(May 6): New Zealand is looking at storing fuel in Singapore and Malaysia, a senior government minister said, as the impacts of the Iran war expose the risks from its limited domestic storage capacity.
“We don’t have surplus storage capacity in New Zealand,” Resources Minister Shane Jones said in an interview. “We do have options and officials have explored the capacity for us to store fuel offshore. One of the options we have been advised about is Malaysia and Singapore.”
New Zealand lost a vast portion of its fuel storage capacity when its only refinery at Marsden Point north of Auckland closed in 2022. The area around Singapore and southern Malaysia is a major fuel refining and storage hub for Asia.
The outbreak of the Iran war and the closure of the Strait of Hormuz have pressured Asia as the region relies heavily on oil and gas from the Middle East. That’s set off a scramble among nations to lock up supplies and seek assurances of steady supplies.
Last month, New Zealand Prime Minister Christopher Luxon’s government contracted Channel Infrastructure NZ Ltd, which operates a fuel import terminal at the former refinery site, to recommission tanks for diesel storage. It also announced a deal last week with Z Energy — a unit of Australian fuel company Ampol Ltd — to secure an additional nine days of diesel supply. And it’s assessing whether additional jet fuel supplies may be needed.
Jones said the idea of overseas storage was raised during talks with Z Energy as a way to create a further buffer. “Officials are pursuing those options as we speak,” he said.
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The minister’s comments come two days after Singapore and New Zealand signed a deal to strengthen supply chain resilience and safeguard the flow of critical goods such as food and energy.
New Zealand government data Wednesday showed fuel stocks have declined slightly, with less than 50 days of demand cover for gasoline and diesel. New Zealand operates a four-phase fuel security system that can be activated if shortages loom. The country is currently at phase 1, which involves monitoring global developments.
Jones said he hadn’t been advised that a shift to a higher phase was imminent.
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Finance Minister Nicola Willis is expected to outline later this week what restrictions under phases 3 and 4 would mean in practice, following requests for greater clarity from the commercial sector, he said.
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