Q:  How can Hession can make that statement?

A:  The deal is done

How so?  Here's my take.

IOC and XOM have bottom lined their SPA agreement for train #3 expansion with all details of upfront cash, staged cash and PNG LNG % ownership.  Per PNG LNG PA, existing project partners must commit or pass on expansion participation, these partners have NO E/A gas integration into PNG LNG for expansion veto power.  IOC/XOM agreement is now in PNG LNG partners hands and they were given a deadline by which to respond.  Per Hession that deadline is prior toY/E.

PNG LNG partners have final say as to deal partner make-up and deal partner make-up is required prior to the IOC/XOM SPA agreement becoming a 'Material Event'.

A deadline for partners to respond exists but they can also respond prior to deadline, hence, the "each day can be the final day" comment by Hession and why Hession could state "partner is not chosen" in CC.

Partner is selected, minimally XOM, as Santos, Nippon, OSH and PNG Gov't are weighing in now if they are 'in' or 'out' of expansion plans with terms cut between IOC/XOM for their prticipation.

'Tree' pid='32103' dateline='<a href="tel:1384865 Wrote:

"And I've sat here today and told you we'll do this deal by the end of the year, yes."

Q:  How can Hession can make that statement?

A:  The deal is done

How so?  Here's my take.

IOC and XOM have bottom lined their SPA agreement for train #3 expansion with all details of upfront cash, staged cash and PNG LNG % ownership.  Per PNG LNG PA, existing project partners must commit or pass on expansion participation, these partners have NO E/A gas integration into PNG LNG for expansion veto power.  IOC/XOM agreement is now in PNG LNG partners hands and they were given a deadline by which to respond.  Per Hession that deadline is prior toY/E.

PNG LNG partners have final say as to deal partner make-up and deal partner make-up is required prior to the IOC/XOM SPA agreement becoming a 'Material Event'.

A deadline for partners to respond exists but they can also respond prior to deadline, hence, the "each day can be the final day" comment by Hession and why Hession could state "partner is not chosen" in CC.

Partner is selected just not revealed.

Tree-it's better than that me thinks. The quality of the new bank consortium lenders with the low short term rates and the size of the loan scream that the IOC/Exxon deal is done . I conclude Exxon is in and the PNGLNG partners decide to participate or not. Their in or out determines the IOC participation rate  maybe or Exxon may do the deal with a larger slice for them if some partner ops out.

Maximum cash flow for shareholders would be Exxon train 3 with partication in all 3 trains and an EWC super major operated LNG facility at Gulf. The EWC units are cheaper than other choices , are expandable and have a shorter installation time period. I guess EWC because they are on slide 19 ,could be different of course.

'Tree' pid='32103' dateline='<a href="tel:1384865 Wrote:

"And I've sat here today and told you we'll do this deal by the end of the year, yes."

Q:  How can Hession can make that statement?

A:  The deal is done

How so?  Here's my take.

IOC and XOM have bottom lined their SPA agreement for train #3 expansion with all details of upfront cash, staged cash and PNG LNG % ownership.  Per PNG LNG PA, existing project partners must commit or pass on expansion participation, these partners have NO E/A gas integration into PNG LNG for expansion veto power.  IOC/XOM agreement is now in PNG LNG partners hands and they were given a deadline by which to respond.  Per Hession that deadline is prior toY/E.

PNG LNG partners have final say as to deal partner make-up and deal partner make-up is required prior to the IOC/XOM SPA agreement becoming a 'Material Event'.

A deadline for partners to respond exists but they can also respond prior to deadline, hence, the "each day can be the final day" comment by Hession and why Hession could state "partner is not chosen" in CC.

Partner is selected, minimally XOM, as Santos, Nippon, OSH and PNG Gov't are weighing in now if they are 'in' or 'out' of expansion plans with terms cut between IOC/XOM for their prticipation

I agree with you 100%.  Dr Hession would never had said what he said unless the situation is just as you described.  Thanks!!

'strategyguy536' pid='32201' datel Wrote:I agree that these scenarios are likely very close the current situation. I think we will hear of a closed deal before 12-31, but digesting its terms and conditions and putting likely numbers to them will take a few days at that time. We could see two bounces in the stock, or more, that way, with only a little algebra in between. Just MHO.

My experience is that it is very difficult to get things done in December, especially after early December.  There also may be advantages to deal being official in December.  Therefore from my memory,  I would say a deadline of (at latest) Dec 6 would be my choice for latest that final answers are due from others.  ...trans

Trans I think you're spot on.  Siimply based on my take of the EPS cc, I don't think MH will be sitting there on Dec 30th trying to pull a rabbit out of the LNG hat.  As he told us, the rabbit could be pulled out any day now.

'trans' pid='32204' datel Wrote:My experience is that it is very difficult to get things done in December, especially after early December.  There also may be advantages to deal being official in December.  Therefore from my memory,  I would say a deadline of (at latest) Dec 6 would be my choice for latest that final answers are due from others.  ...trans

Agree 100% trans.

Can anyone doubt how incredibly bold and bullish Dr. Mike was on the last CC? This following years of missed expectations from prior management. Even given the safe harbor statements provided, Dr. Mike would face a huge backlash if the deal isn't done before the end of 2013. In addition, he is sharp enough to give himself plenty of buffer. Therefore, I think Tree is right that the deal is essentially done.