World Class Gas Resources

[Stavros]

This statement concerns me The LOW END of Mr. Mulacek's estimate range is WELL ABOVE the estimates provided through our independent resources certifier." It continues on to say that IF Mr. Mulacek's estimates were to come to fruition, we'll do really well by owning shares of the combined company.

My guess is that they are referencing GCA's 7.1 estimate which they cited a few times in the 2015 MD&A.

BELOW IS A POST BY PETRENGR1 THAT LAYS OUT THE FACTS. YOUR "GUESS" IS WISHFUL THINKING - - - PERHAPS PLANTED BY IOC'S PR FOLKS?

QUOTE

Here is a statement from IOC’s May 26, 2016 letter to shareholders accompanying the second issue of the “WHITE” proxy forms.

“ The LOW END of Mr. Mulacek's estimate range is WELL ABOVE the estimates provided through our independent resources certifier."

This is simply a false statement in the “Facts Sheet” from IOC management.

Here is what Phil said: “The InterOil Board and management allowed the material balance payment from TOTAL to be removed, which represents a significant loss of value assuming an interim certification of 7 tcf and a material balance certification of 12.5 tcf, both of which we believe to be reasonable based on our detailed understanding of the resource.”  >>> Stavros: Mulacek's RANGE is 7.0 - 12.5 Tcfe

The following is from: http://tinyurl.com/zpfomk7 

Here is what IOC’s independent resources certifier said: “GLJ Petroleum Consultants Ltd ("GLJ", an independent qualified reserves evaluator, prepared an independent evaluation of Contingent Resources for the Elk-Antelope Field as at December 31, 2015 which estimated the gross unrisked Contingent Resources for the Elk-Antelope field# of 7.7 Tcfe 1C, 10.2 Tcfe 2C and 12.4 Tcfe 3C.”

Previously GLJ estimates for Contingent Resources were 7.5 Tcfe 1C, 9.9 Tcfe 2C, 11.8 Tcfe, as at December 31, 2014.

So GLJ increased their 2C estimate for Elk/Antelope from 9.9 Tcfe at the end of 2014 to 10.2 Tcfe at the end of 2015.

The range of the field size according to GLJ is A 1C  volume of 7.7 Tcfe to a 3C volume of 12.4 Tcfe.

Not much difference from Phil’s estimate of field size ranging from 7 Tcfe to 12.5 Tcfe.

The low end of Phil’s range i.e. 7 Tcfe is not “WELL ABOVE the estimates provided through our independent resources certifier” as stated by IOC’s management.  >>> Stavros: Lying Criminals are at work attempting character assasination

Just further evidence that the current Management and BOD continue to lie to shareholders and fail to disclose material information so that shareholders can make rational decisions about the Company.

Of course the SPA between Interoil and Total is based on 2C  resources so the important number in the latest GLJ report is a 2C resource volume of 10.2 Tcfe.

[petrengr1]

This statement concerns me The LOW END of Mr. Mulacek's estimate range is WELL ABOVE the estimates provided through our independent resources certifier." It continues on to say that IF Mr. Mulacek's estimates were to come to fruition, we'll do really well by owning shares of the combined company.

My guess is that they are referencing GCA's 7.1 estimate which they cited a few times in the 2015 MD&A.

Did you notice what they "didn't" put in the MD&A? Their own GLJ report. I think the colusion was already in progress.

[katytrader]

This statement concerns me The LOW END of Mr. Mulacek's estimate range is WELL ABOVE the estimates provided through our independent resources certifier." It continues on to say that IF Mr. Mulacek's estimates were to come to fruition, we'll do really well by owning shares of the combined company.

My guess is that they are referencing GCA's 7.1 estimate which they cited a few times in the 2015 MD&A.

Did you notice what they "didn't" put in the MD&A? Their own GLJ report. I think the colusion was already in progress.

  You may well be right about that.  On the other hand, the lawyers would advise to use the most conservative numbers in any case, and these people who have spent their lives in larger corporations  would easily accept that advice.

[Palm]

The GLJ report was included in the AIF report, which is normal.

[petrengr1]

The GLJ report was included in the AIF report, which is normal.

Yes, I found that but it was a somewhat different version of risked and un-risked resources and I did not see the 10.2 TCF they had published elsewhere as the 2C number from GLJ. They have always published these numbers in their presentations etc. in the plain,  simple easily understood format. I think their annual  report should contain these same numbers somewhere but I could not find them.

[katytrader]

The GLJ report was included in the AIF report, which is normal.

So we are left with the uncertainty of whose numbers they were referencing in the statement about PM's estimates.  Palm,  do you have a clear bead about who is to certify what, going forward?   Some posters seem to treat certification as coming from a single source whereas my understanding is that the payoff is derived from an average of two firms' judgments, which implicitly would be lower than the highest number.   I find clarity difficult after more than a little claret.

[Li'loilady]

From the replay of an RJ / Pavel conference call with Hession and gang regarding the deal. May 24:  Per Hession, there will be 2 Resource  Evaluators, chosen out of the following 3:

Ryder Scott,  Beicip,  and Miller and Lents, Ltd.

It was decided that Gaffney Cline and Nederland Sewall were "tainted" because they're working for OSH right now. The evaluators they're choosing from now are the 3 left on our original SPA list.  Nothing suspicious with this, I don't think.  I would have preferred folks who are already familiar with our field, however.

Total picks 1 resource evaluator and a  "CVR subcommittee" picks the other one.  This subcommittee is made up of 2 IOC directors + 2 OSH directors + 1 "independent chairperson."  This subcommittee will oversee the CVR process from beginning to end.

[ArtM72]

From the replay of an RJ / Pavel conference call with Hession and gang regarding the deal. May 24:  Per Hession, there will be 2 Resource  Evaluators, chosen out of the following 3:

Ryder Scott,  Beicip,  and Miller and Lents, Ltd.

It was decided that Gaffney Cline and Nederland Sewall were "tainted" because they're working for OSH right now. The evaluators they're choosing from now are the 3 left on our original SPA list.  Nothing suspicious with this, I don't think.  I would have preferred folks who are already familiar with our field, however.

Total picks 1 resource evaluator and a  "CVR subcommittee" picks the other one.  This subcommittee is made up of 2 IOC directors + 2 OSH directors + 1 "independent chairperson."  This subcommittee will oversee the CVR process from beginning to end.

I don't understand how independent certifiers can be "tainted" anymore than I understand how Interoil's own independent certifier for over 10 years running can have their estimates suddenly and summarily ignored without comment. Qualified "bankable" experts don't get tainted other than by graft (not a sustainable business model). If anything they've been tainted with exposure to and possible revelations in the data unappreciated by management.

The whole committee issue trumpeted as complex but fair and transparent is a facade covered in the blood of red herring.

[Palm]

From the replay of an RJ / Pavel conference call with Hession and gang regarding the deal. May 24:  Per Hession, there will be 2 Resource  Evaluators, chosen out of the following 3:

Ryder Scott,  Beicip,  and Miller and Lents, Ltd.

It was decided that Gaffney Cline and Nederland Sewall were "tainted" because they're working for OSH right now. The evaluators they're choosing from now are the 3 left on our original SPA list.  Nothing suspicious with this, I don't think.  I would have preferred folks who are already familiar with our field, however.

Total picks 1 resource evaluator and a  "CVR subcommittee" picks the other one.  This subcommittee is made up of 2 IOC directors + 2 OSH directors + 1 "independent chairperson."  This subcommittee will oversee the CVR process from beginning to end.

And this from The OSH transcript of their CC:

"Nick Burns: (UBS, Analyst) Thank you very much. I just had a question around the Total agreement, just wondering what the condition precedents are around the MoU. I'm assuming that the agreement with Total negates or cancels the Total-InterOil gas resource payments and subsequent payments as well, and effectively that's being replaced by the fee structure that's been outlined today. Thank you.

Peter Botten: No, the obligation for the InterOil and Total SPA remain absolutely on foot. They are - what we've arranged with Total exactly mimics what was originally on foot for InterOil shareholders. There is - obviously those payments relate to certain key thresholds, including, importantly, the final resource allocation after Antelope-7. But there has been no tinkering or no change to those fundamentals in our deal with Total. I stress, our process for evaluation [unclear] is absolutely transparent, with independent ex-InterOil and InterOil appointees on a governance committee of our Board to assess it properly. I can't emphasise that much, and I've highlighted our desire to get the best possible, reasonable - the best possible evaluation of the resource. If the gap is there, we really don't mind paying for it. At the end of the day, there are no preconditions for the Total payment - the Total deal, and it is on foot. We have to obviously go through a process of transferring the interest and making sure that's done properly. But at the end of the day, we're off and running with that deal. Subject, obviously, to the InterOil deal completing."

So Katy, with the proposed deal, and as proposed buyer OSH will add its layer of oversight to the Certification process and (current) IOC will also have representation.  Then Total as Buyer in the SPA still has its representation.

[Thylacine-2]

As I understand the Botten quote, OSH and IOC are on the same side in benefiting from a high certification.