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Minister should release fuel storage capacity report immediately

06 September 2022

by Chris Leitch, Leader

The admission by Energy Minister, Megan Woods, that within days of the country's only oil refinery being about to shut down, she had no idea of how many days refined fuel storage the country had or should have and so told MBIE to hurry up on a report on mandatory onshore holdings, is almost beyond belief.

Both she and the cabinet apparently relied on oil company assurances that they could maintain consistent supplies of refined fuel.

Surely the Minister understands that international corporations have only one focus - increasing profits to pay out larger dividends to shareholders, not the best interests of the country they operate in.

Channel Infrastructure, the company that owned the refinery demonstrated that focus quite clearly when, despite having publicly committed not to, they proceeded to gut all the major processing units, and cut off electrical feeds to them at ground level immediately after shutting the refinery down to ensure the plant would never operate again.

The report the Minister wanted should have been done prior to her presentation of a report to cabinet in September last year, which outlined options and should have been included with that report.

An assessment of the number of days of refined fuel the country could currently store was essential information for the cabinet to know to help it determine whether to intervene and stop the closure.

Lack of supply has the potential to cripple the entire economy so instead of keeping the report secret which the Minister and MBIE are doing, the ministerial briefings should be immediately released so that our key business sectors know what they are dealing with.

Our two biggest earners of overseas exchange, tourism and farm products would be at risk if international airlines could not refuel here, our transport fleet would be unable to get goods to retailers and food into our supermarkets, farm products to processors and export ports, our fishing fleets would be confined to port, and fire, ambulance, and helicopter rescue services could not operate.

MBIE admitted in evidence to the select committee dealing with Social Credit's 18,300 signature petition that the country had only eighteen days average stocks of refined fuel storage capacity and they suggested we should be aiming to get closer to Australia, which had twenty eight days.

What they failed to mention was that Australia also had two refineries still in operation while New Zealand's only refinery had been shut down and was in the process of being gutted.

We no longer have the capacity to fall back on our own Taranaki oil should supplies of refined product from Asia be interrupted as would be the case if China invaded Taiwan or cut off shipping routes.

That cabinet should have intervened to stop the refinery being shut down at least until more storage capacity had been put in place, and preferably not shut down at all.

To rely on oil company assurances was the worst option the Minister and Cabinet could have adopted.