Analyst Wrap

The main headlines for the week belonged to the decision of the WA Supreme Court ordering the Independent Gas Pipelines Access Regulator to review his controversial draft decision to order Epic Energy to charge a lower tariff for the use of their Dampier to Bunbury Natural Gas Pipeline. Epic is hailing the decision as a great success for their legal action, which basically puts all players back to square one, with the playing field a little better scoped out.

What has raised pipeliners' hackles in the place of this temporary reprieve is the news that the Prime Minister's taskforce report into energy reform will now be held back due to commercial sensitivities until the report from the separate COAG body is published - at the end of the year.

Tensions are rising in the Middle East but that doesn't stop the wheels of commerce. Worley picked up the FEED contract for the gas injection development of the Umm Shaif oilfield in the United Arab Emirates. Two Sydney consultancies, An Meá and Logic Space, have won an HSE contract to train up the workforce of major Middle Eastern oil company, Petroleum Development Oman, using soccer's World Cup as a theme.

There's been some activity in New Zealand this week with Maui Development Ltd saying that a major maintenance shutdown planned for mid-November may cause major supply disruptions to consumers.

The AGL-owned Natural Gas Corporation had a win when the contract terms of Shell's acquisition of Fletcher Challenge Energy two years ago kicked in. Regardless of the results of the Maui gas redetermination, Shell is required to hand over 80 petajoules to NGC, worth a cool NZ$26m, for zip.

Shell was on the wrong end of another legal issue again this week when an odourous release from their Corio Bay refinery in Geelong in February 2001 resulted in it being ordered to pay over $50,000 in fines and costs and run national press ads broadcasting the fact.

The sale of the NZ assets of Aquila (formerly UtiliCorp) has raised enough interest to have the offer period extended to allow more prospective buyers to kick the tyres. And meanwhile the Huinga partners continue to swab out their well, aiming to get a definitive production test from their promising discovery.

The same story is true for the Woodada-19 well across the other side of the region in the Perth Basin. Last reports indicate the partners, Hardman and Bounty, are days away from recovering all the lost drilling fluids from the target zone, and will soon know whether they have an oil discovery on their hands.

Perth Basin neighbours Origin and Arc Energy have established a 26 metre pay zone with excellent permeabilities from the deviated Hovea-3 well, which should yield excellent flow rates when in production. Origin also posted a 31% net profit increase this week.

Looking toward the big boys and on the back of the Guangdong supply agreement announcement, the Chinese have negotiated themselves into 25% of the venture that will supply China with LNG from the North West Shelf for what has been described as a very cheap US$320m.

Putting LNG bums on seats for the next three years will be Qantas, which this week picked up the key $60m Karratha and Darwin fixed wing aviation contracts for Woodside and its contractors.

On the IPO front, Global Petroleum has scaled back their raising to $2 million from $15m, after haggling to pay vendors with stock instead of cash.

And finally, Australian Oil & Gas Corp, former owner of the OD&E drilling business, slips from the boards of the ASX this week after being taken over by Canadian drilling outfit, Ensign Resources.

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