png lng debt deal set to raise stakes , page-5

Another story
Govt moves to recoup shares
Govt seeks $A1.8b, denies links to takeover of OTML

THE O’Neill Government is keen to buy back its Oil Search Ltd shares it offloaded to the Abu Dhabi-based International Petroleum Investment Company (IPIC) in 2008. And it is still in negotiations with potential financiers, according to the Independent Public Business Corporation (IPBC).
The developments coincide with revelations by highly-placed sources that the move to take over the Ok Tedi Mine is allegedly connected to the hunt by the Government for collateral to enable it to raise $AU1.8 billion to repurchase the shares.
Prime Minister Peter O’Neill brushed aside the reports in a recent interview with the Post-Courier saying they were baseless as negotiations were still ongoing.
“There is no truth in all this. Discussions are still going on. The final shareholding structure will be determined after the conclusion of these discussions,” he said.
Former PM and sidelined PNG Sustainable Development Program (PNGSDP) chairman Sir Mekere Morauta refused to comment when approached, saying the matter (ownership of the mine) was in court in Singapore and the Washington DC.
IPBC acting managing director Wasantha Kumarasiri echoed similar sentiments to the PM saying negotiations were still underway, though he expressed concern with reports connecting investment bank UBS AG to a purported deal.
A copy of a National Executive Council Decision (Decision No 117/2013) dated April 5, 2013 obtained by the Post-Courier showed that the cabinet had given approval for the Minister for State Enterprise to direct the IPBC management to seek funding that would be used to finance the State’s component for train 3 of the PNG LNG Project expansion.
The State’s component is estimated to be $AU1.2 billion, according to the NEC document. Cabinet also directed that the IPBC should minimise cost associated with raising funds through direct negotiations with potential financiers and the use of IPBC management.
Appropriate security options to meet the financer’s security requirements should also be provided.
According to highly placed Government sources, who spoke on condition of anonymity, the Government through IPBC had a shortlist of five overseas financiers who were interested in providing the funding.
However, the Government’s lack of collateral to guarantee the provision of the loan appears to be an obstacle to moving with the loan negotiations. “The Prime Minister has said for us to look at all options but we advised him to let it go because getting another loan would add more burden to the people and we need that kind of money to provide health and education services,” said an official involved in the negotiations.
The Government’s takeover of the Ok Tedi Mine Ltd (OTML) and the sidelining of the PNG Sustainable Development Program (PNGSDP) opened up the potential of using revenue generated by the Western Province mine.
However, its efforts were frustrated by landowners splitting over the Government’s moves and litigation initiated in Singapore and America by the PNGSDP.

http://www.postcourier.com.pg/20131114/thhome.htm

Interesting is again to hear about seeking funding for the expansion for the third train.
And the saga continues......