InterOil Says Talks with Exxon Ongoing Over PNG Gas Fields


InterOil Corp and ExxonMobil Corp remain in talks to jointly develop InterOil's Elk and Antelope natural gas fields in Papua New Guinea, InterOil said on Friday after a website reported negotiations had ended without an agreement.

InterOil's shares fell as much as 12 percent following the report in PNG Industry News.

The news service, citing an unidentified source, said the talks were "dead" and that ExxonMobil's exclusive period for negotiations had ended.

InterOil, responding to a query from the New York Stock Exchange, said its policy was to not comment on market speculation or negotiations. But it added: "Negotiations with ExxonMobil Papua New Guinea Ltd regarding an agreement to monetize the Elk and Antelope fields are ongoing."

ExxonMobil spokesman Patrick McGinn declined to comment.

ExxonMobil needs gas for its $19 billion Papua New Guinea liquefied natural gas (PNG LNG) project.

InterOil, which has its headquarters in Cairns, Australia, was awarded the license to develop the fields in November 2010. The license covers nine blocks surrounding the Elk and Antelope fields.

The talks also included funding of InterOil and its partner Pacific LNG to drill additional delineation wells in the fields.

InterOil shares were down 5 percent at $70.38 in early afternoon trading.


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