Dairy group told court of its milk-dumping fears

HAMILTON - New Zealand Dairy Group feared it would be forced to dump milk because of problems commissioning a co-generation power plant at its Te Rapa factory, which receives up to 8 million litres a day.

The company revealed its concerns when it took Contact Energy and its contractor Alstom New Zealand to court last month in an attempt to guarantee a supply of steam for its dairy factory.

But the three parties negotiated an out-of-court agreement after an interim injunction ordering Alstom to supply steam was granted in the High Court at Wellington.

An NZDG representative said the problems arose because of "contractual difficulties."

Contact was to build the plant, supplying power to NZDG's milk powder driers but missed its completion date.

NZDG told Justice McGechan that if the Te Rapa plant did not have power it would be forced to dump milk at the height of the season in mid-October.

NZDG will suspend testing for a week while soundproofing is installed and restrict testing times at night. - NZPA