Shell NZ chairman Lloyd Taylor said the Maui sale and purchase agreements with OMV Australia Pty Ltd was for the sale of 10 % of the Maui Joint Venture, including all associated infrastructure, and the Maui gas contract.
Taylor also announced a separate transaction involving the sale of Shell's 49% joint venture share in the Maari petroleum exploration permit (PEP 38413) and its potential oil field development, also to OMV.
The terms and conditions of both sales were confidential and depended on regulatory, joint venture and gas contract approval.
Taylor said the sale of the Maui interest completed the divestment program of physical assets required by the Commerce Commission when Shell acquired Fletcher Challenge Energy (FCE) in March last year.
A possible sale of Shell's Maari interests were hinted at during last February's 2002 New Zealand Petroleum Confernece in Auckland, where Taylor said the Maari field remained marginal in terms of meeting Royal Dutch Shell's strict international investment criteria.
Since then commentators have said OMV or German giant Preussag Energie (which is a fellow Pohokura partner with Shell and Todd) were frontrunners to get the Maui and Maari interests.
The OMV commitment to Maari should also see at least one Maari appraisal well drilled by the Diamond Offshore Drilling Ocean Bounty semi-submersible rig after it has drilled the Pohokura North-1 well this spring and then Conoco's un-named well further north in PEP 38602 this summer.
Taylor said the OMV sale would reduce Shell NZ's stake in Maui to 77.5%, with Todd Petroleum Mining holding 12.5% and OMV 10%. (The Shell group also holds a 6.25% stake in Maui through US affiliate Pectin International.)
The sale of Shell's interest in the undeveloped Maari field was part of an on-going portfolio rationalisation, started after the acquisition of Fletcher Challenge Energy, he added.
"We have decided to divest our 49% ownership of Maari to focus on our more material gas business. The divestment of our share of this potential oil development to an independent company of OMVs' size maximises the likelihood that this development will proceed quickly and efficiently," said the Shell NZ chairman.
Taylor also said the divestment program, and associated portfolio rationalisation, undertaken by Shell since acquiring FCE, had seen the development of a more dynamic oil and gas sector in New Zealand.
"As a result, a range of parties has access to more material business positions in the oil and gas industry. This bodes well for the future investment and diversity that is necessary to underpin a vibrant energy sector," he concluded.
Commentators say OMV would have driven a hard bargin for its 10% Maui stake, given that the field is now expected to falter from 2007, 2.3 years earlier than the gas supply contracts specify. It is also expected the field contains up to 285PJ less gas than contracted.
With total remaining recoverable gas reserves likely to be about 800PJ in early in 2003, that would mean the 10% OMV stake would be worth about $US80 million at the wellhead.
However, OMV may have paid as little as $US1 million per PJ, as Houston firm Vanco Energy was rumoured to be paying for its finally unsuccessful bid for the undeveloped offshore Kupe field several years ago.
