Q1 Conversion Project Update

channelnz.com


NZX RELEASE

13 April 2022

Q1 Conversion Project Update
Channel Infrastructure (CHI), New Zealand’s largest fuel import terminal business based at Marsden Point in
Northland, has today released its inaugural quarterly conversion project update for the three months ended
31 March 2022 (Q1 FY22).

Channel Infrastructure commenced operations as a dedicated fuels import terminal business on 1 April 2022.
Over the next 12 months work will be undertaken to decommission the refinery, transition the workforce and
commission the contracted private storage, and these quarterly updates will provide an update on progress.

Key conversion project highlights for Q1 FY22 include:
• Completed refinery shutdown safety and to plan, despite challenges of COVID in the community
• Successfully commenced import terminal operations on 1 April 2022
• Intensive on-going programme of transition support for our workforce
• Conversion costs tracking to plan, with $20 million spent to 31 March 2022

CEO Naomi James said “Following the safe shutdown of the refinery and completion of a number of
conversion projects, we have successfully commenced operation of New Zealand’s largest fuel import
terminal at Marsden Point. Our conversion project and private storage projects remain on-plan and to
budget.”

Refining NZ completed the shutdown of its refinery in late March safely and to plan, despite the challenges of
operating with COVID in the community. The shutdown was completed with continued excellent safety
performance with no Tier 1 or Tier 2 process safety incidents and one recordable personal safety incident
(our first lost time injury in over two years). Following the successful completion of a number of conversion
projects, including fuel additive dosing facilities and linework modifications for imports, Channel Infrastructure
began operations as a dedicated fuels import terminal on 1 April 2022. The long-term Terminal Services
Agreements with customers bp, Mobil and Z Energy also commenced on 1 April 2022. Channel
Infrastructure has successfully received fuel from three vessels since that time.

Following the shutdown of the refinery, two months of intensive site works to decommission refinery assets
which include steaming and chemical decontamination of the refining plant, catalyst removal, and flushing
and draining of plant and linework has now commenced. These 24/7 decommissioning activities are
expected to complete around the end of May, with decommissioning activities continuing as day-works
following that time. Private storage tanks not requiring conversion work are already in operation, while a
range of works are planned or underway to bring other private storage tanks into operation with
commissioning scheduled through 2022 and H1 2023.

The refinery workforce transition will occur progressively over the coming year, as transition and
decommissioning work is completed. Focused on supporting people through this major transition, Channel
Infrastructure has committed to and set a target, as outlined in our Sustainability Report released last week,

channelnz.com
to have at least 90% of employees who are seeking new employment find new roles or be retraining within
six months. An intensive programme of transition support is now well underway with personal transition
plans, career counselling, access to training and development and support to find new jobs.

Conversion costs are tracking to plan ($200-220 million of conversion costs and $45-50 million for private
storage over 5-6 years), with $20 million spent to 31 March 2022. Net Borrowings reduced $11 million from
year-end to $173 million as at 31 March 2022 reflecting the sale of carbon units, above fee floor processing
income and lower refinery maintenance spend.

- ENDS -

Authorised by:
Chris Bougen
General Counsel and Company Secretary

Investor Relations contact:
Anna Bonney
investorrelations@channelnz.com

Media contact:
Laura Malcolm
communications@channelnz.com
+64 21 02363 297

About Channel Infrastructure NZ
Channel Infrastructure is New Zealand’s leading fuel infrastructure company.
Channel Infrastructure owns critical infrastructure, supplying the Northland and Auckland markets, which
make up 40% of New Zealand’s fuel demand and all of the jet fuel to the Auckland International
Airport. Utilising the deep-water harbour and jetty infrastructure at Marsden Point, as well as 280 million
litres of storage tanks, and the 170-kilometre pipeline from Marsden Point to Auckland we receive, store, test
and distribute fuel owned by our customers. Channel Infrastructure’s wholly-owned subsidiary, Independent
Petroleum Laboratories, provides quality fuel testing services at Marsden Point and around New Zealand.
Channel Infrastructure is well positioned to support New Zealand’s changing future fuel needs, with growth
opportunities at the Marsden Point site including additional fuel storage to support fuel security, renewable
electricity supply through the Maranga Ra solar project, and work underway with customers and partners on
biofuel and hydrogen opportunities.
For more information on Channel Infrastructure, please visit: www.channelnz.com