Interoil revises its PNG strategy
Interoil has undergone a major reorganisation in the past 12 months, changing its management team, divesting itself of its downstream assets and focusing instead on exploration and the development of the Elk-antelope project with France’s Total SA. Its CE
In 2014, we prepared for growth. We renewed our management team, streamlined our business, focused on monetising our gas resources, and began renewing our board.
Second, we focused on effectively and efficiently developing Elk-antelope–potentially the lowest-cost LNG project in the Asia-pacific.
Third, we remain focused on financial discipline and have a strong balance sheet with cash in the bank and very little debt.
Finally, our deal with Total SA provides for additional cash on certification of Elk- Antelope gas volumes, which is expected in the second half of 2015.
Our strategy is simple and focused—we find hydrocarbons, monetise and develop them, and then do it again.
If 2014 was about us focusing the company and freeing us from distractions, 2015 is about delivery.
Elk-antelope sits on the doorstep of Asia, the world’s largest LNG market, and we are poised to take advantage of our proximity to markets.
We are now focused on using our funds effectively and efficiently in a competitive contractor market for seismic, drilling and LNG development.
Elk-antelope is a single gas field that can be developed without the cost of collecting gas from multiple fields.
It is closer to the coast and Port Moresby than other major gas fields in PNG and it is close to a major river, an important cost benefit when transporting people and equipment.
The gas field is in a less-mountainous region than other major gas fields, a big factor in development cost, and, it is within Papua New Guinea’s least populated province, a key factor in negotiating land access.
All of these factors point to lower cost, and lowest cost projects go first.