By Andrew Hobbs, Group Editor
IF PAPUA New Guinea were a person, it could be forgiven for hoping that its 40th birthday could be the start of a move into a less hectic middle age.
But a downturn in commodity prices has meant that business activity in the nation, and the taxation income that it brings, is at a low at a time when attempts to invest in the nation’s future are at an all-time high.
Economically, something has got to give, and an update to the PNG Budget, due in October, will no doubt see that happen – with PNG Prime Minister Peter O’Neill saying that “non-essential spending” would be in the firing line.
It comes at a time when the government is also looking to develop local business enterprises as well as encouraging foreign investment.
On that front, at least, it seems the challenge is less severe – despite short term obstacles, foreign investors are playing a long-term game and continuing to circle the major players, and major prospects with interest.
Nowhere is this clearer that with Oil Search’s confident rejection of the takeover proposal made by Woodside in early September.
The Australian company had been on the search for high value assets it could acquire at a time of international downturn and Oil Search, with its strong asset base in both the PNG LNG and Papua LNG projects, must have been a very tempting prospect.
For Oil Search chairman Rick Lee, however, the offer was opportunistic and undervalued the company – with little support found among shareholders for the offer.
It will also allow the company to continue funding charitable arm the Oil Search Foundation as well as other independent charities, and to keep its focus solely on PNG.
One can’t help but think that this will also be a good thing.
** Staff at PNG Resources have had another reason to celebrate this month with the safe arrival of Ruby Rose Brimble, the daughter of our advertising account manager Greg Brimble and his wife, Elizabeth, on 14 September.
All the family are well and excited to face the future, and we wish them all the best.