- Release Date: 08/08/13 10:48
- Summary: GENERAL: MEL: Meridian reaches commercial agreement with NZAS
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MEL 08/08/2013 08:48 GENERAL REL: 0848 HRS Meridian Energy Limited GENERAL: MEL: Meridian reaches commercial agreement with NZAS For immediate release: Thursday 8 August, 2013 Meridian Energy and New Zealand Aluminium Smelters Ltd (NZAS) have concluded the renegotiation of their electricity contract. "After a year of robust negotiations we have reached an agreement that is commercially acceptable to both parties and provides a greater level of certainty for Meridian," says Meridian Chief Executive Mark Binns. In the renegotiated contract Meridian agreed a new price, which will see a reduction in the current electricity charge from July 1 2013 and allows for price increases should the New Zealand dollar value of aluminium rise above agreed levels. The contract period remains to 2030. "The new agreement is inflation indexed and includes guarantees from or on behalf of the NZAS parent companies Rio Tinto and Sumitomo Chemical Company, Ltd. These guarantees demonstrate a commitment to the Tiwai Point smelter to January 2017," adds Mr Binns. Mr Binns says the deal provides the smelter with more flexibility in its operations, whereby it can reduce its contracted volume from 572 MW to 400 MW from 2015. In addition, NZAS can terminate the deal from January 2017, providing notice is given at least 15 months prior. "Meridian is delighted that the parties could find a mutually acceptable position - and trusts that the new pricing framework and associated arrangements assist NZAS in establishing a competitive cost position for the future," says Mr Binns. It is back to business as usual now and we look forward to continuing to work with NZAS," adds Mr Binns. The Government has made a contribution of NZ $30 million to secure the medium-term future of the smelter and provide greater certainty for the electricity market. A statement will be released via the Finance Minister's office. Meridian was approached by NZAS and its shareholders in July 2012 to discuss potential changes to its existing electricity contract. This concludes the renegotiations. ENDS For media enquiries, contact: Claire Shaw Corporate Communications Manager Meridian Energy 021 370777 [email protected] meridian.co.nz For investor relations queries, contact: Owen Hackston Investor Relations Manager Meridian Energy (04) 382 7496 [email protected] meridian.co.nz End CA:00239414 For:MEL Type:GENERAL Time:2013-08-08 08:48:18
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