CEO: Momentum building for project

 INTEROIL chief executive officer Dr Michael Hession says momentum is building for the multi-billion dollar Papua LNG project in Gulf.

Hession (pictured) said Antelope-6 was intersecting 42 meters (138 feet) of dolomite with connectivity to the rest of the Antelope field.

In addition, the reservoir qualities, identified by a short flow test last year at Antelope-5, were successfully confirmed by a longer flow-test in first quarter of this year.

“During 2015, significant milestones were achieved with the appointment of Total as operator and the selection of the Papua LNG project’s key infrastructure sites,” he said.

“Analysis from independent sources suggests Papua LNG (liquefied natural gas) will be one of the most competitive new-build LNG projects globally, with short shipping distances to Asian markets and potential for attractive returns.” 

Hession was providing an update on InterOil’s operations and financial results for the fourth quarter and the financial year ending December 31, 2015.

“The data from the last three appraisal wells have surprised on the upside and extended flow tests have confirmed connectivity, deliverability and excellent reservoir quality across Antelope,” Hession said.

“This will mean a less complex and lower cost development. 

“While the analysis of the Antelope-6 well and the Antelope-5 flow test is continuing, results to date have been encouraging and we remain confident of a two-train LNG development.

“On the completion of the appraisal programme, data will be submitted to two independent auditors for certification, a process which could take four to six months.

“Following last year’s restructuring and streamlining of the business, we have reduced guidance on our expected 2016 spend to a lower range of  US$155 million (K466 million) to US$170  million (K511 million, predominantly focused on the Papua LNG project.

“While we have US$252 million (K757 million) in current liquidity at the end of 2015, we are in discussions with our lenders to increase and extend our credit facility. 

“It is proposed to complete the increased and extended facility in the second quarter of 2016.”

Elk-Antelope is one of Interoil’s largest Asia undeveloped gas fields. Its exploration licences covers about 16,000 km2.