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Austrian oil company given permission by watchdog to takeover Shell’s NZ business

New Zealand’s competition watchdog has given approval for an Austrian oil and gas company to buy Royal Dutch Shell’s New Zealand assets.

The acquisition will result in OMV taking ownership of Shell’s entire New Zealand portfolio, including its stake in the Maui and Pohokura gas field joint ventures with Todd Energy and the associated production, pipeline and tank assets.

The sale, worth $794 million, marks the end of Shell’s association in New Zealand after more than 100 years.

In considering the acquisition, the Commerce Commission focused mainly on competition issues in the national market for production and first point of sale of natural gas.

Commerce Commission deputy chairwoman Sue Begg said it was satisfied the acquisition would not substantially lessen competition in any of the markets that were assessed.

“OMV and Shell only compete to supply natural gas from the Pohokura gas field, as all production from the Maui field, including LPG, is jointly sold,” Begg said.

The acquisition would make OMV the largest producer and supplier of natural gas in the immediate future, she said.

But its overall market share was likely to decline in the longer term as the Maui field was nearing the end of its life and Pohokura was easing off its peak, she said.

Todd Energy and Greymouth Petroleum had increased their shares of the market over the past five years and that trend was likely to continue, she said.

“The constraint from these and other players, combined with the strong buyer power of large gas users, means we are satisfied the acquisition would not substantially lessen competition.”

The commission concluded the acquisition would not affect competition in the supply of LPG or restrict access to onshore infrastructure assets such as pipelines and tanks.

 – Stuff SOURCE ARTICLE

READ MORE: Shell NZ assets sold to Austrian oil and gas explorer

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