Shell reapplies for clearance to acquire FCE: offers to divest additional assets
Published20 Oct 2000
The Commerce Commission has received a second application from Shell Exploration Company BV for clearance to acquire Fletcher Challenge Limited's energy division, Fletcher Challenge Energy (FCE).
Commission Chair John Belgrave said that Shell's second application includes divestment undertakings additional to those included in the initial application.
In its initial application Shell undertook to divest:
all of the shares in, or all of the assets employed in connection with, the retail business of Challenge Petroleum Limited ("Challenge!");
all of FCE's equity interest (being 14.2%) in the New Zealand Refining Company Limited;
all of FCE's equity interest and any other involvement in the Kupe field;
all of FCE's equity interest and any other involvement in Kapuni Gas Contracts Limited;
all of FCE's equity interest and any other involvement in Fletcher Challenge Gas Investments Limited.
In its second application Shell have undertaken to divest the following additional assets within 12 months of the date of settlement:
all of FCE's equity interest in the Tariki, Ahuroa, Waihapa and Ngaere fields (commonly known as TAWN);
all of FCE's equity interest in the Ngatoro field;
all of FCE's equity interest in the McKee field;
shares comprising in aggregate a 10% equity interest in the Maui field;
shares comprising in aggregate a 3.6667% equity interest in the Pohokura field and in the petroleum exploration permit associated with that field (thereby reducing the applicant's equity interest to 48% post-merger), together with an equivalent participating interest in the joint venture.
Mr Belgrave said that the Commission will investigate what impact the proposal would have on those gas related markets previously assessed.
Last week the Commission declined to authorise clearance on the basis that a dominant position would be acquired or strengthened in the current gas production market, the post 2009 gas production market and the LPG production market.
The Act gives the Commission 10 working days in which to make its decision, but allows for extensions of time if necessary. Working day 10 will be November 6.
The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any markets in New Zealand.
