CENTREPORT SHIPPING CHANNEL DEEPENING PROJECT

CENTREPORT SHIPPING CHANNEL DEEPENING PROJECT SUMMARY OF TECHNICAL REPORTS (DRAFTS FOR CONSULTATION) APRIL 2016

B CentrePort Harbour Deepening Project April 2016

CONTENTS 1. Introduction 2 2. Commercial 3 3. Economics 4 4. Navigation 5 5. Dredging 6 6. Sediment Characterisation 7 7. Coastal Processes 8 8. Western Beaches (Breaker Bay to Kau Bay) 9 9. Eastern Beaches (Eastbourne) 10 10. Aquifer 11 11. Ecology 12 12. Heritage and Archaeology 13 13. Noise 14 14. Recreation 15 15. Landscape 16 Appendix 1 Project Description 17 Appendix 2 Commercial 26 Appendix 3 Economics 28 Appendix 4 Navigation 31 Appendix 5 Dredging 33 Appendix 6 Sediment Characterisation 35 Appendix 7 Coastal Processes Technical Report 40 Appendix 8 Coastal Processes Summary Report 41 Appendix 9 Coastal Processes Thorndon Container Wharf Report 43 Appendix 10 Western Beaches (Breaker Bay to Kau Bay) 44 Appendix 11 Eastern Beaches (Eastbourne) 46 Appendix 12 Aquifer 47 Appendix 13 Ecology 49 Appendix 14 Archaeology and Heritage 52 Appendix 15 Noise 54 Appendix 16 Recreation 56 Appendix 17 Landscape 58 CentrePort Harbour Deepening Project April 2016 1

1. INTRODUCTION 1.1 As an international port, CentrePort is critical to the economy of central New Zealand. 1 As Central New Zealand contributes 26.3% of national GDP it is important to New Zealand s growth to maintain and enhance its strong international connections. 1.2 To enable Central New Zealand to flourish requires strong transport connections. Nearly all of New Zealand s exports and imports are transported via sea. CentrePort needs to be able to effectively and safely meet the needs of its customers, including importers/exporters and international shipping operators. 1.3 Those needs are changing. The global demand for more efficient freight movement is driving demand for larger ships, in turn requiring deeper shipping channels. The largest container ships regularly visiting Wellington can carry approximately 4,300 containers. Ships carrying around 6,500 containers are anticipated in New Zealand by the end of 2016 and even larger ships of 8000 plus containers, and with draughts of up to 14.5m, are expected in New Zealand within 10 years. 1.4 All major NZ ports are preparing for this change and the Port of Tauranga and Port Otago have commenced dredging to enable larger ships. The first stage of these deepening programmes will be complete in late 2016. 1.5 Wellington Harbour is a naturally deep water harbour. However, the current harbour entrance shipping channel, berth and berth approach depths restrict ships with draughts over 11.6m. While CentrePort has consents in place (since 2003 and 2005) to deepen shipping channels they are to insufficient depths and volumes to meet future needs. New consents are therefore required and it is important to CentrePort that future consents are sufficiently flexible to enable channel deepening to occur when required, to the optimum depths required and in the most economic manner. 1.6 The proposed shipping channel in the harbour entrance will extend for 7km with a channel width of 217m at each end and 270m at the central elbow (where vessels alter course). The area of disturbance will be 184ha. The channel will be 16.5 m deep 2 at the northern end and 17.2 m deep at the southern end. Creating the new channel will require removal of up to 6.0 Mm 3 of sediment, which will be placed off Fitzroy Bay, at a site approximately 50-55m deep, covering an area of 140ha. 1.7 At Thorndon Container Wharf ( TCW ), CentrePort s main container wharf, the berth pocket and the northern approach will be deepened to 15.2 m over an area of approximately 14ha. This will require removal of up to 270,000m 3 of sediment, which will be placed near TCW at a depth of 18-19.5m, covering an area of approximately 30ha. 1.8 CentrePort may undertake the deepening works in one go or in a series of smaller stages that responds progressively to ship sizes as larger ships arrive. The works may also be undertaken by a large dredging vessel in a short duration or a smaller dredging vessel over a longer duration. 1.9 This is a condensed summary of all the technical reports prepared for CentrePort s Shipping Channel Deepening Project ( The Project ). The booklet provides an overview of the Project. All the effects summarised are potential effects of the Project as identified by the experts. The key Project parameters and executive summaries of all the technical reports are attached as Appendices. 1 For the purpose of this report central New Zealand includes the Taranaki, Hawke s Bay, Manawatu/Wanganui, Wellington, Tasman, Nelson and Marlborough regions. 2 All depths are relative to chart datum. 2 CentrePort Harbour Deepening Project April 2016

2. COMMERCIAL 2.1 CentrePort s goal is to be the port of choice for Central New Zealand and to efficiently connect Central New Zealand s producers and consumers with the world. This ongoing cargo connection is essential to the prosperity of Central New Zealand s economy. 2.2 The efficient rail and road transport networks to CentrePort, combined with its latent capacity, high productivity, low expansion costs, centrality, intermediacy with north/south shipping routes, balance of trade (imports and exports) and a substantial Central New Zealand market, enable CentrePort to provide significant shipping network and economic benefits to the Wellington Region, Central New Zealand and New Zealand as a whole. 2.3 The arrival of larger ships from late 2016 will deliver a generational change to New Zealand s national and international cargo networks. 2.4 If Central New Zealand cannot provide a cargo connection with the world that cargo connection will move north. For businesses in Central New Zealand this will significantly increase internal shipping costs reducing returns and jobs. Consumers in Central New Zealand will face increasing product costs reflecting the significant increase in shipping costs for imported goods. 2.5 The 2014 Future Freight Scenarios Study 3 shows that without a Central New Zealand port call Central New Zealand shippers face significant increases in costs, with the Wellington Region most affected. 2.6 Larger ships require significantly upgraded infrastructure. The 2014 Future Freight Scenarios Study concluded that the potential benefits of larger ships on the New Zealand economy were outweighed by the infrastructure costs. However, CentrePort benefits from a naturally deep harbour, its excellent (and improving) rail and road connections, and existing infrastructure making it one of the least cost ports to develop to service larger ships. 2.7 To participate as a sustainable port into the future, and to enable Central New Zealand s producers and consumers to efficiently connect with the world, CentrePort must complete the Project which is the last step in its upgrade to accommodate larger ships. 3 Future Freight Scenarios Study, November 2014, Figure 28, prepared for the Ministry of Transport by Deloitte. CentrePort Harbour Deepening Project April 2016 3

3. ECONOMICS 3.1 During the year ended 30 June 2015, CentrePort earned $69.8 million in revenue, of which $66.2 million was from port operations; provided 223 jobs, of which 219 jobs were in port operations; and paid $19.8 million in salaries and wages, of which $19.0 million were to employees engaged in port operations. A dividend of $6.3 million was paid to CentrePort s two shareholders, the Greater Wellington Regional Council and the Horizons Regional Council. 3.2 If the Project does not proceed CentrePort s commercial viability will be significantly affected. In addition, without the Project, CentrePort will have assets with a value of $65m that are not being efficiently utilised. 3.3 Seaports provide an essential service to New Zealand s merchandise trade. Central New Zealand has 25.1% of New Zealand s population and contributes 26.3% of New Zealand s gross domestic product. It is heavily dependent upon agriculture and primary product processing and the efficient movement of containerised exports and imports is important to the regional economy. 3.4 On the basis of the Future Freight Scenario Study analysis: (a) if CentrePort is not made big ship capable cargo owners: (i) in the Wellington region face an increase in freight costs between 50 and 100% if Napier becomes the big ship capable port for Central New Zealand and over 100% if Tauranga and/or Auckland are the only big ship capable ports in the North Island; and (ii) in the Horizons region face an increase in freight costs between 11 and 50% if Napier becomes the big ship capable port for Central New Zealand and between 50 and 100% if Tauranga and/or Auckland are the only big ship capable ports in the North Island; (b) in the Taranaki region a change from the status quo port arrangement will result in cargo owners facing an increase in freight costs between 11 and 50%; (c) in the Tasman/Nelson/Marlborough regions a change from the status quo port arrangement will result in cargo owners facing an increase in freight costs of at least between 11 and 50%; and (d) in the Hawke s Bay region if Tauranga and/or Auckland are the only big ship capable ports in the North Island cargo owners will face an increase in freight costs between 11 and 50%. 3.5 Without a big ship capable port hub in Central New Zealand there will be increased costs for producers and consumers and reduced economic activity, employment and incomes. Some producers may be forced to relocate, downsize or close their activities. 4 CentrePort Harbour Deepening Project April 2016

4. NAVIGATION 4.1 The existing harbour entrance shipping channel has a minimum depth of 11.3 m, which limits its use by ships beyond 11.6 m draught at High Water Spring (maximum) tide and 10.2 m draught on a normal Low Water tide. 4.2 The proposed new channel is designed for a modern, 14.5 m laden draught container ship. This is the same draught that is being used by the Ports of Tauranga, Napier, Lyttelton and Otago for their dredging projects. 4.3 The proposed channel meets the Permanent International Association of Navigational Congresses Guidelines 2014 which provide international best practice for shipping channel design. The channel width and depth has been optimised using the ship simulator in Launceston, Tasmania. 4.4 To enable a 14.5m draught vessel to undertake a safe transit of the harbour entrance at all tides and during a 6m swell, the channel needs to be 16.5 m deep at the northern end and 17.2 m deep at the southern end. 4.5 The working berth at TCW must accommodate the vessel at all stages of the tide cycle. A maximum depth of 15.2 m is required for the berth pocket and the northern approach to the TCW berth. CentrePort Harbour Deepening Project April 2016 5

5. DREDGING 5.1 The type of materials to be dredged and the sea conditions mean that a Trailing Suction Hopper Dredge ( TSHD ) is the most suitable dredge for the Project. A TSHD can work around shipping traffic in the channel. TSHDs are available in different sizes to suit the dredging works required. If rock is encountered, a backhoe dredge will be used. 5.2 For the full 6.0 Mm 3 excavation a larger TSHD will take approximately 18 weeks, while a 2,100m 3 TSHD will take approximately 90 weeks. The cost estimate for the full dredge (to enable a 14.5m draught vessel) is $37-44m. If staged dredging is undertaken, and using a 12.5m draught vessel depth, a larger TSHD will take 6 weeks, a 2,100m 3 dredger will take 35 weeks and a small dredger will take 72 weeks. 6 CentrePort Harbour Deepening Project April 2016

6. SEDIMENT CHARACTERISATION 6.1 The harbour entrance channel is sandy, with coarse sands at the south end getting finer toward the north end. There are fine silts at the northern-most end. The Fitzroy Bay disposal site is also sandy, with medium sand at the southeast end, getting finer toward the northwest. At TCW, there are layers of silt, sand, and gravel. The proposed TCW disposal area is silty with fine sand. 6.2 Sediment at TCW is contaminated due to historical urban stormwater discharges and nautical paint falling off vessels using the wharf. Disturbing the sediment at TCW will not cause water quality to exceed guidelines for protection of human health or aquatic species. 6.3 The proposed dredging at TCW and placement of that material in deeper water will decrease contaminant concentrations in the dredged area, decrease most contaminant concentrations at the proposed placement area, and will result in less ongoing disturbance of contaminated sediment. CentrePort Harbour Deepening Project April 2016 7

7. COASTAL PROCESSES 7.1 Sediment plumes created by the Project in the harbour entrance channel will have a very limited spatial extent, be short lived and have effects that are negligible in comparison to the effect of a typical southerly storm or the Hutt River flows after heavy rainfall. 7.2 Deepening the harbour entrance channel will slightly reduce peak tidal flows within the constriction of the harbour entrance. The timing of the tidal phase will change slightly. Current directions will not change. The change in the naturally-occurring difference between the peak outgoing and incoming tidal flows will be negligible. 7.3 The new channel will re-direct the wave energy within the harbour entrance. On average, the wave heights will be up to 30% lower along the eastern side and up to 30% higher along the western side. 7.4 The number of surfable events on the eastern side of the harbour entrance will be reduced. The modelling takes into account all potential conditions equivalent to a specific wave height threshold. This can be considered conservative, as the effect of daylight hours, wind velocities (including direction) and wave peak periods on the percentage of surfable events are not accounted for. At the Pipes surf break, modelling predicts wave heights will reduce by around 25%. The effect will be a five-fold reduction in the number of surfing opportunities at this surf break based on the minimum surfable wave height of 0.5 m (equivalent to a significant swell wave height of around 0.3 m). This wave height threshold is considered appropriate in that it relates to all types of surfing apparatuses, including, but not limited to, short board, long board, surf kayaking, Stand Up Paddle boarding (SUP). Surfability and surfing wave quality will not be affected at the most popular surfing sites, such as Lyall Bay and Breaker Bay. 7.5 Around 15% of the sediment placed in the Fitzroy Bay disposal area will be gradually transported away from the area over a 10-year period. The direction of net transport is to the northwest, and there is no direct transport pathway between the offshore ground and the harbour entrance, or to any sensitive coastal areas. 7.6 The disposal area in Fitzroy Bay will not affect the coastal wave climate, surfing conditions, or coastal processes. 7.7 The effects above are from a single campaign to achieve the full channel depth. The cumulative effects of two or three incremental dredging campaigns will be no worse. 7.8 At TCW, fine sands will settle within minutes, while the silty fraction will settle within a few hours. The thickness of silts beyond the disposal ground is up to 2 mm. The plume dispersion is most influenced by wind-driven current flow, which offers an opportunity for mitigation. 8 CentrePort Harbour Deepening Project April 2016

8. WESTERN BEACHES (BREAKER BAY TO KAU BAY) 8.1 The existing environment is prone to coastal erosion processes, particularly during significant onshore storm events, both from the north and the south. 8.2 The Project will not change coastal processes at Breaker Bay, Kau Bay and Mahanga Bay. 8,3 At Scorching Bay, waves during extreme storms will be slightly larger (up to 10cm), but coastal process trends will not change, and the overall effect on Scorching Bay will be low. 8.4 At Worser Bay there will be slight accretion at the northern end of the bay from sand transported from the southern end, but this will be similar to existing beach fluctuations. The protection works at the south end of the bay could be exposed, but the overall effect on Worser Bay will be low. 8.5 Along Seatoun Beach the wave height from the easterly and southerly sectors will increase, but extreme storm effects of run-up and overtopping will not be affected. Slight redistribution of sediment may occur changing the areas where the existing seawall is exposed. However, net loss of sediment from the beach is not expected and overall the effect on Seatoun Beach will be low. CentrePort Harbour Deepening Project April 2016 9

9. EASTERN BEACHES (EASTBOURNE) 9.1 There has been significant accretion along the shoreline from Pencarrow Head to Eastbourne over the last 100 to 150 years. 9.2 The Project will not affect coastal processes at the northern end of Eastbourne to Lowry Bay. 9.3 The Project will not change the trend of gradual accretion within the bays and gravels moving further to the north, but the rate of sediment transport will generally reduce. Any adjustment in the coastline is likely to be within the natural range of beach profile fluctuation experienced on this coast. 10 CentrePort Harbour Deepening Project April 2016

10. AQUIFER 10.1 The Waiwhetu aquifer is an important source of potable supply for the Wellington region with an estimated sustainable yield of 100,000m 3 per day. 10.2 The top of the aquifer is more than 35 m below seabed in the northern dredge area, overlain by marine sand and gravel. The proposed dredging will not expose the aquifer gravels. 10.3 Without dredging, the estimated leakage from the Waiwhetu aquifer in the dredge area is approximately 3,800 m 3 /day. Dredging will increase leakage by approximately 400 m 3 /day, and decrease aquifer yield by 300-1000 m 3 /day (0.3 to 1% of the sustainable yield) which is a negligible effect. During dredging effective monitoring of any change in the aquifer water level can occur at the Matiu/Somes Island bore. 10.4 There is sufficient existing information to support dredging deep enough for a 12.5m draught vessel, with monitoring at the Matiu/Somes Island bore. However, before dredging deeper than necessary for a 12.5m draught vessel, CentrePort will gather more information, such as monitoring aquifer pressures in a deep bore near the dredging area and collecting sediment samples from boreholes in the dredging area. CentrePort Harbour Deepening Project April 2016 11

11. ECOLOGY 11.1 While the Project will significantly affect the existing benthic communities within the dredge and disposal areas the ecological value of these ecosystems is low, and, given the short recolonisation time, the overall direct effects of the Project on benthic communities will be low in the short-term, and very low in the long-term. 11.2 Suspended sediment plumes resulting from the Project will not migrate far from the works footprint, and the effects on the benthic community will be negligible. 11.3 Although the Project will change wave climate at the eastern and western sides of the harbour entrance, the size of the change is low, and any effects on habitats and species will be low. 11.4 The Project will not affect the hoki, rock lobster or paua fisheries; will have a very low effect on adult finfish; and a low effect on recreational, kaimoana and customary fishery resources. 11.5 Wellington Harbour, the harbour entrance and Cook Strait supports an ecologically significant assemblage of seabirds that includes up to 50 nationally Threatened or At Risk species. Due to the small footprint of the Project and its limited effects beyond the dredging areas the Project has a very low risk of moderate level of effects on little blue penguin, common diving petrel, fairy prion and the collective seabird assemblage. 11.6 A desktop assessment for each of the common marine mammal species showed that the effects of the dredging and disposal operations will be low. 12 CentrePort Harbour Deepening Project April 2016

12. HERITAGE AND ARCHAEOLOGY 12.1 Archaeological deposits may include shipwrecks, or structural remains associated with coastal defence or nineteenth century infrastructure. The Wellington harbour entrance is the reported location of 33 shipwrecks between 1848 and 1996, 22 of which pre-date 1900. 12.2 Despite no archaeological or maritime heritage sites being recorded within the proposed dredge footprint, there remains a reasonable likelihood that buried remains of shipwrecks, or remnants of coastal defence infrastructure might still be encountered during dredging operations and an archaeological authority will be sought. CentrePort Harbour Deepening Project April 2016 13

13. NOISE 13.1 Noise levels from dredging activities at land locations will be generally less than 40 dba which is a less than minor effect. At some residential locations near to TCW dredging noise levels may be as high as 48 dba. As this occurs in an area already exposed to elevated ambient noise, the noise effects are predicted to be minor. 13.2 Kayakers and non-motorised sea surface users will experience increased noise levels within a radius of approximately 700 metres from the dredging vessel at a level similar to encountering other powered craft. 13.3 Underwater, noise levels within 100m of the dredging activity will be within existing peak noise levels caused by vessels in the harbour. Within 2-3km of the activity underwater noise levels will be within the typical background underwater noise levels present in the area. Such noise levels will result in behavioural avoidance effects by common species similar to those that already exist. 14 CentrePort Harbour Deepening Project April 2016

14. RECREATION 14.1 There are no effects on recreation amenity as a result of short-term ( construction ) or long-term changes to turbidity, marine ecology, mobilisation of contaminated sediment and dredge vessel activity. There are also no relevant effects for recreation from long-term effects on beach profiles and tides. 14.2 The Project s effects on wave patterns are too small to have a material effect on recreation, especially considering that they will be relevant only in southerly conditions when diving, beach fishing, swimming and boat launching amenity is low. 14.3 Changes to wave conditions will affect surfing at the Pipes and other surf breaks south of Eastbourne, with a reduction in potential surfable time at the Pipes. While a physical solution is not possible the consultation process will explore possible mitigation packages. CentrePort Harbour Deepening Project April 2016 15

15. LANDSCAPE 15.1 Wellington harbour is the primary reason for Wellington City being where it is. Wellington s urban form similarly responds to the topography. There is a contrast between the urbanised western sides of the harbour and the mainly natural ranges of hills east of the harbour. 15.2 There is a contrast in natural character between the west and east sides of the harbour entrance. The Miramar Peninsula (western) side is urbanised and has a generally moderate natural character, although some smaller parts of the peninsula (e.g. south of Point Dorset) have moderate-high natural character. The Pencarrow (eastern) side has been modified but retains a high degree of natural character south of Burdens Gate because it comprises bold coastal landforms, regenerating natural vegetation, and only a very few human structures (such as lighthouses and navigation aids). 15.3 The South Coast between Pencarrow Head and Baring Head has been modified but has high natural character because it is dominated by bold coastal landforms and regenerating natural vegetation, and is visited for the experience of a wild coastline. 15.4 Turakirae Head has very high natural character because of the dominance of coastal landforms and vegetation, and the lack of human features. It is considered to have outstanding natural character. 15.5 The Thorndon Container Terminal and the adjacent part of the harbour is highly modified and has a low degree of natural character. 15.6 The dredging works will have high visibility because the harbour is a natural amphitheatre, and works will be carried out in reasonable proximity to urban areas. The main spoil disposal will be less visible because it will be undertaken some distance from shore. 15.7 The temporary natural character, landscape and visual amenity effects of the dredging and spoil disposal will be low because the works will be of limited duration, will be consistent with the character of shipping operations in the harbour, and visible sediment plumes will be limited in extent and will dissipate quickly. 15.8 While the dredging and spoil disposal will modify the natural seafloor, the permanent effects on natural character and landscape will likewise be low as the seafloor in each location is featureless soft sediment, the basic seafloor topography patterns will be maintained, and the disturbed areas will be recolonised by similar benthic species. 15.9 The works in the vicinity of the Thorndon Container Wharf will be in keeping with the character of the port, and will be carried out over a very short duration. 16 CentrePort Harbour Deepening Project April 2016

APPENDIX 1 PROJECT DESCRIPTION Introduction As an international port, CentrePort is critical to the economy of central New Zealand. 4 As Central New Zealand contributes 26.3% of national GDP it is important to New Zealand s growth to maintain and enhance its strong international connections. To enable Central New Zealand to flourish requires strong transport connections. Nearly all of New Zealand s exports and imports are transported via sea. CentrePort needs to be able to effectively and safely meet the needs of its customers, including importers/exporters and international shipping operators. Those needs are changing. The global demand for more efficient freight movement is driving demand for larger ships, in turn requiring deeper shipping channels. The largest container ships regularly visiting Wellington can carry approximately 4,300 containers. Ships carrying around 6,500 containers are anticipated in New Zealand by the end of 2016 and even larger ships of 8000 plus containers, and with draughts of up to 14.5m, are expected in New Zealand within 10 years. All major NZ ports are preparing for this change and the Port of Tauranga and Port Otago have commenced dredging to enable larger ships. The first stage of these deepening programmes will be complete in late 2016. Wellington Harbour is a naturally deep water harbour. However, the current harbour entrance shipping channel, berth and berth approach depths restrict ships with draughts over 11.6m. While CentrePort has consents in place (since 2003 and 2005) to deepen shipping channels they are to insufficient depths and volumes to meet future needs. New consents are therefore required and it is important to CentrePort that future consents are sufficiently flexible to enable channel deepening to occur when required, to the optimum depths required and in the most economic manner. Project Aim The overall Project Aim is to enable CentrePort to deepen the shipping channel in the Wellington harbour in order to meet the long term needs of its customers. Project Objectives Economic: to support and enhance the economic growth and competitiveness of central New Zealand through enabling the region to maintain and grow direct international freight transport connections by ensuring CentrePort can accommodate larger ships. Commercial: to enhance the long term commercial competitiveness of CentrePort as a container freight port by providing certainty for the needs of shipping customers through long term, flexible, resource consents. Navigational safety and compliance: to enable larger ships to access Wellington Harbour and CentrePort s container berth in compliance with relevant international guidance for navigational safety. Sustainability: to identify and sustainably manage environmental, economic, social and cultural effects of deepening shipping channels including placement of material. Project Scope Shipping channel deepening requires a 3 stage process: Phase 1 Investigation and Design; Phase 2 Consenting; Phase 3 Construction. The scope of this Project is limited to Phases 1 and 2 only. Phase 1: Investigation of alternatives, feasibility and potential impacts of the core shipping channel deepening concept (refer below). Consultation with iwi, stakeholders and regulators, and preparation of resource consent applications. Phase 2: Lodgement and determination of a resource consent application for the core shipping channel deepening proposal (subject to Phase 1 findings and consultation). 4 Central New Zealand includes the Taranaki, Hawke s Bay, Manawatu/Wanganui, Wellington, Tasman, Nelson and Marlborough regions. CentrePort Harbour Deepening Project April 2016 17

Core proposal for shipping channel deepening Design vessel dimensions 14.5m laden draught 300m LOA 48m beam Transit speed 10 knots Estimated maximum cargo capacity 9500TEU Harbour Entrance Channel Channel design has been revised as a result of an extensive optimisation exercise. The revised design will ensure maximum channel operability (or unrestricted design vessel access), except in extreme wave climate or swell events. Location and coordinates Refer Appendix 1 (Figures 1 and 2) Dimensions Refer Appendix 1 (Figure 2) Channel widths (in accordance with PIANC Guidelines, 2014), excluding batter slopes: 217m at north and south ends 270m at central elbow (course alteration point) Depth Maximum depths are 16.5m to 17.2m (below Chart Datum, based on a sloped channel descending to the south along a longitudinal profile) 5 Maximum depths include a 0.5m overdredge allowance Maximum depths include provision for 1.5m under keel clearance at all times Depths do not include allowance for tide (i.e. any depth of water due to tide is additional) To achieve the above maximum depths the maximum dredge depth below current seabed is 5.5m. The following maximum depths apply to the four vessel draught scenarios (construction staging) outlined below Vessel draught scenario Depth (mcd) incl. 0.5m overdredge Coordinates of ends of sloped section North section South section North (WGS 84) South (WGS 84) 12.0m draught 14.0 14.7 12.5m draught 14.5 15.2 13.5m draught 15.5 16.2 14.5m draught 16.5 17.2 41.3296 174.8505 41.3462 174.8449 Estimated disposal volume and areas of disturbance Maximum disposal volume 6.0M m 3 The following total cumulative dredge volumes apply to the four draught scenarios Vessel draught scenario Total dredge volume (million m 3 ) Area of disturbance (ha) 12.0m draught 1.6 118 12.5m draught 2.4 140 13.5m draught 4.0 166 14.5m draught 6.0 184 Includes batter slopes of: 1:5 for north section of channel 1:9 for central and south sections of channel Includes 10% contingency Based on a sloped channel descending to the south along a longitudinal profile Disposal Area for Harbour Entrance Disposal location, depth and dimensions Primary disposal option is at Fitzroy Bay (refer Appendix 1 Figure 3). This is a previously consented disposal area. Depth: 50-55mCD Area: approximately 140ha 5 Reference: MetOcean Solutions Ltd, CentrePort Channel Deepening Project, Optimised Depth Profiles, Report P0222-02, Rev O, Figure 3.1, 98% operability profile, October 2015. 18 CentrePort Harbour Deepening Project April 2016

Thorndon Container Wharf (TCW) Location Refer Appendix 1 (Figure 4) Dimensions Refer Appendix 1 (Figure 4) Depth (berth and approach channel) Maximum depth of 15.2m (below Chart Datum) The following maximum depths apply to the four draught scenarios (construction staging) outlined below Vessel draught scenario Depth including overdredge (mcd) Max dredge depth (m below current seabed surface) 12.0m draught 12.7 1.5 12.5m draught 13.2 2.0 13.5m draught 14.2 3.0 14.5m draught 15.2 4.0 Depth includes: 0.5m overdredge allowance 0.6m minimum under keel clearance Provision for Wellington spring tidal range of 1.34m Estimated disposal volume and areas of disturbance Maximum disposal volume 270,000 m 3 The following total cumulative dredge volumes apply to the three draught scenarios Vessel draught scenario Total dredge volume (m 3 ) Area of disturbance (ha) 12.0m draught 20,000 2.4 12.5m draught 50,000 6.5 13.5m draught 140,000 10 14.5m draught 270,000 14 Includes 1:5 batter slopes 10% contingency Disposal Area for TCW Disposal location, depth and dimensions Primary disposal option is off TCW (refer Appendix 1 Figure 4). Depth: 18-19.5mCD Area: approximately 30ha Construction (Phase 3) scenarios The following construction scenarios need to be considered for the Harbour Entrance Channel. Scenario 1 staged. The following indicative stages are proposed (actual staging and associated depths and volumes may be more or less than that indicated). Stage 1 up to 12.0m draught vessel Depth 14.0m 14.7m (below Chart Datum) Up to 1.6 M m 3 Stage 2 up to 12.5m draught vessel Depth 14.5m 15.2m (below Chart Datum) Up to 2.4 M m 3 Stage 3 up to 13.5m draught vessel Depth 15.5m 16.2m (below Chart Datum) Up to 4.0 M m 3 Stage 4 up to 14.5m draught vessel (consented maximum depths and volumes) Depth 16.5m to 17.2m (below Chart Datum) Up to 6.0 M m 3 Scenario 2 multi year programme Multi year dredging programme using a low volume (<1000m 3 ) dredge vessel Assumes dredging up to 6 days week for 50 weeks/year, daylight hours only (subject to limitations such as weather and sea state, mechanical downtime etc). Scenario 3 single event Dredging and disposal to consented maximum depths and volumes (refer above depths of 16.5-17.2m; volume up to 6.0M m 3 ) Estimated duration 10-20 weeks. Given the lower volumes involved, construction scenarios at TCW are unlikely to include Scenario 2 (i.e. design depths will be achieved by a single event or in stages). Maintenance dredging Maintenance dredging to approved depths is to be provided. Consent duration CentrePort will seek resource consents for a term of 35 years. CentrePort Harbour Deepening Project April 2016 19

Figures Figure 1: Site location map Figure 2: Harbour entrance channel deepening area (update to include 12m scenario) Figure 3: Fitzroy Bay placement area Figure 4: Thorndon Container Wharf northern approach deepening area and placement area Figure 5 Shipping Channel Deepening Longitudinal Profiles 20 CentrePort Harbour Deepening Project April 2016

Figure 1: Site location map CentrePort Harbour Deepening Project April 2016 21

Figure 2: Harbour entrance channel deepening area 22 CentrePort Harbour Deepening Project April 2016

Figure 3: Fitzroy Bay placement area CentrePort Harbour Deepening Project April 2016 23

Figure 4: Thorndon Container Wharf northern approach deepening area and placement area 24 CentrePort Harbour Deepening Project April 2016

Figure 5: Shipping Channel Deepening Longitudinal Profiles CentrePort Harbour Deepening Project April 2016 25

APPENDIX 2 COMMERCIAL 1. CentrePort s goal is to be the port of choice for Central New Zealand 6 and to efficiently connect Central New Zealand s producers and consumers with the world. This ongoing cargo connection is essential to the prosperity of Central New Zealand s economy. Enabling CentrePort to accommodate larger ships 7 will maintain, and provide for the future connection of, Central New Zealand s cargo links to the world. 2. Central New Zealand s cargo of approximately 400,000 500,000 TEU is most efficiently 8 serviced by CentrePort, making it the logical hub port for Central New Zealand. Through the daily CentreRail service, CentrePort services remote regions throughout Central New Zealand more efficiently than other ports. The current and ongoing State highway 1 upgrades as a result of the Government s Wellington North Corridor Road of National Significance projects will deliver considerably enhanced cargo efficiency and journey time reliability. These excellent transport networks enable CentrePort to provide the least cost island transport cargo linkage to Central New Zealand. 3. The efficient rail and road transport networks, combined with CentrePort s latent capacity, high productivity, low expansion costs, centrality, intermediacy with north/south shipping routes, balance of trade (imports and exports 9 ) and a substantial Central New Zealand market, enable CentrePort to provide significant shipping network and economic benefits to the Wellington Region, Central New Zealand and New Zealand as a whole. 4. The arrival of larger ships from late 2016 will deliver a generational change to New Zealand s national and international cargo networks. Larger ships enable greater aggregation of cargo and this is likely to lead to fewer hub ports. 5. If Central New Zealand cannot provide a cargo connection with the world that cargo connection will move north. For businesses in Central New Zealand this will significantly increase internal shipping costs reducing returns and jobs. There will be a point beyond which the increase will result in businesses either changing their business activity, moving their business closer to the hub port (and away from Central New Zealand), or closing their business. Producers who cannot readily shift closer to hub port, or who are time sensitive, such as the agriculture base of Central New Zealand, will be particularly vulnerable to this change. Consumers in Central New Zealand will face increasing product costs reflecting the significant increase in shipping costs for imported goods. 6. Should CenterPort not be able to accommodate larger ships then the Wellington Region will be the most affected in New Zealand by increased cargo costs resulting from the arrival of larger ships. For the Wellington Region if there is no larger ship capable Central New Zealand port total cargo costs increase by greater than 100%, with reduced, but still significant, increased costs for the Manawatu, Hawke s Bay, Taranaki and Tasman/Nelson/ Marlborough regions. 10 7. The outcomes of the 2014 Future Freight Scenarios Study show that without a Central New Zealand port call Central New Zealand shippers face significant increases in costs, with the Wellington Region most affected. In addition if the project does not proceed CentrePort s commercial viability will be significantly affected. 6 For the purpose of this report central New Zealand includes the Taranaki, Hawke's Bay, Manawatu/Wanganui, Wellington, Tasman, Nelson and Marlborough regions. 7 Larger ships are used in this report as container ships with a greater container (TEU) capacity than those currently visiting New Zealand (which are up to 4,500TEU), and typically of 6,500 TEU size or greater. 8 There is a specialist, largely seasonal, cargo located in close proximity to the Port of Napier that is efficiently serviced by that port. 9 CentrePort is the only balanced trade port in Central New Zealand. This avoids shipping empty containers and enables CentrePort to provide shipping lines with greater revenue per box. 10 Future Freight Scenarios Study, November 2014, Figure 28. 26 CentrePort Harbour Deepening Project April 2016

8. Larger ships also require significantly upgraded infrastructure to, and at, ports to efficiently aggregate and shift large volumes of cargo. The 2014 Future Freight Scenarios Study concluded that the potential benefits of larger ships on the New Zealand economy were outweighed by the infrastructure costs. 11 However, CentrePort benefits from a naturally deep harbour and its excellent (and improving) rail and road connections. Except for deepening the shipping channel at the harbour entrance, and at the berth, CentrePort already has the port infrastructure capable of handling larger ships. This makes CentrePort one of the least cost ports to develop to service larger ships. 9. New Zealand s current total container trade is sufficient to support two Upper North Island ports with approximately 1,600,000TEU, a South Island call (excluding Nelson which is much closer to Wellington and has no rail connection) with approximately 560,000TEU, and a Central New Zealand port (which includes Nelson and Marlborough) with approximately 400,000 500,000 TEU. CentrePort s aim is to be the port of choice for Central New Zealand in a 3-4 port larger ship strategy which includes 1-2 Upper North Island call(s), 1 South Island call and 1 Central New Zealand call. The proposed 3-4 port larger ship strategy provides the key trade areas in New Zealand with a hub port while local efficiencies remain for specialised local cargo ports, such as the Port of Nelson. 10. To participate as a sustainable port into the future, CentrePort must complete the last step in its upgrade programme by deepening the shipping channel in Wellington harbour. The Shipping Channel Deepening Project provides CentrePort, and the Central New Zealand shippers, with the certainty that the port will be able to continue to efficiently service the international shipping requirements of Central New Zealand. 11 Future Freight Scenarios Study, November 2014, prepared for the Ministry of Transport by Deloitte. This adverse effect on the New Zealand economy of bigger ships was reduced by retaining a Central New Zealand port. CentrePort Harbour Deepening Project April 2016 27

APPENDIX 3 ECONOMICS 1. CentrePort Limited ( CentrePort ) is investigating the deepening of the Wellington Harbour entrance shipping channel and the approach to, and berth at, the Thorndon Container Wharf ( TCW ) (together called the Project ). The purpose of the Project is to enable the future generation of larger container ships to access CentrePort, thereby maintaining CentrePort s existing container service, providing for its future growth and providing exporters and importers access to a big ship capable port within Central New Zealand. 2. Merchandise trade enables New Zealand to specialise in the production of certain products in which New Zealand has a comparative advantage enabling production surplus to domestic consumption to be exported. These exports in turn provide the foreign exchange to enable New Zealand to finance the purchase of competitively priced imported goods and services. Seaports provide an essential service to New Zealand s merchandise trade, which remains heavily skewed towards products with a relatively low value to volume ratio and therefore dependent upon transport by sea. 3. CentrePort plays a significant role in the current and future economic well-being of Wellington City, the Wellington and Horizons 12 regions and Central New Zealand 13 in that: (a) it facilitates the efficient movement of goods and people internationally and between the North and South Islands; (b) it purchases goods and services from local businesses and provides local residents employment opportunities and incomes through its own operations and investment in assets; (c) it generates profits which are distributed as dividends to its owners, the Greater Wellington Regional Council (GWRC) and the Horizons Regional Council, to the benefit of the regions ratepayers, businesses and residents; (d) organisations servicing the port such as shipping agents, transport firms and government border control agencies purchase goods and services from local businesses and provide local residents employment opportunities and incomes; (e) CentrePort customers that put freight through the port purchase goods and services from local businesses and provide local residents employment opportunities and incomes; and (f) ferry and cruise tourism operators dependent upon the port purchase goods and services from local businesses and provide local residents employment opportunities and incomes. 4. Central New Zealand has 25.1% of New Zealand s population, 26.0% of New Zealand s workforce and contributes 26.3% of New Zealand s gross domestic product (GDP). It is heavily dependent upon agriculture and primary product processing and the efficient movement of containerised exports and imports is important to the regional economy. 5. The Wellington region s key economic driver is its office sector. However given the challenges faced by this sector (e.g. the possible downsizing of central government employment in the capital and the drift north and overseas of private sector head office functions), the significance of CentrePort s contribution to local economic activity is likely to increase in future years. 12 The area covering the Manawatu-Whanganui region. 13 Defined to include the regions of Tasman/Nelson, Marlborough, Wellington, Taranaki, Horizons and Hawke's Bay. 28 CentrePort Harbour Deepening Project April 2016

6. Through the Project, Wellington harbour s natural deep sea port attributes and the advent of larger container ships on New Zealand s international trade routes, CentrePort is expected to significantly increase the volume of containers it handles. From its current (2015 financial year (FY)) 107,400 TEUs per annum, CentrePort forecasts growth to 124,000 in FY2016, 150,000 TEUs in FY 2017, and 218,000 TEUs in FY 2020.This projected growth is based on the likely rationalisation of port visits by shipping lines utilising the larger container vessels and the physical constraints limiting the extent to which other central New Zealand ports (i.e. the ports of Taranaki, Napier, Marlborough and Nelson) will be able to accommodate the larger vessels. 7. The value of cargo exported through Centerport in 2015 totalled $1,412 million in value (or 2.8% of New Zealand s total merchandise exports) and the value of imports totalled $1,868 million (or 3.6% of New Zealand s total merchandise imports). 8. If CentrePort is not made big ship capable, the advent of larger container vessels on New Zealand trades will mean that containers that would otherwise have been exported or imported via larger vessels berthing at the Port will instead need to be diverted to an alternative port in New Zealand which is big ship capable. There will be cost penalties for exporters and importers who would otherwise use CentrePort. 9. On the basis of the Future Freight Scenario Study 14 analysis: (a) if CentrePort is not made big ship capable cargo owners: (i) in the Wellington region face an increase in freight costs between 50 and 100% if Napier becomes the big ship capable port for Central New Zealand and over 100% if Tauranga and/or Auckland are the only big ship capable ports in the North Island; (ii) in the Horizons region face an increase in freight costs between 11 and 50% if Napier becomes the big ship capable port for Central New Zealand and between 50 and 100% if Tauranga and/or Auckland are the only big ship capable ports in the North Island; (b) in the Taranaki region a change from the status quo port arrangement will result in cargo owners facing an increase in freight costs between 11 and 50%; (c) in the Tasman/Nelson/Marlborough regions a change from the status quo port arrangement will result in cargo owners facing an increase in freight costs of at least between 11 and 50%; and (d) in the Hawke s Bay region if Tauranga and/or Auckland are the only big ship capable ports in the North Island cargo owners will face an increase in freight costs between 11 and 50%. 10. A recent analysis 15 of the overall transport costs (i.e. international shipping costs, port costs and road and rail costs) for Central New Zealand s containerised exports and imports estimated considering cost savings for the freight currently utilising CentrePort, if it continues to be a port of call for the Australia, South East Asia and North Asia trades. For the Americas trade the savings in inland transport costs with CentrePort as an international port of call did not outweigh the international shipping and port costs because of the smaller volume of cargo involved. The scenarios analysed considered Auckland, Tauranga and Napier as alternatives to CentrePort. 11. Without a big ship capable port hub in Central New Zealand there will be increased costs for producers and consumers and reduced economic activity, employment and incomes. Some producers may be forced to relocate, downsize or close their activities. 12. The Project is consistent with the efficient use of resources because CentrePort has: (a) existing modern infrastructure capable of achieving the highest productivity in New Zealand on big ships; (b) a naturally deep harbour and unobstructed berth access and wharf length for larger vessels; (c) an existing container terminal that can handle approximately triple the current container volumes; (d) a cost effective CentreRail agreement with KiwiRail to service much of its Central New Zealand cargo base of 400,000 to 500,000 TEUs per annum; (e) a location adjacent to State Highway 1 and the main trunk rail line infrastructure; (f) centrality requiring only 4 hours steaming each way from the route between the North Island and the South Island providing good intermediacy and minimal extra cost to shipping lines; 14 Future Freight Scenarios Study; Deloittes; for the Ministry of Transport; November, 2014, Figure 28, page 95. 15 See section 6 of: Economic Impacts of CentrePort on Central New Zealand 2015; April 2016; Berl (Berl report). CentrePort Harbour Deepening Project April 2016 29

(g) additional capital investment costs of $37- $44 million to become bigger ship capable (14.5m draught vessels). This compares to $50-200 million for Auckland, $50-80 million for Tauranga, $40-80 million for Lyttelton, $100 million for Otago and $50-$100 million for Napier; (h) the potential for North Asia shipping services to make Wellington the final port of call and depart via the Tasman Sea, providing significant steaming savings such that the cost to shipping lines of adding CentrePort in their schedule is therefore minimal; (i) the ability to provide a superior hub port (as opposed to Napier or Tauranga) for Nelson cargo given significantly reduced transit times between Nelson to Wellington enabling a more regular shuttle service between Nelson and Wellington improving reliability, increasing refrigerated capacity and reducing supply chain costs; and (j) a balanced trade providing shipping lines with greater revenue per box by negating the need to reposition empty containers. 13. During the year ended 30 June 2015, the company earned $69.8 million in revenue, of which $66.2 million (an increase of 9% from 2013/14) was from port operations; provided 223 jobs, of which 219 jobs were in port operations; and paid $19.8 million in salaries and wages, of which $19.0 million were to employees engaged in port operations. A dividend of $6.3 million was paid to CentrePort s two shareholders, the Greater Wellington Regional Council and the Horizons Regional Council. 14. From a local Wellington and Horizon s regional economic perspective, the Project will also underpin and enhance the economic benefits generated by CentrePort s operations, since without the Project the number of containers handled at the Port is likely to initially reduce by 30-40,000 TEUs i.e. by 28-37% of TEUs handled in FY2015. That will result in CentrePort initially losing around $9.2 million in revenue and 15 to 20 jobs. With multipliers this would result in an initial decline in regional output of $17.9 million and 30 to 40 jobs. Through economies of scale and scope, a reduction in containers handled at the Port would increase the unit costs for the remaining containers and other trades handled at the Port, placing in jeopardy the financial viability of CentrePort s international trade operations. Also the Project will facilitate visits to Wellington by larger cruise ships and fuel tankers. 15. CentrePort s proposed Shipping Channel Deepening Project will: (a) enable the residents and businesses of the lower North Island region and Central New Zealand to provide for their economic... well being (section 5(2) of the RMA); and (b) be consistent with the efficient use and development of natural and physical resources (section 7(b) of the RMA). 16 PIANC: Permanent International Association of Navigational Congresses. 30 CentrePort Harbour Deepening Project April 2016