Synfuel, refinery to save N.Z. $300M?

Press, 21 July 1986, Page 9

Synfuel, refinery to save N.Z. $300M?

PA New Plymouth Taranaki’s synthetic petrol plant at Motunui and the Marsden Point expanded oil refinery will lower petroleum product imports to New Zealand by $3OO million this year, says the Institute of Economic Research. This estimate, which the institute said was very approximate, is contained in a letter to the Opposition spokesman on energy, Mr A. P. D. Friedlander (New Plymouth).

Mr Friedlander had asked the institute to quantify the effects of the synfuel plant and the re-

finery expansion on New Zealand’s balance of payments.

The institute estimated the balance of payments would also be improved by $2OO million now that energy projects were complete and imports no longer required for them. However, the institute’s director, Dr D. G. Mayes, said he was reluctant to announce a $5OO million saving for 1986-87. “The figures are probably only accurate within $5O million. They are only partial figures — making no allowance for financial flows associated with them as capital projects,”

Dr Mayes said. “They do not take any account of the effect on the exchange rate — a saving of $3OO million would be enough to contribute to a higher rate of exchange,” Dr Mayes said.

Mr Friedlander said the letter clearly supported the case he had been making about the benefits to New Zealand of the projects. “The institute’s letter is a damning blow for Mr Roger Douglas’s attempts to discredit ‘think big’ by claiming the projects are a drain on the nation’s economy,” he said.