Leighton Wins Indonesia Contract

Mayank Mehta, Chandrasekhar Atreya and Sanjay Barot
17 Jun, 2010
New York City

Australian banks are accessing cheaper debt by selling covered bonds in New Zealand. Liberia reveals BHP ore spending plans. Amadeus Energy Ltd announces commencement of exploration in Texas. Leighton wins A$1.1 billion contract in Indonesia.

[R]6:00 PM Sydney, Australia – Australian banks are accessing cheaper debt by selling covered bonds in New Zealand. Liberia reveals BHP ore spending plans. Amadeus Energy Ltd announces commencement of exploration in Texas. Leighton wins A$1.1 billion contract in Indonesia.[/R]

Stocks in Australia traded lower as ASX 200 index in Australia decreased 0.7% or 31.70 to 4,527.30. Of the stocks in the index, 61 increased, 120 declined and 19 were unchanged.

Australian banks are accessing cheaper debt by targeting new investors and diversifying assets by selling covered bonds through their New Zealand subsidiaries. A subsidiary of National Australia Bank Ltd, sold NZ$425 million of top rated covered bonds backed by mortgage payments on June 14.

Covered bonds, prohibited in Australia, are mostly sold by European banks and attract higher credit ratings than regular notes because they are backed by assets that stay on the lender’s balance sheet, which can be sold in case of a default.

Iron ore exporters Rio Tinto Group and BHP Billiton Ltd agreed 23% increase in prices of the ore from China’s Baosteel Group Corp for the July quarter delivery.

The Chinese steel maker has agreed to pay about $147 a ton, excluding freight charges, Hu Kai, an analyst at UC361.com said in an interview today.

BP Plc’s disaster off the Gulf of Mexico is generating a strong opposition in Australia for offshore drilling after the government started exploring new areas for prospecting of oil. Resources Minister Martin Ferguson had invited bids for new offshore exploration areas in an effort to reduce the nation’s dependence on imports.

Ferguson, ruling out suspension of exploration efforts, today offered 31 drilling sites in waters as deep as 3,750 meters, more than twice the depth of BP’s leaking well.

ASX Movers

Gunns Limited led gainers in the S&P ASX 200 index with a rise of 12.0% followed by Sigma Pharmaceuticals Limited 9.0%, Mermaid Marine Australia Limited 5.4% and Spark Infrastructure Group 4.4%.

iSOFT Group Limited led decliners in the S&P ASX 200 index with a loss of 10.9% followed by Energy World Corporation Limited 6.3%, Ausenco Limited 5.4%, Mincor Resources NL 5.1% and Pacific Brands Limited 4.6%.

Other Movers

Amadeus Energy Limited surged 32.4% to A$0.24 after the oil explorer announced that it has commenced drilling at the Paul Hermes Estate No. 1 exploration well (formerly the Spikes B well) on the Hallettsville Project in Texas.

BHP Billiton plc fell 1.3% to A$38.71 after the mining company signed a development agreement with Liberia worth $2 billion to $3 billion with generous but competitive tax and royalty rates, the head of Liberia''s National Investment Commission said.

James Hardie Industries SE, the seller of home siding, fell 4.6% to A$6.70.

Leighton Holdings Limited rose 2.3% to A$33.07 after the construction company said today that its Asian subsidiary won a A$1.1 billion contract for the expansion of the mining services at the MSJ coal mine in Indonesia for PT Mahakam Sumber Jaya.

Northern Star Resources Ltd added 4.1% to A$0.07 after the company started to explore and develop mineral resources in the largely under-explored, highly prospective Kimberley region of Western Australia.

Rio Tinto Limited, the mining company, fell 1.7% to A$70.14.

Sigma Pharmaceuticals Limited surged 10.1% to A$0.54 after the owner of the Guardian drugstore stock was upgraded to “buy” from “sell” by Citigroup Inc.