News

NZ Contact Energy profits down by 79%

Alexander Richter Alexander Richter 24 Feb 2009

New Zealand utility Contact Energy Ltd. (NZE:CEN), "which generates about 28% of New Zealand’s electricity, posted a 79% slump in first-half profit, saying constraints on the national grid stymied its efforts to respond to climatic challenges.

Reported by Business Wire, New Zealand utility Contact Energy Ltd. (NZE:CEN), “which generates about 28% of New Zealand’s electricity, posted a 79% slump in first-half profit, saying constraints on the national grid stymied its efforts to respond to climatic challenges.

Net income fell to NZ$25.1 million (~ US$ 13m), or 4.35 cents a share, from NZ$117.4 million (US$ 60m), or 20.14 cents, a year earlier, the company said in a statement. Sales rose 11% to NZ$1.2 billion (US$ 610m).”

Further in the news, the company announced that it is “pressing ahead with plans to increase North Island capacity, including the first phase of the Tauhara geothermal project near Taupo and a 200 megawatt gas-fired power station at Stratford. The company is also developing an underground natural gas storage facility near Stratford. The three projects represent investment of more than NZ$500 million (US$ 256m), Baldwin said.

The company also today announced plans to raise funds selling bonds next month and has registered a prospectus, it said.”

Further details on the geothermal projects of the company, which has three power stations in the Taupo region producing about five per cent of New Zealand’s total energy, are given on its website.

“Contact’s plans for three new geothermal power stations are progressing rapidly. The plans involve replacing the 50 year old Wairakei Power Station with a new power station at Te Mihi, which will be powered with steam from the Wairakei steamfield.
The Te Mihi power station will produce up to 220 megawatts of electricity, and will gradually replace the Wairakei Power Station which will be phased out of production.

The utility is half owned by Australia’s Origin Energy Ltd. (ASX:ORG), which itself is a shareholder in Australian EGS company, Geodynamics (ASX:GDY)
Source: BusinessWire (Scoop.co.nz)