Marsden Point

Marsden Point refinery

Marsden Point Refinery –a long history

Hector Thorpe

President, Auckland Branch Local 13

There was a time when New Zealand nation relied on our historical ties with the United Kingdom for all our shipping needs, imports, and exports.

We were dependent for our fuel supply, for example diesel for our trucks, tractors and industry, petrol for our cars, aviation fuel for our planes and light and heavy fuel for our heavy industry and maritime industry. This reliance on other countries had a negative effect in many areas.

The Unions that now make up the Maritime Union of New Zealand had a big influence in changing this situation. The Federated Seamans Union of Australasia successfully campaigned for New Zealand oil tankers to transport fuel around our country as early as 1927. We have served the coast effectively, efficiently and with an impeccable safety record ever since.

The Labour Government of PM Walter Nash began the momentum to construct our own oil refinery at Marsden Point near Whangarei, a huge undertaking which was officially opened in 1964.

A new and larger New Zealand manned oil tanker MV Athol Viscount was also brought on to cater for the extra capacity required. Such was the success of the Marsden Point refinery, it has been expanding ever since.

During the first global oil shock in 1973, crude oil prices rose. New Zealand was able to cushion the blow to retain reasonable security of supply. A similar situation occurred when the Iranian revolution in 1979 led to another oil shock.

Expansion of the refinery continued with the building of a 170 km fuel pipeline direct to Auckland, freeing up the tankers to serve the rest of the country. The Auckland pipeline takes petrol, diesel and jet fuel via pumping stations along the way, up to 400,000 litres per hour. The pipeline was ruptured in 2017 after an excavator damaged the pipeline on a rural property near Ruakaka. This led to jet fuel shortages and flight cancellations at Auckland.

New Zealand coastal tankers serving the rest of the country were scrambled to assist with supply. This was not a quick fix as turning around tankers, including cleaning tanks and loading fuel, takes valuable time. The tanker berth at Auckland has been decommissioned indefinitely and taken over for the Viaduct and Americas Cup campaign. How this affects our fuel security is an interesting question.

Refining New Zealand

Marsden Point has long been a politically sensitive zone. The Petroleum Sector Reform Act in 1988 deregulated the petroleum industry, with the usual story of job losses and assets transferred by the Government to global business interests. Shell, Mobil, BP and Chevron (Caltex) known collectively as ‘Refining New Zealand’ received $80 million from the Government to enable the company to adapt to the new environment.

Fast forward to now and returns from the refinery are not doing well. Refining NZ announced a ‘strategic review’ to improve returns to shareholders and hired Santos executive vice president Naomi James as the new CEO of Refinery NZ.

Who is Santos?

Santos stands for South Australia, Northern Territory Oil Search, Australia’s second-largest oil and gas producer. The Offshore Alliance unions including the MUA allege Santos found enough spare cash last year to pay their CEO $11.26 Million, but now want to stand-down their interstate workforce without pay if they don’t accept a forced transfer to Western Australia.

The Offshore Alliance have filed a dispute in the Fair Work Commission, so new CEO Naomi James comes across the ditch with some baggage. Refining NZ claim her prior experience in strategy development, operations and ‘change management’ will be hugely beneficial to their strategic review to improve returns to shareholders.

(continued overleaf)

For workers this means buckle up and get ready for the worst, as the assumption is corporate success should benefit only shareholders, regardless of whether this hurts workers and their families, their communities and our economy as a whole.

Union involvement in the refinery

FIRST Union says Refining NZ has advised that at least 90 per cent of the 1100 Northlanders whose jobs depend on the Marsden Point oil refinery will lose their jobs if it switches to importing refined fuel. Another 2400 workers outside the region that supplied services to Marsden Point would also be impacted if refining ceased.

FIRST Union represent most of the Marsden Point oil refinery workers. FIRST traces its origins back to the formation of the militant National Distribution Union. The NDU was formed by amalgamation in the 1980’s of drivers, warehouse and retail unions.

Later the NDU merged with the finance sector union FinSec. In 2011 FinSec and the National Distribution Union merged to form FIRST Union which continues as a bona fide, progressive union, affiliated to the New Zealand of Council of Trade Unions.

FIRST Union is currently faced with supporting their members who face job losses at Marsden Point. (It’s a small world regarding New Zealand trade unions. FIRST Union Secretary (Retail, Finance & Commerce Division) is Tali Willams, daughter of MUNZ Wellington Branch President Mike Williams. Also, one of FIRST Union’s Auckland organizers is Grahame “Coach” McKean, a respected ex MUNZ waterfront battler and executive member.) MUNZ and other maritime unions have a tradition of more than 90 years of supplying seafarers, catering, officers, engineers and young trainees for the shipment of petroleum products around the coast on the Kiwi oil tankers now via Marsden Point Oil Refinery.

The restructure or closing of Marsden Point to a storage facility and reverting back to a lack of fuel security, and control to foreign operators, is alarming. Possible job losses will have an effect on workers, their families, their communities, their region and our country.

Marsden Point Strategic Review update – May 2021

Information is appearing about Refinery NZ’s plans for the future including advocating for an energy strategy, as proposed by the Climate Change Commission. For example, dusting off 2019 plans for a massive solar farm. A storage facility to handle fuels of all types, including sustainable aviation fuels and liquefied natural gas, has also been investigated.

The front runner appears to be a proposal to convert Marsden Point to an import terminal, importing prerefined fuels and supplying using existing infrastructure like the Auckland Pipeline and presumably the continuation of coastal tankers. The largest shareholders BP, Mobil and Z Energy as still in negotiations with Mobil and Z Energy, which took the refinery to court last year.

As of May 2021, Z Energy says it expects to complete negotiations on the future of the Marsden Point oil refinery, since it has returned to profit, despite a huge slide in the amount of fuel it sold during the year to the end of March 2021. Refining NZ has reached an inprinciple agreement with BP. Ultimately it appears to be subject to approval of Refining NZ’s non-customer shareholders.

munz Online www.munz.org.nz

New conviction shows health and safety crisis in the waterfront industry

The negligence of stevedoring employer ISO led to the death of a young woman employee.

Shannon Brooke Rangihuna-Kemp, 29, an ISO Limited stevedore worker at Eastland Port in Gisborne, died from crush injuries after she was hit by a log that fell from a trailer load she was about to scan in a “tally lane” on 8 October 2018.

ISO Limited were convicted and ordered to undertake significant health and safety improvements earlier this year in the Gisborne District Court.

Harrowing statements were made to the Court by family members whose lives had been shattered by the death of a loved daughter and mother.

Maritime Union National Secretary Craig Harrison says that he has no faith that the outcome of the case would stop more deaths happening. “Preventable deaths and injuries occur, convictions happen, the employer gets told off in court and makes some temporary changes, they are absorbed as a business cost, and then the old speed ups and bad practices come back, and then another death.”

Mr Harrison says until corporate manslaughter is used to put individual responsibility on managers and Boards, then nothing would change. He says the Union message is simple: “Kill a worker, go to jail.”

Maritime workers had already been shaken by the deaths of two workers at the Ports of Auckland since 2018, and health and safety issues needed a national response with the involvement of the industry stakeholders.

Mr Harrison says these tragedies were happening to young, working class people and it seemed their lives did not have the same value as others.

Rather than being fined, ISO had been ordered through a Court Ordered Enforceable Undertaking (COEU) to improve health and safety to a cost of $800,000. Mr Harrison says while MUNZ is not opposed in concept to COEU in this case it was not an appropriately severe sentence.

He says ISO had killed a worker through negligence and were now simply being made to comply with health and safety laws: the same laws that would have protected Ms Rangihuna-Kemp if they had been adhered to.

Mr Harrison says it was staggering the company’s lawyers had argued the company should be discharged without conviction, and had suggested a $20,000 reparation payment to the family was appropriate, on the basis some payments had already been made.

It was an indication of the real attitude of ISO management, he says.

Judge Recordon ordered a payment of $100,000 to the family for emotional harm. A Worksafe investigation uncovered numerous routine hazards in the work area where the death occurred that ISO knew about, but failed to take steps to fix.

Worksafe stated the death was the result of systemic fundamental failure to protect workers – and came less than a year after ISO was subjected to an enforceable order after a worker fell from a ladder on a ship in the Port of Tauranga.