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LPG to be imported to meet winter peak demand

LPG to be imported to meet winter peak demand

LPG market leaders Rockgas today expressed its disappointment as the LPG industry confirmed it needed to import product from Australia to satisfy continued market growth and to meet demand over the peak winter period.

Rockgas General Manager Owen Poole said the shortfall in Maui production was the major factor in this decision.

“It is critical to our customers that we source adequate supply of LPG, and following recent projections of declining production from the Maui gas field, the LPG industry has no choice but to now arrange for imported supplies from Australia to arrive here to meet winter demand,” Mr Poole said.

Imported LPG is priced internationally at much higher prices than New Zealand is accustomed to, Mr Poole said. Rockgas had also been informed by local tolling agent Liquigas, of a price increase for product supplied from Maui.

As a result of these actions, while there will be stable supply of LPG, the price will rise, on average, by 7 – 8 cents a litre from 1 May 2003. Price increases vary according to contractual arrangements and volume of use. Rockgas customers have been notified of their price increases.

Mr Poole said despite increased demand for LPG, uncertainties of future Maui supplies meant that the industry must periodically import product until such time as new local gas fields reach sufficient output, projected to be around 2006. In the interim, he predicted movements in price, up and down, as sourcing costs for LPG change.

“For the past 25 years Rockgas has proudly sourced LPG locally, which has provided considerable price benefits to New Zealand users. We are disappointed that we need to import product, but there is no other option available if we are to ensure stability of supply.

“While we regret passing on a price increase, it is beyond our control. We believe the benefits of LPG are considerable and it is important users continue to enjoy stable supplies of a clean, healthy and efficient fuel,” Mr Poole said.

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