28 August 2024
Mercury statement on Winstone Pulp International
Recent media statements that high spot prices are to blame for the potential closure of Winstone Pulp International are factually incorrect, based on information available to Mercury.
Mercury currently provides a contract that helps set the price for about half of the power that Winstone International uses. This is priced at a similar level to what is charged to other large corporates including New Zealand Aluminium Smelters Limited. This is significantly lower than spot prices and comparable to the prices Winstone has noted their international competitors are paying.
“We don’t have visibility on the electricity not contracted by Mercury, however it may be that Winstone have taken a calculated risk to purchase some of their remaining power off the spot market. This is a business decision, taken by a large and sophisticated international company,” said Mercury’s Chief Executive, Vince Hawksworth. “In making this decision, Winstone is required to complete tests of their risk exposure (called stress tests) quarterly. These should be signed off by their senior management and visible to their Board”.
“Since July we have been actively talking with Winstone about their current situation and over two weeks ago we provided them with a further contract to reduce their exposure to the spot market. We are still waiting to hear back from them on this. This new contract is at a similar level to our existing agreement with them.”
“We completely sympathise with those individuals who are impacted by the current process that Winstone Pulp International are working through. However, based on what we know, commentators sheeting this back to high spot prices does not portray a complete picture of the current situation.”
ENDS
For media inquiries, please contact: Shannon Goldstone
Reputation and Social Impact Lead 027 210 5337
mercurycommunications@mercury.co.nz
ABOUT MERCURY NZ LIMITED
Mercury generates electricity from 100% renewable sources: hydro, geothermal and wind. We are also a retailer of electricity, gas, broadband and mobile services. We’re listed on the New Zealand Stock Exchange and the Australian Stock Exchange with the ticker symbol ‘MCY’, with foreign exempt listed status. The New Zealand Government holds a legislated minimum 51% shareholding in the Company.
Visit us at: www.mercury.co.nz