Total Is Analyzing Exxonmobil’s Competing Offer for Interoil

[SupaSage2003]

This just came out...  Sounds like a bit of posturing to me.  If Total thought the initial offer was fair value for IOC (and that they would only be willing to pay 'fair value' then why are they still analyzing the Exxon bid?  They must be working on a counterbid.  I would interpret this quote to be positive for us.

Supa

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Total Is Analyzing Exxonmobil’s Competing Offer for Interoil

Wednesday, July 20, 2016 07:18 AM

by David Whitehouse

(Bloomberg) -- Total says in a statement that the initial offer by Oil Search represented fair value for Interoil assets, says the Exxonmobil bid is being analyzed in line with capital discipline policy for acquisitions.

[cybersssss]

GAME ON

The timing and the wording implies to me that oil search is out of the bidding and total will make some sort of a bid.

[Palm]

Let's see who has the bigger desire and wallet to be in control and Operator.

[jdeo1969]

completely Agree. Makes no sense to say OSH deal was fair and then in the same breath say they are analyzing the XOM offer.

[Gator]

PARIS, July 20 (Reuters) - French oil and gas company Total
said on Wednesday it was analysing a competing offer
made by rival U.S oil giant ExxonMobil's for explorer
InterOil Corp , its partner in a gas field in Papua New
Guinea.
ExxonMobil this week trumped an offer from Oil Search, which
was backed by Total. Oil Search is due to declare on Thursday
whether or not it will match ExxonMobil's $2.2 billion bid.
[see story]
"Total is analysing the competing offer in line with its
demonstrated policy for capital discipline on acquisitions and
investments," the company said in a statement.

[Gator]

But also

Total seen unlikely to fight ExxonMobil over South Pacific gas

MELBOURNE,

July 20 (Reuters) - Total SA is unlikely to take on ExxonMobil in a bidding war for explorer InterOil Corp , the French giant's partner in a rich gas field in Papua New Guinea, analysts said on Wednesday. ExxonMobil this week trumped an offer from Oil Search, which was backed by Total. Oil Search is due to declare on Thursday whether or not it will match ExxonMobil's $2.2 billion bid. ExxonMobil and Total both want to simplify the ownership of the Elk-Antelope gas field by taking out InterOil's 36.5 percent stake. This would clear the way for the majors to tie together their rival gas export projects, PNG LNG and Papua LNG. Analysts said it made more sense for Total to let ExxonMobil take over InterOil. Using Elk-Antelope to feed an expansion of ExxonMobil's existing PNG LNG plant could generate double the return compared to building Total's proposed $10 billion Papua LNG plant, they said. "While it is possible that they go it alone, it would certainly make more economic sense if it was to be combined," said Saul Kavonic, an analyst at consultant Wood Mackenzie. The oil majors are targeting PNG for growth as the quality of its gas, low costs and proximity to Asia's big liquefied natural gas (LNG) consumers make it one of the world's most attractive places for gas projects. Total entered PNG in 2014, by buying a 40.1 percent stake in Elk-Antelope for $401 million up front plus future payments that could range between $594 million and $2.48 billion, based on reserves between 7.1 trillion cubic feet and 9.9 tcf, according to InterOil. Total will have to make those payments to ExxonMobil if the U.S. giant succeeds in taking over InterOil. "Total would need to believe in material upside to want to counter-bid at this stage," Bernstein analyst Neil Beveridge said in a note. ExxonMobil offered $45 worth of its own shares plus $7.07 per share for each trillion cubic feet equivalent above 6.2 tcfe up to a maximum of 10 tcf, while Oil Search offered 8.05 of its own shares plus $6.05 per share for each tcf above 6.2 tcfe. Oil Search said last week two experts had concluded that Elk-Antelope most likely holds 6.43 tcf of recoverable gas, with potential for a further 1-2 tcf of gas, yet to be certified. Total declined to comment on the bidding battle.

[jft310]

Reuter's writer has never read the SPA nor even know it exists or what it means for Total . A journalism major .

[ArtM72]

completely Agree. Makes no sense to say OSH deal was fair and then in the same breath say they are analyzing the XOM offer.

What?  Of course it makes sense. Did you expect them to say 'this is a steal'?

As for the ratings agencies views, well, we seem to celebrate ignorance in this nation. I suppose the people in those agencies who passed judgement on the deal should be cut the same slack.

[Tree]

PARIS, July 20 (Reuters) - French oil and gas company Total said on Wednesday it was analysing a competing offer made by rival U.S oil giant ExxonMobil's for explorer InterOil Corp , its partner in a gas field in Papua New Guinea. ExxonMobil this week trumped an offer from Oil Search, which was backed by Total. Oil Search is due to declare on Thursday whether or not it will match ExxonMobil's $2.2 billion bid. [see story] "Total is analysing the competing offer in line with its demonstrated policy for capital discipline on acquisitions and investments," the company said in a statement.

This easily can be interpreted as opening the door for a way out of PNG as proposed in another thread -OR- they are ready to launch a higher bid as OSH is out of the way.   The LNG market ain't what it used to be when TOT bought in in 2013.

[jft310]

These SM have seen many cycles of energy prices . They are looking at 4 years plus out and thus willing to invest money to try and hit the next rise up in price . That's why we get several more bids in my opinion .