1 00:00:05,640 --> 00:00:08,799 Speaker 1: Kyoda. I'm Chelsea Daniels and this is the Front Page, 2 00:00:09,320 --> 00:00:16,680 Speaker 1: a daily podcast presented by the New Zealand Herald. Marsden 3 00:00:16,760 --> 00:00:21,680 Speaker 1: Point operated as New Zealand's only oil refinery for nearly 4 00:00:21,920 --> 00:00:25,880 Speaker 1: sixty years. At its peak in the eighties, it employed 5 00:00:25,920 --> 00:00:30,000 Speaker 1: around seventeen hundred people. When it was closed in twenty 6 00:00:30,080 --> 00:00:34,320 Speaker 1: twenty two, nearly two hundred and forty people lost their jobs. 7 00:00:34,920 --> 00:00:39,040 Speaker 1: Run by Channel Infrastructure, the site now operates as New 8 00:00:39,120 --> 00:00:45,080 Speaker 1: Zealand's largest fuel's import terminal, storing and distributing forty percent 9 00:00:45,360 --> 00:00:49,159 Speaker 1: of the country's fuel. In recent weeks, a slew of 10 00:00:49,400 --> 00:00:52,800 Speaker 1: ministers have visited the site, with New Zealand first in 11 00:00:52,840 --> 00:00:57,960 Speaker 1: particular floating the idea of introducing our first Special Economic 12 00:00:58,120 --> 00:01:02,440 Speaker 1: Zone to help pump invent into the site and life 13 00:01:02,600 --> 00:01:07,399 Speaker 1: back into the Northland economy. Later, Channel Infrastructure CEO Rob 14 00:01:07,400 --> 00:01:11,640 Speaker 1: Buchanan takes us through the future of Marsden Point, but 15 00:01:11,840 --> 00:01:16,080 Speaker 1: first on the front Page, Massy University Emeritus Professor of 16 00:01:16,120 --> 00:01:20,959 Speaker 1: Sustainable Energy and Climate Mitigation Ralph Simms joins us to 17 00:01:21,080 --> 00:01:30,440 Speaker 1: discuss the site's past and potential. First off, Ralph pretend 18 00:01:30,600 --> 00:01:33,360 Speaker 1: I've never heard of Marsden Point before. 19 00:01:33,720 --> 00:01:35,280 Speaker 2: Can you tell me what is it? 20 00:01:35,840 --> 00:01:36,080 Speaker 3: Right? 21 00:01:36,520 --> 00:01:40,560 Speaker 4: Well, Marsden Point is an oil refinery located up in 22 00:01:40,800 --> 00:01:46,560 Speaker 4: Northland and it was established in nineteen sixty four because 23 00:01:46,600 --> 00:01:52,440 Speaker 4: we were bringing petrol and diesel into New Zealand already refined, 24 00:01:52,960 --> 00:01:55,800 Speaker 4: thought it was cheaper have we brought in crude oil 25 00:01:56,080 --> 00:02:00,160 Speaker 4: and then produced our own fuel products and that worked well. 26 00:02:00,360 --> 00:02:05,640 Speaker 4: For quite some time we were producing maybe half of 27 00:02:05,720 --> 00:02:10,720 Speaker 4: New Zealand's demands of petrol, diesel and aviation fuel. A 28 00:02:10,800 --> 00:02:15,840 Speaker 4: refinery takes crude oil, which is a very complex chemical 29 00:02:15,880 --> 00:02:19,000 Speaker 4: if you like, and it varies from place to place, 30 00:02:19,360 --> 00:02:24,320 Speaker 4: so a refinery breaks it down into useful products and petrol. 31 00:02:23,960 --> 00:02:25,919 Speaker 3: Diesel the obvious ones. 32 00:02:25,760 --> 00:02:32,160 Speaker 4: Aviation fuel, jet fuel is called also kerosene, other products 33 00:02:32,400 --> 00:02:36,520 Speaker 4: chemical use as well, and also bitchamin is this stuff 34 00:02:36,600 --> 00:02:39,360 Speaker 4: left over which of course we seal our roads with, 35 00:02:39,880 --> 00:02:42,840 Speaker 4: so that all comes from an oil refinery. 36 00:02:42,400 --> 00:02:45,760 Speaker 1: And so it hasn't been used as a refinery of 37 00:02:45,800 --> 00:02:49,720 Speaker 1: course since it closed down in twenty twenty two. In 38 00:02:49,800 --> 00:02:54,920 Speaker 1: the mid nineteen eighties, though, the refinery substantially expanded and 39 00:02:55,000 --> 00:03:00,920 Speaker 1: upgraded to allow for increased production. Extra tanksity supplies and 40 00:03:01,040 --> 00:03:05,079 Speaker 1: environmental treatment units were added. Along with a one hundred 41 00:03:05,080 --> 00:03:08,680 Speaker 1: and seventy kilometer Marsden Point to Auckland pipeline. Now it's 42 00:03:08,720 --> 00:03:11,679 Speaker 1: safe to say, hey, that the eighties were really its 43 00:03:11,760 --> 00:03:12,480 Speaker 1: boom time. 44 00:03:12,919 --> 00:03:17,880 Speaker 4: That's right, because it was expanded. A hydrocracker was installed, 45 00:03:17,919 --> 00:03:20,600 Speaker 4: which was quite innovative at the time to get more 46 00:03:20,840 --> 00:03:23,840 Speaker 4: diesel out of a barrel of oil. You can only 47 00:03:23,840 --> 00:03:26,400 Speaker 4: get so much petrol, so much diesel, so much of 48 00:03:26,480 --> 00:03:30,280 Speaker 4: the other products, and the hydrocracker was to say, let's 49 00:03:30,280 --> 00:03:34,720 Speaker 4: get more diesel out because of our diesel demand, agricultural demands, trucks, etc. 50 00:03:35,120 --> 00:03:37,640 Speaker 4: So this was a project. It was owned by the 51 00:03:37,680 --> 00:03:41,280 Speaker 4: New Zealand refining companies. It was Shell that the oil 52 00:03:41,320 --> 00:03:43,680 Speaker 4: company that first thought about it, and then they went 53 00:03:43,720 --> 00:03:47,320 Speaker 4: into partnership with all the other oil companies in New 54 00:03:47,400 --> 00:03:51,680 Speaker 4: Zealand and set up the business. And so then they 55 00:03:51,680 --> 00:03:55,600 Speaker 4: thought they'd expand and then mister Muldoon came along with 56 00:03:55,680 --> 00:03:58,000 Speaker 4: his think big project, so he thought that was a 57 00:03:58,040 --> 00:04:04,360 Speaker 4: good idea. Through money at it and then it took five. 58 00:04:04,240 --> 00:04:06,320 Speaker 3: Six years nineteen eighty six. 59 00:04:06,120 --> 00:04:08,760 Speaker 4: It finally opened because there were strikes and there were 60 00:04:08,880 --> 00:04:12,800 Speaker 4: delays and there was over a budget, and then eventually 61 00:04:12,960 --> 00:04:16,279 Speaker 4: the government did a secret deal with the oil companies 62 00:04:16,320 --> 00:04:20,960 Speaker 4: to buy it to pay for all the changes that 63 00:04:21,480 --> 00:04:24,640 Speaker 4: had occurred, and that meant that we were then able 64 00:04:24,680 --> 00:04:29,359 Speaker 4: to produce about seventy percent of our total fuel demand. 65 00:04:29,440 --> 00:04:33,080 Speaker 4: We were still importing Sundays or some In course in 66 00:04:33,120 --> 00:04:36,760 Speaker 4: the nineteen seventies there were the oil shocks. 67 00:04:36,360 --> 00:04:38,480 Speaker 3: Around the world and we were having. 68 00:04:38,279 --> 00:04:41,360 Speaker 4: Carliss days and rationing diesel, etc. 69 00:04:41,760 --> 00:04:44,760 Speaker 3: Because there just simply wasn't enough that the. 70 00:04:44,800 --> 00:04:48,080 Speaker 4: Refinery could produce because of the oil supply, but also 71 00:04:48,120 --> 00:04:51,960 Speaker 4: buying imported products, and so that was another reason to 72 00:04:52,040 --> 00:04:55,800 Speaker 4: give it a boost in the eighties. Interestingly, New Zealand 73 00:04:55,880 --> 00:04:59,440 Speaker 4: by that time was exploring and producing oil and gas. 74 00:05:00,040 --> 00:05:05,240 Speaker 4: Oil was what's called a light sweet crude and it 75 00:05:05,279 --> 00:05:10,760 Speaker 4: didn't match the refinery processing characteristics. Most of our crude 76 00:05:10,800 --> 00:05:14,040 Speaker 4: oil that we extracted was sent off to a refinery 77 00:05:14,040 --> 00:05:17,760 Speaker 4: in Australia and we were producing we were importing this 78 00:05:17,920 --> 00:05:22,920 Speaker 4: medium sour crude from other parts of the world, Saudi 79 00:05:22,920 --> 00:05:27,120 Speaker 4: Arabia and United Arab Emirates and wherever, and so that 80 00:05:27,200 --> 00:05:31,080 Speaker 4: was unfortunate really because we were still relying on imported 81 00:05:31,200 --> 00:05:35,520 Speaker 4: product and a small percentage, very small percentage of our 82 00:05:36,160 --> 00:05:38,880 Speaker 4: our own crude oil would be blended in with the 83 00:05:38,920 --> 00:05:42,560 Speaker 4: imported stuff, but not enough to make us self sufficient. 84 00:05:45,160 --> 00:05:49,120 Speaker 5: Right over withster Peters. That from the person who agreed 85 00:05:49,240 --> 00:05:52,560 Speaker 5: secretly to close down one of the three big industries 86 00:05:52,560 --> 00:05:56,160 Speaker 5: in this country, namely Marson Point. Never told the workers, 87 00:05:56,440 --> 00:05:58,880 Speaker 5: never told the unions, never told anybody up north, No 88 00:05:59,160 --> 00:06:04,000 Speaker 5: COVID it did And she laughs this critical componatory, she 89 00:06:04,120 --> 00:06:06,640 Speaker 5: laughs about this accused of me going secretly to the 90 00:06:06,640 --> 00:06:09,919 Speaker 5: Prime minister. No, all twenty cabinet ministers were required to 91 00:06:09,920 --> 00:06:13,040 Speaker 5: write to the Primise with their ideas. That's what I did. 92 00:06:13,320 --> 00:06:16,159 Speaker 5: So don't believe the media crap and hype that somehow 93 00:06:16,240 --> 00:06:19,719 Speaker 5: we did something special and there isn't appalling their debuty 94 00:06:19,720 --> 00:06:21,960 Speaker 5: prime Minister has been caught talking to the Prime Minister. 95 00:06:25,520 --> 00:06:27,920 Speaker 5: Only Labor could think there's something wrong. 96 00:06:31,120 --> 00:06:33,680 Speaker 1: Looking back, do you think that there were any missed 97 00:06:33,760 --> 00:06:39,240 Speaker 1: opportunities to integrate I guess more sustainable practices into Marsden 98 00:06:39,320 --> 00:06:41,040 Speaker 1: Points refining activities. 99 00:06:41,480 --> 00:06:44,640 Speaker 4: Yes, well, there was a lot of debated discussion about 100 00:06:44,680 --> 00:06:50,400 Speaker 4: exactly what production it should achieve from an economic sustainability 101 00:06:50,440 --> 00:06:53,080 Speaker 4: point of view. If we'd have gone to one hundred 102 00:06:53,120 --> 00:06:58,599 Speaker 4: percent refining and if anything had gone wrong then that 103 00:06:58,680 --> 00:07:03,960 Speaker 4: would have been a risk. The economic balance, as I 104 00:07:04,080 --> 00:07:07,560 Speaker 4: understand it, was that we would produce two thirds or 105 00:07:07,600 --> 00:07:10,400 Speaker 4: so of our own fuels, but still have some reliance 106 00:07:10,440 --> 00:07:14,360 Speaker 4: on imported fuels, which gives some flexibility reduces the risk. 107 00:07:14,920 --> 00:07:19,800 Speaker 4: I guess that was the main reason for not going 108 00:07:19,840 --> 00:07:24,000 Speaker 4: to a full large refinery. But of course that was 109 00:07:24,120 --> 00:07:27,400 Speaker 4: one of the reasons why it did close down in 110 00:07:27,480 --> 00:07:32,200 Speaker 4: twenty twenty two, because it's a relatively small refinery on 111 00:07:32,240 --> 00:07:37,400 Speaker 4: a global basis, and the cost of oil shipping it's 112 00:07:37,440 --> 00:07:41,120 Speaker 4: a long way to come, and the value of the 113 00:07:41,200 --> 00:07:45,400 Speaker 4: products was such that it was actually thought cheaper to 114 00:07:45,560 --> 00:07:52,080 Speaker 4: import refined products from Singapore and other Asian countries rather 115 00:07:52,160 --> 00:07:55,560 Speaker 4: than carry on with refining here. And of course by 116 00:07:55,560 --> 00:07:59,440 Speaker 4: that time it was some of it was forty to 117 00:07:59,480 --> 00:08:04,840 Speaker 4: fifty year years old, and these chemical engineering production processes 118 00:08:05,400 --> 00:08:11,440 Speaker 4: equipment doesn't last forever, so there was quite a maintenance 119 00:08:11,480 --> 00:08:15,320 Speaker 4: operation going on. So in the end, from an economic 120 00:08:15,360 --> 00:08:20,320 Speaker 4: sustainability point of view, they decided maybe we would shut 121 00:08:20,360 --> 00:08:28,280 Speaker 4: it down and import refined products. And that's another issue, 122 00:08:28,480 --> 00:08:33,080 Speaker 4: because it was decided not to mothball the plant, which 123 00:08:33,120 --> 00:08:36,360 Speaker 4: means to sort of shut it down, but put grease 124 00:08:36,480 --> 00:08:39,920 Speaker 4: on it and paint it and protect it so that 125 00:08:40,000 --> 00:08:43,320 Speaker 4: it could be used again. It was just decommissioned. It 126 00:08:43,360 --> 00:08:46,120 Speaker 4: was just shut down and that was it. So parts 127 00:08:46,160 --> 00:08:48,199 Speaker 4: of it have gone rusty and parts of it have 128 00:08:48,320 --> 00:08:51,480 Speaker 4: been sold off, and there's more other bits that are 129 00:08:51,559 --> 00:08:54,440 Speaker 4: possibly going to be sold from what I understand how 130 00:08:54,880 --> 00:08:57,920 Speaker 4: the government, I think Minister Shane Jones has been thinking 131 00:08:57,960 --> 00:09:04,280 Speaker 4: of re commissioning the refinery, but it would be very 132 00:09:04,320 --> 00:09:07,760 Speaker 4: difficult and very expensive to do, so there has been 133 00:09:07,800 --> 00:09:13,480 Speaker 4: a report to assess whether that's feasible or not. The 134 00:09:13,520 --> 00:09:16,600 Speaker 4: idea of being that in this day and age, with 135 00:09:16,760 --> 00:09:20,560 Speaker 4: all the geopolitical unrest and such like, we would have 136 00:09:21,320 --> 00:09:25,760 Speaker 4: more security if we produced more of our own fuels, 137 00:09:26,440 --> 00:09:31,720 Speaker 4: but that's unlikely to happen, I think. I think to 138 00:09:32,240 --> 00:09:36,480 Speaker 4: the cost it would be billions of dollars to renovate it. 139 00:09:36,679 --> 00:09:40,240 Speaker 1: In terms of the chat about making the area of 140 00:09:40,360 --> 00:09:44,160 Speaker 1: Marsden Point a special economic zone, how does that sit 141 00:09:44,240 --> 00:09:45,080 Speaker 1: with you, Ralph? 142 00:09:45,600 --> 00:09:48,560 Speaker 4: Yeah, well, again it's the company that's come up with 143 00:09:48,640 --> 00:09:52,599 Speaker 4: this concept and Minister Shane Jones has said, oh, this 144 00:09:52,720 --> 00:09:55,280 Speaker 4: could be a good idea, so he's got involved there 145 00:09:55,320 --> 00:09:59,080 Speaker 4: a bit to what decree, I don't know, but basically 146 00:10:00,160 --> 00:10:02,920 Speaker 4: it's saying, well, we've got all these resources, all these facilities, 147 00:10:02,960 --> 00:10:06,240 Speaker 4: how can we best utilize them? And so extra storage 148 00:10:06,360 --> 00:10:10,960 Speaker 4: is one they've talked about producing green hydrogen, which is 149 00:10:11,880 --> 00:10:16,840 Speaker 4: different hydrogen that comes from methane from natural gas, releases 150 00:10:17,120 --> 00:10:19,640 Speaker 4: emissions into the atmosphere carbon dioxide as part of the 151 00:10:19,679 --> 00:10:24,000 Speaker 4: producing hydrogen. Whereas green hydrogen, if you've got renewable electricity 152 00:10:24,200 --> 00:10:28,800 Speaker 4: to electrolyze the water and produce the hydrogen, then there's 153 00:10:28,840 --> 00:10:33,080 Speaker 4: no carbon emissions coming from that. They've there's a possibility 154 00:10:33,120 --> 00:10:39,240 Speaker 4: of doing that. Hydrogen as a fuel is debatable in 155 00:10:39,559 --> 00:10:42,800 Speaker 4: many ways at the moment, whether it be for cars 156 00:10:42,880 --> 00:10:47,920 Speaker 4: or trucks or planes. Technically possible, but is it energy 157 00:10:47,960 --> 00:10:52,079 Speaker 4: efficient to use all that electricity to produce hydrogen, store 158 00:10:52,080 --> 00:10:55,480 Speaker 4: the hydrogen to turn the hydrogen back into electricity, or 159 00:10:55,520 --> 00:10:59,920 Speaker 4: maybe use electricity directly for a car Obviously idiots makes 160 00:11:00,040 --> 00:11:03,000 Speaker 4: more sense than for an aeroplane, but green hydrogen is 161 00:11:03,040 --> 00:11:07,800 Speaker 4: a possible product that they could use. They could also 162 00:11:08,920 --> 00:11:14,199 Speaker 4: produce biofuels, their liquid fuels that could replace spetrol and diesel. 163 00:11:14,480 --> 00:11:20,479 Speaker 4: The IATA, the International Air Transport Association of All Airlines. 164 00:11:20,559 --> 00:11:24,000 Speaker 4: Air New Zealand being a strong member, has from some 165 00:11:24,200 --> 00:11:29,040 Speaker 4: years looked at sustainable aviation fuels and they've been analyzing 166 00:11:29,040 --> 00:11:31,559 Speaker 4: this to a great degree. United Era of Emirates I've 167 00:11:31,600 --> 00:11:33,720 Speaker 4: been involved with a little bit and they've been very 168 00:11:33,760 --> 00:11:37,559 Speaker 4: strongly supporting this and advocating for the concept, even though 169 00:11:37,600 --> 00:11:41,720 Speaker 4: they produce oil themselves. The IARTA have got nine different 170 00:11:41,760 --> 00:11:44,960 Speaker 4: technologies that they can that they've approved in order to 171 00:11:45,040 --> 00:11:50,480 Speaker 4: make these jetpul and one of them is through using 172 00:11:50,480 --> 00:11:51,280 Speaker 4: green hydrogen. 173 00:11:51,760 --> 00:11:53,479 Speaker 3: Another one, which. 174 00:11:54,960 --> 00:12:00,560 Speaker 4: Channel Infrastructure is now looking at in association with Zealand 175 00:12:00,800 --> 00:12:05,520 Speaker 4: and Scion, which was Forest Research Institute, is to convert 176 00:12:05,800 --> 00:12:09,680 Speaker 4: woody biomass waste from the forest, so you take out 177 00:12:09,720 --> 00:12:12,400 Speaker 4: the logs and then you're left with all the slash, 178 00:12:12,440 --> 00:12:16,360 Speaker 4: which is quite controversial at the moment and in Sweden 179 00:12:16,480 --> 00:12:19,600 Speaker 4: and the Austriaan whatever. And I've been advocating here for 180 00:12:19,679 --> 00:12:22,320 Speaker 4: many years too. We should be using that to chip 181 00:12:22,360 --> 00:12:23,319 Speaker 4: it up and turn. 182 00:12:23,160 --> 00:12:26,120 Speaker 3: It into heat and power. We can turn it into. 183 00:12:25,920 --> 00:12:29,679 Speaker 4: Electricity and it's very viable and it makes good sense 184 00:12:30,120 --> 00:12:31,599 Speaker 4: and it's low carbon. 185 00:12:31,520 --> 00:12:34,959 Speaker 1: But it's expensive though. Ralph is that where the special 186 00:12:35,000 --> 00:12:37,520 Speaker 1: economic zone can come in, we can get some overseas 187 00:12:37,559 --> 00:12:41,280 Speaker 1: investors in to invest in things like that. 188 00:12:41,120 --> 00:12:42,520 Speaker 3: That's exactly right. 189 00:12:42,600 --> 00:12:45,280 Speaker 4: I mean it's been done for heat and power for 190 00:12:45,360 --> 00:12:48,240 Speaker 4: decades in many countries, so it's not expensive. 191 00:12:48,360 --> 00:12:52,160 Speaker 3: If you've got the system in place, it can be competitive. 192 00:12:52,400 --> 00:12:55,880 Speaker 4: But if you've got going to sustainable aviation fuels, it's 193 00:12:55,920 --> 00:12:59,720 Speaker 4: a bigger process. It's a refining process, if you like, 194 00:12:59,720 --> 00:13:02,920 Speaker 4: of the woody biomass into liquid biofuels. And that's where 195 00:13:02,960 --> 00:13:08,480 Speaker 4: the economic zone could attract these investors for sure, which 196 00:13:08,480 --> 00:13:11,040 Speaker 4: of course is what government's got in mind as being 197 00:13:12,000 --> 00:13:15,960 Speaker 4: a good incentive to do so. And so the process 198 00:13:16,040 --> 00:13:19,040 Speaker 4: there or lansa Tech is a company which is involved, 199 00:13:19,080 --> 00:13:23,240 Speaker 4: which was originated in New Zealand some twenty years or 200 00:13:23,280 --> 00:13:26,760 Speaker 4: more ago from a PhD study which was looking at 201 00:13:26,840 --> 00:13:30,600 Speaker 4: bacteria to take emissions from steel mills and turn them 202 00:13:30,600 --> 00:13:33,400 Speaker 4: into ethanol, which is a liquid fuel. 203 00:13:33,480 --> 00:13:35,320 Speaker 3: You can run petrol cars on ethanol. 204 00:13:35,920 --> 00:13:40,200 Speaker 4: And that developed into a company and then that went international. 205 00:13:40,240 --> 00:13:42,160 Speaker 3: They've still got a research office in Auckland. 206 00:13:42,240 --> 00:13:46,360 Speaker 4: It was New Zealand innovation at its best and they 207 00:13:46,600 --> 00:13:50,920 Speaker 4: are now looking at jet fuels as a subsidiary company 208 00:13:50,960 --> 00:13:56,160 Speaker 4: of Lanthotech and Scion's been looking at producing ethanol from 209 00:13:56,559 --> 00:14:01,640 Speaker 4: woody biomass for decades and it's not I mean, when 210 00:14:01,679 --> 00:14:06,959 Speaker 4: I was producing biodiesel in nineteen seventies, Forest Research Institute 211 00:14:07,240 --> 00:14:11,920 Speaker 4: was looking at ethanol from woodchips and after twenty or 212 00:14:11,920 --> 00:14:14,560 Speaker 4: thirty years they sort of gave up. So it is 213 00:14:14,600 --> 00:14:16,960 Speaker 4: a challenge, but there's more development going on now. So 214 00:14:17,160 --> 00:14:23,480 Speaker 4: this is where this consortium is thinking that ideally Marsden 215 00:14:23,560 --> 00:14:29,720 Speaker 4: Point could be a world's leading center for producing sustainable 216 00:14:29,720 --> 00:14:34,200 Speaker 4: aviation fuels. What the volume is that they can produce 217 00:14:34,520 --> 00:14:39,400 Speaker 4: is probably enough for New Zealand, but on a global capacity, 218 00:14:39,880 --> 00:14:45,240 Speaker 4: it's a real challenge through substitute avgas aviation fuel for 219 00:14:45,920 --> 00:14:47,640 Speaker 4: sustainable aviation fuels. 220 00:14:48,080 --> 00:14:49,480 Speaker 3: But it's technically possible to do. 221 00:14:49,880 --> 00:14:53,160 Speaker 4: And even you can term municipal solid waste instead of 222 00:14:53,160 --> 00:14:56,920 Speaker 4: going into a landfill, you can turn that into sustainable 223 00:14:56,920 --> 00:15:01,280 Speaker 4: fuels as well. So there's great hope, great potential there, 224 00:15:01,760 --> 00:15:05,480 Speaker 4: but there is a challenge a on the chemistry beyond 225 00:15:05,480 --> 00:15:10,280 Speaker 4: the costs. See on having a regular supply, where would 226 00:15:10,320 --> 00:15:12,600 Speaker 4: all the wood chips come from? How do they get 227 00:15:12,640 --> 00:15:15,840 Speaker 4: to the refinery? Coastal shipping might be the answer to 228 00:15:15,920 --> 00:15:18,480 Speaker 4: that and rail as well that they've got to be 229 00:15:18,600 --> 00:15:23,520 Speaker 4: delivered there in large volumes, but it's certainly worth looking at. 230 00:15:24,040 --> 00:15:35,080 Speaker 1: Thanks for joining us, Ralph. The privately owned Marsden Point 231 00:15:35,360 --> 00:15:39,320 Speaker 1: was New Zealand's only fuel refinery until it was decommissioned 232 00:15:39,560 --> 00:15:43,400 Speaker 1: in twenty twenty two to become an import only fuel 233 00:15:43,480 --> 00:15:48,480 Speaker 1: terminal under the name Channel Infrastructure. CEO Rob Buchanan is 234 00:15:48,520 --> 00:15:55,480 Speaker 1: with us now to take us through what the future holds. Rob, 235 00:15:55,640 --> 00:15:59,840 Speaker 1: how much fuel flows through Marsden Point at the moment 236 00:16:00,080 --> 00:16:00,960 Speaker 1: and where does it all go? 237 00:16:01,440 --> 00:16:06,400 Speaker 2: Yeah, so it's around three billion or over three billion 238 00:16:06,480 --> 00:16:09,600 Speaker 2: liters a year of fuel that goes through the Marsten 239 00:16:09,680 --> 00:16:13,720 Speaker 2: Point import terminal system. And just to give you a 240 00:16:13,760 --> 00:16:19,840 Speaker 2: thumbnail sketch of how that works, our customers earth ships 241 00:16:19,920 --> 00:16:24,600 Speaker 2: at Marsden Point where their product is stored either petro 242 00:16:24,720 --> 00:16:28,280 Speaker 2: diesel and jet and a significant number of tanks that 243 00:16:28,320 --> 00:16:31,880 Speaker 2: we've got back three hundred million liters of storage on site. 244 00:16:32,080 --> 00:16:36,160 Speaker 2: Most product is ship down the pipeline to Auckland where 245 00:16:36,200 --> 00:16:39,800 Speaker 2: it is then distributed either to the Auckland and why 246 00:16:39,840 --> 00:16:42,440 Speaker 2: Cano region or in the case of jet, direct to 247 00:16:42,480 --> 00:16:46,240 Speaker 2: Auckland Airport and a small amounts are taken off at 248 00:16:46,240 --> 00:16:50,240 Speaker 2: our site to truckloading facility for distribution into Northland. 249 00:16:50,640 --> 00:16:55,160 Speaker 1: How might Marsden Point adapt towards I suppose a renewable 250 00:16:55,360 --> 00:16:57,760 Speaker 1: energy or sustainability in the future. 251 00:16:58,360 --> 00:17:00,760 Speaker 6: Great question. So there's a couple of things there. 252 00:17:00,880 --> 00:17:04,200 Speaker 2: I think the first for us is, you know, we 253 00:17:05,240 --> 00:17:09,439 Speaker 2: think that the future for decarbonization of aviation is sustainable 254 00:17:09,480 --> 00:17:13,639 Speaker 2: aviation fuel, which is dropping, which is to say that 255 00:17:13,720 --> 00:17:17,960 Speaker 2: it can flow through our infrastructure today. So as then 256 00:17:17,960 --> 00:17:24,120 Speaker 2: industry transitions from fossil jets to sustainable aviation fuel over 257 00:17:24,160 --> 00:17:27,280 Speaker 2: the next twenty thirty years, you know that product can 258 00:17:27,320 --> 00:17:30,199 Speaker 2: come straight through the masson Point I Bort terminal system 259 00:17:30,480 --> 00:17:34,119 Speaker 2: like it can today. One of the unique features of 260 00:17:34,200 --> 00:17:37,840 Speaker 2: our location and master point, and actually it's function in 261 00:17:37,880 --> 00:17:42,320 Speaker 2: our history, is we've got a very large landholding which 262 00:17:42,400 --> 00:17:45,879 Speaker 2: is consented for at least the next thirty five years 263 00:17:45,880 --> 00:17:51,560 Speaker 2: anyway for fuels manufacture. And so one of the significant 264 00:17:51,560 --> 00:17:55,959 Speaker 2: opportunities that we're exploring is renewable fuels manufacture on our 265 00:17:56,000 --> 00:17:56,600 Speaker 2: site as. 266 00:17:56,440 --> 00:17:59,560 Speaker 1: Well and all the infrastructures there for that. Or do 267 00:17:59,560 --> 00:18:04,240 Speaker 1: you need significant investment from government or say elsewhere under 268 00:18:04,240 --> 00:18:06,320 Speaker 1: a special economic zone, say. 269 00:18:06,840 --> 00:18:09,080 Speaker 2: Well, to be clear, we're not looking for investment from government, 270 00:18:09,280 --> 00:18:14,600 Speaker 2: so just to put that one to bead, but otherwise 271 00:18:14,640 --> 00:18:17,439 Speaker 2: the answer is yes to both. So yes, there is 272 00:18:17,440 --> 00:18:22,639 Speaker 2: a significant amount of infrastructure there by virtue of a 273 00:18:23,080 --> 00:18:28,200 Speaker 2: range of decommissioned refinery assets and refined product tanks which 274 00:18:28,240 --> 00:18:31,440 Speaker 2: are available for fuel storage and then the pipeline which 275 00:18:31,440 --> 00:18:34,840 Speaker 2: can ship that product to Auckland or indeed the gen 276 00:18:35,040 --> 00:18:39,000 Speaker 2: where it can be put into a boat and distributed elsewhere. 277 00:18:39,920 --> 00:18:42,679 Speaker 2: But also there is a significant amount of investment that 278 00:18:42,760 --> 00:18:48,480 Speaker 2: would be required by our partners ultimately to bring renewable 279 00:18:48,520 --> 00:18:51,879 Speaker 2: fuels manufacture to master points. So one of the projects 280 00:18:51,880 --> 00:18:55,800 Speaker 2: that we're working on with a consortium of international investors 281 00:18:56,000 --> 00:18:59,679 Speaker 2: is indeed repurposing some of the old refinery assets for 282 00:18:59,720 --> 00:19:01,520 Speaker 2: bio fuels production in New Zealand. 283 00:19:01,960 --> 00:19:03,720 Speaker 7: What's the goal with that? 284 00:19:03,840 --> 00:19:06,800 Speaker 1: So when we talk about biofuels, what would that then 285 00:19:06,880 --> 00:19:07,760 Speaker 1: be used for? 286 00:19:08,320 --> 00:19:11,959 Speaker 2: Yeah, So in relation to that particular project, in particular, 287 00:19:13,520 --> 00:19:18,800 Speaker 2: the main areas of focus renewable diesel or an alternative 288 00:19:18,800 --> 00:19:23,280 Speaker 2: to diesel, and obviously sustainable aviation fuel And just to 289 00:19:23,320 --> 00:19:27,320 Speaker 2: speak to both of those clearly, there is a pathway 290 00:19:27,440 --> 00:19:33,640 Speaker 2: for decarbonization of light transport and evs and adoption will 291 00:19:33,680 --> 00:19:36,840 Speaker 2: go up and down over time, but ultimately you know 292 00:19:36,920 --> 00:19:41,359 Speaker 2: that pathway is there. I think that the pathway for 293 00:19:41,440 --> 00:19:45,560 Speaker 2: heavy transport. And if you think about tractors on farms 294 00:19:46,520 --> 00:19:51,600 Speaker 2: getting milk from remote locations in New Zealand to manufacturing sites, 295 00:19:52,359 --> 00:19:55,080 Speaker 2: getting our products to export markets and getting them in 296 00:19:55,119 --> 00:20:00,520 Speaker 2: a boat and shipping them overseas, that's where renew diesel 297 00:20:00,600 --> 00:20:03,720 Speaker 2: is an opportunity to decarbonize that particular part of the 298 00:20:03,760 --> 00:20:07,479 Speaker 2: supply chain. The opportunity and aviation, as I spoke to before, 299 00:20:07,720 --> 00:20:09,840 Speaker 2: is sustainable aviation fuel. 300 00:20:10,080 --> 00:20:13,719 Speaker 1: In terms of sustainable aviation fuel, though, does the whole 301 00:20:13,760 --> 00:20:16,520 Speaker 1: world have to get on board for it to work? 302 00:20:16,920 --> 00:20:21,040 Speaker 2: Well, that's actually a great question. And so you know 303 00:20:21,080 --> 00:20:24,639 Speaker 2: that the most important point about sustainable aviation fuel is 304 00:20:24,680 --> 00:20:28,960 Speaker 2: that it's dropping. So where it wouldn't work is if 305 00:20:29,000 --> 00:20:33,919 Speaker 2: we couldn't use that fuel an existing jet turbine technology today. 306 00:20:34,119 --> 00:20:37,080 Speaker 6: So you know the most important thing is that it's dropping. 307 00:20:37,560 --> 00:20:40,159 Speaker 2: You can blend it with jet today and it can 308 00:20:40,200 --> 00:20:43,520 Speaker 2: go straight into the aircraft that any Zealand for example, 309 00:20:43,680 --> 00:20:47,399 Speaker 2: is fly around New Zealand or overseas, and so that 310 00:20:48,080 --> 00:20:52,440 Speaker 2: means that we don't have to wait for technology changes 311 00:20:53,280 --> 00:20:56,920 Speaker 2: at aircraft level, which I think, let's space, it would 312 00:20:56,960 --> 00:21:00,520 Speaker 2: take decades. We can actually get into the piece of 313 00:21:00,560 --> 00:21:06,280 Speaker 2: work now, and various countries are taking different or making 314 00:21:06,280 --> 00:21:10,760 Speaker 2: that adoption at different speeds. Certainly, you know Europe is 315 00:21:10,800 --> 00:21:14,639 Speaker 2: going faster than many other places. But actually some of 316 00:21:14,680 --> 00:21:19,360 Speaker 2: the major trading partners in Asia have sustainble aviation fuel 317 00:21:19,480 --> 00:21:21,119 Speaker 2: targets as well, like Japan. 318 00:21:21,480 --> 00:21:24,879 Speaker 1: And why isn't it happening you know, tomorrow then? Or 319 00:21:24,920 --> 00:21:26,800 Speaker 1: does it cost a lot of money? I know that 320 00:21:26,920 --> 00:21:31,520 Speaker 1: the recommissioning project was costed out at about four point 321 00:21:31,680 --> 00:21:34,720 Speaker 1: nine billion to seven point three billion. That was if 322 00:21:34,760 --> 00:21:39,120 Speaker 1: we made Marsden Point an oil refinery against say, obviously 323 00:21:39,200 --> 00:21:41,719 Speaker 1: that's a pipe dream, and that's probably are you are 324 00:21:41,720 --> 00:21:44,359 Speaker 1: you confident to say that that's actually never going to happen. 325 00:21:44,680 --> 00:21:48,240 Speaker 2: Yeah, Well, I think the government a significant piece of 326 00:21:48,280 --> 00:21:51,359 Speaker 2: work on the recommissioning of the refinery and found that 327 00:21:51,440 --> 00:21:55,879 Speaker 2: it was infeasible ultimately, so you know, it was permanently 328 00:21:55,960 --> 00:21:59,720 Speaker 2: decommissioned and our position hasn't changed on that. I think 329 00:22:00,160 --> 00:22:04,479 Speaker 2: that's the same aviation fuel piece. I probably distinguished between 330 00:22:04,520 --> 00:22:07,520 Speaker 2: the opportunity to manufacture it and onw Zealand at Master Point, 331 00:22:07,560 --> 00:22:10,679 Speaker 2: which we think is a fantastic opportunity, and the fact 332 00:22:10,680 --> 00:22:12,960 Speaker 2: that it can actually be brought into New Zealand by 333 00:22:12,960 --> 00:22:16,520 Speaker 2: a boat today and distribute it through our supply chain. 334 00:22:17,119 --> 00:22:20,120 Speaker 2: But you've landed on one of the key issues for adoption. 335 00:22:21,000 --> 00:22:24,480 Speaker 2: There's nothing cheap about decarbanization. We've seen it in the 336 00:22:24,480 --> 00:22:29,679 Speaker 2: electricity sector and that transition to renewal electricity. 337 00:22:29,040 --> 00:22:30,760 Speaker 6: And the impact that that's hand. 338 00:22:30,920 --> 00:22:35,240 Speaker 2: On electricity prices, and it's the same with the same 339 00:22:35,359 --> 00:22:41,320 Speaker 2: aviation fuel. It's as that technology gains traction and increasing 340 00:22:41,440 --> 00:22:44,119 Speaker 2: scale is built around the world and the manufacturer of 341 00:22:44,160 --> 00:22:47,320 Speaker 2: the sable aviation fuel, then the costs can come down. 342 00:22:47,440 --> 00:22:52,520 Speaker 2: But right now it's significantly more expensive than fossil jet today, 343 00:22:52,800 --> 00:22:57,119 Speaker 2: so the impact on is ultimately born by airlines or 344 00:22:57,160 --> 00:23:01,280 Speaker 2: customers for making that choice around substitution in between fossil 345 00:23:01,359 --> 00:23:03,600 Speaker 2: jets and statele aviation field. 346 00:23:05,960 --> 00:23:12,960 Speaker 7: Our investigating the re establishment of Marsden Point refinery. Sadly 347 00:23:13,680 --> 00:23:18,240 Speaker 7: we are left to gather the results of an awful 348 00:23:18,400 --> 00:23:23,159 Speaker 7: decision made over the last two years, and it's driven 349 00:23:23,400 --> 00:23:28,000 Speaker 7: served by a mixture of wokeism, a mixture of naivety 350 00:23:28,800 --> 00:23:34,640 Speaker 7: and an unwillingness to accept with our gas, with our fuel, 351 00:23:35,160 --> 00:23:39,000 Speaker 7: the nation will collapse. With New Zealand first in charge 352 00:23:39,040 --> 00:23:42,840 Speaker 7: of such an initiative, our resilience will prosper. 353 00:23:45,119 --> 00:23:49,119 Speaker 1: What's the future look like for Marsden Point, say in 354 00:23:49,160 --> 00:23:52,560 Speaker 1: the next ten years and then twenty years and so forth. 355 00:23:53,160 --> 00:23:55,120 Speaker 2: Yeah, Well, we put out I think, as you know, 356 00:23:55,320 --> 00:23:59,320 Speaker 2: the Marten Point Energy Precinct, which is our vision the 357 00:24:00,000 --> 00:24:04,720 Speaker 2: future at that site, and I'd summarize to you it 358 00:24:04,800 --> 00:24:06,880 Speaker 2: in a couple of ways. You know, we see it 359 00:24:06,920 --> 00:24:09,720 Speaker 2: as over the next ten to fifteen years as a 360 00:24:09,720 --> 00:24:14,200 Speaker 2: massive opportunity for energy security for New Zealand. And by 361 00:24:14,240 --> 00:24:17,439 Speaker 2: that I mean we've got the ability to store more fuel, 362 00:24:17,680 --> 00:24:22,119 Speaker 2: we've got the bility to manufacture biofuels at Marston Point, 363 00:24:22,720 --> 00:24:26,520 Speaker 2: noting that the feedstock for biofuels is domestic, so we 364 00:24:26,640 --> 00:24:33,240 Speaker 2: aren't subject to the geopolitical risks that come with international shipping. 365 00:24:33,800 --> 00:24:37,760 Speaker 2: And we are also working on some energy firming opportunities 366 00:24:37,800 --> 00:24:41,280 Speaker 2: as well, like peak electricity peaking and the like, And 367 00:24:41,320 --> 00:24:45,399 Speaker 2: so we think it's a real opportunity for an energy security. 368 00:24:44,920 --> 00:24:46,679 Speaker 6: Play in New for New Zealand. 369 00:24:46,720 --> 00:24:50,919 Speaker 2: In a world which is quickly becoming more geopolitically contested, 370 00:24:51,359 --> 00:24:54,959 Speaker 2: and we think it's a massive opportunity for Northland if 371 00:24:54,960 --> 00:24:57,320 Speaker 2: the Energy Precinct is built out. Just to how we 372 00:24:57,359 --> 00:25:00,560 Speaker 2: think it could be over the next ten, fifteen, twenty years, 373 00:25:00,880 --> 00:25:05,080 Speaker 2: it's twenty thousand construction jobs, it's twelve hundred jobs on 374 00:25:05,119 --> 00:25:07,800 Speaker 2: an ongoing basis, it's a quarter of a billion dollars 375 00:25:07,840 --> 00:25:12,800 Speaker 2: contribution to New zealergyp. You know, it's a massive opportunity 376 00:25:12,840 --> 00:25:15,480 Speaker 2: for New ZEALANDIC And if you think about some of 377 00:25:15,480 --> 00:25:19,359 Speaker 2: the the industrialization they were seeing around us with manufacturing 378 00:25:19,440 --> 00:25:23,920 Speaker 2: closing high energy prices, we've got the opportunity and to 379 00:25:24,480 --> 00:25:26,480 Speaker 2: lean into solving a couple of those things with the 380 00:25:26,560 --> 00:25:27,360 Speaker 2: Energy Precinct. 381 00:25:27,640 --> 00:25:30,560 Speaker 1: And in order for all of those things to happen seamlessly, 382 00:25:30,840 --> 00:25:33,640 Speaker 1: do we need a special Economic Zone? 383 00:25:33,840 --> 00:25:38,119 Speaker 2: Well, I think the SEZ, which you know the Associate 384 00:25:38,200 --> 00:25:43,639 Speaker 2: Minister for Energy announced back in February as something that 385 00:25:43,800 --> 00:25:48,240 Speaker 2: government was considering, is I think something that would speed 386 00:25:48,359 --> 00:25:52,360 Speaker 2: up the development of the Energy Precinct. So when we 387 00:25:52,400 --> 00:25:57,680 Speaker 2: talk to international investors and international capital providers, you know 388 00:25:57,800 --> 00:26:00,760 Speaker 2: they've got the choice to put the capital and their 389 00:26:00,840 --> 00:26:04,760 Speaker 2: IP and many locations around the world. We think master 390 00:26:04,920 --> 00:26:09,960 Speaker 2: points particularly unique location, but that especially kind of like 391 00:26:10,080 --> 00:26:11,280 Speaker 2: zone provides that. 392 00:26:11,520 --> 00:26:16,320 Speaker 6: Long term government endorsement or this being a place. 393 00:26:16,440 --> 00:26:22,240 Speaker 2: For energy security type projects, that international investors can feel 394 00:26:22,280 --> 00:26:26,719 Speaker 2: comfortable and safe about deploying capital into this area and 395 00:26:26,880 --> 00:26:30,760 Speaker 2: recovering that capital and returns which are very long dated. 396 00:26:31,240 --> 00:26:37,080 Speaker 1: And is anything happening at all? Our ministers just flocking 397 00:26:37,520 --> 00:26:40,280 Speaker 1: to Marsden Point to have a look around all of 398 00:26:40,320 --> 00:26:43,720 Speaker 1: a sudden, You've had three in the last few weeks. 399 00:26:46,800 --> 00:26:48,800 Speaker 6: Yeah, Look, we've got stuff happening right now. 400 00:26:48,840 --> 00:26:51,240 Speaker 2: So we're in the process of building what will be 401 00:26:51,880 --> 00:26:55,440 Speaker 2: or converting an old crud teak from the refinery turned 402 00:26:55,480 --> 00:26:59,480 Speaker 2: to what will be New Zealand's equal largest jet tech 403 00:26:59,680 --> 00:27:03,400 Speaker 2: form of our customers and energy and that that tank 404 00:27:03,440 --> 00:27:05,960 Speaker 2: SIT's next to the other largest tank jet tank in 405 00:27:06,040 --> 00:27:08,320 Speaker 2: New Zealand and. 406 00:27:08,280 --> 00:27:10,040 Speaker 6: So that's being developed at the moment. 407 00:27:10,400 --> 00:27:15,120 Speaker 2: It's got a number of innovations which will help provide 408 00:27:15,560 --> 00:27:19,199 Speaker 2: additional product quality, which is obviously credibly important for a 409 00:27:19,240 --> 00:27:23,760 Speaker 2: product like jet. We've actually commenced construction for a new 410 00:27:23,800 --> 00:27:28,080 Speaker 2: Bitchamen import terminal for one of our new customers, Higgins, 411 00:27:29,080 --> 00:27:33,480 Speaker 2: and so that's going to involve building a new Bitchumen 412 00:27:33,600 --> 00:27:38,480 Speaker 2: import line onto our wool for jety storage and distribution facility, 413 00:27:38,920 --> 00:27:43,359 Speaker 2: and noting the government's policy around roads at national significance 414 00:27:44,160 --> 00:27:48,680 Speaker 2: and the fact that they're looking at significant investment in roading. 415 00:27:48,359 --> 00:27:50,000 Speaker 6: In Auckland and north of Auckland. 416 00:27:50,680 --> 00:27:54,600 Speaker 2: The next nearest Bitchmen import terminal is in port A Tower, Honor, 417 00:27:54,800 --> 00:27:57,680 Speaker 2: so you know it will be an incredibly important and 418 00:27:57,840 --> 00:28:02,000 Speaker 2: valuable a set for the delivery of those things. So no, absolutely, 419 00:28:02,119 --> 00:28:05,120 Speaker 2: we're kind of full flight right now, get it on with. 420 00:28:05,119 --> 00:28:05,919 Speaker 6: Some of these things. 421 00:28:06,080 --> 00:28:11,480 Speaker 1: Thanks for joining us, Rob, Thank you very much. That's 422 00:28:11,520 --> 00:28:14,640 Speaker 1: it for this episode of The Front Page. You can 423 00:28:14,680 --> 00:28:18,560 Speaker 1: read more about today's stories and extensive news coverage at 424 00:28:18,640 --> 00:28:23,080 Speaker 1: enzdherld dot co dot nz. The Front Page is produced 425 00:28:23,119 --> 00:28:26,800 Speaker 1: by Jane Ye and Richard Martin, who is also our editor. 426 00:28:27,320 --> 00:28:31,680 Speaker 1: I'm Chelsea Daniels. Subscribe to The Front Page on iHeartRadio 427 00:28:31,840 --> 00:28:35,280 Speaker 1: or wherever you get your podcasts, and tune in tomorrow 428 00:28:35,400 --> 00:28:37,360 Speaker 1: for another look behind the headlines.