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Contact/NGC Agree Gas Transmission Contract


Contact Energy has confirmed it has dropped its plans to build a major gas pipeline to Auckland for its Otahuhu power station and will continue to use Natural Gas Corporation's transmission pipeline system for gas deliveries for at least the next 10 years under a new commercial agreement announced by the two companies today.

Contact Energy had proposed to construct a separate pipeline between Rotowaro (near Huntly) and its Otahuhu Power Station.

Contact Energy Managing Director, Mr Paul Anthony, said today Contact was pleased new commercial arrangements for gas transportation services to the Otahuhu Power Station had been concluded. The competitive terms offered by NGC for transportation services to this facility means Contact will continue to use the existing NGC pipeline for gas transmission into the Auckland area for the next decade at least, removing the need to commit resources to the construction of a parallel pipeline in the immediate term.

NGC Chief Executive Officer, Mr Richard Bentley, said he was pleased NGC had been able to retain Contact Energy as a major customer of its gas transportation services between Rotowaro and Auckland.

Transmission services pricing was related in part to total gas volumes transported throughout the system and, by securing Contact's gas transportation load for at least another 10 years, NGC had ensured that all users of the NGC transmission system would gain benefits that would not be available if Contact had proceeded to build a bypass pipeline.



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