Abu Dhabi’s International Petroleum Investment Company (IPIC) has purchased a 17.6 percent stake, worth A$1.68 billion ($1.07 billion) in Oil Search Ltd, the company said.

IPIC and the Papua New Guinea government, through its nominee, Independent Public Business Corporation (IPBC) have signed the agreement with Oil Search Ltd, an IPIC statement said.

The acquisition is structured by way of a five-year exchangeable bond issue, the statement said.
"This strategic investment provides IPIC with material exposure to a significant near-term LNG project in Asia-Pacific, the PNG LNG Project operated by ExxonMobil," the statement said.

Oil Search operates all of the oil and gas producing fields in Papua New Guinea and has a 34 percent interest in the PNG LNG Project.

The PNG LNG Project is currently undertaking the front-end engineering design, securing LNG sales and project financing.

The preliminary schedule indicates a final investment decision in late 2009 with a target to supply the first LNG cargo sometime between 2013 to 2014.

IPIC holds equity stakes in South Korea’s Hyundai Oilbank, Gulf Energy Maritime in Dubai, CEPSA in Spain, Borealis & OMV in Austria, Oman Polypropylene in the Sultanate of Oman, PARCO Refinery in Pakistan, SUMED Company in Egypt, Energia De Portugal in Portugal and COSMO Oil in Japan.

(Reuters)