COMMERCIAL E-NEWSLETTER | APRIL 2012

Greetings, This month I had the privilege of meeting several of our large international aviation customers. These customers provide a great window to the world. Firstly, they have significant exposure to the fuel industry globally, and secondly, their passenger and freight bookings give them a very clear picture of general economic conditions globally. Without exception, the customers I spoke to in Asia and the Middle East had far more confidence in the Asia/ Oceania region over the next twelve months than other regions. While this is probably not a surprise for anyone, these businesses are making decisions to back this up by maintaining or growing capacity to this part of the world. We have seen evidence of this with Jet Fuel volumes through Auckland International Airport now exceeding 2008 levels. This is a good news story for New Zealand. Until next time, Lindis Jones

Ferrari and Z partner up

The finest cars on the planet need the very best fuel. So it should be no surprise that Z maintains a long-held and close relationship with the New Zealand Ferrari Owners Club. In March, Z supported the Clubs annual general meeting in Martinborough, which saw close to 100 Ferraris of all shapes and sizes converge on the area for two days. Z used its neighbourhood investment token voting system to help raise more than $5,000 for three local charities over the weekend in partnership with the Ferrari Owners Club. The three charities were Hospice Wairarapa Community Trust, Ronald McDonald House Wellington and Martinborough Youth Trust.

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COMMERCIAL E-NEWSLETTER | APRIL 2012

Fuel saving tips heavy vehicles

Now we are coming into the winter months, some of you will be making lots of big and small trips around the country so we thought it was important to give you a few fuel saving tips. Check them out below and see if they work for you! Source: AA New Zealand. Drive smoothly Lay off the pedals when driving around town. Accelerate smoothly and slowly away from green lights and stop gradually for red lights. Change gear early (but dont labour the engine). If you drive an automatic, allow the transmission to change up early by accelerating on a light throttle. Dont accelerate hard from rest, but let the car move off gently. Look ahead Check whats happening, maintain a safe following distance and youll keep at a more constant speed. Look ahead and ease off the pedal if the traffic lights are about to change, speed limit changes or traffic stops. Its better economically to slow down early rather than brake late. Corner smoothly Dont brake hard for corners and accelerate out. Slow gently, negotiate and exit the corner on a light throttle. Make hills work for you Lift off the throttle as you crest the hill and use the cars momentum to get you over the top. Build up speed before an uphill stretch. Love your car! A little love goes a long way. Regular servicing, the right tyres for the conditions, correct tyre pressure and wheel alignment make a difference. A well-maintained car can use 10% to 20% less fuel than an inadequately maintained one. Watch your air con Use air conditioning sparingly as it tends to eat fuel, up to 8% more in fact. Other features such as the rear window demist can also be a drain, so make sure you switch them off when theyve done their job. Reduce idling time Dont park for long periods with your engine idling and avoid peak hour traffic where ever possible. Dont speed Driving faster doesnt necessarily mean youll get there faster. By travelling at 100km/h instead of 110km/h you can cut around 10% off your fuel bill.

Exhaust emissions - what are they?

Motor vehicles are an essential part of everyday life, from dropping the kids off at school to massive B-trains hauling goods down SH1. These vehicles all have an internal combustion engine which provides the power; the driving force. Unfortunately, where you have internal combustion engines, you also have exhaust emissions. Its one of the big challenges of our time. Exhaust emissions are associated with a number of well documented health and environmental issues. Emissions include particulates, such as carbon monoxide, carbon dioxide, nitrogen dioxide, sulphur dioxide and benzene. Research indicates that the most damaging to peoples health are particulates and carbon monoxide. A Ministry of Transport report estimated that around 400 people aged 30 and over die prematurely each year due to exposure to vehicle emissions. The good news is that modern vehicle engines are vastly cleaner than old engine designs. Believe it or not, using a petrol powered lawn mower for one hour produces the same amount of hydrocarbons as driving an average modern car for 300 kilometres! A key component in petrol engine vehicles is the catalytic converter. Modern three-way catalytic converters act to change the three main pollutants to less toxic compounds: carbon monoxide, unburnt hydrocarbons and nitrogen oxides to carbon dioxide, nitrogen and water vapour. Diesel vehicles use a number of emission reduction technologies: Carbon dioxide and unburnt hydrocarbons: Oxidation catalysts use oxygen to convert carbon monoxide and unburnt hydrocarbons into carbon dioxide and water. The catalysts work best with low sulphur fuels. Nitrogen oxides: One way to reach Euro 5 limits for nitrogen oxide emissions is for trucks coming into New Zealand to be equipped with Selective Catalytic Reduction (SCR) systems. SCR uses a high purity urea solution called Diesel Exhaust Fluid which is injected into a special catalytic convertor. This reduces the nitrous oxides to harmless nitrogen and water. Z Energy has worked with our largest transport customer, to install specialised dispensers at a test site which deliver Z-DEC, Z Energys Diesel Emission Cleaner, into our customers Euro 5 tankers. We are now reviewing further possibilities for this product, looking at installing Z-DEC dispensers at selected truck stop sites around New Zealand. We will keep you posted. Sulphur oxides: These are controlled by reducing the fuels sulphur content. Diesel sold by Z Energy has a

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COMMERCIAL E-NEWSLETTER | APRIL 2012

maximum sulphur content of 10 parts per million; this is classified as an ultra-low sulphur diesel. Particulate matter, commonly known as soot, is reduced by low sulphur fuel and the use of diesel particulate filters. These filters trap the particles and periodically heat up so the carbon is oxidised to produce carbon dioxide. Another way of reducing emissions is to simply reduce

fuel usage. Z Energy has made the decision to reduce our emission foot print by changing to hybrid cars for our mobile staff. The change to hybrid cars is projected to reduce our carbon dioxide emissions by 87 tonnes per annum when fully implemented, due to the fact that hybrid engines run at the most efficient and constant rev range and under the optimal load to produce the most power for the least emissions.

Winter diesel what you need to know and what you need to do
With winter not far away, its important that if you operate diesel equipment - particularly if you have home-base fuel storage - you need to think about diesel cold temperature operability. The diesel fuel supplied by Z will generally meet the cold temperature requirements for the season and region. However, if there are extreme low temperatures for the region, or if summer diesel is used in winter, it is possible that some diesel waxing could occur that could result in blocking fuel filters. Cold winter temperatures can cause operational issues with diesel because all diesels contain wax molecules (straight and branched chain hydrocarbons). These are natural components of the crude oil that diesel is made from. Wax is actually beneficial to diesel because of its inherent high cetane value. In severe winter conditions, especially in inland and high country areas, wax starts to crystallise (solidify) as a result of the low temperature. If enough wax crystals solidify, the fuel lines, filters and strainers in diesel powered vehicles, or diesel fired equipment may become blocked. In New Zealand the legal specification for diesel varies seasonally. In winter, fuel manufacturers are required to produce diesel in which the temperature the wax crystals form is lowered. It is important therefore that in winter, winter grade diesel is used. Most winter grade diesel in New Zealand is treated with an additive at the supplying refinery to reduce the Cold Filter Plugging Point (CFPP). These additives do not reduce the temperature at which the diesel goes cloudy (cloud point) but do reduce the temperature at which the diesel will stop flowing. So although the temperature may be below the diesel cloud point, and diesel may be cloudy, if the diesel is above the fuels CFPP then the diesel will continue to flow and will not immediately result in filter blocking problems. During the winter months, Z supplies Winter Grade diesel which has the cold flow performance tailored to the region it is supplied to. The diesel has superior cold performance through the incorporation of specialised additives. We add more of these additives to the diesel that is supplied to the parts of the country that need it the most, but they are applied to all Z diesel between April and October.

Prevention is better than cure

To avoid winter waxing, use up stocks of summer diesel and restock with winter grade diesel (sometime in April should be suitable). Ensure the fuel systems are not sensitive in cold weather minimise exposed pipelines etc. Ensure maintenance is completed at recommended intervals. If possible, garage vehicles overnight. If you are exposed to extreme low temperatures then it is possible to install fuel tank or fuel filter heaters. Once waxing has occurred, it can only be eliminated by either physically removing the blockage, or warming the fuel to re-dissolve the wax crystals. No suitable solvents or additives are available that will dissolve wax once it is present in the fuel. First check that the cause of the blockage is not ice. If waxing has occurred, gentle heat applied to the pipe work should cure the problem. Hot water or fan heaters should be adequate. Pay particular attention to the fuel filter if it is located in an exposed position. If necessary, and as a temporary measure, remove the filter element to clear the fuel lines. Under no circumstances should a naked flame be used on any part of the fuel system or tank and never add petrol to the fuel! If you wish to talk more about diesel, or any of Z Energys fuel products, just phone our customer service team on 0800 474 355.

COMMERCIAL E-NEWSLETTER | APRIL 2012

Film industry and Z Energy

We have a long standing relationship with the film industry, going back to 1999 when a company then called Three Foot Six Limited was making the Lord of the Rings trilogy the name of the company coming from the height of the hobbits! From there we have seen many films made for television and the big screen come and go. Z worked alongside The Hobbit logistics team providing fuel via fuel cards for the many crews nationwide, including truck convoys as they cruise remote areas of our country. This has required quite some planning with the customers, our supply team and assistance from our very own MiniTankers. The MiniTankers business has provided important and bulk fuels directly to truck convoys around New Zealand. Along with fuel cards we have supplied trailer tanks to various film sets for onsite refuelling of generators to ensure filming continues 24/7. This has been a great opportunity to work with some great teams within many film projects that have passed through our small country a number of which have won awards and recognition worldwide and continue to do so: Three Foot Six Lord of the Rings trilogy New Holland Pictures Separation City Paramount Pictures NZ Without a Paddle Big Primate Pictures King Kong River Queen, Ranger Productions Power Rangers Weta Workshop, Wingnut Films The Adventures of Tintin Wingnut Productions The Lovely Bones Chameleon Event Management Lippy Pictures Tangiwai 3 Foot 7 The Hobbit Top of the Lakes Production mini series New Pacific Renaissance Evil Dead Three Birds The Weight of Eleplants Kiwi Flyer Productions Kiwi Flyer Fossil Films Walking with Dinosaurs Small Axe Films Mount Zion Z is for New Zealand and increasingly supporting some of our countrys finest films!

People profile

Meet Rhys West

Position:
Im the North Region Sales Manager for Commercial. My team and I are responsible for our customer relationships and making sure that we all get what we need from these relationships. Our customers typically use Z Card to obtain their fuel from our truckstop and retail networks, or have fuel delivered to their sites by us.

Z career:
Ive been in the business for five years, joining initially as the Business Manager for Commercial Road Transport, reporting into Singapore. Then following the creation of Greenstone Energy / Z Energy I moved into my current role.

Favourite part of the job:

Knowing that what we (all of Z) do literally keeps our customers going, its a great business and role when you get to work with and meet great people that get up each day to make a difference. So for me its the people - our customers, our staff and what we make possible together.

Vision for future of Z Energy:

Where based on our understanding of customers and our performance we are unquestionably their partner of choice. Where together we tackle and address what really matters in our industry and country.

Hobbies/interests outside work:

The majority of my time outside of work is devoted to my awesome wife and young children. With four (kids that is) aged between a few months and seven years there is plenty going on in the West household, from gardening, to kids sports during the day and hopefully to a quiet read and talk in the evening. The two weeks of the year I look forward to the most are those in January where we pack up the wagon and the trailer and enjoy the traditional Kiwi camping holiday under canvas somewhere by the sand. A big focus of mine right at the moment is taking better care of my health, so creating time for exercise and eating more of the right stuff is important to me right now.

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