Wednesday, July 27, 2011

InterOil provides Gulf LNG project update

InterOil is not in the business of testing new technology nor will it ever use Papua New Guinea as a “guinea pig” for new technology testing, says InterOil chairman and CEO, Phil Mulacek.

Mulacek stressed today that all technology incorporated in InterOil’s Gulf LNG project in PNG’s Gulf of Papua was proven and was chosen after a rigorous assessment process.

He also said that InterOil already had world-class operators in its Gulf LNG project development team to develop and deliver a high quality world-class project for PNG.

“InterOil’s project management team includes experienced operators from major oil companies who have been responsible for world-scale LNG projects,” Mulacek said.

The InterOil CEO was responding to statements attributed to PNG’s new Minister of Petroleum and Energy, Minister Potape in a press articles published in PNG’s two daily newspapers, The National, on Tuesday and in the Post-Courier yesterday.

Mulacek confirmed that InterOil had made substantial progress on its Gulf LNG Project in the past 17 months.

“InterOil achieved critical mass in its contingent resource estimate on February 16, 2010 with the independent resource assessment certifying a best case estimate of more than 8 trillion cubic feet (Tcf) of natural gas and associated condensate.

“Since then, InterOil has entered various framework agreements, contingent on final investment decision (FID), on infrastructure and facilities with a start up capacity of 5 million tonnes per annum (mtpa) in 2014 and potential expansion up to 10.6 mtpa, being the capacity referenced in the 2009 LNG Project Agreement with the government of Papua New Guinea,” Mulacek said.

He said InterOil was in the process of informing Minister Potape and his advisors, as it routinely does with the relevant PNG Government departments and advisors, on the structure and economics of the company’s Gulf project.

“This is a project aimed at bringing benefits to stakeholders, including the people of Gulf province and PNG, as soon as possible.

“We look forward to working with Minister Potape to bring the government and the people of PNG an economically-advantaged, modern LNG project as early as possible.

“InterOil believes that none of the technology proposed for the Gulf LNG project is new, being rather the use of existing technologies in new efficient configurations.

“The specific type and size of floating LNG facility fixed at a jetty InterOil will use its well within the operating envelope of existing floating production storage and offloading (FPSO) vessels, and is a viable and economically-favourable option to accelerate LNG production from the project,” Mulacek said.

The PNG Government has previously provided statements of support and endorsed a separate floating LNG project being explored by State-owned Petromin prior to the appointment of the Minister to his current role over a month ago.

InterOil has operated in PNG since 1995, and proudly employs some 800 people throughout the country in its current operations.


Footnote: 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 covering 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. 


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