Oil Search signals cash in the pipeline
OIL Search has signalled a significant return of capital to shareholders once cash starts flowing from its $US19 billion Papua New Guinea LNG project, led by partner ExxonMobil.
Managing director Peter Botten said some "very long-term shareholders" of Oil Search were "expecting cash returns" from the PNG LNG project, which is 75 per cent complete and which is on track to produce its first LNG in 2014.
The PNG government owns 15 per cent of Oil Search, while London-based fund manager Capital Group has an 11 per cent stake.
A review of dividend policy was flagged in the last annual report and, releasing the company's full-year profit on Tuesday, Mr Botten said the Oil Search board took a "very measured" approach and would put it to shareholders next year.
Oil Search on Monday announced the resignation of chairman Brian Horwood and his replacement by director Rick Lee.
Mr Botten said the changes reflected the increasing complexity of Oil Search and the need to prepare for the next phase of its growth.
He flagged that there would be a review of the organisation and its investment process in 2013, which was a year of transition for Oil Search.
After 12 years at the head of Oil Search, Mr Botten is the longest-serving chief executive among the ASX50 companies. He said that on the achievement of the first LNG he would consider his future. "I'm continuing on, at least for the foreseeable future."
Oil Search reported a 13 per cent drop in net profit after tax to $US176 million, driven partly by slightly lower oil and gas volumes and realised prices, and an increase in spending on exploration.