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InterOil confirms continuity of the Antelope reefal reservoir and extends LNG agreements

Thursday, Jan 03, 2013

PORT MORESBY, Papua New Guinea and HOUSTON, Jan. 2, 2013 /PRNewswire/ -- InterOil Corporation (NYSE:IOC) (POMSoX:IOC) announced that the Antelope-3 well reached total depth on December 25 th, and the wireline logging program is currently in progress.

Preliminary independent analysis of the wireline log results by Schlumberger demonstrate a carbonate reservoir (limestone and dolomite) with similar reefal reservoir character and quality as the offset Antelope-1 and Antelope-2 wells. This is consistent with, and supplements, the excellent results of our initial drill stem test (DST#1).

Preliminary interpretation indicates that the Antelope-3 shares the same water contact with these wells at 7,310 feet (2228 meters) below sea level. With the top of the reservoir encountered at 1,624 meters measured depth in the well, equivalent to a true vertical depth of 5,009 feet (1,527 meters) below sea level, this equates to a hydrocarbon column height of approximately 2,301 feet (701 meters). This represents the tallest vertical column encountered in the Antelope field to date. The forward program is to complete the remaining wireline logging test program before suspending the well for recompletion as a future producer.

Separately, InterOil announced that it has extend the dates in the contingent LNG project agreements with each of Mitsui & Co., Ltd. (Mitsui) and Energy World Corporation Limited (EWC) to provide flexibility for partner selection and Final Investment Decision (FID). The joint venture operating agreement and associated agreements with Mitsui for the proposed Condensate Stripping Plant (CSP) have also been amended to extend the time allowed for FID.

On November 15, 2012, InterOil was notified that the National Executive Council (NEC) of Papua New Guinea had approved a proposal to build a 3.8 million tonnes per annum LNG plant in the Gulf Province of Papua New Guinea. The approval received from the NEC is in line with the proposals from our potential LNG partners. Since then, InterOil has been working with the PNG Government to complete a modified LNG project agreement and to secure an internationally recognized operator of the proposed facilities, consistent with the NEC approval. InterOil expects that these actions will allow it to promptly complete the partnering process.

"InterOil is pleased to have safely completed drilling our sixth well in the Elk and Antelope fields, which InterOil believes further confirms the continuity of this exceptional reservoir. Confirmation of continuous reefal reservoir at the Antelope-3 location, in conjunction with PNG's Cabinet approval for the Gulf LNG project and growing provincial and landowner support, has allowed us to focus on finalizing our partnering process," stated Mr. Phil Mulacek, Chief Executive Officer of InterOil.

About InterOil

InterOil Corporation is developing a vertically integrated energy business whose primary focus is Papua New Guinea and the surrounding region.  InterOil's assets consist of petroleum licenses c overing about 3.9 million acres, an oil refinery, and retail and commercial distribution facilities, all located in Papua New Guinea.  In addition, InterOil is a shareholder in a joint venture established to construct an LNG plant in Papua New Guinea. InterOil's common shares trade on the NYSE in US dollars.

SOURCE InterOil Corporation

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