Appendix E.

CONFIDENTIALITY POLICY

1. POLICY STATEMENT Wanganui Gas Limited (WGL) via GasNet, its independent trading division operating network assets is committed to providing Neutral and Non-Discriminatory access to its Distribution System and, to that end, honouring and protecting the confidentiality of information made available to it by those seeking access.

To achieve this, WGL will:

• ensure that GasNet has detailed procedures in place to protect all confidential information and, in particular:
  - requests for access and related services
  - information directly related to a specific System User
  - any other confidential information specific to a System User which, in the course of applying for or negotiating access, the System User specifies is confidential;
• ensure all staff are aware of the principles and spirit of this policy; and
• train relevant staff to understand their specific obligations under this policy and the consequences of breaching it.

Nothing in this policy will prevent:

• the exchange of information necessary to maintain the safety and reliability of WGL's Networks; and
• WGL complying with any court order or statutory or regulatory disclosure requirement (including any requirement of the Gas Pipeline Access Code).

2. CONFIDENTIALITY OBLIGATIONS
Users of WGL's Network expect that confidential information they make available to GasNet will remain confidential to that division. In particular, they expect that confidential information will not be passed on from personnel in GasNet to WGLRetail or to any other person.

In addition, there are also a number of legislative obligations which WGL must meet, including:

2.1 The Commerce Act 1986 This is generic legislation prohibiting anti-competitive behaviour. In particular, WGL may be affected by Section 36, which prohibits the use of a dominant position in a market for anti-competitive purposes.
2.2 The Gas (Information Disclosure) Regulations 1997 This is industry specific legislation containing obligations on distribution and retail businesses to disclose certain information on an annual basis. In addition, where a company has a distribution business, and undertakes related activities, further information disclosure requirements apply.

WGL's obligations include disclosing:

• separate financial statements for WGL's Network and retailing activities (Regulation 6);
• the prescribed terms and conditions between GasNet and its customers (System Users), and WGL-Retail and its customers (End Users) (Regulation 9);
• non-standard terms and conditions between WGL-Distribution and its customers (System Users) (Regulation 14);
• financial and performance measures (Regulation 15);
• energy delivery performance measures and statistics (Regulation 17);
• reliability performance measures (Regulation 18);
• pricing methodology (Regulation 20);
• the methodology used to allocate costs, revenues, assets and liabilities between the two divisions (Regulation 21);
• the terms and conditions of all transactions between the two divisions (Regulation 22);
• pipeline capacity, including system maps, offtake point data and system throughputs & peak flow data (Regulation 23);
• transmission and distribution costs to WGL-Retails' customers (End Users) (Regulation 25); and
• transmission charging methodology (Regulation 27).

2.3 The Gas Pipeline Access Code
This is an industry-specific voluntary code developed by Gas House detailing how transmission and distribution companies will behave in providing Neutral and Non- Discriminatory access for all users of their pipeline systems.

Where such companies also undertake related activities, further behavioural obligations apply and these relate to protecting confidential information and providing services to any System User on the same terms as it would to its own Retailer.

Under the Code, WGL is required to publish an Information Memorandum detailing, among other things:

• the policies and procedures WGL has in place to ensure compliance with the above obligations;
• the procedures established to ensure that no confidential information is released to its own Retailer; and
• the procedures established to ensure that its own Retailer receives no better terms for access and related services than other Retailers.

• "System User" is a party contracting with WGL-Distribution for transportation of their gas, that is WGL - Distribution's customer (see note 1), and
• "End User" is a party contracting with WGL-Retail for supply of gas for their own use (the consumer), that is WGL-Retail's customer, and
• "Retailer" is a party contracted to supply gas to an End User, and
• "GasNet" is the Network Division of Wanganui Gas Limited, and
• "WGL-Retail" is the Marketing Division of Wanganui Gas Limited.

As detailed in this Policy, "confidential information" includes:
- requests for access and related services;
- metering data and information directly related to a specific System User;
- any other confidential information specific to a System User which, in the course of applying for or negotiating access, the System User specifies is confidential.

Note 1: The Gas (Information Disclosure) Regulations 1997 use the term "Gas Customer" to describe the party being supplied distribution services, while the Access Code uses the term "User" to describe the same party.

4.0 PROCEDURES TO MEET WGL's OBLIGATIONS
4.1 Protection of Confidential Information
Confidential information which has been provided by a System User (who may or may not be WGL-Retail) should not be disclosed without the approval of the System User who provided the information (unless required by law).

The following will apply:

• staff will be informed of their obligations with respect to confidential information through this procedure and through specific training;
• confidential documents should be treated appropriately, by being stamped "Confidential", and should be securely stored and/or disposed of so as to preserve their confidentiality;
• access to billing systems should be controlled through access rights specific to each person using the billing system;
• WGL-Retail staff will be unable to access confidential information being supplied by other System Users and vice versa;
• WGL-Retail staff will not have access to file archives containing confidential data;
• staff will be entitled to receive only the information necessary for the operation of their position; and
• all computers shall have screen saver passwords installed with the screen saver mode being activated after no more than 10 minutes.

4.2 Separation of Financial Statements
WGL is required to comply with the accounting separation requirements of the Gas (Information Disclosure) Regulations 1997.

In particular, WGL discloses:

• separate financial statements for its Network and retailing activities;
• the methodology used to allocate costs, revenues, assets and liabilities between these two activities; and
• the terms and conditions of all transactions between these two activities.

4.3 Separation of Staff
Staff directly involved in WGL-Retail should not also be employed or engaged simultaneously by GasNet. In addition, steps are required to be taken to protect confidential information in the event of staff transfers between GasNet and WGL-Retail.

5.0 IMPLEMENTING THIS POLICY
5.1 Responsibilities and Accountabilities

The Chief Executive Officer (CEO) is responsible for:

• ensuring compliance with this policy;
• facilitating ready access to the Independent Assessor to any party who suspects that there has been a breach of confidentiality relating to their confidential information. The Independent Assessor's contact details will be available from the companies Executive Assistant;
• immediately advising the Independent Assessor and the Board of any complaints and possible breaches;
• maintaining registers for recording suggested improvements, complaints, breaches, investigations and the resulting outcomes.

• investigating any complaints and possible breaches;
• advising the complainant, in consultation with the CEO, of the outcomes of the investigation;
• reviewing and reporting to the CEO annually on the performance of this policy; and
• recommending changes to the policy where it is not achieving its objectives.

• are responsible for ensuring they fully understand and comply with their obligations and responsibilities under this policy, including attendance at any training or briefing sessions;
• must not circulate or pass on memoranda, e-mail, reports or other documents to WGL-Retail staff unless that person is certain that they do not contain confidential information;
• must seek advice from their supervisor or manager if they are unsure;
• must store documents containing confidential information in a locked filing cabinet or similar;
• must ensure computer access codes and passwords are kept secret;
• must be conscious of not discussing confidential information in public or inadvertently disclose confidential information during lunch breaks, social functions, etc;
• will respect the need to show care and sensitivity when entering other work areas, particularly those where confidential information is known to, or likely to, be held;
• must advise their supervisor or manager of any complaints or possible breaches; and
• are encouraged to recommend possible improvements to this procedure to increase its effectiveness.

A staff member who does not comply with this policy will be subject to possible disciplinary action, including dismissal.

The contract for all consultants, independent contractors or agents who provide services to WGL should include an obligation that the contractor will, where relevant, comply fully with this procedure. Termination of their contract may result if any breach occurs. Those who provide services on an on-going basis should be required to acknowledge this obligation annually.

5.2 Training

• all staff will be trained such that they are made aware of their obligations and responsibilities, and understand this policy and the need to adhere to it;
• such training will be utilised as part of the induction process for new and transferred staff;
• revisions and improvements to this procedure will be formally notified through internal memoranda and/or training; and
• regular 'review' training will be held so that relevant staff remain fully aware of their obligations and responsibilities.

• invite the complainant to submit the complaint in writing, if this has not already been done;
• investigate the complaint/possible breach;
• in consultation with the CEO, advise the complainant of the results and any actions to be taken; and
• ensure all documentation is sent to the CEO for retention in the relevant register.

6.0 QUESTIONS AND ANSWERS
These Questions and Answers are provided to assist and may not cover some situations. If you are in any doubt, seek advice from your supervisor or manager.

6.1 Confidential Information
Q. What is Confidential Information?
Information to be defined and treated as "Confidential Information" shall include;

• requests for access and related services provided by GasNet
• metering data and information directly related to a specific System User
• any other Confidential Information specific to a System User that, in the course of applying for or negotiating access, the System User specifies is confidential.

• if the information is officially in the public domain; or
• if it is required to comply with any law, court order etc; or
• if prior approval has been granted by the System User who provided the information
• if the request relates to historical consumption data, or site-specific transportation charges, and prior approval of the End User has been granted. Disclosure under any other circumstances would be a breach of the obligations.

Q. If a third party gives us information regarding the business of a Retailer or of an End User, can GasNet pass on this information to WGL-Retail?
If the information is Confidential Information, GasNet cannot pass it on to any third party without the consent of the Retailer or, where the information relates to an End User, the consent of the End User's Retailer.

Q. If a third party seeks Confidential Information about a System User or a System User's client, can GasNet provide this information?
Only if GasNet first receives the consent of the System User.

Q. If someone from GasNet is questioned on an End User's site about various issues, what should they do?
If this is related to Confidential Information, do not disclose it. Check the definition of Confidential Information before any disclosure.

Q. Whose consent must be obtained before Confidential Information can be released, the Retailer or the End User?
Consent must be obtained from the relevant System User, i.e. the person who has, or is seeking, the contract with GasNet to transport gas to the End User.

As noted above, this will most likely be the Retailer who supplies the End User. However, in some cases the End User may obtain gas directly rather than go through a Retailer. In those circumstances the System User and the End User would be the same person.

Q. No matter how good the restrictions of access to Confidential Information, there will always be gossip/exchange of information by individuals, as in "tearoom discussions". How will we prevent this?
All employees will be given specific training so that they understand the extent of our Confidentiality obligations, and the possible consequences on the employee and GasNet if there is a breach of these obligations. Access to Confidential Information will be limited to persons who need access to perform their duties.

Q. Do we have to worry about non-WGL Retailers' Confidential Information when that information comes to us?
Yes. We must not misuse or disclose to any third party any Retailers' Confidential Information, whether that Retailer be WGL-Retail or another Retailer.

Q. How do we restrict access to information stored on computer?
Access is limited by the profile attached to each individual's password.

Q. Where will Confidential Information be specified? How will we protect Confidential Information?
Confidential Information is specified in the Confidentiality Policy. Confidential Information will be protected by a series of controls;

• access to any information, including Confidential Information will be on a need to know basis;
• access to Confidential Information on both computer systems will be restricted by the access protocol attached to a user's password; and
• access to confidential information will be restricted through storage in locked filing systems.

Q. Do we need to ringfence End User information in computer systems in order to avoid disclosure of Confidential Information? Will Confidential Information about existing End Users be safeguarded?
Yes. While both WGL-Retail and GasNet use one billing system, all sites have an individual installation number, with the relevant Retailer associated with it. WGL-Retail personnel will only have access to information on the billing system relating to sites currently supplied by WGL-Retail.

Q. What happens to the previous site data when a site transfers to a new retailer?
WGL-Retail will still be able to access the old site data on the billing system, but the data will only run up to the date at which the site has been transferred. The new site data will not be accessible by WGL-Retail.

Q. How is Confidential Information concerning new connections to be safeguarded by GasNet?
At present new connections are initiated, approved and managed through the Request for New Gas Connections system. Confidential Information is identified and treated appropriately.

Q. Can GasNet provide a Retailer with information regarding the total volume of natural gas put through its Sales Gates?
No. The Retailer can only know its own usage, determined by an allocation agreement. The reason for not disclosing the total volume of gas passing through the Network is to prevent the Retailer from estimating the amount of gas provided to other Retailers.

Q. What happens when GasNet is negotiating with two or more Retailers for the same site and the Retailers are providing different information that will materially affect GasNets' decision making process?
GasNet will negotiate with each on the information provided by each Retailer.

Q. Are obligations on the treatment of Confidential Information new for WGL's employees?
The current terms and conditions of WGL's employment include a general policy guide on Confidential Information. This policy adds detail specifically covering Confidential Information relating to our Network business.

Q. Who do I go to if I am uncertain about disclosing information?
Check the definition of Confidential Information to see if the data you have been asked to disclose is confidential. If you are still uncertain, talk to your supervisor or manager.

6.2 Accounting Separation
Q. How do we account for services provided to GasNet by other WGL entities?
In assessing proposed transportation prices, the Regulations require us to allocate shared costs between WGL-Retail and GasNet, and to disclose the allocation methodology.

6.3 Separation of Staff
Q. Do we need to have any controls in place for personnel who move from GasNet to a Retailer or to an external marketing agent?
We will put controls in place so that personnel who move from GasNet to a Retailer do not divulge Confidential Information.

Q. What sales and marketing services can be shared by GasNet and WGLRetail?
GasNet and WGL-Retail can only share sales and marketing services that do not involve direct sales. For example, GasNet and WGL-Retail could share market research.

Q. Who are employees directly involved in WGL-Retail?
These are employees who undertake discussions and/or negotiations with:

• End Users on gas supply contracts; and/or
• producers, transporters or retailers on gas purchase and delivery contracts.

They do not include employees involved in strategic planning/decision making, technical, administrative, accounting or service functions.

Q. Can GasNet and WGL-Retail share employees, consultants, or agents to do things other than direct sales? Can GasNet provide technical or other services to WGL-Retail? Can WGL-Retail provide technical or other services to GasNet?
The answer to all three questions is yes. However, GasNet would need to ensure that such relationships or transactions did not put it at risk of breaching any of its Confidential obligations.

Q. Can persons employed by WGL entities other than GasNet provide services to GasNet?
Yes, provided that if a person is employed by WGL-Retail, that person will not be employed on projects of a confidential nature or have access to confidential information.

Q. What should GasNet staff do when we come across a potential End User requiring supply of gas?
WGL-Distribution does not supply gas in its own right. You can refer to the fact that WGL has a gas supply business – WGL-Retail, which may be able to meet their gas supply requirements. However, it must not be implied that GasNet will only work with WGL-Retail, nor should any comparison be made between WGL-Retail, and any other Retailer.

Q. What should GasNet staff do if it is evident following a service call, that an End User has problems after the meter?
You should advise the End User to contact a plumber, or an appliance repair contractor.

Q. Can GasNet leverage its marketing effort by, for example, offering incentives to Retailers to connect new End Users, thereby increasing utilisation of distribution assets?
Yes. Such incentive schemes may well be an effective marketing tool for GasNet. There is nothing that prohibits GasNet from setting up an incentive scheme where a Retailer (including WGL-Retail) would receive a benefit in respect of each new End User connected to the GasNet System. As described in Clause 2.1 of the Confidentiality Policy, any incentive scheme we offer must be available to all Retailers on equal terms.

Q. Does Confidentiality only apply to the contract market?
No. Confidentiality applies to the whole market, ie. Residential, Industrial & Commercial, Contract and even CNG. 6.4 Responsibilities & Accountabilities

Q. How do I know if something I have observed is a Confidentiality issue and worth reporting?
Talk to your supervisor or manager.

Q. How do I report a Confidentiality issue?
In writing, to your supervisor or manager, who will forward the issue on to the CEO.

Q. What do I do if I receive a complaint?
If the complaint is in writing, pass it on to your supervisor or manager immediately. If the complaint is received by telephone, ask for information to be sent in writing, specifying all known details.

Q. How do I know if something I have observed is a potential breach and therefore requires reporting?
Talk to your supervisor or manager, who will evaluate the issue to determine if it is a potential breach or another Confidentiality issue requiring further action.