Loan not necessary: PM

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PRIME Minister James Marape has told the Royal Commission of Inquiry into the Union Bank of Switzerland (UBS) K3 billion loan that it was not urgent nor necessary for the Government to buy shares in Oil Search Ltd.
Marape, the Finance Minister when the loan was processed, pointed out that Section 209 of the Constitution had not been complied with.
He also said the information provided to Cabinet at the time was not what was to be the funding arrangement.
“For reasons only known to the sponsor of the UBS submission in 2014, the then prime minister (Peter O’Neill) rushed the submission,” he said.
He said as the then finance minister, it was impressed on him by the then prime minister about the urgency to engage in the deal with UBS to buy 10.01 per cent shares in Oil Search.
“I supported the transaction on the basis that Oil Search was a good company, in fact one of PNG’s leading companies,” he said.
Looking back now, Marape said the people “lost out big time on the revenue from the PNG LNG project mortgaged against the UBS transaction”.
“Documents show that the LNG revenue that we would have collected in 2014 would be spent on the budget process.
“That was hijacked in the March 6 Cabinet decision, sponsored by O’Neill.
“Then Treasurer Don Polye protested against this and got sacked for (it).”
He said the UBS loan was totally unnecessary “except maybe to help our friends in Oil Search”.
“We sank over a billion dollars into that transaction,” he said.
Marape will appear again before the commission of inquiry on July 23.