NEW ZEALAND ENERGY 2008

Shell mulls Maui ruling

HAVING lost a judicial appeal against a High Court decision over operatorship of the Maui gas fie...

Shell had wanted to remove current operator Shell Todd Oil Services - an unincorporated organisation jointly owned by Shell and New Zealand private company Todd Energy - and replace it with a Shell subsidiary.

However, the Court of Appeal just before Christmas released its decision on Shell's appeal and decided the status quo should be maintained.

Shell is still digesting the ruling, Jackie Maitland spokeperson told PetroleumNews.net.

"Obviously we are disappointed with the outcome and will review all aspects of the Appeal Court's judgment before deciding what we do next," she said.

The Appeal Court examined Shell's and Todd's rights and obligations under the various joint venture agreements and concluded that, overall, Shell was not entitled to encourage its STOS directors to using their casting vote in favour of resolutions to remove STOS as operator as had been proposed at a 2005 STOS board meeting.

Todd was granted an interim injunction in April 2005, preventing that happening and the High Court later sided with Todd by ruling that STOS was operator for the life of the field.

Documents produced during that high court squabble revealed Shell feared a $US100 million ($A111 million) loss in the value of its New Zealand oil and gas assets if it did not take the operator's role at its major Taranaki fields, and that it wanted to re-organise its New Zealand operations in preparation for a possible sale.

Shell then appealed to the Court of Appeal last July regarding the High Court judgment.

Last year Shell won a similar court case, which Todd also opposed, enabling it to remove STOS as Pohokura operator and gain control of that near-shore Taranaki gas field.

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