New Zealand Pipeline Leak Worse Than Expected

Oscar PerrySep 19, 2017

Air New Zealand Ltd said on Monday it was forced to cancel several flights out of the city of Auckland, disrupting the journeys of about 2,000 passengers, after a fuel pipeline shutdown stopped airlines from refuelling. However, closer inspection has shown that the damaged section needs to be replaced.

Virgin's trans-Tasman services departing Auckland and diverting to Wellington Airport or Christchurch Airport, causing delays of up to two hours for flights departing Australia.

It said the leak meant fuel supplies at Auckland airport were down to 30 percent of normal capacity and some long-haul flights were having to make additional refuelling stops in Brisbane and Fiji.

Refining NZ which owns the pipeline said it could take 10 to 15 days to fix.

So far, all of the cancelled flights have been domestic, with inbound global flights diverting to other NZ airports to refuel before touching down at Auckland, or tapping some of the supply that is getting to the airport.

"It's been made very clear to all of those working on this that the government will commit whatever resources and effort are required to get this sorted out as quickly as possible with a minimum of disruption", Energy Minister Judith Collins said in a statement.

"Our team is now preparing for this work", the company said Monday.

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"The refinery is still operating, meaning fuel is still being produced and shipped around the country, supplemented by fuel imports as per usual", it said.

The New Zealand government, which faces an election on Saturday, came under pressure to intervene amid concerns of a shortage of motor fuel.

Auckland Airport's ASX-listed shares were up 1.91 per cent to $5.88 on the news.

"The fuel companies are confident that supply of these fuels will be maintained and it is unlikely that motorists will be inconvenienced", she says.

A breakdown in the supply of jet fuel to Auckland Airport will increase the demand for refuelling aircraft at Wellington Airport.

"Market-based reforms, including fair and reasonable access to on-airport jet fuel storage and distribution systems, are necessary to enable effective competition between suppliers and support reliability and industry resilience".

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