The widely-expected move has come as no surprise to industry commentators, in the wake of last month's announcement by NGC that it was quitting gas retailing and selling its power stations to concentrate of pipeline reticulation and supplying large gas customers.

However, some commentators are surprised that Genesis even applied for commission clearance, given there are half a dozen or so companies involved in gas retailing, so the commission's prime concern "of substantially lessening competition" would not be very relevant.

"It's a natural fit for Genesis and (Genesis CEO) Murray Jackson has made no secret of wanting to take over something Genesis was already servicing. However, I am a bit surprised they would even need to go to the commission for clearance," said one commentator.

Last year NGC exited electricity retailing and sold its North Island electricity customers to Genesis Power. It was also agreed Genesis would service NGC's residential and small business natural gas customers, from NGC's total industrial, commercial and residential customer base of about 100,000 gas users.

Contact Energy is New Zealand's largest gas wholesaler and retailer. Other retailers include Todd Energy, through its Fresh Start and Nova Gas subsidiaries, and Might River Power through Mercury Energy.