New Zealand Refining

There is only one oil refinery in New Zealand, which is run by the New Zealand Refining Company. The oil refinery is called Marsden Point Oil Refinery and is situated in Marsden Point, Whangarei, Northland, New Zealand.

This oil refinery came into being as a result of the growing demand for petrol as well as petroleum related products. The Nash Labor government began exploring the possibility of building an oil refinery in New Zealand. The location at Marsden Point was ideal for such an oil refinery because it is found next to a deep water port, it has a large expanse of flat land, there is a very low occurrence of earthquakes and is conveniently close to the most populated areas of the North Island.

The construction of the refinery started in 1962. A large portion of the New Zealand Government provided the initial NZ?10 million budget that was needed for the construction of the refinery. It was finally opened for operation on 30 May 1964.

In the year 1973, the government approved an expansion of the refinery, which included adding a fluid catalytic cracker to it. The cost was an estimated NZ$160 million. Later in the same year, the first global oil shock occurred, started by the Yom Kippur War. This raised the price of crude oil from US$3 to approximately US$20 per barrel. New Zealand was, remarkably, unaffected and kept a reasonably secure supply of crude oil.

The next global oil shock took place in 1979 as a result of the Iranian revolution. This also sent the price of oil sky rocketing again. But this was only a catalyst in a further expansion of New Zealand refining. The cost was an estimated $320 million, and included a hydrocracker which was an improvement on the previous fluid catalytic cracker.

In 1981, this next step of expansion began. The government also approved a 170km pipeline to Wiri in South Auckland. A workforce of 5,000 was needed for the expansion, which has its estimated cost rise from $320 million to $1.55 billion. There were many strikes that occurred during this project and these strikes led to the Refinery Expansion Projects Dispute Act being introduced in New Zealand by the Muldoon government. The refinery had to shut down in 1985 for some maintenance work, and the project was finally completed a year late in 1986. It was two years behind schedule and the final cost was a remarkable $1.84 billion.

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