The Port of Tauranga is set to receive a significant boost with Z Energy announcing they are looking to spend $40 million to increase storage in the area along with the Port of Lyttleton.

The announcement from the petrol retailer, follows the official opening of the new Mount Maunganui10.6 million litre storage tank by Terminals NZ, suppliers for Gull and BP.

Z Energy is looking to increase storage in Mount Maunganui.

The Wellington based company received resource consent to add 25million litres of storage at the Port of Lyttleton, Christchurch to its existing 30million litre capacity, and is in the early engineering and consent stages for the Port of Tauranga.

Z Energy senior communications advisor Sheena Thomas says they have identified Mount Maunganui, along with Lyttleton, as the most strategically important locations for additional bulk fuel storage and security in the fuel sector.

'This is because the Port of Tauranga is a key import location and the closest port that can provide a back-up for Auckland. It will increase the security of fuel supply in the upper North Island.

Part of the attraction stems from the forward thinking of the Port of Tauranga in its plans to widen and deepen shipping channels accommodating larger ships which will reduce freight costs.

'From our perspective it's a sign of how they are thinking of the long term future of the port and of the country.

'The dredging project the port will be undertaking supports the opportunity to build bigger storage to make the most of being able to use bigger ships. Utilising larger ships in turn can mean lower freight costs.”

Because the company is only in the initial stages with preliminary engineering and consent a figure on the total investment size is not available yet, says Sheena.

Last month the Port of Tauranga received final approval from the Minister of Conservation Nick Smith for its plans to widen and deepen shipping channels, to accommodate for the larger ships.

Port of Tauranga chief executive Mark Cairns says the benefits to the New Zealand economy from the ability to accommodate larger vessels will be widespread and significant.

The project will widen and deepen the sipping channel from a depth of 12.9 metres to 16 metres at low water where ships of up to 347 metres in length and 14.5 metres wide will be able to pass into Tauranga Harbour.

To be carried out in several stages, the first stage of dredging – costing $40 to 450 million – will start at the end of the year taking six to 12 months to complete.

Mark says this will enhance the competitiveness of New Zealand exporters and provide lower freight costs for importers.

'These preparations for more frequent ship visits and larger volumes of cargo will ensure that we continue to meet the capacity demands of our customers and maintain our high productivity levels into the future.”