Todd cleared on Pohokura stake

The Commerce Commission yesterday cleared Todd Energy to increase its stake in the joint venture to develop Taranaki's offshore Pohokura oil and gas field.

The clearance allows Todd Pohokura to take a 9.8 per cent interest from OMV New Zealand. Todd Energy, through Todd Petroleum Mining, previously held 16.1 per cent, with Shell holding 48 per cent through two subsidiaries and OMV holding 35.9 per cent.

The commission said the clearance was a requirement of conditions in its recent decision authorising the joint selling and marketing of gas from the Pohokura field.

Commission acting chairwoman Paula Rebstock said the increase in Todd's participating interest in Pohokura did not result in a substantial lessening of competition in the market for natural gas production.

"The commission specifically considered that the acquisition would not affect the likelihood and ability of any of the parties to delay development of the field," Rebstock said.

The Pohokura joint venturers are considering appealing against the commission's requirement that field production must start by mid-2006. The commission made that stipulation on September 1 when authorising the Pohokura partners to jointly sell gas rather than sell it in competition with each other.

The partners said the threat of not meeting the 2006 deadline, which would void approval for joint marketing of the gas, posed a "significant additional project risk for those parties seeking to secure project finance".

The partners have until September 30 to decide whether to appeal.

Although it said joint marketing was anti-competitive, the commission's goal in allowing it was to speed up the development of the Pohokura field.

Pohokura is estimated to hold 14 to 16 billion cubic metres of gas, making it New Zealand's largest undeveloped field.

- NZPA