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

 


Marsden Point makes margin gains with greater natural use

Marsden Point makes margin gains with greater natural use

By Pattrick Smellie

July 4 (BusinessDesk) - New Zealand's Marsden Point oil refinery is taking advantage of historically low wholesale prices for locally produced natural gas to improve its refining margins as electricity companies, in particular, continue to use far less gas than in the past.

Refining NZ said in a statement it had achieved a 12 US cents per barrel uplift in Gross Refining Margins in May and June, 1 US cent better than planned, and that the company was "well on the way" to achieving its targeted 11 US cents per barrel improvement from the natural gas initiative over the course of the financial year.

Gas was cheapest in winter months when the dairy industry, also a major gas user, was at its seasonal low point for milk processing.

Wholesale gas prices have plummeted in recent years as a combination of weak electricity demand and the commissioning of a string of renewable wind and geothermal energy projects have markedly reduced the use of natural gas and coal to produce electricity.

That trend has already seen Canadian methanol producer Methanex restart and expand its three Taranaki methanol production trains after mothballing them during much of the 2000s, when gas prices were high and shortages were feared.

The gas move is one of four initiatives the refinery is pursuing, targeting a 66 US cents per barrel improvement in gross refining margins, which have been low over the past year, owing to a global glut of refining capacity.

Using more locally produced natural gas to fire its plant allowed the refinery to send less of its own product "up the stack" as fuel for the refining process and "to send those fuels out the door (to market) instead," said Refining NZ spokesman Greg McNeill.

As a result, the refinery had increased gas use by 50 Terajoules to 570TJ's in May and June this year, compared with the same period last year.

The growth in gas use had also been assisted by improved access to the pipeline capacity, which has been a bugbear for would-be new industrial gas users in the upper North Island, with pipeline limitations causing bottlenecks.

"We understand that the renegotiation of power station gas supply contracts has improved available capacity on the pipeline," said Refining NZ chief executive Sjoerd Post.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

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:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Scoop Business: Embrace Falling Home Affordability, Says NZIER

Despair over the inability to afford a house is misplaced and should be embraced as an opportunity to invest in more wealth-creating activity, says the principal economist at the New Zealand Institute of Economic Research, Shamubeel Eaqub. More>>

Productivity Commission: NZ Regulation Not Keeping Pace

New Zealand regulators often have to work with out-of-date legislation, quality checks are under strain, and regulatory workers need better training and development. More>>

ALSO:

Callaghan Innovation: Investment To Help Deepen Innovation Reporting

Callaghan Innovation, the government’s high tech HQ for Kiwi business, is to help deepen New Zealand media coverage of the commercialisation of innovation through an arms-length partnership with independent business news service BusinessDesk. More>>

ALSO:

Tax Credits, Grants: Greens $1Bn R&D Plan

In the Party’s headline economic announcement, the Greens have launched their plan to build a smarter, more innovative economy which has as its centrepiece an additional $1 billion of government investment in research and development (R&D) above current spend, including tax breaks for business. More>>

ALSO:

Inflation: CPI Increases 0.3 Percent In June Quarter

The consumers price index (CPI) rose 0.3 percent in the June 2014 quarter, Statistics New Zealand said today. This follows rises of 0.3 percent the March quarter and 0.1 percent in the December 2013 quarter. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

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