Aotearoa's ability to make its own petrol and diesel looks set to be scrapped - with hundreds of Northland jobs to be lost as well.
Refining NZ shareholders today voted overwhelmingly in favour of switching its Marsden Point operation to an import only terminal.
That almost guarantees all our diesel and petrol supplies will be processed exclusively offshore from mid next year - pending a Refining NZ board meeting to sign off the change next month.
If it does get the green light, the workforce of 300 will be scaled back to 60 over the next two years, and hundreds of contractors' jobs are also likely to go.
That will have a huge impact on the Northland economy, where the refinery contributes about 7 percent of the region's GDP.
Among those facing job losses is Whangārei local Lucas Manihera, who has worked at the refinery for the past 13 years - 10 as a tradie and three as an employee.
"It's a massive loss for us here in Northland - I know people that travel from Waikare to come to work, which is a nearly an hour and a half drive, there's people that come from Kaiwaka.
He said he was not sure what came next - but finding similarly paid work in Northland would be really hard.
"I've got five kids ranging from high school right through to two years old - providing for them is paramount, it comes first.
"Now to learn I've only got this amount of time working for the refinery, now it's time to start something new, which is uncertain also."
Marsden Point workers feel abandoned by government as job cuts loom. Photo: RNZ / Nita Blake-Persen
While today's vote was widely signalled - and received 99 percent support from shareholders - Manihera still said it was a huge blow to the region.
"If this is the way that the government is going to let this happen, to me they've let us down up here in the North. They've let us down massively."
But today Refining NZ chief executive Naomi James said they had sought no government support to remain operational.
"We haven't sought taxpayer subsidies as we don't think that's a long-term sustainable plan. And none have been offered."
The refinery has been struggling with tight margins for the past couple of years - and Covid-19 lockdowns have meant a drop in demand for fuel. A shift to greener energies has also made it hard for the refinery to make money.
James said today's shareholder vote signalled the next step in stopping processing of crude oil onsite, with a new import-only terminal operating under the name 'Channel Infrastructure'.
She said the switch would help reduce the company's climate emissions significantly and was the best long-term solution for the company.
If the Marsden Point operation ends up switching to an import only terminal the workforce of 300 will be scaled back to 60 over two years. Photo: 123rf.com
Numerous shareholders at today's meeting raised concerns that closing the refinery would put fuel security at risk - but James said it could in fact improve supply.
"Instead of being produced at our refinery, fuel would be produced at a range of refineries around Asia and so in that sense there's less exposure to one single refinery but we do recognise that fuel security is a really important issue and so it has been one of the matters that we have engaged with government on through this strategic review process."
Not everyone is convinced about that supply chain though - researcher Toby Dalley has been looking at New Zealand's oil security for years and said today's vote to wind down the operation was a mistake.
He said claims that fuel sources would become more diverse, don't stack up.
"In a perfectly functioning market environment where we don't have a crisis on our hands, that may well be the case. But we don't know what a situation's going to end up being if we have a major international oil crisis on our hands.
"It may well be that crude oil supply is all that we can source, or all the other countries are willing to source - we are really taking options off the table in a crisis situation," he said.
But Waikato University law professor Barry Burton, who specialises in natural resources, said if there was a crisis, it would affect crude and refined oil in the same way.
"We do need to think about where our oil comes from but to be blunt there's no shortage of oil in the world - the problems we have are with the emissions from the burning of it.
"Back in the 1970s we had oil crises but they're actually fairly short-lived and we have 50 years of experience since then of OPEC not being very good at using oil as a strategic weapon - not even able to control production in order to keep the prices high."
He said the closure made financial sense - and he would like to see the industry work towards a "just transition" away from fossil fuels.
"Internationally there's a huge oversupply of refining capacity - everyone in the industry is finding it difficult to make money in refining and a lot of those refineries are much bigger and more modern than Marsden Point so I don't think we should be surprised the company's are deciding to wind down."
In a statement, Energy Minister Megan Woods said she sympathised with workers after today's vote.
"The government will continue to listen to ideas about how the refinery could be repurposed to produce green fuels. In the meantime the Ministry for Building Innovation and Employment (MBIE) will continue its assessment of the implications of a move to a fuel import terminal and how fuel security will be maintained."
