No room for Shell in Gulf LNG?

[Tree]

Post Courier last night:

"This followed a current tussle between the parties involved, InterOil and Royal Dutch Shell with InterOil having no room for any possible deals over the Gulf LNG project in PNG but discussion are continuing."

Implication is Gulf LNG is configured.   XOM/JKM?

If so, Shell would need to out bid XOM/JKM or take a minor slice of the project.   That is unlikely.  Shell's cheap and their public comments on IOC's talks reiterates that.  The initial report of Shell in talks with IOC pointed to both LNG opportunities and exploration licenses.  If I were Shell, I'd forego Gulf LNG and T-2 and pursue ppl236 drilling JV and plop a big LNG project at napanapa, only some 100 miles from likely reefs in ppl236.  IOC could 'compromise' and allow Shell to carry IOC in exploration and plant construction with payment coming from IOC's proceeds.  It is the land of the unexpected afterall.   This "no data room access' talk could well be the seismic data, not E/A or T-2.  Collin yesterday did say this:

..."We are continuing to work with the investment banks on the sell down process, where we are looking to sell down a portion of our interest in the Elk/Antelope field and other prospecting licenses, in addition to selecting an LNG operator and the sell down of our interest in the PNG-LNG joint venture."...

IOC looks to have more gas than any Gulf LNG can ever process, even with an XOM off-take as their subsea pipe is sized to feed PNG LNG 6 tom with 3 ton expansion I believe.  Where else will that PPL 236 gas go for processing as it makes no sense to pipe it back inland to the Gulf when napanapa is nearby.  

"This followed a current tussle between the parties involved, InterOil and Royal Dutch Shell with InterOil having no room for any possible deals over the Gulf LNG project in PNG but discussion are continuing."

[Palm]

Treedaddy, I was reviewing financials last night and the MDA has the language regarding the EA selldown (interesting they say that when at AGM they stressed the selldown is for all of PRL15) and other licenses. They mention the EA SD, the LNG operator and LNG project interest sell and the other prospecting licenses. They then say that the PRE deal is in addition to the EA SD, LNG operator selection and LNG project interest sell. This leads me to believe that PRE is was they are pinpointing right now when mentioning the "other licenses". So then we have Shell. The comments about the data room lockout and Shell's ridiculous statement that they only pay $0.50/mcf and Duma's comments about still favoring Shell as the operator lead me to believe that Shell is either offering to buy all of EA/PRL15, or all of IOC. The data room comment (if true) would indicate that they did not sign a CA and so did not get access to the data room and were hoping for the election to turn out differently so they might steal IOC's assets. Now that they have the election results being not the way they wanted, they have set the table for a possible buyout and sent several messages that they may go after the whole ball for cheap and hope no one else enters the bidding.

[Tree]

Treedaddy, I was reviewing financials last night and the MDA has the language regarding the EA selldown (interesting they say that when at AGM they stressed the selldown is for all of PRL15) and other licenses. They mention the EA SD, the LNG operator and LNG project interest sell and the other prospecting licenses. They then say that the PRE deal is in addition to the EA SD, LNG operator selection and LNG project interest sell. This leads me to believe that PRE is was they are pinpointing right now when mentioning the "other licenses". So then we have Shell. The comments about the data room lockout and Shell's ridiculous statement that they only pay $0.50/mcf and Duma's comments about still favoring Shell as the operator lead me to believe that Shell is either offering to buy all of EA/PRL15, or all of IOC. The data room comment (if true) would indicate that they did not sign a CA and so did not get access to the data room and were hoping for the election to turn out differently so they might steal IOC's assets. Now that they have the election results being not the way they wanted, they have set the table for a possible buyout and sent several messages that they may go after the whole ball for cheap and hope no one else enters the bidding.

Hmmmm,

You thinkie Shell bids $.50/m based on KR and that will be less than we traded yesterday?  I'd love to see that as I'd imagine XOM would wouldn't allow that.

[ArtM72]

I like simple explanations. Shell didn't make the final cut and was subsequently locked out of the data room when the new T-2 data came in. They thought for some reason that data might be important to inform a buyout bid :-). Bids for E/A have been good enough that IOC figures it doesn't need to inform Shell about T-2 or anything else at this point. Shell is still free to go after all of IOC but if that happens I suspect (unless Shell's bid is both awesome and contingent on exclusivity) the doors to the data room get flung wide open for everyone.

That, or the Shell guy didn't know what he was talking about.