Channel Infrastructure lifts full year profit guidance to as much as $105 million as fuel crisis fills its Marsden Point tanks
Channel Infrastructure has lifted its full-year underlying profit guidance for 2026 to a range of $97 million to $105 million, telling shareholders at its annual meeting in Auckland that the unfolding fuel crisis is filling its Marsden Point tanks faster than the company expected when it set its original forecast in February.
The NZX listed import terminal operator, which trades under the ticker CHI, had previously guided the market to a 2026 underlying profit of between $95 million and $100 million. The new range tightens the floor and lifts the ceiling by five million dollars, and reflects what board chair James Miller described to the meeting as a step change in the strategic value of the Marsden Point site.
Channel Infrastructure is the rebadged former owner of New Zealand Refining. The company shut its refinery in 2022 and converted the Marsden Point site into a fuel import terminal, a decision that has been contested in political circles ever since. The reopening of that argument has run hot through April and May after Iranian pressure on the Strait of Hormuz pushed wholesale diesel up 42.6 percent between February and March, the sharpest monthly rise on record, and added 18.6 percent to petrol over the same period. New Zealand has been forced to draw on offshore reserves and to lean on its remaining domestic infrastructure harder than at any point since the early 1980s.
Channel Infrastructure now finds itself the direct beneficiary of that scramble. The company told shareholders that its 93 million litre government diesel storage facility, contracted to the Crown until December 2027 to add the equivalent of nine days of national diesel demand, is on track to come into service by the end of May. That is the original accelerated target the company committed to in April when Cabinet signed the $21.6 million deal. The Z Energy jet fuel tank under construction on the same site is now expected to be ready for commissioning in July, which is six months ahead of the original schedule and a useful buffer for an Auckland Airport supply chain that has been under audit since the Hormuz disruption began.
The company has also written up the economics of the Higgins bitumen import terminal that it is building under a 15 year contract. Anticipated revenue from that project has risen from $45 million to $57 million over the life of the deal, although the cost has climbed too, from a previous estimate of $17 million to $21 million up to a fresh range of $25 million to $27 million. The lift in revenue still gives the project a meaningfully better return than was first modelled, and adds another long dated cash stream alongside the existing fuel terminal revenues.
Chief executive Rob Buchanan, addressing his first annual meeting since taking the role, told shareholders that the company’s record on delivering capital projects had been a key reason that both the Crown and Z Energy had been willing to sign accelerated contracts. “We have proven our ability to execute on large capital intensive projects safely, on time and on budget,” Buchanan said, according to RNZ’s report on the meeting.
Beyond the immediate domestic uplift, the company is also pushing into Australia. Channel Infrastructure has acquired a 25 percent stake in the Somerton jet fuel pipeline that supplies Melbourne Airport, paying A$14 million for the holding. The Somerton stake gives Channel Infrastructure a foothold in the Australian aviation fuel supply chain at a time when carriers across the Tasman are paying close attention to the resilience of their refuelling infrastructure. The deal also fits with the company’s stated strategy of growing earnings through small bolt on acquisitions rather than through large new build infrastructure, where construction risk has been rising sharply in both countries.
Miller used his chair address to reframe the Marsden Point conversion from a closure story to what he called an evolving energy precinct. The company is pitching the site as a base for future fuel resilience capacity, jet fuel storage, bitumen handling and potentially low carbon liquid fuels, all sitting on a single deepwater berth with rail and road links into Auckland. That precinct framing is a deliberate counter to the political argument from New Zealand First and parts of the trucking sector that the country should be looking to rebuild domestic refining capacity. Channel Infrastructure’s case to investors is that storage and import flexibility, paid for by long term Crown and customer contracts, is a more reliable earnings stream than the volatile refining margins that drove its predecessor business into closure.
For shareholders, the practical message from the meeting was that the original 2026 guidance was set before the Hormuz shock, before the diesel storage deal landed and before the Z jet tank schedule was pulled forward. The upgraded range reflects the company’s view that those tailwinds are now embedded in its near term earnings rather than one off windfalls. Whether they persist into 2027 will depend in part on how long the Middle East disruption keeps fuel demand pressing against domestic storage and import capacity. Reporting from interest.co.nz this week noted ANZ economists are warning corporate New Zealand to plan for a long period of elevated volatility, and Channel Infrastructure is one of the few listed names that benefits when that warning plays out.
What do you make of Channel Infrastructure’s pivot from refiner to strategic storage operator, and is Marsden Point now too important to be in private hands? Share your thoughts in the comments below.