Request for SHU members

[oliver.gump]

I think I have the same stuff you're referring to.

Here are four of them.

I'll post the last one searately.

Nothing is marked CONFIDENTIAL, so I'm not violating any laws in that regard.

Here's the last one Ollie

This is a fine mess Hession has got us in, eh?

I would suggest that he needed a jolly good rogering, but I think thats what he likes, so I wont.

[oliver.gump]

Wahoo-1 and Wahoo-1 Side Track.  PPL 474.  Well pad and capped off well.  We didn't receive much of a report on that except "higher than expected pressures."  Henry Aldorf had some reason to believe in a big find in Wahoo.

Add to the other data that Stavros posted, this:

 As you can see from these logs and reports, it was already evident from Wahoo-1 that the well had

intersected the Lower Orubadi Formation at 834m; Talama/Lavao Formation at 1257m and Chiria

Formation/Aure Beds at 1410m. Wahoo-1 reached final TD at 1526m in the Middle Miocene Chiria

Formation. Refer to the Final ISC Biostrat Report attached.

InterOil however, stated that Wahoo-1 reached final TD in the Late Miocene Miaru Mudstone (Orubadi

Formation).

Wahoo-1 ST1 basically confirmed that the stratigraphy from the kick off point at 1295m was not the

Miaru Mudstone but the Talama/Lavao Formation and the Chiria Formation/Aure Beds was

intersected at 1407m. The well reached its final depth in the Middle Miocene Chiria Formation/Aure

Beds at 1590m.

The drilling of Wahoo-1 ST2 was not a good decision by the current InterOil Management. It was a

waste of shareholders money.

That was from someone that was onsite and an active participant in Wahoo drilling and ST1.

The upshot is that they drilled it in the wrong location went off location, damaged the integrity of the well, and then were in danger of having a mile of casing propelled into the air and a Bolivian style blow-out.

The cause: "Management override"

[weaselpuppy]

I think I have the same stuff you're referring to.

Here are four of them.

I'll post the last one searately.

Nothing is marked CONFIDENTIAL, so I'm not violating any laws in that regard.

Here's the last one Ollie

This is a fine mess Hession has got us in, eh?

I would suggest that he needed a jolly good rogering, but I think thats what he likes, so I wont.

Well, that makes sense, as MH certainly seems to be a pirate....coincidence he sets up shop in the Malacca Strait??

[Li'loilady]

Another way to look at this is to compare what Total paid for 40.1% of only PRL 15.  Has somebody already done this?

From IOC.PR, original deal with Total buying 60.3% of PRL 15 below. I've included the whole table but, I'm choosing 9.9 to multiply by 66.67% (41.1 / 60.3.  As you recall, that's what the revised - post OSH partnership - SPA did:  pro-rated payments from original SPA.

  ~~~~~~~~~~~~~~~~

"Following the appraisal program, which is anticipated to be completed in 2015, the indicative payments based on the certified resource estimate are as follows:

Pricing Table US$0.77/mcfe..5.4 Tcfe = US$1.5 Billion

Pricing Table US$1.03/mcfe...6.5 Tcfe = US$2.1 B

GLJ Certified 2C...9.9Tcfe = US$4.1 B  [[  x 2/3 = US$2.734 B  ]]

GLJ Certified 3C...11.8 Tcfe = US$5.3 B"

   ~~~~~~~~~~~~~~~~

compare:

Deal with TOT.  9.9 T = 2.734 B

Deal with OSH.   ". "  =  3.117 B

TOT. 9.2 T = 2.540 B

OSH. ". ".   = 2,903 B

= 383 M and 363 M difference, respectively.

Digging through MD&A's from 2013, 2014, 2015 I came up with our sunk costs which benefit OSH, For ease of reading all these figures, the numbers are in millions.  All of this nitpicky detail will drive some people crazy.  The bottom line is, well, at the bottom lines.

41.5M .....PRL15 Minority by out

.... = 41.5M

Seismic TBR: 18.9 +  PRL15: 4.9  (( 0 known for Wahoo,Tuna, Mako etc.  IOC wrote that did that entire PPL but, the figure was buried in an early "consolidated" MD&A ))  One could add 5-15M, I suppose; I didn't.

....= 23.8

$178.4 Bobcat Raptor in 2014 + 9.8 Raptor sidetrack.  9 Bobcat in 2015

.....= 197.2

74.0 Triceratops-3. + 1.7  TTops-4 prep

....= 75.7

10.6 Pre-spud Antelope-4 + 39.5. A-4 STI

....= 50.1

3.4 Pre-spud Ant-5 + 17.6 A-5

..... = 21

22.6. Ant-5 + 10.6

....= 33.2

36.5. Wahoo in 2014  (( Again, I couldn't find the full numbers on this. Maestro Pet might know. )

.....= 36.5

Concept selection work with TOT

....= 13.7

10.7. Development survey, environmental, societal, labor relations.

....= 10.7

Adds up to:

******. ==. US$ 497.3 Million ******

But wait – there's more:

12.2 Expenditure (usage) drilling inventory

12.6 Rig moving

12.6 Field maintenance (of Wahoo capped well etc.)

..... = 37.4

******  == US$ 537.7 Million ******

I believe those totals are inaccurately low, easily by $25–100 M.

But let's subtract $400M for their IOC loan pay-off:

****** == US$ 137.7 – 237.7+Million ******

And then subtract $104.3M for TOT forgiveness of Antelope drilling costs. (Sorry. Almost forgot.)

******* == US$ 33.7 – 133.7+ Million *******

And last of all subtract 363 M for their net price above our TOT deal for a 9.2 T certification (we should be so lucky.)

 ******* == (~ US$ 230 M) *******

The field is de-risked (you're welcome.)  FID is a virtual certainty.  TBR is discovered and 3rd party certified at 2C 6.3 Tcfe, on our dime, (uh, I mean 200 grand) and likely supply 2 trains (you're welcome, again.)  40 prospects identified by advanced seismic across "all of our licenses" (I never could tease out that cost.)  Total didn't have any of that.

So, all of THAT to say, OSH is offering ~ US$ 230 M more, for ALL of a new and improved InterOil, than TOT was to pay for 41% of PRL15.

All right, you numbers geeks, what did I miss?  Be gentle.

[jft310]

Are the assets in the Total and OSH deal the same ??
Why are we throwing in
TBR for free
Ant S for free
Raptor and Mule Deer that extend into PRL-15 for free
Giving up the second certification
Balance of lease assets for free
Etc .
Who is comfortable with no updated E/A asset size being made public in a deal worked on for 6 months or more . ...
Was the CEO giving away our assets while lining his own pockets ???
Does the above appear to be a Breach of Fiduciary obligation to shareholders ??

[ioc.aussie]

Are the assets in the Total and OSH deal the same ?? Why are we throwing in TBR for free Ant S for free Raptor and Mule Deer that extend into PRL-15 for free Giving up the second certification Balance of lease assets for free Etc . Who is comfortable with no updated E/A asset size being made public in a deal worked on for 6 months or more . ... Was the CEO giving away our assets while lining his own pockets ??? Does the above appear to be a Breach of Fiduciary obligation to shareholders ??

hession panicked as he ran the business into the ground. Shopped it around for over six months and took the best deal.

Sounds like Dec 2013 all over again.

[Stavros]

No he didn't panic.
He had to sell before the deadline or his bonuses would have been slashed.
I don't call that panicking ... I call that criminal behavior

They could easily stay afloat until after the Certification Payment with no drilling costs to bear

[jft310]

Stavros is correct . Hession is to receive double his 2016 salary for a successful deal before mid July 2016 plus his employment contract bonus of $37 million plus more .
Was he incentived to act in shareholder best interest ?? The BOD approved the deal which is why they are in Breach . How can this deal be in shareholder best interest .?..
Thus you see why Phil has filed his law suit to push the AGM . Appears Phil has cause but will the courts agree ???

[ArtM72]

I think I have the same stuff you're referring to.

Here are four of them.

I'll post the last one searately.

Nothing is marked CONFIDENTIAL, so I'm not violating any laws in that regard.

Here's the last one Ollie

This is a fine mess Hession has got us in, eh?

So I have to ask since no one else has.  How did our crack SHUists come by these drilling reports?  I was under the impression information like this only existed in the data room.  If I were a friendly analyst would this information be available to me under the theory that this was a non material detail offered by Hession?  Or was this the result of some clandestine operation?

I recall the conversation about drilling on the flank of Triceratops to be certain there was a sufficient mud column to prevent blowouts in the event unexpectedly high gas pressures were encountered.  Was this location of Wahoo selected for similar reasons?  Do we have an accompanying siesmic line with which to further interpret this log?

TIA

[jft310]

Looking at the Interoil seismic slides for Wahoo it's clear the spot they chose was way off the seismic indicated formation location . Not even close . The sidetrac at Wahoo was again drilled in the opposite direction from the seismic presented on the IOC slides . Further Phil wrote a letter to Hession before drilling to say they had the wrong location . Dave Holland advised a different location also , Both ignored . If this non trained person can see the formation and the drilling locations one just has to ask why ????