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24

BG To Support Origin in NSW Power Privatization

An integrated British oil and gas company, BG Group, will support Origin's participation in the upcoming privatization of New South Wales' power assets, if it succeeds in a takeover plan, the government has said

An integrated British oil and gas company, BG Group, will support Origin's participation in the upcoming privatization of New South Wales' power assets, if it succeeds in a takeover plan, the government has said.

BG also has no plans to spin off Origin Energy Ltd's power retail arm, Heather Gilmore, a spokeswoman for New South Wales state treasurer Michael Costa, said in an e-mail.

Senior executives from BG's Australian unit met with New Costa on Tuesday following concerns raised by some analysts that BG's $12.9 billion proposed offer for Origin would take a key bidder out of the field for the state's privatization plans.

BG, one of the largest LNG shippers in the world, also told the NSW government it wants to grow Origin's energy retail business and compete in the sector, she said.

BG launched a surprise takeover for Australia's second-largest energy retailer Origin last week in a bid to secure more gas resources for its proposed coal seam gas-fuelled liquefied natural gas (LNG) project at Gladstone port in northern Queensland state.

There has been speculation among analysts that BG would look to sell Origin's retail business and focus on its coal seam gas resources.

Origin has not yet formally responded to BG's proposal, which offers $14.70 a share in cash, a 40 per cent premium to its share price before the bid was announced.