27 Oct 2011

Supermarket shortages because of gas leak

7:15 pm on 27 October 2011

Business throughout the country are warning of delays and shortages in supply because of the Maui gas pipeline leak.

The two main supermarket chains, Foodstuffs and Progressives, say there will be nationwide shortages in basic food products, because suppliers have been shut down by the gas shortage.

Ian Greenshields of Goodman Fielder, which produces about half of New Zealand's bread, says its bakeries will be operating again in the next 24 hours but in the meantime consumers will have to deal with shortages.

The part-owner of Skellern's Metal Casting, Steven Welburn, says his and other foundries have had to drastically slow down production because they can't use gas to melt metal.

The New Zealand Institute of Economic Research says all the delays and shortages could be costing the economy anywhere from $40 million to $175 million a day.

About 1000 small businesses have had the green light to turn their gas back on, but many big businesses in the upper North Island still have their doors shut because of the fault.

The company that maintains the pipeline, Vector, says it could take three more days to repair the crack that appeared in it near New Plymouth on Monday.

Steve Bielby, chief executive of the gas industry regulator, GIC, says that thanks to conservation efforts by residential customers, businesses like shops and cafes, can start using gas again.

Hospitality New Zealand's Auckland branch says the news comes as a huge relief to its members, some of whom had started to cut back staff hours.

'Keep it up' - minister thanks residential users

The acting Minister of Energy and Resources, Hekia Parata, is urging New Zealanders who have cut back on gas to continue to do so.

Ms Parata says the efforts already made by those customers have helped the situation and are really appreciated.

"We encourage them to continue making those savings," she says, "because in doing so it has allowed us to bring back on these small-business users."

Repair job could take up to three days

Meanwhile, Vector says progress at the repair site - in the White Cliffs area of New Plymouth - is good, though the weather is posing a challenge.

It estimates the repair job, including welding, testing and certification, will take up to to three days unless unforeseen issues arise.

Vector chief executive Simon McKenzie told Checkpoint excavations have been completed and the cracked section of pipe cut out.

He says cameras have to be sent along the pipeline to check for any other damage and testing carried out, at the same time as a new section of pipe is being manufactured.

Mr McKenzie says that even after the repair job is complete customers will have to wait a bit longer before full services can be restored.