John Lau: Husky boss says Asian spinoff still in the works.
Husky mulls over Asia spin-off
Canadian giant Husky Energy will decide on going ahead with a spin-off of its Asian offshore oil and gas operations by around the middle of the year, its boss said today.
Husky, which has said little about the plan since first touting it to investors nine months ago, is still running the numbers on the proposed establishment of a new publicly traded company that will operate some large fields in the South China Sea, chief John Lau said.
The tax impact of the move is a big consideration, Lau said in a Reuters report.
"We will make the decision in this year," he told analysts and reporters on a conference call held to discuss the company's fourth-quarter results.
"I dare say the middle of the year, when the advisers confirm that everything is in order. We want to make sure that will be a good project for all shareholders."
Husky is China National Offshore Oil Corporation Limited's partner in the producing Wenchang oil field in the South China Sea.
The company's crown jewel, however, is the Liwan gas field, 250 kilometres (155 miles) south-east of Hong Kong.
The field, discovered four years ago, is estimated to have reserves of up to 6 trillion cubic feet.
Husky completed front-end engineering for the project in last year and sanction is expected this year for project start-up in 2013.
In December, the company, which is controlled by Hong Kong billionaire Li Ka-shing, discovered another field in the region, called Liuhua.
It is currently drilling an exploration well there.
Lau said positive results would bolster the prospective spinoff operation, which the company has said would be listed on an Asian stock exchange.
A year ago, before the recent discoveries, one analyst pegged the value of the Asian operations at C$3 to C$5 per Husky share.