Todd’s application and the commission’s subsequent decision are seen as two of the last hurdles to be cleared before the strategic Taranaki-Huntly Maui pipeline can be opened to gas from new fields such as Pohokura and Kupe, and that gas can be piped north to the energy-hungry greater Auckland and Waikato regions.

The commission said it would shortly be calling for public submissions on the matter, though it had set no deadline for making any decisions.

It added that the Todd applications for restrictive trade practice authorisations were necessary under the Commerce Act. The Act prohibits competitors working together in a way that lessened competition unless the resultant public benefit outweighed the detrimental affects of that anti-competitive behaviour.

Todd Energy made its submissions to the commission as Maui partner, Todd Petroleum Mining Company, and McKee-Mangahewa gas producer, Todd Taranaki Ltd.

Under the existing Maui pipeline operating code “legacy” gas – Maui gas sold to Contact Energy, Vector subsidiary NGC or methanol producer Methanex – would not face the same penalties, fees and restrictions as would “non-legacy” gas, although both types of gas would be sold in competition to each other.

And legacy gas buyers could “shelter themselves from the penalty regime in place” in relation to much of any non-legacy gas they purchased.

As well, pipeline users or gas owners had to have a transmission services agrement (TSA) with the relevant pipeline owner and a “Welded Point Agreement” (WPA) with NGC for the transportation of gas in NGC’s pipelines past Huntly.

Both these aspects could potentially breach the commerce act by substantially lessening competition in the wholesale gas market, said Todd, NZ’s largest integrated gas player.

Todd – which gained last year gained interim access to the Maui pipeline for its McKee-Mangahewa gas – said it had been actively selling, swapping and buying gas on the Maui pipeline with most market participants. This was only possible because the parties had not needed TSAs, or prior approval either from the Maui partners (Shell NZ, Todd and OMV) or from NGC.

Todd added that New Zealand was long overdue for an internet-based gas market exchange, where the buyers and sellers did not know the identity of the counter-party, as opposed to the current requirement by the Maui partners to “pre-approve each and every trade at NGC-welded points”.