PNG to sell Oil Search stake

Papua New Guinea

PORT MORESBY, September 21, 2017 – Papua New Guinea is to sell its remaining stake in Oil Search in order to quash a USD 1-billion loan, international media reported on Thursday.

The PNG government bought its 9.8% stake in the company in 2014, taking a AUD 1.2-billion (USD 965-million) loan from UBS that was later refinanced with UBS and JP Morgan, Reuters reported. Today that stake, which the banks have held as collateral for the loan, is worth approximately AUD 1.02 billion (USD 820 million).

While the two banks have sold most of the 149 million Oil Search shares owned by PNG and would have had to buy those back had the government paid back the loan, PNG officials have decided to exit the company, three anonymous sources told the agency.

UBS and JP Morgan will sell the remaining 31.3 million shares at a minimum price of AUD 6.55 (USD 5.26) per share, the report added.

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