33 pm on 21 February 2012

Refining NZ plans to spend up to $400 million to replace its ageing petrol-making plant at Marsden Point, near Whangarei.

Chief executive Ken Rivers says the work would enable the refinery, the only one in New Zealand, to produce an extra two million barrels a year. The new plant could be operating in late 2015.

Mr Rivers says there will be 300 jobs in the primary construction, but there will be a ripple effect far beyond those positions with another six jobs created off-site for every job on-site.

"The direct employees that we have here on-site, and then of course there are people who are working off site who support that; and then ... there will be the fabrication work, the suppliers, the equipment that we will be buying here in New Zealand which will lead to further job creation during that construction period."

Mr Rivers says provided Refining NZ gets approval from its shareholders at a meeting in April, the primary construction period will begin at the end of the year and run until 2015.

He says the board decided to support the upgrade after conducting a feasibility study.

He told Checkpoint the extra two million barrels would increase its market share from about 50% to about 60%, with the balance to come from imports.

He says it is up to the petrol retailers it supplies to decide whether the upgrade will make petrol cheaper for the public.