100% of the project costs will be financed with 30% equity and 70% project financing.
If InterOil sold 25% of the 100% the company would be reduced from 58.6% to 33.6%.
InterOil’s equity contribution of the total project costs would be: 33.6% of 30% of the total project costs, or 10.8% of the total costs.
Let’s look at the 2 x 4.0 mtpa plant case (8.0 mtpa) at $8.246 billion.
The equity requirement for the entire project is 30% of $8.246 billion or $2.474 billion.
InterOil’s share would be 33.6% of the $2.474 billion, or $831 billion.
If InterOil sells 25%, the resource sold would be of 8.6 Tcf of natural gas and 130 MMbbls of condensate (9.4 Tcfe of natural gas equivalents), or 2.35 Tcfe.
If InterOil gets only $1.00/mcfe for the resources sold that would be $2.35 billion, 2.8X more cash than the Company’s required equity contribution.
If InterOil got $2.00/mcfe from the resources sold, that would be $4.7 billion, or 5.6X the required equity contribution, leaving the company with almost $4 billion!