Gas fields linked; we was robbed, say NZ shareholders

NEW Zealand's longest-running insider trading battle finally made it to the High Court last week.
Gas fields linked; we was robbed, say NZ shareholders Gas fields linked; we was robbed, say NZ shareholders Gas fields linked; we was robbed, say NZ shareholders Gas fields linked; we was robbed, say NZ shareholders Gas fields linked; we was robbed, say NZ shareholders

Minority shareholders of Southern Petroleum are seeking about $NZ23 million (about $A18.8 million) in compensation from Shell Exploration New Zealand.

They say Fletcher Challenge Energy, bought by Shell in 2001, withheld vital information in a takeover move.

The 700 or so disgruntled shareholders, led by Auckland businessman Tony Gavigan, have battled for years to get their case heard, following an out-of-court settlement by Shell with listed retirement care provider ElderCare over its disputed preference shares in Southern Petroleum.

On Friday, counsel for the shareholders, Gary Judd QC, told the court that the plaintiffs believed FCE had insider information that showed Southern's oil and gas prospects in onshore Taranaki were worth more than FCE was offering in a takeover.

The shareholders argued that FCE subsidiary Petrocorp was aware of that a deep gas study of Southern's Mangahewa field showed very large upside, but failed to disclose the information.

Consultant petroleum geologist Tom Haskell told the court he believed the deep gas study, which included an area covering the now commercial Pohokura, Mangahewa, Turangi and Kowhai fields, showed these fields could be linked.

Judd said the study evaluated the greater Mangahewa structure as being "potentially bigger" than the 3 trillion cubic feet-plus Maui gas field.

The shareholders claim they would have received more money per share had FCE not withheld information about the potentail of Southern's Taranaki oil and gas portfolio, which included a stake in the licence that later yielded the 1Tcf-plus Pohokura gas discovery.

Their claim represents the difference between the two sums, including penalties and interest.

Southern shareholders were paid NZ75 cents a share but say they would have received much more - up to $NZ3 a share - had that information been made public.

The case is being heard by Justice Hugh Williams and may take several weeks to complete.

loader