Landfill operator says ‘business as usual’ as owner mulls sale of NZ unit

By Te Ao - Māori News

As the Chinese owner of Waste Management NZ is reported to be getting ready to sell the company just as the Chinese economy wobbles, Waste Management says it’s business as usual, including its controversial plan for a giant landfill in Wayby Valley (near Dome Valley), north Auckland.

Waste Management general manager customer, strategy and sustainability Ingrid Cronin Knight, says the landfill is the best solution, despite considerable opposition from iwi and other community groups and an appeal to the Environment Court.

Some objectors have argued for a waste to energy plants instead but Cronin Wright says such plants require taxpayer subsidies and produce lots of carbon emissions.

The company has five landfills in New Zealand and operates 29 refuse transfer stations and more than 800 specialised waste collection vehicles. It has more than 1200 employees and handles more than 8500 tonnes of waste per day.

The new landfill is to replace a landfill at Redvale and will be known as the Auckland Regional Landfill. The landfill will be 3.5km from the Hōteo River, 35km from the Kaipara Harbour and represents 0.009% of the Kaipara catchment. It is also 50m higher than the Hōteo River and above the flood plain.

Bloomberg has reported the Chinese state-owned Beijing Capital Group Co is exploring a sale of Waste Management for US$1 billion ($1.4b).

China’s economy wobble

The agency said Beijing Capital had asked investment banks for proposals on the potential divestment of the company, now called Beijing Capital Waste Management NZ, or sale of a partial stake.

Beijing Capital acquired Waste Management for $950 million from ASX-listed Transpacific in 2014.

Given the small numbers of companies listing on the NZX, New Zealand investment managers would welcome a return of the once highly profitable Waste Management, which delisted from the NZX in 2006 after its amalgamation with Australia's Transpacific Industries.

But wobbles in the Chinese economy because of a giant property development company’s debt levels, with concerns it may crash in coming weeks, may yet stymie the proposal.

Chinese investors dominate New Zealand's waste management sector.

Regular request

Hong Kong-based Cheung Kong Infrastructure Holdings owns the other big player - Enviro (NZ), which operates as EnviroWaste.

And last week a South Island joint venture between China Tianying Incorporated, Spanish company Urbaser SAU, and Renew Energy was announced planning a waste-to-energy plant in Waimate.

Waste Management’s Cronin Knight says Beijing Capital Group (BCG) regularly gets approached in the normal course of business to assess potential options and test appetite for selling.

“Waste Management NZ continues to operate as usual with no changes and will provide the appropriate communication to all stakeholders in the event that anything changes,” she said.

“Waste Management NZ has been owned by New Zealanders, Americans, Australians and now the Chinese. BCG bought WMNZ in 2014 and has from the outset been an outstanding and supportive owner, allowing substantial investment into our sustainability initiatives over the years.

“We will continue to provide the essential service of waste management and resource recovery to New Zealanders. We are proud of the work we do and our team of 1800 Kiwis.”

Earlier this year independent commissioners for Auckland Council granted resource consent for the company’s proposed landfill in Wayby (near Dome Valley where the Dome Forest is Department of Conservation–protected land). The commissioners noted positive effects on Auckland’s infrastructure.

New landfill needed

However, only last week the same commissioners turned down an application made at the same time as the resource consent to operate all the 1000ha involved as a “precinct.”

The commissioners said they preferred the tough existing rules for environmental protection than proposed ones for the precinct.

Waste Management’s Cronin Wright said Tāmaki Makaurau was a growing city, and it needed a new landfill to keep up with the waste the city produces if it’s going to be able to grow and function.

“We’ve held an exhaustive search looking at over 75 different sites, including some suggested by iwi, and the Wayby Valley site is the best choice to minimise environmental, congestion and amenity impacts.

She says the company agrees with opponents that it needs to do better to address the amount of waste generated each year.
“As a leading provider in the circular economy, we play an active role in helping to achieve waste minimisation, but this will also require a significant change in New Zealanders’ behaviour.”

The company was disappointed its private plan change to create a precinct was turned down but said the commissioners felt the precinct provisions were not needed as resource consents had already been granted. “We are reviewing the plan change decision in detail before deciding how to progress.”

Carbon emissions

Cronin Knight conceded incineration is raised as an alternative possibility for Aotearoa from time to time (as in the Waimate joint venture being proposed).

“The problem is that burning the rubbish, such as plastics, causes significant carbon emissions, as well as producing toxic ash. Not only that, but to be economically viable, incinerator plants need ongoing amounts of rubbish – just at the time New Zealand is looking to reduce the amount of rubbish and plastics we use,” she said.

“Overseas, countries that have incineration plants need expensive taxpayer subsidies to make them work and often have to import waste from other countries – producing more carbon emissions that damage the environment. It remains our view that a modern engineered landfill, which captures and treats all of the leachate so it is safe for the environment and waterways, is the best solution for Papatūānuku, the awa, moana and Ranganui.”