Petroleum Resources Kutubu Chairman Responds to PNGi misleading publication

On behalf of the Petroleum Resources Kutubu (PRK) Board, I wish to make the following statement in relation to a very misleading social media post by PNGi about the purchase of land at Ela Beach, Port Moresby.

In 2013 the Board of Petroleum Resources Kutubu (PRK) approved the purchase of a company that owned a piece of prime land at the Ela Beach in Port Moresby. The company Queental Limited’s only asset is the land that was acquired.

The PRK Board considered the land very valuable, and the location ideal for future property development. 

The financial transaction for the acquisition of Queental Ltd was done in two parts: K15 million for 50% of the company in 2013, and K15 million for the remaining 50% of the company in 2014, for a total of K30 million for the land asset.

The value of the land is not K15 million, as claimed by the blog article published by PNGi. The land is valued much higher than the cost of acquisition and our advise is that this value will potentially rise in the coming years because of its prestigious location, and the development around Ela Beach and Port Moresby.

The audit highlighted by the PNGi blog was in 2015, but the facts were wrongly misinterpreted and misconstrued in the blog article for its own interests.

The PRK audits by accounting firm Deloitte in 2015 and 2016 clearly stated all the facts around this asset, and did not mention any material concerns on the valuation or any illegality in the transaction.

In fact, the property is worth more than what PRK paid for. Ten years since the acquisition we have had several big offers in excess of K40 million for the land, but the PRK Board has turned down those offers because it intends to develop a unique and iconic property of its own.

The Ela Beach, Paga Hill and Fairfax Harbour waterfront are the most prestigious locations of Port Moresby undergoing further development, and as a renowned property developer, PRK intends to have a presence in this high end of town today and in the coming years.

Through the Pacific Property Trust, PRK already owns the MRDC Haus, the MMI Building, the Heritage Centre, the Hilton Hotels and Apartments, and the Gobe Haus in Lae.

This Ela Beach land and what we eventually build there will add to our growing property portfolio in the country.

There is nothing wrong or illegal about the acquisition of the land but a straight forward commercial transaction by PRK after its own due diligence. It is an investment on land banking by PRK.

We are most disappointed that the PNGi blog has decided to highlight only parts of an audit without the reading the full financial statements to portray this investment dubious and unlawful to achieve its own political ends.

The Board of PRK abides by its Trust Deed and Investment Guidelines in making such investment decisions, and I want to assure our beneficiaries that we will continue to abide by this prudent practice at all times. 


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