The government is partnering with Z Energy to secure extra diesel to be stored at Marsden Point, over-and-above the current minimum stockholding obligations.
Last month, the government announced $21.6 million of funding from the Regional Infrastructure Fund to boost storage capacity at Marsden Point in Northland by refurbishing tanks that have sat unused since the closure of the refinery in 2022.
The prime minister said the government had now signed a letter of intent with Z Energy to secure the 90 million litres of diesel to fill the tanks.
Christopher Luxon described it as a "major step" in plans to shore up fuel supply.
"This is a significant outcome, which alongside the other work the government is doing will strengthen our fuel security and give reassurance to Kiwis," he said.
Under the terms of the agreement, Z Energy will procure, own, and manage the fuel, while the Crown will control the release of the fuel to the market.
The costs, however, have not been disclosed due to commercial sensitivity.
The deal also sets out that the fuel will be delivered to Marsden Point either as single cargo or as two cargoes, the Crown's exposure to any long-term falls in fuel prices will be limited, and the fuel will be held at the direction of the Crown.
The diesel, equivalent to around nine days of supplies is expected to be in the tanks by late June or early July.
Willis said Z Energy was selected following a contestable procurement process, with a number of bidders putting forward proposals.
"The Z proposal provided the strongest value for money and the most flexibility about when and how the fuel could be used," Willis said.
Earlier on Tuesday, Willis said officials had advised a proposal for New Zealand to swap its crude oil options for useable fuel was more of a last resort.
The government had received a proposal in March to swap tickets, but Willis said it became clear that a commercial arrangement should in the first instance be executed to fill the tanks at Marsden Point before looking at the tickets.
As at 11:59pm on April 22, there were 51.8 days of petrol, 41.3 days of diesel and 45.7 days of jet fuel either in the country or en route.
The government will also consider whether to ease weight restrictions for heavy vehicles to allow them to carry more weight per trip, but the idea has received pushback from New Zealand First leader Winston Peters, who would prefer rail.
Luxon travels to Singapore on Sunday to formally sign the Comprehensive Strategic Partnership, but had already received assurances from his counterpart Lawrence Wong that Singapore will not restrict fuel exports to New Zealand.
This story was first published on rnz.co.nz |  |
