New Zealand’s strategic diesel reserve ready to go

Two refurbished tanks at Northland’s Marsden Point which will store New Zealand’s strategic diesel supply are officially in use, Finance Minister Nicola Willis and Associate Energy Minister Shane Jones say.

Prime Minister Christopher Luxon and senior Government Ministers joined Channel Infrastructure chief executive Rob Buchanan and other guests at an event today to officially mark the completion and recommissioning of the tanks.

The Government acted quickly to increase New Zealand’s fuel resilience when the Middle East conflict ramped up, securing additional diesel and a place to store it.

“Diesel is essential to keeping New Zealand moving. It powers freight, agriculture, and construction services, as well as many of the other services businesses and households rely on every day,” Nicola Willis says. 

“Strengthening fuel security was, and remains, a top priority for the Government.”

“While tensions in the Middle East have eased somewhat, global supply chains remain vulnerable and it is important New Zealand is better prepared for future disruption.” 

Today’s event marks little over three months since senior Ministers signed off on up to $21.6 million from the Regional Infrastructure Fund to Channel Infrastructure to refurbish enough capacity at its Marsden Point site to store an additional 93 million litres of diesel.

“Channel Infrastructure assured the Government it could have the tanks ready in two months. New Zealanders were counting on this to store the country’s diesel buffer,” Shane Jones says.

“Thankfully, the tanks were completed in early June and ready to receive the first of two shipments for our strategic diesel supply.”

After a competitive procurement process, Z Energy was selected to supply and manage the 90 million litre diesel reserve. 

“The Government and Z Energy worked at pace to put in place a practical, time-bound arrangement that delivers value for taxpayers, as well as flexibility around how and when the fuel is used,” Nicola Willis says.

Under the agreement, Z Energy owns and manages the diesel reserve but the Crown will control its release to the market if needed. The reserve does not count towards the company’s minimum stockholding obligation.

The first of two shipments of the diesel reserve recently arrived at the facility. The second is expected later this month.

As global fuel supply conditions continue to stabilise, fuel stock reporting will return to its standard weekly schedule. Updated fuel stock information will be published on the MBIE website every Wednesday at 1pm. ...