'Petrovale' pid='27251' datel Wrote:Blair Price
Friday, 16 August 2013
EXXONMOBIL’S exclusive period of negotiations for a large stake of InterOil’s Elk-Antelope field in Papua New Guinea is finally over, according to an industry source.
The source told PNGIndustryNews.net that Exxon failed to close a deal and questioned why a press release was not made.
“It's dead,” the source said, before indicating that other pre-selected bidders have the opportunity to approach InterOil.
“They [InterOil] have opened it up again to others this morning.”
ExxonMobil has not commented on the matter.
“It is not our practice to comment on commercial discussions,” a spokesperson said.
Yet an InterOil spokesperson said negotiations between Exxon and InterOil were ongoing, although he needed to make enquiries to see if they were still on an exclusive basis.
The exclusive talks were first announced in late May with PNG Prime Minister Peter O’Neill telling Parliament they would last for up to 60 days.
While PNGIndustryNews.net understands there was a time extension, the source indicated it too had expired.
Exxon was aiming to acquire at least 4.6 trillion cubic feet of gas from the Elk-Antelope field to fuel a third train expansion of the PNG LNG project it operates.
However, Petroleum Minister William Duma along with Gulf Province parliamentarians had since campaigned against piping the Elk-Antelope gas outside of the province, providing an obstacle to Exxon’s plans.
At least two other supermajors previously made bids over the Elk-Antelope asset.
Just to clarity, "It's dead” refers to the exclusivity period, not to the deal. Read the article carefully. Ongoing negotiations with Exxon were confirmed, but it may now be on a nonexclsuive basis, which grants much more leverage to InterOil and could even open the door to a public bidding war. Note that the source said "Exxon failed to close a deal" within the exclusivity period. InterOil may have held out intententionally knowing that the competitive bids would drive the final deal terms they're seeking.