Union fears more job losses at Refining NZ in Northland

First Union fears more than 90 people could lose their jobs at Refining New Zealand as demand for fuel plummets. Photo / John Stone

A union representing the bulk of unionised members at Refining New Zealand fears the eventual job losses could be more than the 90 currently earmarked as the company scales back production.

The country's only oil refinery, at Whangārei's Marsden Pt, posted an annual loss of $198.3 million due to a glut in fuel supplies globally, combined with the impact of Covid on refinery output, pipeline fees and plummeting demand for fuel.

The refinery's management is looking at converting it to an import terminal only and the earliest this could be done is next year, only after agreement is reached with all customers on that model.

First Union currently has about 180 members directly employed by the refinery but 30 are set to be made redundant next month.

There are a few more working for companies contracted to the refinery.

The 90 to be made redundant by the end of April are full-time employees.

"Judging by the narrative the refinery is creating, there's likely to be more job losses coming. They are putting a lot of info out to soften the blow in terms of moving to an import terminal," First Union manufacturing and transport secretary Jared Abbott said.

Refinery spokeswoman Ellie Martel didn't say whether the number to be made redundant could exceed 90 but said there were plans to bring in an additional 300 to 350 contractors to complete maintenance work.

Last year, she said the refinery announced about 100 jobs would be lost as a result of refocusing the refinery to supply Auckland and Northland, but it ended up being 90 jobs.

E tū has 20 members at the refinery and union organiser Annie Tothill said the company would need minimum staff if it converted to an import fuel terminal as it would receive fuels and pass them on.

"What next for Northland? It would leave a huge gap because the refinery is also a training ground and a platform by which people can take their skills offshore. It's had a status.

"We're not getting any direct information from them but our members are noticing things and they don't think they have a long-term future there," she said.

Ruakākā Economic Development Group chairman Peter Batten said there would be a lot of potential impact with more job losses.

The refinery's final report, due in three to four months, he said, would give hints on what the future held and the potential impact on the local economy.

"Naturally it's a blow to the community because no one wants to see job losses but it's a changing world and nobody knows what tomorrow brings. Northland desperately needs more jobs.

"There's a huge amount of work going on out here, everyone is busy but there's uncertainty what's going to happen six months from now. It's a guessing game," Batten said.

Shares in the refinery remain at around 52 cents.

The financial loss includes a $158m non-cash writedown on its refining assets compared with a small profit of $4.1m in the previous year to December.