Greymouth Petroleum picks up Shell assets

By Phil Boeyen, ShareChat Business News Editor

Monday 25th February 2002

Oil company Shell has agreed to divest a number of oil and gas assets to privately owned Greymouth Petroleum, a company which once led a competing bid against Shell for Fletcher Energy.

Greymouth Petroleum says it has reached agreement to acquire Southern Petroleum Ohanga and Shell's interest in the Kaimiro oil and gas fields, for an undisclosed sum.

The assets comprise interests in three onshore producing oil and gas fields and related facilities, including pipelines, located in the Taranaki Basin.

Chairman Mark Dunphy says Greymouth is delighted to be adding the assets to its existing production and exploration operations.

"Greymouth is not only acquiring proved producing properties which immediately increase oil and gas production and cash flow, but more importantly adding significant facilities and infrastructure that can enhance the value of our existing Motoroa oil field and Eastern Margin exploration interests.

"With the Kaimiro field interest we will own and operate substantial additional oil and natural gas processing capacity. Significantly also, we hope to attract a number of key former Fletcher Energy oil and gas professionals to join our team in Taranaki."

Mr Dunphy says the company has entered into agreements with Shell with regard to the use of oil storage facilities and for purchase of crude oil produced. It has also entered into a strategic agreement that provides Shell with the right to participate in further development of the deeper Kapuni gas reservoirs present in the Kaimiro field.

The purchase will require various approvals and consents from New Zealand regulatory authorities and is expected to be completed by the end of next month.

Greymouth Petroleum joined with listed-investor Guinness Peat Group (NZSE: GPG) and FR Partners early last year in a failed attempt to bid for Fletcher Energy.

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