O’Neill denies shares speculation

National, Normal
Source:

The National, Wednesday October 30th, 2013

 By MALUM NALU

PRIME Minister Peter O’Neill yesterday denied speculation his government intends to use Ok Tedi Mining Ltd (OTML) as collateral for a loan to buy back shares in Oil Search Ltd (OSL).

He said this when asked about speculation in the business community that the government had used OTML as collateral for a US$1.9 billion (K4.88 billion) loan from UBS Switzerland to keep control of the OSL shares that were used as collateral for the original US$A1.6 billion (K3.94 billion) IPIC loan for the State to acquire its shares in the PNG LNG project.

The OSL shares now belong to Arabs and word is that the government wants to get them back.

“To use Ok Tedi as collateral is absolute nonsense,” O’Neill told reporters after appearing on FM 100’s Talk-back Show.

“There’s not been one single suggestion.

“There’s no need for collateral.

“If there was any arrangement, it will be that the collateral will be the Oil Search shares itself.

“There’s no need for any collateral by any financier.

“Why that is necessary is because the LNG project itself is a certainty, Oil Search shares are worth something, so you don’t need any other security to borrow any money.

“Again, this is coming from people who have got no business acumen whatsoever to make such a comment.

“This is very unrealistic. I can’t keep on debating issues on speculation. I think people need to be a bit more realistic.

“No evidence about anybody giving any instruction that Ok Tedi shares will be issued as collateral, not ever a discussion in cabinet, not even a discussion among leaders in government, so that is absolutely false.”