InterOil posts US$17.7m profit for 2011

By MALUM NALU

InterOil yesterday (Monday) announced a net profit US$17.7 million for the year ended December 31, 2011, despite all the negative publicity it has been receiving in 2011 about its Gulf LNG project and its fallout with the Papua New Guinea government, The National reports.

The Gulf LNG project was expected to have liquefied and exported gas from the Elk and Antelope gas fields in the Gulf province.

Last September, however, the InterOil-proposed Gulf LNG project was dumped by cabinet on grounds that it deviated from the original project agreement.

 InterOil, in reply then, said it was still committed to delivering a world-class Gulf LNG project in compliance with the 2009 agreement with the government.

 Yesterday’s profit announcement compared with a net loss of US$44.5 million for the same period in 2010, an improvement of US$62.2 million, the company announced in a statement posted on the internet.

The operating segments of corporate, midstream refining and downstream collectively returned a net profit for the year of US $82.3 million.

The development segments of upstream and midstream liquefaction yielded a net loss of US$64.6 million.

InterOil CEO Phil Mulacek confidently said the company continued to work with its existing LNG development partners and the PNG government to advance its LNG project towards first production.

“Simultaneously, our advisors are managing the process of soliciting and evaluating proposals from potential strategic LNG partners,” Mulacek said.

“If a strategic partner is selected, we expect that such a partner would assist with accelerating the LNG project's capacity growth.

“Our delineation drilling at Triceratops has the potential to add to our substantial resource estimate at Elk and Antelope, and provide back-up supply for increasing LNG capacity.

“Our prospect inventory is maturing and we anticipate that it will support our goal of a multi-year, multi-well exploration program.

“We believe that these achievements, combined with our strong balance sheet, support our continued growth and operational success."

During the fourth quarter 2011, InterOil completed two heads of agreements (HOA) on long-term LNG supply for its proposed LNG project in PNG, bringing the total of its three HOAs to 3.3 to 3.8 million tonnes per annum (mtpa).

Subsequent to the quarter end, on January 17, 2012, InterOil announced that the Triceratops-2 delineation well had been spudded.