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The New Zealand Herald: Shell loses appeal against Todd in Maui field dispute

11:17AM Wednesday December 19, 2007

Shell has lost an appeal against a High Court decision over who should be the operator of the Maui gas field in Taranaki.

The effect of today’s Appeal Court decision is that the status quo will be maintained at the Maui field.

Shell had wanted to remove Shell Todd Oil Services (STOS) as the operator of Maui and replace it with a Shell subsidiary.

In 2005 Shell-appointed directors of STOS called a meeting of the STOS board to consider a draft set of resolutions under which, if passed STOS would resign as operator of Maui.

Todd sought an interim injunction to prevent the meeting taking place, which was granted in April 2005. Todd then sued Shell and Justice John Wild in the High Court found in favour of Todd.

Justice Wild said that Shell could not take over from STOS as Maui’s operator because it would be a breach of employment contract and of the joint venture deal between Shell and Todd.

Under that ruling STOS continued to operator Maui and the Kapuni onshore gas and condensate field. It also operates “in substance” the Pohokura gas field.

Today’s judgement by the Court of Appeal dismissing an appeal by Shell was unanimous.

The court examined Shell and Todd’s rights and obligations under the various joint venture agreements and concluded overall that Shell was not entitled to encourage its directors on the STOS board to vote in favour of the resolutions to remove STOS as an operator.

Todd Energy managing director Richard Tweedie has said that Shell’s move was an attempt to maximise the value of its assets in New Zealand, particularly if it sold any or all of its shares.

– NZPA

http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10483254

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