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Papua New Guinea to use LNG Funds

Staff Reporter | 7:41 PM |

THE National Petroleum Company of PNG says the K450 million it will contribute to the Supplementary Budget is from its share of the LNG revenue collected this year.
NPCP managing director Wapu Sonk however told The National that the payment “is not a dividend payment and must be recouped”.
The K450m from the NPCP is the largest contribution to the K1.1billion State revenue estimate announced recently by Treasurer Patrick Pruaitch for the 2015 supplementary budget ― expected to be tabled in Parliament at a special sitting this month.
The Internal Revenue Commission and Customs will contribute $400 million to that K1.1b.  
Sonk told The National that K86.4 million had earlier been paid to the Government as the half-yearly dividend in August. 
The balance of K363.4 million will be paid before the Supplementary Budget.
Sonk said the NPCP had been mandated by the National Executive Council in June to start preparatory work in financing the “Kroton Equity Option”. Under the Kokopo UBSA agreement, PNG LNG Project landowners and the affected provincial governments were given an option to take up 25.75 per cent (4.22 per cent equivalent of NPCP) at a fixed price value of $US1.01 billion (K2.91bn) payable to the State within a six-month window (option exercise window) starting on January 1, 2016 and ending on June 30, 2016.
Sonk said because the provincial governments and the landowners had not been organised, and the option exercise date was approaching, the State through the NEC mandated the NPCP to start the process on their behalf.
“Hence the K363 million is NPCP’s own funds that we are paying to the State as a bridge while we take time to do the financing for the balance of the option value,” he said. 
When asked if any of the money was borrowed, Sonk said: “We have not borrowed any money. We are using our cash flow from the past 10 months of LNG exports.”
He said depending on the market conditions, “when we get the K1bn, we will recoup this money back”. The National