Vector Appointed COO of NZ's Natural Gas Supply

Vector has been appointed as the lead agency in managing events impacting New Zealand's security of supply of natural gas on the high pressure transmission pipelines.

The Gas Governance (Critical Contingency Management) Regulations 2008, effective from today, have introduced a compulsory code that the gas industry must follow during events that impact on the normal operation of the pipelines.

Under these regulations Vector has been appointed by the Gas Industry Company (GIC) to act as the Critical Contingency Operator (CCO) – a role which vests the CCO with the power to direct pipeline users to take specific actions during a national gas supply emergency.

Gas emergencies or supply constraints can arise when demand for gas exceeds supply or when there has been a physical failure or damage to the high pressure natural gas pipelines.

Vector Chief Executive Simon Mackenzie said that prior to these regulations the gas industry operated under the voluntary National Gas Outage Contingency Plan where critical contingencies were managed by Vector and industry groups.

"The appointment of the CCO provides clear leadership and outlines a definite industry process with specific trigger points and actions that need to be taken following a critical contingency declaration.

"Depending on the severity of the event, pipeline users may be directed to instruct their customers to reduce or cut consumption of natural gas. This will be done following formal industry curtailment notifications which will outline the order in which the curtailments must occur.

"The process has been designed to restore normal pipeline operations as soon as possible while minimizing the impact on consumers and ensuring that essential services are maintained," he said.

The critical contingency declaration will only be terminated once the CCO is confident that normal pipeline operations have been restored and supply of gas to consumers resumed.

Mackenzie said the GIC had taken a number of actions to improve the transparency and operation of the gas market.

"We continue to support the GIC in its initiatives and work with other companies to improve market functions and processes as well as better outcomes to customers."