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Mobil escapes $10m remediation bill

NZ NewswireNZ Newswire 19/07/2016
A Mobil service station © Bloomberg A Mobil service station

Mobil has won an appeal against a $10 million bill for remediating Auckland's contaminated Wynyard Quarter where oil was stored for decades.

The Supreme Court on Wednesday overturned a Court of Appeal decision that would have required the company to remediate the land to a level suitable for residential use.

Properties in Packenham and Beaumont Streets at Freemans Bay had been used to store oil between the mid-1920s and 2005.

Originally the reclaimed land was leased to Australian companies, which later became Mobil Australia, before being transferred New Zealand companies in the 1950-60s which later became Mobil Oil New Zealand.

In a 35-page judgment the Supreme Court noted the land was already heavily contaminated when a new lease agreement was entered into in 1985.

That agreement required a clause that Mobil return the properties "in good order and clean and tidy".

But Development Auckland claimed the condition was not met when the properties were returned in 2011 and argued Mobil was liable for the expense of removing and replacing soil up to 3.5 metres deep across the sites.

The High Court initially sided with Mobil claiming they could not be held responsible for contamination caused by predecessors, but this was overturned by the Court of Appeal which ordered Mobil undertake the $10 million remediation.

But the Supreme Court found he lease requirements did not include subsurface contamination and said Mobil was not liable.

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