Oil secrets stolen

00:08, Apr 30 2014

A former Tag Oil production manager has been found guilty of stealing highly-confidential oil-discovery secrets before taking up a job with the opposition.

Canadian James Winston Watchorn, 42, denied three counts of stealing Tag's "secret recipe" computer files on June 7, 2012.

Two months later he was working for Tag's direct competitor, New Zealand Energy Corp.

Yesterday Judge Allan Roberts released his reserved decision finding Watchorn guilty of all three charges.

Tag Oil said yesterday the case had been a sorry and distressing affair.

Chief operating officer Drew Cadenhead said the company was alarmed by the amount of data Watchorn had hurriedly copied before he left to work for a rival.


"I was shocked when I realised what had happened. We were left with no choice but to make a complaint to the police.

"The verdict speaks for itself," Cadenhead said.

"This has been an extremely upsetting issue for all our staff," he said.

Earlier this month, Cadenhead told the judge-only trial in the New Plymouth District Court that Watchorn deliberately targeted and downloaded seismic and geotechnical information from Tag's server which revealed the highly successful methods used by his company to find oil and gas in Taranaki.

Through these methods, Tag achieved 20 strikes from 20 wells, a success unheard of in the oil and gas exploration industry.

How Tag used its "secret recipe" was very valuable information sought after by oil industry exploration companies - in particular newcomer to the industry NZEC.

The Cheal well site material was "definitely part of our utmost of confidential information", Cadenhead said in his evidence.

Carey Davis, Tag's exploration and new ventures manager, gave evidence that Watchorn told him "he got what he wanted" from the files prior to leaving.

The extent of and the nature of the material would have been of significant interest to opposition businesses, Davis told the court.

Watchorn initially told the police officer in charge, Detective Byron Reid, that he did not take the hard drive to Canada and would "never think" of taking a geoscience folder to NZEC.

Crown solicitor Cherie Clarke said Watchorn targeted the highly confidential geoscience information. He knew what he was taking and that he was not entitled to it.

The material in the hands of the opposition would be viewed as disastrous because it was the secret recipe on which significant amounts of money were spent to collect, Ms Clarke said.

Watchorn, through his lawyer Susan Hughes, QC, denied any dishonest intent. There was no evidence of any dissemination of any of the material.

Watchorn accepted he was mistaken in that he did take the hard drive with him to Canada.

Judge Roberts said yesterday the oil industry was highly competitive. It was clear in Watchorn's contract of employment that confidentiality was demanded and that property must be returned.

The judge said Watchorn was not charged with disseminating any of the material he secured and there was no evidence to suggest that.

The judge found Watchorn had targeted the geoscience material.

"I have no hesitation at all in determining that his actions in this regard were dishonest from the outset."

Watchorn had downloaded a large amount of material to his hard drive the day before he travelled to Canada to see his ill mother. While in Canada he met with NZEC management to discuss work prospects.

On July 16 he handed in his notice and transferred Tag data to a USB key.

The hard drive was taken into the NZEC offices and Watchorn used a USB key to access confidential Tag data on his computer at NZEC.

Watchorn acknowledged he did undertake substantial downloads and did so in order to work while in Canada.

He said the court could not be satisfied beyond reasonable doubt of dishonest intent, that he had no knowledge that the seismic information was in the files.

Watchorn said it was common practice to download files from earlier employees as a template for the future.

He will be sentenced on May 23.

Taranaki Daily News