“In keeping with company’s strategy to become a simpler, more profitable and resilient company, Shell announced that its interests in New Zealand are under review”, the company said in a statement.
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Analysts have estimated the company’s assets in New Zealand could generate around USD1.00 billion in proceeds if sold, but have also noted that finding a buyer in the current environment will be hard.
The Maui pipeline, which Shell is the major shareholder of and transports around 78 percent of all natural gas produced in New Zealand, was put up for sale back in October.
Shell’s operations in New Zealand account for about half the total natural gas production in the country and a “significant” portion of its light oil production.
Shell has about 70 employees in New Zealand and there are a further 360 people in the Shell Todd Oil Services venture, Mr Jager said.
Shell has three major upstream assets in New Zealand, comprising stakes in the Maui gas and condensate field, the Kapuni gas and condensate field and the Pohokura field.
They would not be drawn on whether the review could potentially affect Shell’s business in the New Caledonia and Great South basins, for which they have been awarded prospecting and exploration rights, respectively, saying it was “too early” to talk about that.
“The Shell business in New Zealand is great, but a small part of the global Shell business and hence the decision to undertake a strategic review at this time”, said Rob Jager, country chairman of Shell New Zealand.
He said the company was ” very conscious” of the uncertainty the review created for local staff and New Zealand staff overseas.
Mr Key says the Government was told of the review yesterday.
Jager, who had worked for Shell for close to four decades said the company was part of who he was.
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