AGL Energy sells PNG assets for A$1.13 billion
No capital gains tax will be payable in either Papua New Guinea (PNG) or Australia on proceeds from the sale. AGL Energy anticipates receiving the bulk of the proceeds by December 19, 2008 with minor cash flows relating to purchase price adjustments and a pipeline license interest occurring in January 2009. The sole buyer of the bulk of the interests for A$795 million was the Merlin Petroleum Company, an existing co-venturer and an affiliate of Nippon Oil Exploration. A pipeline license interest was sold for $5 million and split approximately in equal stakes between Merlin and an existing landowner company, Petroleum Resources Kutubu. Michael Fraser, managing director of AGL, said: "These proceeds will provide a valuable buffer against the current financial markets turmoil. They also gives us the flexibility and capacity to transact on future growth options across all our businesses as evidenced by our recent purchase of the Gloucester basin coal seam gas assets."