Shell seeks to acquire Fletcher Challenge Energy

The Royal Dutch Shell Group is proposing to buy New Zealand company Fletcher Challenge Energy Ltd. (FCE) for $2.3 billion (Aus.). Shell has applied to New Zealand�s Commerce Commission for clearance to acquire the energy arm, recently spun off the Fletcher Challenge Group.

Aug 28th, 2000


MELBOURNE�The Royal Dutch Shell Group is proposing to buy New Zealand company Fletcher Challenge Energy Ltd. (FCE) for $2.3 billion (Aus.). Shell has applied to New Zealand�s Commerce Commission for clearance to acquire the energy arm, recently spun off the Fletcher Challenge Group.

Fletcher Challenge dominates New Zealand�s petroleum industry and is the major interest holder in the country�s Maui gas field with 68%. Shell, with 18.75%, operates Maui and would like a larger share.

Analysts point out that the acquisition of FCE is in line with Shell�s global gas strategy; however, there is no guarantee that Shell will be successful in its application to the Commerce Commission, a prerequisite of any potential purchase.

Shell�s application said it would sell FCE�s fuel retailing division and 14% interest in New Zealand Refining Co., operator of the country�s only refinery at Marsden Point on the east coast of the North Island.

At the same time FCE has not been idle in the acquisition game, recently agreeing to buy between 33.7% and 58.6% of Australian company Petroz NL, which has an interest in the Bayu-Undan field in the Timor Sea (OGJ Online, July 26, 2000).

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