Fonterra says 15 of its milk processing plants in Waikato, Bay of Plenty and Northland have had to stop operations because of the shut-down of the Maui gas pipeline.
The pipeline was shut down on Tuesday morning because of a suspected serious leak.
The shutdown is affecting supplies to energy generators as well as large users in the north of the North Island.
Fonterra operations manager Gary Romano says the loss of gas supply has come at the busiest time of the year for milk processors.
He says about 30 million litres of milk could be lost every day that the plants are deprived of gas and farmers may be forced to dump milk onto their paddocks.
Waikato-based Tatua dairy co-operative is also affected by the pipeline shutdown.
Experts work to find cause of leak
Technical experts are working to try to find the cause of a leak that has shut down the Maui pipeline.
Acting Minister of Energy Hekia Parata says they are preparing to excavate a section of the pipeline to assess the extent of the damage.
She says this is the first time there has benn a fault on the Maui pipeline and until the cause is identified, and the scale of it is known, it is hard to know how long it will take to fix.
Gas-fired electricity generation at Huntly, Otahuhu and Southdown was immediately halted when the leak was reported in the remote White Cliffs area north of New Plymouth.
All customers, other than residential customers, in the areas north of Morrinsville, and in Bay of Plenty have been asked to immediately curtail their gas usage to help manage available supplies.
While domestic customers are not covered by the curtailment directive, they are being asked to limit their use of gas as much as possible.
National electricity grid operator Transpower has said electricity generators are using alternative fuels to produce power and there are no problems for industrial or household users.
Huntly switches to coal
Genesis Energy, which operates Huntly power station and supplies nearly 20% of the North Island's electricity, says it is producing as normal, using coal.
Spokesperson Richard Gordon says the company has reserves of over a million tonnes of coal so there is plenty of fuel for the Huntly generators to keep operating for a long time.
He says, for households using piped natural gas, there is enough gas in the system to supply them for the immediate future.
