XOM or RDS buyout

[Palm]

One last point on this issue. We saw today that the Total number was used to drive the price down. We saw who led this charge on Yahoo. The problem with using that number of course is what Hession explained; it assumed a 19.3% sell- down. Those using this number may of may not have understood this. But it doesn't matter; it was wrong. From there things snowballed. Everything was bad. Hession explained this, but I don't think any of us , nor Calio, nor Pavel, nor Westlake's analyst grasped this.

So does this make a difference? It should and when this and other things mentioned are realized we should start seeing a pps recovery. Hopefully MS and Westlake take this into account when they come out with updates.

[SamAdams]

Good point Palm.  I can't imagine TOT is happy that IOC stock was down so much after signing a deal with them.  Did TOT overpay by that much, really?  I am sure MH is not happy.  I expect a response from MH on this and pretty quickly.

[Dmarque]

I must ask myself why Exxon or Shell would not come in and pounce on IOC right now.  Hell, a low ball $100 offer could gain some traction.  Knowing what Exxon has said about the IRR on trains #3 and beyond......AND everyones apparent excitement over this Elephant prosppect on top of E/A certified resource......why in the world would Exxon not come in and try to buy Interoil?  I would!

I've believed (as have many others) for quite some time that it has been deep pockets of one of these SMs that has stealthfully financed the shorts in an attempt to give themselves an ability to slide in and take IOC for less than a fair price......Strategy could certainly be in place.

[johnwgrant]

If Exxon or Shell wanted to take out InterOil, would they have to complete the sell-down to TOTal, or, would they be able to cancel the deal ? Are there penalties for either side (InterOil or TOTal) to cancel at this point ?

[kommonsents]

Another scenario is that both IOC and TOT sell down 19.3% (or more) each to XOM for PNGLNG train 3 (or enough gas) including some ownership in the PNGLNG sales for an earlier revenue stream.

While that is going on, the delineation wells can be drilled and the deal finalized and more exploration carried on.

The delineation and other wells may also turn up more gas for train 4 at PNGLNG.

Meanwhile, planning and engineering for the Gulf LNG plant is underway.

Early monetization for IOC, TOT and PNG, gas for PNGLNG, lower costs for TOT and IOC, and a smooth cash flow for all plus a Perfect Storm for trapping shorts. WinWinWin

[ArtM72]

I don't know how this is going to time out, but it seems to me gas for the first two trains will go to Gulf LNG and whatever happens after that depends upon the drill bit. If Total is as enthusiastic and incentivized as Hession suggests (and at $1.25/mcf they should be) with four or five rigs in the field things will move very quickly.

[AD123]

If Exxon or Shell wanted to take out InterOil, would they have to complete the sell-down to TOTal, or, would they be able to cancel the deal ? Are there penalties for either side (InterOil or TOTal) to cancel at this point ?

i took a brief look at the SPA and did not see any liquidating damages clause that would allow IOC to terminate the agreement without cause in the event IOC was taken over by XOM or RDS and they chose to terminate the agreement. Leads me to beleive Total would have the right to compell a closing or at a minimum sue for damages for breach of contract.  Anyone have a different conclusion.

If i am right, that would certainly have a chilling effect on anyone looking to buy out the company.

[ebster123]

Unless the buyer was Total. With this and an assisted MS push downward Total could get IOC cheap. They don't need to chase or kill the goose with the golden egg. They cleverly caught it in a cage and locked the door. With this clause they win either way.

[AD123]

Fair point

[streamingeagle88]

I would expect for twice Friday's close TOT could own the whole enchilada. Richard Chandler is probably so embarrassed that he would sign on in a minute. Max $125 would keep most happy. What a deal!