InterOil Corporate Presentation

INVESTOR PRESENTATION
October 27, 2014
Antelope-4
Today’s presentation
Disclaimer: Contents and forward looking statements
This presentation includes “forward-looking statements” as defined in United States federal and Canadian securities laws. All statements,
other than statements of historical facts, included in this announcement that address activities, events or developments that InterOil
expects, believes or anticipates will or may occur in the future are forward-looking statements, including in particular, the presence of
shallow marine carbonate reservoir, hydrocarbon volumes, and the estimated drilling times.
These statements are based on our current beliefs as well as assumptions made by, and information currently available to us. No assurances
can be given however, that these events will occur. Actual results could differ, and the difference may be material and adverse to the
Company and its shareholders. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond
the control of the Company, which may cause our actual results to differ materially from those implied or expressed by the forward-looking
statements.
Some of these factors include the risk factors discussed in the Company’s filings with the Securities and Exchange Commission and on SEDAR,
including but not limited to those in the Company’s Annual Report for the year ended 31 December 2013 on Form 40-F and its Annual
Information Form for the year ended 31 December 2013. In particular, there is no established market for natural gas or gas condensate in
Papua New Guinea and no guarantee that gas or gas condensate from the Elk and Antelope and Triceratops fields will ultimately be able to
be extracted and sold commercially.
Investors are urged to consider closely the disclosure in the Company’s Form 40-F, available from us at www.interoil.com or from the SEC at
www.sec.gov and its Annual Information Form available on SEDAR at www.sedar.com.
Finances are reported in US$ unless otherwise stated.
Page 2
Today’s presentation
Disclaimer: Resources
Reference is made in this Presentation to Resources.
It should be noted that we have no production or reserves or future net revenue as defined in NI 51-101 or under definitions established by
the United States Securities and Exchange Commission. GLJ, an independent qualified reserves evaluator, effective as of December 31, 2013,
evaluated our gas and condensate resources for the Elk, Antelope and Triceratops fields, all of which are in onshore Papua New Guinea. The
GLJ 2013 Report, with a preparation date of March 11, 2014 was prepared in accordance with definitions and guidelines in the COGE
Handbook and NI 51-101.
This Presentation outlines GLJ's estimates contained in the GLJ 2013 Report effective December 31, 2013 of total and net contingent
resources for gas and condensate at the Elk and Antelope field and the Triceratops field. This Report is included in the Company’s Annual
Information Form which is filed at SEDAR and is available on our web-site.
All resources estimated for the Elk and Antelope fields are classified as contingent resources – economic status undetermined. At this early
stage of appraisal, the resources estimates for the Triceratops field are classified separately in the GLJ 2013 Report as either contingent
resources – economic status undetermined or prospective resources.
Contingent resources are those quantities of natural gas and condensate estimated, as of a given date, to be potentially recoverable from
known accumulations using established technology or technology under development, but which are not currently considered to be
commercially recoverable due to one or more contingencies. The economic status of the resources is undetermined and there is no certainty
that it will be commercially viable to produce any portion of the resources.
Accuracy of Resource Estimates
The accuracy of resource estimates is in part a function of the quality and quantity of available data and of engineering and geological
interpretation and judgment. Other factors in the classification as a resource include a requirement for more appraisal wells, detailed
design estimates and near-term development plans. The size of the resource estimate could be positively impacted, potentially in a material
amount, if additional appraisal wells determined that the aerial extent, reservoir quality and/or the thickness of the reservoir is larger than
what is currently estimated based on the interpretation of the seismic and well data. The size of the resource estimate could be negatively
impacted, potentially in a material amount, if additional appraisal wells determined that the aerial extent, reservoir quality and/or the
thickness of the reservoir are less than what is currently estimated based on the interpretation of the seismic and well data.
ENERGY FOR THE ASIAN MARKET
Page 3
Today’s Presentation
Speakers
Dr Michael Hession
Don Spector
Keli Taureka
Laurie Brown
Chief Executive Officer &
Board Member
Chief Financial Officer
Executive Vice President
PNG
Senior Vice President
Exploration
Page 4
COMPANY UPDATE
Dr Michael Hession
Bobcat-1
Key Milestones In 2014
InterOil today: Funded & focused with world class assets and team
New Leadership
Transformational change in
leadership team
>200 years of industry
experience
Board Renewal
Ex-CEO of BG Group Chris
Finlayson named Chairman
Up to 3 new board
appointments
Business Simplified
Monetizing Elk–Antelope
4 2 offices
IR representation in US
Pure focus on LNG
development & exploration
Farmed down 40% to Total
in March 2014
Appraisal program
underway
Downstream Sold for $525.6m
Exploration Around PRL15
Sold downstream assets
to Puma Energy
Cash payment of $525.6
million
Awarded 16,000 sqkm
exploration acreage around
Elk-Antelope in March 2014
40 potential leads
Funded
Estimated funding at end of
Q3 2014: $753m
o $300m credit facility
o $453m cash & receivables
Largest Drilling Campaign
Started PNG’s largest
drilling campaign
5 wells by end of 2014
Investor Confidence
Research coverage has
doubled
Short interest has halved
Community Affairs
Significant scale-up
Medical ship, measles
containment, flood response
Page 6
Leadership
Combining over 200 years of international oil and gas experience
CEO
COO
CFO
GENERAL COUNSEL
MICHAEL HESSION
JON OZTURGUT
DON SPECTOR
GEOFF APPLEGATE
• >30 yrs experience
• Mega-projects, emerging provinces
• Ex-BP, Woodside
• >30 yrs experience
• M&A, strategy, LNG, operations
• Ex-Arco, Pioneer, CMS
• >30 yrs experience
• Project financing, treasury, tax
• Ex-BP, Woodside
• >40 yrs experience
• Corporate oil and gas, mostly in PNG
• Ex-Gadens (Partner)
SVP Exploration
SVP Development
EVP PNG
SVP Corporate
LAURIE BROWN
DAVID KIRK
ISIKELI TAUREKA
THOMAS NADOR
• >30 yrs experience
• Emerging provinces
• Ex-BP, Shell
• >30 yrs experience
• Mega-project development
• Ex-BP, Woodside
• >30 yrs experience
• Corporate finance, country management
• Ex-Chevron, National Australia Bank
• >20 yrs experience
• LNG project management, strategy
• Ex-Fluor, Woodside
Page 7
Board of Directors
New Chairman appointed, up to three new board appointments
CHAIRMAN
DEPUTY CHAIRMAN
CEO AND DIRECTOR
CHRIS FINLAYSON
FORD NICHOLSON
MICHAEL HESSION
• >30 yrs in North American and global
oil and gas project development
• Presently: President, Kepis & Pobe
Financial, Chairman, BNK Petroleum
• >30 yrs experience
• Mega-projects, emerging provinces
• Ex-BP, Woodside
• >30 yrs in international oil, gas, LNG
development, Director, Lloyd’s Register
• Formerly: CEO, BG Group, senior
Managing Director, Shell
DIRECTOR
DIRECTOR
DIRECTOR
DIRECTOR
ROGER LEWIS
SIR RABBIE RAMALIU
SIR WILSON KAMIT
SAMUEL L. DELCAMP
• >30 yrs in commercial finance for oil,
gas and LNG projects
• Formerly: Group Financial Controller,
Woodside
• >40 yrs in PNG public and business
affairs
• Formerly: PNG Prime Minister and
Speaker, PNG Parliament
• >40 yrs in PNG public and business
affairs
• Formerly: Governor of Bank of PNG,
PNG Governor to IMF, Director of ADB
• >40 yrs in US business, investment and
public affairs
• Formerly: Executive Director and Chief
Financial Officer, Fuller Foundation
Page 8
Commanding Position
InterOil has majority ownership in an emerging basin
Nearly 4 million acres, equivalent to 22x the size of Singapore
PPL477
PRL39
•
Elk-Antelope in PRL15 is
PNG’s largest
undeveloped gas
discovery
•
Eastern Papuan Basin is
an exciting emerging
province
•
InterOil has material
interest over most of the
Eastern Papuan Basin
•
InterOil now focused and
funded to deliver two key
strategies:
1 LNG Development
2 Exploration
PPL475
SEEPAGE
PRL15
Eastern
Papuan
Basin
PPL476
SEEPAGE
PPL474
Page 9
LNG Development And Exploration
Delivering two key strategies
1. LNG DEVELOPMENT
• Papua New Guinea is gas long in a gas short
region
• The $19 billion ExxonMobil-led PNG LNG
project is a significant step in de-risking PNG
as an energy supplier
2. EXPLORATION
• 40 potential leads across acreage
• InterOil’s exploration acreage surrounds ElkAntelope
• Three major trends identified in proven
hydrocarbon area (Elk-Antelope, Triceratops)
• PNG now emerging as a highly competitive
player in the Asia-Pacific LNG market
• InterOil spudded 3 exploration wells in 2014
• InterOil planning to develop Elk-Antelope as
PNG’s second major LNG project
• Raptor and Bobcat within tie-back distance to
Elk-Antelope
• Appraisal process now underway
• Wahoo a bold step out from Elk-Antelope but
only 170km from Port Moresby
• Potential to be lower cost than PNG LNG
(Analyst estimates)
• PNG LNG:
$2,324 US$/mtpa
• Elk-Antelope: $2,051 US$/mtpa
• Exploration licenses were awarded in March
2014 for up to 11 years
Page 10
Current Drilling Program
Leading PNG’s largest drilling campaign
By the end of 2014, InterOil expects to have 5 wells spudded
BOBCAT-1
RAPTOR-1
ANTELOPE-4
Eastern
Papuan
Basin
WAHOO-1
ANTELOPE-5
Page 11
Performance Improvement
Improving well times and cost while ensuring safety
•
•
•
Strengthened the operations team
•
New VP Drilling – Tom Junker (Apache, ConocoPhillips)
•
New GM Development – Phil Ryles (Santos, Woodside)
•
New GM Portfolio And Assurance – Mark Graham (Schlumberger, Shell, TRACS)
•
New GM Supply – Des Drury (Bechtel, Chevron, Shell, Woodside)
Strengthened service providers
•
World-class drilling consultants advising on improving drilling efficiency
•
Using High Arctic Energy Services (HAES) experienced heli-rig contractors
Strengthened supply and procurement
•
InterOil currently manages 4 rigs (owns 2, leases 2)
•
Reviewing rig ownership model – moving to a leasing model (industry standard)
•
Already secured a new HAES Rig 115 for two years – starts 1H 2015
•
Currently negotiating for one more rig
Page 12
Summary
InterOil in its strongest position
FIRST-RATE
TEAM
•
>200 years of E&P, LNG
experience in Executive
Leadership Team
•
Blue-chip chairman
•
Up to 3 more board
appointments
FANTASTIC
ASSETS
•
Commanding position ‘basin
master’
•
Low cost of development
•
FUNDED
FOCUSED
•
Streamlined business
•
Two clear strategies:
1.
LNG Development
2.
Exploration
•
$753m available at end of Q3
2014
•
Growth strategy funded
On doorstep of Asian demand
Page 13
FINANCIAL UPDATE
Don Spector
Antelope-5
Strong Balance Sheet
Moving from InterOil financed exploration wells to carried appraisal wells in Q4
Estimated Q3 costs:
$42m share buyback
$56m expenditure on:
• Raptor-1 drilling
• Bobcat-1 drilling
• Wahoo-1-drilling
$34m other costs include:
• Antelope-4 prep & drill
• Antelope-5 preparation
• Seismic program
• Inventory
• Corporate
• Net receivables
• Expected liquidity at end
of Q3 2014: $753m
AT JUNE 30, 2014
ESTIMATED Q3 COSTS
ESTIMATED AT
SEP 30, 2014
$m
1,000
900
42
56
800
34
700
600
585
500
885
400
753
300
• Further information will be
provided in Q3 2014 filing
200
300
100
0
Exploration Facility
Cash
Q2 2013
Liquidity
Share
Buyback
Drilling costs
Raptor, Bobcat, Wahoo
Seismic, inventory and
other costs
Q3 2014
Liquidity
Page 15
Next Liquidity Injection
Potential to be significant. Depends on size of certification volume
INDICATIVE PAYMENTS TO INTEROIL
Total SA Deal Summary
•
•
•
•
•
Closed on March 26, 2014
Fixed and contingent
payments
Largest proportion paid on
certification (expected 2H
2015)
+ Wildcard certification
+ Bonus exploration
payment
US$m
4,000
$3.5bn
3,500
3,000
$2.6bn
$2.4bn
2,500
$2.2bn
$2.0bn
2,000
First Cargo Payment
$65m
FID Payment
$517m
Carry
(75% carry on appraisal + exploration)
Certification payment
(expected 2H 2015)
$401m completion payment
(received March 2014)
$2.8bn
$1.8bn
$1.6bn
2,480
1,500
1,000
594
754
955
1,156
1,356
1,557
1,717
500
0
7.1
GCA
P50
Estimate
7.5
8
8.5
Tcfe
9
9.5
9.9
11.8
GLJ
P50
Estimate
GLJ
High Case
Estimate
Page 16
Community Affairs
Isikeli Taureka
Raptor-1
Introduction
97% of land in Papua New Guinea is traditionally owned by clans
• Almost all InterOil leases and
licences are located on land owned
by clans
• The PNG Oil & Gas Act enables
licence operators to carry out
petroleum exploration &
development subject to:
• Obtaining agreement from
clan landowners
• Maintaining harmonious
relationship with local
communities
InterOil PRL & PPL licences cover
•
16,000 sqkm of Papuan Foreland region
•
4 Provinces
•
ENERGY
Many districts & local-level government areas & villages
•
10+ language groups
•
Hundreds of clan groups
• Community Affairs manages the
relationship between company
and landowners, sub-national
government organisations, NGOs
and civil society groups
FOR THE ASIAN MARKET
Page 18
Community Affairs
Key functions and responsibilities
Government Liaison:
- National Government
- Provincial, District & Local
Community Affairs:
1 ) Land Management and access –
assessments, compensation & rental payments
2) Community Relations – support & liaison
with representative landowner organisations
Locations
Port Moresby – Ravalien House & Napa Napa
PRL15 – Herd Base & Hou Creek
PPL474 – Herisu & Wahoo rig site
All exploration and seismic locations
3) Community Development – interventions
that assist & improve local livelihoods
ENERGY FOR THE ASIAN MARKET
Page 19
1) Land Management And Access
Identifying rightful landowner clans and licence areas
InterOil has a long history with
the landowners around the Gulf
Province
Community Affairs Lands
Officers:
• Identify landowner clans in
licence areas
• Execute land use agreements
• Assess and pay compensation
for land damages in line with
the PNG Valuer General’s
Rates Schedule
• Refer any clan land disputes
to Government officers for
mediation or resolution
through local land courts
Page 20
2) Community Relations
Constructive communications between company and community
• Engagement of community based village
liaison officers
• Maintaining awareness of project & work
progress in local villages
• Support of landowner representative bodies
e.g. Landowners Association(s)
• Recording and addressing
landowner/community grievances
• Mediating industrial disputes involving local
employees of the company and contractors
Page 21
3) Community Development
Improving services in local communities
• Medical evacuations and health services, including
assistance to Kapuna Hospital, solar lighting to aid
posts, measles vaccinations, support of YWAM
(Youth With a Mission) medical ship visits
• Assistance to local schools and education – solar
lighting kits to schools
• Support of village infrastructure (e.g. water wells in
5 villages, assisted Digicel Foundation construct
Wabo classrooms)
• Relief supplies to villages affected by flooding of the
Purari River
• Support of women, youth and sports organisations
and activities
Page 22
Challenges
And overcoming them
KEY CHALLENGES
• Unresolved land disputes
between landowning clans in
the licence areas
• In-migration from surrounding
districts into PRL15 villages
• Misunderstandings between
PNG law and customary land
rights
SOLUTIONS
• Long term planning to manage expectations of LNG development in the project area
• Educating land owners of the project and its benefits
• Facilitating communication between communities & leaders in Port Moresby
• Ensuring the Gas Agreement incorporates local infrastructure and business development
• Supporting the Government to build capacity in the project area
Page 23
EXPLORATION & APPRAISAL
Laurie Brown
Raptor-1
Overview
GEOLOGY
The Eastern Papuan Basin
EXPLORATION
HISTORY
STRATEGY
Proving up the acreage
What we know about our acreage
Two major petroleum basins in
PNG – the Eastern and
Western Papuan Basins
InterOil has gravity imaging
over > 95% of its acreage and
>1500km of seismic
‘Antelope may not be alone’
InterOil controls the relatively
unexplored Eastern basin
Analysis of all data indicate
the widespread presence of
the 4 components critical for
success: reservoir, source
rock, seal and structure
Tenure secured for up to 11
years with majority ownership
(6 years + 5 year option)
Sweet spots identified
throughout the acreage – up to
40 potential targets
Three exploration wells
spudded in March 2014
All key components critical for
success present in this basin
Our basin offers less
challenging surface cover and
topography allowing seismic
imaging
Cracking the code
Long-term exploration strategy
Page 25
Geology: Eastern Papuan Basin
Eastern and Western Papuan basins on trend but with different geology and petroleum systems
Fields
The WPB has been
relatively heavily
explored
(~280 wells) with
discoveries
including Hides,
Juha, P’Nyang,
Kutubu
The EPB is
underexplored
(~65 wells) with
discoveries at Elk,
Antelope,
Triceratops
Coral Sea
Page 26
Geology: EPB evolution and key components
Three key geological components critical for success
4 KEY COMPONENTS
SCHEMATIC CROSS-SECTION OF EASTERN PAPUAN BASIN
What gravity sees
What gravity sees
S
ORUBADI SEAL
R
R
C
KAPAU LIMESTONE
S
S
Source Rock :
Generates the
hydrocarbons
R
Reservoir:
Stores the hydrocarbons
C
S
MOOGLI MUDSTONE
Seal or Cap rock:
Keeps the hydrocarbons
contained
Structure:
Generates trapping
geometries
Page 27
History: InterOil’s acreage
InterOil exploring PNG since 2003 – acreage position dominates onshore EPB
2003: IOC CONTROLLED ENTIRE ONSHORE EPB. 2014: HIGH-GRADED 50% SECURED FOR UP TO 11 YEARS
Licence
Acreage
(Acres)
IOC Stake
% (Gross)
PRL 15
188,675
36.5%
EXPLORATION ACREAGE
4m acres
InterOil has the largest holdings in basin
PRL 39
188,877
SEEPAGE
69.1%
SEEPAGE
PPL 474
1,232,462
78.1%
AIRBORNE GRAVITY
PPL 475
524,315
65.2%
95% OF ACREAGE
PPL 476
1,215,243
78.1%
PPL 477
629,254
78.1%
TOTAL
3,978,828
Coverage highlights key anomalies
SEISMIC
1562 km
Eastern
Papuan
Basin
Most seismic coverage of any PNG operator
HISTORIC WELLS
12 WELLS
Over $600m spent over past 11 years
NEW CAMPAIGN
40 POTENTIAL TARGETS
Across acreage, at least 11 around ElkAntelope
Note: IOC can continue and commit to continue or exit the licence after each
two-year period. Licences can be extended after six years for a further five
years with 50% relinquishment.
Page 28
History: Airborne Gravity
Early regional reconnaissance exploration
LOW COST NON-INVASIVE INITIAL EXPLORATION TOOL – 20+ ANOMAILIES IDENTIFIED
EXPLORATION ACREAGE
Elk-Antelope anomaly
4m acres
InterOil has the largest holdings in basin
AIRBORNE GRAVITY
Bobcat anomaly
Triceratops anomaly
Puri-Raptor-Duck Bill
anomaly
95% OF ACREAGE
Coverage highlights key anomalies
SEISMIC
1562 km
Eastern
Papuan
Basin
Most seismic coverage of any PNG operator
HISTORIC WELLS
Wahoo-Mako
anomaly
12 WELLS
Over $600m spent over past 11 years
NEW CAMPAIGN
40 POTENTIAL TARGETS
Across acreage, at least 11 around ElkAntelope
Page 29
History: $153m invested in seismic
The key pre-drill risk reduction tool in EPB – firms up targets to drill-ready
SEISMIC CONFIRMS GRAVITY ANOMALIES, IDENTIFIES DRILLING LOCATIONS, AND MAPS POTENTIAL VOLUME
EXPLORATION ACREAGE
4m acres
InterOil has the largest holdings in basin
AIRBORNE GRAVITY
95% OF ACREAGE
Coverage highlights key anomalies
SEISMIC
1562 KM
Eastern
Papuan
Basin
Most seismic coverage of any PNG operator
HISTORIC WELLS
12 WELLS
Over $600m spent over past 11 years
NEW CAMPAIGN
40 POTENTIAL TARGETS
Across acreage, at least 11 around ElkAntelope
Page 30
History: Seismic reduces pre-drill risk
Defines scale of prospects, can allow wells to be optimally located on reservoir sweet spots
NEW SEISMIC DATA HAS IDENTIFIED THREE MAJOR TRENDS
EXPLORATION ACREAGE
2013 reprocessing – now used for Elk-Antelope appraisal
4m acres
Antelope Trend
InterOil has the largest holdings in basin
AIRBORNE GRAVITY
95% OF ACREAGE
Whitetail Trend
Top reservoir
Coverage highlights key anomalies
SEISMIC
3 Mappable Trends
New modern processing shows 3 trends
Raptor Trend
Antelope Field
2007 analysis – used at time of Elk-Antelope discoveries
HISTORIC WELLS
12 WELLS
Over $600m spent over past 11 years
NEW CAMPAIGN
40 POTENTIAL TARGETS
Across acreage, at least 11 around ElkAntelope
Page 31
History: 3 discoveries
Track record of success – cracking the code in the carbonate fairway
AFTER INITIAL CHASE FOR SANDSTONES, 3 DISCOVERIES IN KAPAU LIMESTONE
EXPLORATION ACREAGE
4m acres
Triceratops
Gas Field
2005
Elk-Antelope
Gas Field
2006, 2008
InterOil has the largest holdings in basin
AIRBORNE GRAVITY
95% OF ACREAGE
Coverage highlights key anomalies
SEISMIC
1562 km
Eastern
Papuan
Basin
Most seismic coverage of any PNG operator
HISTORIC WELLS
12 WELLS
Over $600m spent over past 11 years
NEW CAMPAIGN
40 POTENTIAL TARGETS
Sandstone well – early exploration
Limestone/Carbonate well – primary target
Across acreage, at least 11 around ElkAntelope
Page 32
History: Potential around Elk-Antelope
Significant tie-back potential to Elk-Antelope
AT LEAST 11 STRUCTURES, ONLY 3 DRILLED TO DATE, ~10% OF OUR TOTAL ACREAGE
EXPLORATION ACREAGE
ANTELOPE TREND
Triceratops
4m acres
Bob Cat
InterOil has the largest holdings in basin
AIRBORNE GRAVITY
Jaguar
WHITE TAIL TREND
Mule
Deer
95% OF ACREAGE
Coverage highlights key anomalies
PPL476
Elk
RAPTOR TREND
Antelope
Puri Deep
SEISMIC
Raptor
1562 km
Whitetail
Antelope
Deep
Most seismic coverage of any PNG operator
HISTORIC WELLS
Duck
Bill
PPL475
12 WELLS
Significant investment over past 14 years
20 km
PRL15
NEW CAMPAIGN
40 POTENTIAL TARGETS
Across acreage, at least 11 around ElkAntelope
Cold colors depict increasing depth
* Well locations illustrative
Page 33
Raptor-1 (PPL475)
Deepest exploration well, preparing for testing
Raptor-1
Exploration well location
illustrative
Raptor-1
•
12 km west of Elk-Antelope in
PPL475
•
InterOil holds 65.2% interest of
Raptor-1 and is operator
•
Pacific Rubiales Energy Corp
holds 12.9% of well; minority
interests hold 21.9%
•
Spudded March 28, 2014
As of October 21, 2014
•
Drilled into the Kapau limestone
target zone
•
Wireline logs indicate
hydrocarbons over a 200 meter
interval
Testing
•
Well testing underway to
determine hydrocarbon type,
column, flow rate and reservoir
quality
Page 34
Bobcat-1 (PPL476)
Exploring Elk-Antelope trend – now in Kapau limestone
Bobcat-1
Bobcat-1
•
30km north-west of Elk-Antelope
in PPL476
•
InterOil holds 78.1% interest of
Bobcat-1 and is operator.
Minority interests hold 21.9% in
the well.
•
Spudded March 5, 2014
Exploration well location
illustrative
As of October 21, 2014
•
Have run and cemented 5-inch
liner near top of Kapau limestone
Next Steps
•
Preparing to drill into target zone
Page 35
Wahoo-1 (PPL474)
Plan to resume drilling in 2015
Wahoo-1
•
170km north-west of Port Moresby in PPL474
•
InterOil holds 78.1% of Wahoo-1 and is operator. Minority
interests hold 21.9% in the well
•
Spudded March 8, 2014
•
Well suspended on July 14, 2014 following safety concerns over
high pressures
As of October 27, 2014
•
Wahoo-1
Exploration well location illustrative
Current review of options include:
•
Well engineering
•
Mud weight and type
•
Casing design
Resumption of drilling: Planned for 2015
•
Rig is still on site
•
Timing driven by:
•
Procurement of long lead items e.g. suitable wellhead
•
Finalisation of drilling sequence
Page 36
Wahoo-1 (PPL474)
Seismic analysis
WAHOO-1 – InterOil, 2014, Onshore
KAPURI-1 – Phillips Australia, 1968, Offshore
Well suspended in
Orubadi Seal
25 km
✔ Effective source – note gas chimney
✔ Reservoir present – proven reef
✔ classic seismic signature
✔ excellent reservoir quality
✔ porosity up to 26%
✔ up to 4,800bpd water on test
✖ Orubadi seal absent – not contained
✔ Orubadi seal proven
✔ Effective source rock – thermogenic
charge established
Well suspended before reservoir BUT:
Potential reefal seismic expression
Known to be above target level in
younger sediments
Need to test for reservoir
✔
✔
✔
Page 37
Antelope-4 (PRL15)
Appraisal well testing southern extent of Elk-Antelope field
Antelope-4
PRL15
•
1km south of Antelope-2
•
Appraisal well tests southern
extent of Elk-Antelope
•
Ownership (gross%)
Antelope-4
Appraisal well location
illustrative
•
InterOil
36.5%
•
Total
40.1%
•
Oil Search 22.8%
•
Minorities 0.5%
•
Spudded September 16, 2014
•
IOC carried by Total in well
•
InterOil contributes
<$5m on the first $50m
gross cost
Page 38
Antelope-5 (PRL15)
Appraisal well testing western extent of Elk-Antelope field
Antelope-5
PRL15
Antelope-5
•
1.7km west of Antelope-2
•
Appraisal well tests western
extent of Elk-Antelope
•
Ownership (gross%)
Appraisal well location
illustrative
•
InterOil
36.5%
•
Total
40.1%
•
Oil Search 22.8%
•
Minorities 0.5%
•
Expected spud: Q4 2014
•
Rig sub-structure already
constructed
•
IOC carried by Total in well
•
InterOil contributes
<$5m on the first $50m
gross cost
Page 39
Review Summary
Cracking the code of the Eastern Papuan Basin to find the next Antelope
12 WELLS BASIN
NEW EMERGING
Elk-Antelope, PNG’s largest discovery, has put the Eastern Papuan
Basin on the map as an exciting emerging province
12 WELLS
COMMANDING
BASIN POSITION
InterOil commands the Eastern Papuan Basin and holds material
equity – a privileged position
3 DISCOVERIES
ALREADY
12 WELLS
InterOil has best knowledge of basin and record of success with three
discoveries – and understanding how to crack the code for more
CRACKING THE CODE
12 WELLS
All four components critical for success – source, reservoir, seal and
structure – can be mapped to varying degrees across InterOil acreage;
key to cracking the code
40 POTENTIAL
TARGETS
12 WELLS
InterOil inventory deep and wide with ~40 potential targets so far,
with more than 10 years of high-growth running room; likely Antelope
is not alone
EXPLORATION SUCCESS
12 WELLS
Further exploration success expected but so too is failure – that is
exploration. An evolving exploration strategy is focused on sequencing
delivery of further risk-mitigated commercial successes
FUNDED, FOCUSED, RIGHT TEAM
InterOil has world-class assets; with a focus on exploration and LNG
development. It now has the funding and skills to deliver on these two
strategies
Page 40
THANK YOU
For more information, please contact:
michael.lynn@interoil.com
Senior Vice President, Investor Relations
david.wu@interoil.com
Vice President, Investor Relations