Page 14 - AsianOil Week 22

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PNG suspends trading of Oil Search shares

POLICY OIL Search revealed this week that Papua New
Guinea’s (PNG) market regulator had ordered
the National Stock Exchange (PNGX) to sus-
pend trading of the company’s shares.
The Securities Commission’s acting head, standing in law”. Tongayu added that his own
Alex Tongayu, has accused the company of appointment “under National Gazette NO. G741
failing to obtain the commission’s approval for of 2018” was current.
the retail component of its recent capital raising He said: “While the commission was occu-
exercise, which would constitute a breach of the pied with the discussions with Oil Search team,
Capital Market Act 2015. Oil Search went behind the back of the commis-
Oil Search’s offer attracted $700mn and closed sion and took through the process, breaching the
oversubscribed on May 28, owing to heightened Orders of April 20 and completing the offer. The
demand from Australian institutional investors. commission only realised that Oil Search had
The dual-listed company held a separate capital been playing double standard all along only after
raising exercise in PNG, though analysts do not the commission saw Oil Search’s market release
believe this elicited much investment. on May 27 on the ASX announcing the comple-
Oil Search claims that it sought and obtained “valid tion of the PNG offer.”
approvals” for the capital raise from the commission’s The company said it would challenge the
executive chairman, Christopher Hnanguie. suspension order before PNG’s National Court
Tongayu, however, said in a statement: “The and that it was confident that the approvals it had
issuer decided to proceed with the issue under an received were valid.
illegal and legally flawed approval, undermining Oil Search opted to conduct the capital rais-
the Securities Commission.” ing exercise after the oil price collapse strained its
Tongayu told Business Advantage PNG in balance sheet. The company revealed in March
a June 3 interview that the National Court had that it intended to slash its spending for this year
ruled on June 21, 2019 that Hnanguie’s claim to by around 40% to $440-530mn from a previ-
the position of commission chairman had “no ously projected $710m-845mn.™

NSW advances CBM moratorium

POLICY NEW South Wales’ Upper House passed a where thousands of jobs have been created,
controversial Bill on June 3 that seeks to ban billions of dollars invested in regional com-
coal-bed methane (CBM) development within munities, and hundreds of millions of dollars
the state. paid to farmers, with no significant environ-
The state’s Labor Party opposition united with mental impacts and over 66,000 Gl of water
the Greens and several independents to pass the returned to farmers for their beneficial use, or
Bill, which will now proceed to the Lower House. injected back into aquifers,” McConville said.
For it to pass into law all it will take is for a single “The only way to put downward pressure on
Liberal or National member of the house to vote gas prices for customers, including manufac-
against their party’s agenda. If that were to hap- turers, is to increase supply and competition.
pen then Santos’ proposed Narrabri gas project The Narrabri project does just that.”
would be derailed. The proposed moratorium’s success-
Santos has said the project, which is currently ful trip through the Upper House comes
before the state’s Independent Planning Com- at a difficult time for the gas sector, given
mission (IPC), could deliver 70 PJ (1.82bn cubic depressed energy demand owing to national
metres) per year of additional gas to the domes- social distancing measures.
tic market by 2023. With NSW importing 95% Australian Energy Minister Angus Taylor
of the gas it needs from other states, Narrabri said last week that the government believed a
promises to help lower the state’s gas bill. “gas-fired recovery” would create jobs and drive
The head of the Australian Petroleum Pro- economic growth.
duction and Exploration Association (APPEA), Taylor said: “Gas is flexible and provides the
Andrew McConville, has decried the passing of dispatchable capacity we increasingly need to
the Bill, saying its implementation would con- balance intermittent renewables and deliver a
demn the state to higher gas prices and a slower secure, reliable and affordable electricity system
economic recovery. to power our homes, businesses and industries.”
“The Bill ignores the proven track record He called on states to do more to increase
of the onshore gas industry in Queensland, domestic gas production for the local market.™

P14 www. NEWSBASE .com Week 22 04•June•2020