Rumour has Origin earmarked to drive Kupe

Aussie company Origin Energy is now believed to be the frontrunner to take over as operator of the offshore Taranaki Kupe field, with an announcement by present operator Genesis Power still expected within two weeks.
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In October Auckland-headquartered Genesis Power admitted it was finding it more difficult than anticipated to choose a new Kupe partner and have them take over as operator of the undeveloped gas-condensate field. Chief executive Murray Jackson said Genesis was still meeting with prospective operators, "but we want it out before Christmas."

Genesis spokeswoman Donna Baker today confirmed that was still the plan. "I cannot give you something just yet, but we are working towards that," she told EnergyReview.Net.

However, she had no comment to make that Origin was now the clear favourite in the previously rumoured two-horse race - between Origin and Adelaide-headquartered Santos Energy.

Origin business development manager Kim Rouse and BassGas project manager Jeff Wearne have both declined to comment to ERN.

In August ERN reported that Santos already had board approval to try for Kupe and some had staff visited New Zealand in July, while Origin had also visited the Genesis data room in Auckland as part of its due diligence process.

However, it is now understood Santos has effectively lost interest in Kupe and the whole Kiwi industry; whereas Origin sees the ever-strengthening NZ gas market, together with its already extensive onshore Taranaki interests, offering good opportunities for further expansion.

Earlier this year six international companies registered their interest in taking over as operator of the field, as well as gaining a significant chunk of Genesis' 70% stake in Kupe that will climb to 81% once Energy Minister Pete Hodgson sells the government's former "free carry" interest to Genesis.

The sale process had earlier been delayed by a Waitangi Tribunal report that said the government should negotiate a royalties deal with disaffected Maori and not conclude the sale of its Kupe 11% interest to Genesis until the matter had been settled.

However, the government last month rejected the tribunal's findings, with Hodgson saying petroleum resources were publicly owned assets and not available for use in settling Treaty of Waitangi claims.

Jackson said then that the likely quick sale of the Crown's interest would facilitate the speedy development of New Zealand's second largest proved undeveloped petroleum resource, which Genesis wanted onstream by the first half of 2007.