829 million litres handled as Channel progresses bp storage conversion

Fuel Throughput Holds at 829 Million Litres

Channel Infrastructure NZ Limited (NZX:CHI, ASX:CHI) kept fuel volumes broadly steady in the September quarter, handling approximately 829 million litres compared with 855 million litres in Q3 2025. The company said year-to-date volumes remain in line with the Envisory fuel demand outlook and its expectations, despite significant domestic fuel price increases linked to geopolitical issues offshore.

The mix was uneven. Jet throughput was approximately 330 million litres, matching the prior corresponding quarter after Middle Eastern carriers reinstated flight schedules in late Q2. Diesel remained stable at about 258 million litres, while petrol fell to roughly 242 million litres from 260 million litres a year earlier. Channel received and discharged 14 import shipments during the quarter, up from 12 in Q3 2025.

bp Storage Contract Adds Long-Dated Revenue

The more consequential development sits in Channel’s growth program. Work began in September to repurpose tanks for a 15-year contract with bp covering additional jet and diesel storage at the Marsden Point Energy Precinct. Channel expects the agreement to generate approximately $130 million in revenue over its term, although the announcement does not specify the timing of that revenue.

The contract follows a year in which Channel has been expanding the scope and pace of its projects, including the earlier project expansion that was associated with higher FY2026 EBITDA guidance. The latest update says the bp tank repurposing work is progressing to plan, while construction of the bitumen import terminal remains on track for delivery in late Q4 2026.

Conversion Spending Stays Within Budget as Debt Rises

Conversion spending reached approximately $194 million by 30 September, only slightly above the approximately $193 million recorded at 30 June and still within budget. The bund upgrade program is also progressing as planned, with its final construction phase continuing through to the end of 2027.

Net borrowings increased to $365 million from $346 million at the end of June, following payment of the interim dividend. The dividend reinvestment plan was applied to that payment, with 20.3% shareholder participation and $22.2 million paid out in cash. That compares with the September dividend reinvestment plan, which set the reinvestment price at NZ$3.4012 per share.

Stable throughput provides little evidence of a near-term volume acceleration, but the fixed or capacity-based component of Channel’s contracted revenue, which the company puts at about 50%, offers some insulation from movements in fuel demand. The next test is execution: whether the bp conversion and bitumen terminal arrive on schedule without pushing spending or borrowings materially higher.