BOC is to invest around $70m in a new air separation plant (ASU) and associated equipment to supply products to the New Zealand air gases market.

The news comes after BOC Ltd and New Zealand Steel agreed a long-term industrial gas supply contract that will be ‘critical’ to New Zealand Steel’s ongoing iron and steel making operations at Glenbrook.

The $70m (€56m approx.) investment is underpinned by a contract with New Zealand Steel to serve the air gas needs of that plant’s production for at least a 20-year period.

The plant will replace an existing plant that is approaching the end of its useful life. Gasworld understands that it will feature increased production and storage capacity, enhancing the reliability of supply and potential for growth at New Zealand Steel.

“The new contract to supply air gases to New Zealand Steel continues a long lasting partnership between our two companies”

Colin Isaac, Managing Director of BOC South Pacific

The plant will also supply increased quantities of liquid oxygen, nitrogen and argon to the broader New Zealand air gases market for other vital applications, such as medicinal use, food freezing & packaging, and metal fabrication.

Up to 120 people will work on the plant’s construction over the next two years. Once operating, the state-of-the-art facility will generate energy savings from the current production; equivalent to the yearly energy needs of 1900 average New Zealand homes.

BOC South Pacific Managing Director, Colin Isaac, said the new infrastructure would enable BOC to deliver efficient and cost-effective supply of air gases to its growing New Zealand customer base. “The new contract to supply air gases to New Zealand Steel continues a long lasting partnership between our two companies,” he explained.

“Last year we celebrated our 100th year of business in New Zealand and I see this new investment as a strong signal of our confidence in our New Zealand business well into the future.”

Simon Linge, New Zealand Steel President, said the agreement marked a significant commitment by the company in its continued support of New Zealand customers and the country’s economy.

“It was important for us that this facility was state-of-the-art, which reduces our environmental footprint and shows the commitment to innovation that New Zealand Steel was founded on,” Linge said.

BOC expects to complete construction of the new plant in December 2013.