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Private Investors announced for Ruataniwha

Media Release
19 September 2013

Private Investors announced for Ruataniwha Water Storage Scheme

Two well-known New Zealand companies have signalled their intention to potentially invest in the Ruataniwha Water Storage Scheme in Hawke’s Bay.

TrustPower Limited and Ngāi Tahu Holdings Corporation Limited (NTHC) have each signed a Memorandum of Understanding with Hawke’s Bay Regional Investment Company Limited (HBRIC Ltd) to potentially invest in the Ruataniwha Water Storage Scheme in Hawke’s Bay.  HBRIC Ltd is Hawke’s Bay Regional Council’s investment company and lead entity for the Ruataniwha Water Storage Scheme which, if approved, has the potential to improve the water quality and quantity in the Tukituki River and reliably irrigate up to 30,000 hectares of land. 

All parties emphasise their commitment to deliver the best possible outcomes for the Hawke’s Bay region, across environmental, social, cultural and economic values.  Today’s announcement comes after significant combined investigations by the two potential investors with HBRIC Ltd.

HBRIC Ltd Managing Director Andrew Newman says NTHC, TrustPower and HBRIC Ltd all understand the importance of sustainable water management for New Zealand’s future, in particular where large scale water storage can relieve pressure on ground water and surface water takes during major periods of stress. 

“We are pleased to have this opportunity to align ourselves with two companies with the same values as us,” says Mr Newman.

An investor committee will now be formed.  It will include representatives of TrustPower, NTHC and HBRIC Ltd. The committee will consider the design and construction contracts for the scheme, along with water uptake, contracting and consenting implications.  The resource consent applications are currently before a Board of Inquiry with the Environmental Protection Authority.
NTHC Chief Executive Mike Sang has welcomed the independent board of inquiry phase. He says this should provide further opportunity for mana whenua and the community to seek further assurance about the scheme.

TrustPower and NTHC will, alongside the existing contributions made by HBRIC Ltd and the Ministry for Primary Industries through its Irrigation Acceleration Fund, contribute to the financial costs through to the targeted financial close date in April 2014.  All investors will then make a final decision on whether to invest in the scheme at that time.

Andrew Newman says he is pleased to be able to announce the commitment to the scheme from these two successful New Zealand companies, who both understand what this scheme could do for the future prosperity of Hawke’s Bay.

TrustPower General Manager Commercial Operations Chris O’Hara says that while there is still a lot of work to do before financial close, the joint investigation, along with the additional commercial rigour that TrustPower and NTHC bring to this final phase, will ensure a robust analysis of all aspects of the scheme. He says their goal is to put together a well-developed viable proposition that will give real value for the region.

The estimated capital cost, including water storage and distribution infrastructure is $265 million.  The total investment being considered by TrustPower and NTHC could be in the region of  30 to 40 percent of the initial capital cost, together with a share of the final business case costs incurred prior to financial close.

Andrew Newman also noted that HBRIC Ltd is retaining the opportunity for farmers and landowners to invest in the scheme but that no money is currently being sought, and no applications for securities will be accepted or money received, until after an investment statement containing information about the offer is available.

HBRIC Ltd Chairman Andy Pearce says today’s announcement is a significant milestone. He says it reflects the hard work and commitment that is being put into this scheme. 

ENDS

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