O’Neill said the Kroton equity shares are now owned outright by the State and they will look at the option of transferring the shares to the beneficiaries.
He said this in Parliament early this week when questioned by Komo-Margarima MP, Manasseh Makiba.
The Komo-Margarima MP asked the Prime Minster to clarify confusion among landowners regarding the Kroton equity shares.
He said whilst the Prime Minister declared that the 4.27 percent will be transferred the beneficiaries as free carry equity, there was the ‘Vendor Financing’ arrangement being conducted by Kumul Petroleum Holdings Limited (KPHL).
“While I was in Hides with the Minister for Petroleum to carry out the clan vetting, which is currently ongoing, LOs are confused and there is a misunderstanding that KPHL is carrying out vendor financing but the Government has committed to give free carry.
“Can you confirm whether the 4.27 percent Kroton Equity is free carry or has to be acquired through vendor financing?” asked Makiba.
The Prime Minister said at the initial signing of the PNG LNG agreement, LOs and beneficiaries were expected to raise over K3 billion for their share of the 4.27 percent Kroton Equity.
He said the Government intervened by lowering the share price but it was still unrealistic.
“When we came into Government we tried to give them a realistic price, discounted through an NEC decision to US$150 million per share. We thought that could be something that they could raise, but again for 4 percent that’s well over US$600 million and in terms of Kina, probably close to K2 billion. Again the LOs have no capacity to raise that kind of money.
“It is our thinking that now that the Kroton Shares no longer have any loans outstanding or financial obligations to that, it is now owned outright by the State. I have committed that we will now look at the option of giving the shares directly to the landowners at free carry.
“That commitment still stands,” said the Prime Minister.
O’Neill said once the current clan vetting exercise is completed and the legitimate landowners identified, they will be transferring the Kroton equity shares to the landowners and other beneficiaries.
(Landowners signing the Kroton Equity Option in 2016)