Origin and Contact finalise NZ$110 million deal
13 June 2008
Origin and Contact finalise NZ$110 million New Zealand oil and gas deal
Origin Energy and Contact
Energy today announced the completion of a NZ$110
million acquisition of Swift Energy’s New Zealand oil and gas operations.
The completion of the acquisition sees Origin acquire:
• Two oil and gas producing areas in Taranaki
– the Tariki, Ahuroa, Waihapa and
Ngaere (TAWN) and Rimu-Kauri fields;
• The Rimu and Waihapa production stations;
• Oil and gas transmission pipelines from Waihapa to New Plymouth;
• Two offshore Taranaki exploration permits; and
• An inventory of equipment and supplies.
Under a separate agreement between Contact and Origin, Contact has purchased the right to own and develop the Ahuroa gas field as an underground gas storage facility and purchase the remaining gas and LPG reserves in the Ahuroa reservoir.
Origin Managing Director Grant King said the acquisition is part of the ongoing expansion of Origin’s interests in New Zealand: “The purchase of Swift’s New Zealand assets will bring immediate production benefits for Origin, and also adds exciting development and exploration opportunities both onshore and off the Taranaki coast.
“Origin has been carefully building its position in New Zealand for a number of years. We hold the largest exploration acreage position of any company involved in New Zealand, are well advanced with the liquids-rich Kupe Gas Project in the offshore Taranaki, and have now added this important mix of operating assets.
“Origin gains the highly valuable expertise and technical skills of 56 Swift Energy staff who are transferring to Origin and we are establishing our New Zealand headquarters in New Plymouth,” he said.
Contact Chief Executive, David Baldwin, said the acquisition provides Contact a valuable gas storage development option, which the company is expected to have operating by 2010. “Gas storage will be a critical component of New Zealand’s energy future. The ability to purchase gas during off-peak periods, store it underground and release it when it is most needed will provide valuable supply flexibility for Contact and enable the company to use its gas-fired power stations in the most economic and efficient fashion.”
Mr Baldwin said the gas storage development underpins the development of Contact’s 200 megawatt gas-fired peaking plant at Stratford which will be operational by the winter of 2010.
“The gas storage facility and the company’s Stratford peaking plant will play a vital role in supporting increasing levels of renewable electricity generation in the electricity system,” he said.
Grant King said that the acquisition will deliver operational synergies with the Origin-operated Kupe Gas Project in the Taranaki Basin and increase the exploration opportunities available to Origin.
“Together with our exposure to the power generation and energy retail markets in New Zealand through Contact, this acquisition continues to demonstrate and build on Origin’s capabilities as the leading fuel-integrated generator and retailer in Australasia,” Mr King said.
Both Mr King and
Mr Baldwin said that this arrangement demonstrates the
strengths of Origin and Contact.