New Zealand’s fuel suppliers will be “substantially punished” legally and financially if they don’t live up to their word in supplying fuel, Associate Energy Minister Shane Jones says.

Those international companies had asked for the current just-in-time supply model, and “rightly or wrongly I took them at their word”, Jones told Mike Hosking.

“I said, okay, you guys know how to keep New Zealand afloat, but the political downside is that the national security question always remains with the Government, not just the commercial companies.”

There was no suggestion of any problem with supply, he said. But the issue was even if the Government were to underwrite additional fuel imports —as Australia plans to do— there was not currently space to store added fuel volumes.

“We could have a ship bobbing off the coast of Marsden Point for a while, then someone's got to pay for that ship to sit there and do nothing while we draw down.”

He repeatedly blamed the closure of the Marsden Point oil refinery for leaving New Zealand with inadequate storage.

Jones said he had been warned that refineries in Singapore, Malaysia and Korea were set up specifically to deal with oil from the Middle East. While they would be seeking oil from other regions, they would need work before they could process that oil.

He also revealed more details about the unsolicited proposals the Government is receiving to increase New Zealand's offshore fuel supplies.

Jones says both the Government and MBIE officials have received approaches from either New Zealanders, people already known to them, or people who have lived in New Zealand.

But Jones he told Hosking the offers they're making don't last long, with ships usually being snapped up within 72 hours.

He says many Kiwis don't appreciate how serious the situation is in Asia.

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Shane Jones: Associate Energy Minister on fuel stocks, supply offers, inadequate storage

The Mike Hosking Breakfast