Mobil attacked by Minister at signing of agreement

Press, 13 February 1982, Page 1

Mobil attacked by Minister at signing of agreement

PA

Wellington

The Minister of Energy, Mr Birch, said last evening that Mobil oil company had erred and made a wrong political judgment when it refused to commit itself to the Motunui synthetic gasoline plant until after November’s General Election.

He made his surprise attack on the Government’s partners when signing the formal documents sealing agreement on the plant. Mr Birch said Mobil “made a political judgment which'was inappropriate in a country such as New Zealand.” He said Mobil’s' decision was a personal disappointment. “This county works a Westminster style of Government and the multinationals should understand that and be prepared to deal with the government of the day,” he said. Mr Phil Marriot, Mobil’s managing director in New Zealand, said he disagreed with Mr Birch’s remarks, but said the issue was now over. The signed agreement bound each party to going ahead with the project, subject to the Planning Tribunal’s consent and the completion of financial arrangements. Ownership of the plant will be held by the New Zealand Synthetic Fuels Corporation, the Government, and Mobil. The estimated cost of the

project, in mid-1980 values and according to Mobil, is $767 million. . The aim of the plant is to convert natural gas into gasoline. The formal signing marked the end of months of negotiations for the controversial project which Mr Birch believes is of “tremendous importance” to New Zealand. The plant is one of the main projects in the Government’s growth strategy and is designed to reduce New Zealand’s dependence on imported fuel. Mr Birch said yesterday that the Opposition’s criticism of the plant again demonstrated the lack of a coordinated energy policy in the Labour Party. Arguments put forward by the Labour spokesman, Mr R. J. Tizard (Otahuhu), did not stand up to scrutiny, he said. “The annual production of 600,000 tonnes of petrol a year from the plant will help to lift New Zealand’s selfsufficiency in liquid fuels from 10 per cent to the Government’s objective of 50

per cent oy the end of the decade,” he said. “No other course open to us will achieve this objective so quickly.” It would be a big error not to proceed with the project, Mr Birch said. The price of $767 million (in 1980 dollars) was based on firm bids. The price would increase with inflation, “but it will also increase the benefits to New Zealand.”