Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Z Energy in stoush over cost of ETS

Z Energy in stoush over cost of ETS

By Pattrick Smellie

Feb. 5 (BusinessDesk) - South Island mining OceanaGold Corp is refusing to pay for diesel it bought from Z Energy, which charged for the fuel based on a higher cost of the emissions trading scheme than the New Zealand-owned company actually pays.

Z's lawyers agreed in court the company had charged more than it paid for carbon costs under the ETS, but that there was "nothing wrong with this," according to a High Court judgment from Associate Judge David Gendall on the dispute.

Z had sought but was refused a summary judgment requiring OceanaGold to cough up close to $1.2 million more than the gold miner believes it should have to pay under its contract for supply.

The government's ETS, intended to price carbon and help control carbon emissions, sets a top price per tonne of carbon of $25, and makes Z liable to pay carbon costs on one in every two tonnes of carbon emitted.

However, carbon prices over the period of the contract in dispute were more in the region of $14 a tonne and OceanaGold claims Z is attempting to impose an additional element of "windfall" profit margin.

OceanaGold argues its contract specified a fixed margin, so the additional charge is unlawful under the contract.

The agreement terminated in May 2012, before global carbon prices collapsed further.

Justice Gendall said while Z regarded the issue as "a simple debt recovery exercise", OceanaGold argued "the supply agreement required pricing of the fuel to be 'detailed and transparent' and that although the plaintiff could recoup the actual underlying costs of supply of fuel… as those costs fluctuated over the life of the contract, (Z's) margin on the supply was visible and fixed."

The judge said OceanaGold contended Z "could not … by charging more for the ETS than it paid, obtain additional profit margin on its supply of fuel to (OceanaGold)."

Justice Gendall ruled the issue raised sufficient issues to mean a summary judgment was not warranted. The issue will go to a full hearing at a date to be determined.

Z Energy, formerly the domestic wholesale, retail and distribution arm of Shell New Zealand, is owned 50/50 by infrastructure group Infratil and the New Zealand Superannuation Fund.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Finance: Major Campaign To End "Gross Overtaxation Of Savings"

The campaign – which includes a special web site through which New Zealanders can e-mail their own and other MPs and party leaders – is backed by Age Concern, Consumer NZ, the Financial Services Council and the Taxpayers’ Union. More>>

ALSO:

Scoop Business: Leighton-Led WGP To Build, Manage Transmission Gully

The Wellington Gateway Partnership, led by a unit of ASX-listed Leighton Holdings, has won the $1 billion contract to build the Transmission Gully road north of Wellington. More>>

ALSO:

Gareth Morgan: The Government’s Fresh Water Policy – Revisited

Fresh water quality is the latest area to be in the sights of Gareth Morgan and his research organisation The Morgan Foundation... They found that the fresh water policy was a bit murkier than the Environment Minister let on. More>>

ALSO:

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news