From the MD&A; remember that both Exxon and IOC have stated that the major points of the negotiations have already been agreed upon:
"On May 24, 2013, we and PacLNG entered into exclusive negotiations with ExxonMobil for the
development of our PRL15 resource. The transaction has been discussed with the Government of
Papua New Guinea in general terms and any future agreement will be subject to Papua New
Government approval. Items under consideration in those negotiations include:
– InterOil and PacLNG selling to ExxonMobil an interest in PRL 15 that is sufficient to supply
gas to develop an additional LNG train at ExxonMobil’s Konebada site. There will be staged
payments before and after production commences.
– InterOil and PacLNG will be funded to drill additional delineation wells in the Elk and Antelope
fields, which will be followed by certification of the resource. The resource recertification will
be used to determine the economic interest of ExxonMobil in the license.
– We will have the optionality to either independently develop a second LNG project in the Gulf
Province that may also use gas from PRL 15, and potentially other discoveries, such as
Triceratops, or pursue further development with ExxonMobil."
"In addition, the terms of the grant of PRL 15 require us to spend $73.0 million on the development of the Elk and
Antelope fields by the end of 2014. All work program commitments with the exception of two wells, are
complete. We have spent $441.6 million on PRL 15 which includes seismic, Herd Base/Hou Creek wharf and
camps, roads, FEED for wells, gas gathering, condensate stripping, and pipelines. $52.8 million of the
expenditures to date relates to the $73.0 million commitment. Expenditure on the drilling of further delineation
wells, post the completion of ExxonMobil agreement for the development of our PRL15 resource, will meet our
well commitment requirements under the license."
"Management will consider the recognition of the deferred tax assets once the sale and purchase agreement for monetization
of resources from the PRL 15 license with ExxonMobil is executed. The initial tax benefit to be recognized would
be 30% of the temporary differences and losses carried forward through the income statement."
Of course they also state their standard clause of, "We can give no assurance that we will be successful in completing a transaction with ExxonMobil on terms
acceptable to us.", but for them to state publicly more than once that they are in exclusive negotiations with Exxon, that they have agreed on all major points and that talks are progressing well should give anyone a good bit of confidence that they expect a deal with Exxon to be completed.