OMV to buy out Shell’s stakes in offshore New Zealand gas fields for $578m

Oil and gas industry news : OMV, an Austrian oil and gas company has struck a deal of $578 million to buy the upstream business of Royal Dutch Shell in New Zealand.

As part of the deal, OMV will acquire Shell’s stake of 48% in the Pohokura gas field and an 83.75% stake in the Maui gas field along with associated infrastructure available for production, storage and transportation.

The Austrian oil and gas company is already an existing partner in the two assets with stakes of 26% and 10%, in the Pohokura gas field and Maui gas field, respectively. OMV says that it plans to take up operatorship role in both the New Zealand gas fields.

The Austrian oil and gas company revealed that the average production of the two offshore gas fields in the first two months of this year was about 31,000 boe/d.

Commenting on the OMV Shell deal, Rainer Seele – Chairman of the OMV Executive Board and CEO said that the acquisition is a major step to develop Australasia into a core region in line with the company’s new strategy.

Johann Pleininger – OMV Board Member Upstream and Deputy Chairman of the Executive Board added: “This acquisition builds on our operatorship capabilities in New Zealand, adds up to 100 mn boe of recoverable resources and improves the quality of our Upstream portfolio.”

Royal Dutch Shell. Photo courtesy of Royal Dutch Shell plc.

For Shell, the sale is part of its strategy of disposing $30bn worth assets by the year end and also in line with its push to simplify the upstream portfolio and make the company attractive to investors.

Maarten Wetselaar – Integrated Gas & New Energies Director at Shell, said: “We are proud of having worked in New Zealand for more than 100 years. Our customers, our neighbours, the regulator and partners have been a critical part of this journey and integral to our successes. I wish them all well.”

Subject to conditions such as approvals from New Zealand Commerce Act and Overseas Investment, the transaction is expected to be completed by the fourth quarter of this year.

Apart from the acquisition of Shell’s stakes in the Pohokura gas field and Maui gas field, OMV has also acquired the British-Dutch oil and gas giant’s stake of 60.98% in the Great South Basin exploration block (GSB), south of New Zealand’s South Island. This takes OMV’s overall stake in the Great South Basin exploration block to 82.93%.