After a bitter media and court battle, Greymouth Petroleum was successful in proving that Indo-Pacific developed the field without consent and operated it in a less than optimal manner, and in having the operatorship of Goldie transferred to itself.
The bad news did not stop there with the Court finding five breaches of Indo-Pacific's obligations including deliberately misrepresenting its position to Greymouth and the Taranaki Regional Council.
The breaches were as follows:
a) Failing to seek or gain approval for development of the Goldie oil field;
b) Failing to prepare a development program and budget for the Goldie discovery;
c) Flaring gas from Goldie without consents;
d) Acting toward Greymouth in bad faith and with a lack of candour, and deliberately and falsely representing its position to Greymouth and the Taranaki Regional Council; and
e) Developing Goldie in a sub-optimal manner involving significant losses and excessive costs.
However, Indo-Pacific is not shell-shocked by the High Court report.
"We won a number of claims ourselves and, overall, we are quite pleased; we think we will be celebrating'" company corporate affairs manager Jenni Lean told Energy Review.Net.
Among the court's judgments favourable to Indo-Pacific were it not accepting Greymouth's argument that it was entitled to 92% of production and revenue from Goldie, nor Greymouth's claim that costs of the Goldie-1 operation were substantially less than $NZ3 million.
The Court's decision on a damages claim by Greymouth has been reserved for further argument.
Mark Dunphy, Greymouth's Chairman said; "We are pleased to have this decision from the court. We hope now to be able to move quickly to development of the Goldie resource. It is disappointing that the actions of Indo Pacific Energy required this matter to be resolved through court proceedings."
Greymouth acquired assets from Shell in April, 2002 including an interest in the Goldie oil and gas field. To clawback into the field, Shell had paid close to $2 million in 2001 as its contribution to the cost of the Goldie-1 well, which gave it the right to participate in Goldie cashflow when net revenues exceed a six times multiple of Goldie-1 well costs.
