17 Apr 2012

Company seeks support for Marsden Point expansion

2:09 pm on 17 April 2012

New Zealand Refining is holding shareholder meetings around the country this week briefing investors on the biggest expansion project at Marsden Point since the 1980s.

The company's directors want to spend $365 million replacing old equipment in order to increase the capacity of the country's only oil refinery, near Whangarei.

They require at least 50% shareholder approval at the annual general meeting at the end of next week.

Chief executive Ken Rivers says the company's in a good position to expand again after successfully completing two sizeable upgrades in recent years.

He says the loans for those upgrades have been repaid, and banks are keen to lend again for the new project.

The refinery expansion would create 300 jobs in Whangarei over the three- to four-year construction phase.

The major oil companies own 73% of New Zealand Refining and their representatives have 70% of the seats at the board table but Mr Rivers says majority shareholder support is not a foregone conclusion.

Shareholders Association chairman John Hawkins says it will support the upgrade plans, and he thinks retail shareholders will accept some short term reduction in returns in order to gain significant long term benefits.