Shell New Zealand is selling the Maui gas pipeline to an Australian company.
The Maui pipeline, which has been operating for over 35 years, transports 78 percent of New Zealand's natural gas. It was put up for sale in October.
Earlier this month, Shell NZ chairman Rob Jager said this country was a great place to do business but ultimately was only a small part of its global operation.
Shell has been a big player in the energy scene for generations, and produces 70 percent of all natural gas in the country.
Until recently, Shell had petrol stations all over the country, but sold them to Infratil and the Superannuation Fund. They now form Z Energy.
Maui pipeline desirable "defensive asset"
The Maui natural gas pipeline is a low-risk network with a simple operation, according to the company trying to buy it.
It was also a useful way of diversifying its business.
The pipeline has been running for over 35 years and transports 78 percent of New Zealand's natural gas, but Australian-based global infrastructure asset manager First State Investments wants to buy it.
Shell New Zealand and its minority partners OMV and Todd have agreed to sell the pipe for $335 million, subject to regulatory approval.
First State Investments recently agreed to buy gas pipelines owned by Vector.
The pipeline was what "a defensive asset", a First State Investments senior executive, Gavin Kerr, said - meaning it was an unglamorous and solid earner, rather than a fast-growing investment that might possibly come unstuck.
The system could work whether or not gas was produced locally or was imported, Mr Kerr said - but New Zealand producers had maintained consistent reserves and had developed a high level of confidence among gas customers.
The prices for using the pipe were unlikely to change much since they were regulated, and Mr Kerr added there were not likely to be any other investments at this level for some time, though the company was still interested in New Zealand investments in principle.
The sale by Shell came after it announced it was reviewing its ownership of all assets in New Zealand.
The offer to sell the pipeline preceded that however, and was separate from it.
The vendor, Maui Mining Company, is 83.75 percent owned by Shell, 10 percent by OMV New Zealand and 6.25 by Todd Energy.
The sale to the Australian company involved all three New Zealand owners.
Shell recently announced it was reviewing its ownership of all assets in New Zealand, but the offer to sell the pipeline preceded that announcement.
There is no word so far on what progress has been made on the overall asset review.