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Oil Search Limited rejects Woodside’s proposal

Staff Reporter | 3:46 PM | ||
The Board of Oil Search Limited has now met and unanimously decided to reject Woodside’s nonbinding, conditional and indicative proposal to acquire all the shares in Oil Search for a consideration of one Woodside share for every four Oil Search shares held (the "Proposal").

The Board concluded that the Proposal is highly opportunistic and grossly undervalues the

Company. Oil Search has built a unique partnership with PNG, local communities, landowners and

the PNG Government over nearly 90 years. Oil Search remains exclusively and committed to PNG.

 The overwhelming feedback from shareholders has been that this Proposal has little merit.

Oil Search has clear growth opportunities, a very strong cash position and an excellent track

record of delivery.

Oil Search owns 29% of the world class PNG LNG Project and  22.8% of the Papua LNG Project.

Oil Search has a strong commitment to PNG society in all of its operations, as well as the Oil

Search Foundation,

Oil Search is in a very robust financial position, with current liquidity of US$1.6 billion, comprising

US$850 million in cash and US$750 million in undrawn corporate credit facilities. The Company is

well placed to fund the development of its growth projects.

Commenting on the Proposal, the Company’s Chairman, Mr Rick Lee said:

“The Board of Oil Search believes our Company is in a very strong position, both operationally and

financially. We have a low cost, high quality, production base which is generating strong cash flows

and excellent growth opportunities, with the proposed PNG LNG Train 3 and Papua LNG among

the most competitive new developments in the world. Oil Search provides its shareholders with a

pure exposure to PNG and is fully committed to PNG. 

“If any proposals are tabled that reflect compelling value for Oil Search shareholders, we will

engage on them. Clearly this proposal falls well short of that test.”  Source: Post Courier/PMW