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PNG Opposition calls on Government to explain Oil Search take over deal

Staff Reporter | 5:04 PM |
Papua New Guinea  Opposition called on Prime Minister Peter O’Neill and the management of Oil Search Ltd to explain the proposed takeover of the company by Australian company Woodside Petroleum Australia.
Opposition Leader Don Polye said citizens needed to know how their 10.1 per cent shares will be affected.
“The abrupt news of Oil Search scaling down its operations within the region including PNG, the immediate offer of K23 billion to buy the entire Oil Search Ltd shares leaves citizens with many questions,” Polye said.
“While we welcome new investors into business in PNG, we do have the right to expect veteran investors like Oil Search Ltd to be more responsible corporate partners to the people of this nation.”
Government officials confirmed from Parliament yesterday that negotiations were well underway.
It is understood that the commercial transaction will be based on a 4:1 ratio of buying the shares from Oil Search.
Polye said this posed serious economic implications.
“The 10.1 per cent shares obtained from an illegally obtained loan was a disastrous decision,” Polye said.
“The first wrong decision of 10.1 per cent acquisition might lead to the second wrong decision to sell the shares very cheaply to Woodside Petroleum. If that happens, PNG’s equity will certainly be eroded to around only 2 per cent if the OSL equity structure is maintained by the foreign company,” Polye added.
He called on other state entities including Treasury, National Planning and Monitoring, Finance and the IPBC to be vigilant on matters of national interest.
O’Neill said he would comment on the issue after obtaining advice from Treasury.