Closing Marsden Point oil refinery would dramatically reduce fuel supply, could cause immediate price rise - experts

Workers at the Marsden Point refinery are warning if their plant closes New Zealand could face petrol shortages.

Shareholders will vote on Friday on shutting down the refinery, with 500 jobs at risk.

Aaron Holroyd has worked at Marsden Point, the country's only oil refinery, for the past 35 years. 

He says its closure would be a foolish move and a tragedy. 

"You're looking at 500 staff gone and probably 500 more in the community gone," he told Newshub. 

On the cusp of retirement, he's more worried about what closure would mean for the country's fuel supply. 

He said relying solely on imported fuel from Asia would leave New Zealand at risk of running out.

For refinery worker Greg Ventnor this is deja vu - he worked for a BP refinery in Brisbane that was shut in 2015.

Marsden Point.
Marsden Point. Photo credit: File

Ventnor is concerned Kiwis and the Government don't realise how crucial onshore refining is. 

"If there's a conflict or diplomatic spat we're at risk," he said. "NZ's fuel crisis starts right here right now. 

"It's actually vital that we keep that open for national fuel security and don't become entirely dependent on Asia."

Expert advice warns the Government that a closure of the refinery would dramatically reduce fuel supply nationwide. 

The advice says New Zealand relies solely on imported fuel from North Asia and any international issues could wipe half of the country's supply overnight - and cause the price of petrol to rise almost immediately. 

The Ministry of Business, Innovation and Employment (MBIE) says that scenario is "very unlikely, as all trade routes would have to be cut off at the same time". 

"We can source fuels from multiple refineries in multiple locations to minimise supply risks," MBIE says.

Closing Marsden Point oil refinery would dramatically reduce fuel supply, could cause immediate price rise - experts
Photo credit: Getty Images

But the workers Newshub spoke to are warning that risk isn't one worth taking. They want shareholders to vote against the refinery's closure at a shareholder meeting in Auckland on Friday.

"Vote no. Don't throw away a billion-dollar business because we've had two years of COVID," Holroyd said.

"I think sometimes you've gotta put the national interest first and the national interest would be to keep that refinery open," Ventnor added. 

Seventy-five percent of shareholders have to vote in favour of the shutdown for it to happen. Major shareholders Z Energy and BP, which own 25 percent, have already agreed to it.