The post Marsden supply
Recently, Megan Woods, New Zealand’s Minister of Energy, announced that the Government is moving to bolster what they call post Marsden Point supply resilience in the fuel sector. Marsden Point was New Zealand’s only oil refinery and was closed in 2022.
The mandated obligations, outlined by Woods, require fuel companies and importers to hold a minimum amount in reserve set by the Commerce Commission.
Fuel wholesalers will be required to hold a minimum of 28 days for petrol, 24 days for jet fuel and 21 days for diesel.
The Commerce Commision will measure these minimums using a three month rolling average.
In addition, the Government will also maintain its own supply of 70 million litres of diesel stock, which would cover Kiwis for only 7 days, should supplies to NZ cease.
Delays to mandated biofuel quotas
Frustrating climate alarmists, the Government is now allowing petrol companies 12 months longer to comply with the incoming mandated biofuel quotas.
Fuel companies will have to prove that a percentage of their fuel sold is biofuel that meets a sustainability criteria. Wood’s acknowledged that this will slightly increase the price consumers pay.
The initial targets are 1.2% in 2023, 2.4% in 2024 and 3.5% in 2025. The ultimate target is 9% biofuel by 2035.
In the same announcement the Government reminded New Zealanders the tax on fuel will increase back to its standard rate in January of 2023.
The futility of price controls
The Government announced new powers to enable the Commerce Commission to step in and adjust prices they believe are “unfair”.
John Carnegie from Energy Resources Aotearoa has pushed back on the Government since the announcement, pointing out the futility of price controls and their detrimental effects on consumers and supplier.
“The risk of price controls will be a red flag for any international firm weighing up whether to enter New Zealand. Today it’s fuel companies, who’s next?”
He went on to say the mandated minimums for fuel stockpiles would have a significant cost involved around storage which would, ultimately, flow down to the consumers.
Spokespeople from different energy companies have said added costs will undoubtedly be passed on.
Oil field deal struck off
Uncertainty surrounding energy policy has ended a $50 million dollar deal between Jadestone Energy and OMV who run New Zealand’s largest producing oil field. The deal was struck off while bogged down waiting for government approval.
