Crown frees gas and geothermal fields for development

The Government has agreed to sell its 11 percent stake in the Kupe gas field to Genesis Power and transfer central North Island geothermal assets to Mighty River Power.

Energy Minister Pete Hodgson said selling the Crown's interest in the Kupe gas field, which is off the southern Taranaki coast, would smooth the path for the development of the field by Genesis. Genesis owns 70 percent of the field, with the remaining 19 percent held by NZ Oil and Gas Ltd.

"Genesis intends to appoint a field operator for Kupe and work towards bringing the gas onstream in 2006," Mr Hodgson said. "The Government does not intend to be commercially involved with the development of the field and a sale to Genesis will enable the company to move ahead with certainty over the ownership structure."

The price of the Crown's share is to be negotiated.

The Crown owns a number of geothermal bores, largely in the central North Island, which the Government has agreed to transfer to Mighty River Power. Currently the only major production comes from the supply of steam to the Norske Skog Tasman plant at Kawerau.

"Some of these wells, particularly those in the Kawerau geothermal field, have considerable potential for geothermal power development," Mr Hodgson said. "The Government believes that Mighty River Power is best placed to undertake this development."

The assets will be transferred to Mighty River Power at a price established with the advice of independent valuers.

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