New Zealand Oil & Gas, which is on the prowl for new investment opportunities, has sold its 27.5 per cent stake in the Tui oil fields off the coast of Taranaki for US$750,000.
The Wellington-based company has been considering the exit since mid-December when Tamarind, an energy company backed by Blackstone Energy Partners, bought a 57.5 per cent interest from the field's operator, AWE. Tamarind will take on the field's assets and liabilities, including US$4.7 million in oil, $6 million of working capital, and all field retirement obligations.
"The sale of the Tui interest allows New Zealand Oil & Gas to realise the present value of the remaining Tui reserves while reducing exposure associated with the uncertain end of field cessation costs," chief executive Andrew Jefferies said in a statement. "New Zealand Oil & Gas analysed the Tamarind offer and finds it compelling based on Tamarind's specialist end-of-field-life capability, including optimising late stage production and abandonment operations."
NZOG is sitting on a war chest after selling its 15 per cent stake in the Kupe oil and gas fields to Genesis Energy for $168m. While $100m will be returned to shareholders, the rest is being held back while the energy explorer and producer seeks out bargain acquisitions when a protracted period of low oil prices has prompted bankers to give up on loss-producing fields.
Jefferies today reiterated the company's plans to find new opportunities, saying they had "a preference for gas in markets we understand".
