"The company did not put a deadline on the sale process."

[Tree]

Sorry Chaps, this was missed while on vacay.  We should know  much more in 11 to 41 days.

**********

Interoil receives final bids for Gulf LNG from prospective partners

By Russell Searancke Wellington

 07 March 2013 23:59 GMT

InterOil has received final binding offers from potential partners for the Gulf liquefied natural gas project in Papua New Guinea, and is also claiming to have boosted the project’s gas reserves by 10%.

Final bids were submitted on 28 February, and the US-based player re­iterated that interest was shown by international oil companies, national oil companies and global utility companies.

InterOil did not disclose how many final offers were ­received, saying only that “several” bids had been received.

The project must introduce a recognised international operator in order to receive the PNG government’s final approval to proceed.

“I know that you are all awaiting the announcements on the asset sell-down process, and I can assure you that we are all excited about our future, especially given the certified resources that we have,” said InterOil’s chief financial officer Collin Francis Visaggio.

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project.

“The asset sell-down, once completed, will fund the Gulf LNG project and our longer-term exploration programme,” said Visaggio.

The company did not put a deadline on the sale process.

The project’s current shape — as provisionally approved by the government in November 2012 — involves a single onshore train of 3.8 million tonnes per annum of LNG, coming on stream in 2016, followed by a second identical train two years later.

InterOil’s most recent capital cost guidance for two trains was between $8.3 billion and $9.3 billion.

The Canadian company has battled against market pessimism about the project for years, but Interoil has always believed in its feedstock — the Elk-Antelope fields — and has been drilling wells regularly in support of this.

Chief executive Phil Mulacek said that, based on the two wells drilled last year, Antelope-3 and Triceratops-2, a new independent reserves report by GLJ Petroleum Consultants gave the Elk-Antelope and Triceratops fields a best-case contingent resource of 9.45 trillion cubic feet of gas and 143.6 million barrels of condensate, 10% higher than previously.

InterOil’s latest drilling rig, Rig 3, is now rigged up and on location at the Elk-3 well.

[Getitrt2]

Tree, I guess you want to perhaps understandably downplay expectations, and I realize 41 days is a possibility, and I know Phil made that "we should know much more" statement in the conference call. However, the question he was responding to was NOT the one specifically about the "sale process", but rather the more extended process of determining with the new partner the technology and construction path and time frame for the LNG plant, moving toward FID; and I don't think linking that response and time frame, a more extended "deadline", to this article and the "sale process" is any more appropriate than saying they put any deadline on it. It's true they did not, but there was an implication that the Company and its BOD would work with the IB's and attempt to complete the complex sale process in March if feasible. I'm not counting on it, but I think there is still reasonable hope for that; I wouldn't bet against it, either.

[Tree]

Tree, I guess you want to perhaps understandably downplay expectations, and I realize 41 days is a possibility, and I know Phil made that "we should know much more" statement in the conference call. However, the question he was responding to was NOT the one specifically about the "sale process", but rather the more extended process of determining with the new partner the technology and construction path and time frame for the LNG plant, moving toward FID; and I don't think linking that response and time frame, a more extended "deadline", to this article and the "sale process" is any more appropriate than saying they put any deadline on it. It's true they did not, but there was an implication that the Company and its BOD would work with the IB's and attempt to complete the complex sale process in March if feasible. I'm not counting on it, but I think there is still reasonable hope for that; I wouldn't bet against it, either.

Getit,

The context of Phil's answer of 30-60 days was a nicer way of saying 'How long is a piece of string Pavel?' twice.  It is impossible to seperate the 'sales process' from the partner/technology and construction path.  The 'sales process' reveals the partner/technology/construction answers.   Phil went off script to answer Pavel who asked 2 impossible questions to answer as IOC hadn't even seen the bids!  Phil told Pavel 'That's like asking how long a piece of string is' at the first question and Pavel followed up with another question asking Phil how long the string is.

There has been initial bid presentations and there will be counter proposals and attempts by IBs to raise the bid terms of all the bidders.  That will take time and it could be completed anyday or in 6 mos.  No one knows for sure.

"However, the question he was responding to was NOT the one specifically about the "sale process", but rather the more extended process of determining with the new partner the technology and construction path and time frame for the LNG plant, moving toward FID; and I don't think linking that response and time frame, a more extended "deadline", to this article and the "sale process" is any more appropriate than saying they put any deadline on it."

[ellerslick]

Tree, I guess you want to perhaps understandably downplay expectations, and I realize 41 days is a possibility, and I know Phil made that "we should know much more" statement in the conference call. However, the question he was responding to was NOT the one specifically about the "sale process", but rather the more extended process of determining with the new partner the technology and construction path and time frame for the LNG plant, moving toward FID; and I don't think linking that response and time frame, a more extended "deadline", to this article and the "sale process" is any more appropriate than saying they put any deadline on it. It's true they did not, but there was an implication that the Company and its BOD would work with the IB's and attempt to complete the complex sale process in March if feasible. I'm not counting on it, but I think there is still reasonable hope for that; I wouldn't bet against it, either.

Getit,

The context of Phil's answer of 30-60 days was a nicer way of saying 'How long is a piece of string Pavel?' twice.  It is impossible to seperate the 'sales process' from the partner/technology and construction path.  The 'sales process' reveals the partner/technology/construction answers.   Phil went off script to answer Pavel who asked 2 impossible questions to answer as IOC hadn't even seen the bids!  Phil told Pavel 'That's like asking how long a piece of string is' at the first question and Pavel followed up with another question asking Phil how long the string is.

There has been initial bid presentations and there will be counter proposals and attempts by IBs to raise the bid terms of all the bidders.  That will take time and it could be completed anyday or in 6 mos.  No one knows for sure.

"However, the question he was responding to was NOT the one specifically about the "sale process", but rather the more extended process of determining with the new partner the technology and construction path and time frame for the LNG plant, moving toward FID; and I don't think linking that response and time frame, a more extended "deadline", to this article and the "sale process" is any more appropriate than saying they put any deadline on it."

We have partner selection in March and I think the bids are firm, no back and forth. It was give it your best shot. Where does it say otherwise?

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project.

[Getitrt2]

I hear you, Tree, and agree he was saying they couldn't put a date or "deadline" on any of that; but I think it will take longer to be ready to state a planned construction completion date than to make an announcement required by regulation of a partner selection and signed sell down deal, and don't want to put that time frame on both, although the selected partner may already have a proposal that reflects such a date. It may be a fine point, but let's don't be a source of ammo for anyone working against us. I think the shorts are finally facing more uncertainty than we are!

[Tree]

We have partner selection in March and I think the bids are firm, no back and forth. It was give it your best shot. Where does it say otherwise?

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project.

[/quote]

Eller, did you happen to catch this Q by McDougall who just penned the best analysis of IOC I've seen?  How else do you explain it?  Unless a bidder met IOC's asking price/terms I would expect IB's to solicit re-bids within a reasonable time window.  They get paid commission and they only sell this once.  To expect IOC to operate on firm timelines which they never laid out for this bid consideration is foolish.  It can be completed anyday, just not  by some specific date.  USE or FLUSH as normal with all I or anyone posts.

William Christopher McDougall - Westlake Securities LLC, Research Division

I'm looking forward to hearing the results on the bidding process. I wanted to understand a little bit of the process with communicating with the market over the next few months, will it be kind of one update at the end when you accept the bid? Or will there be some interim updates?

Phil E. Mulacek - Chief Executive Officer and Director

I mean, as we need to disclose under law, we'll complete and comply with proper disclosure. We -- it's -- I don't want to say it's too premature, but we wouldn't want to talk and be prejudicial where any comments affect the final outcome. I mean we have waited this long. We have never had better interest. LNG prices this winter have been some of the highest. We saw over $20. We saw $19 earlier this month, $19.50. And when everyone was claiming 6 months ago, we're going to see some U.S. parity and that was an absolute falsehood. So I mean we're coming together on the timing at no better -- we don't want to jeopardize that. So as we have requirements, we'll complete and we'll announce it to the market.

[ellerslick]

We have partner selection in March and I think the bids are firm, no back and forth. It was give it your best shot. Where does it say otherwise?

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project.

Eller, did you happen to catch this Q by McDougall who just penned the best analysis of IOC I've seen?  How else do you explain it?  Unless a bidder met IOC's asking price/terms I would expect IB's to silicit re-bids within a reasonable time window.  They get paid commission and they only sell this once.  To expect IOC to operate on firm timelines which they never laid out for this bid consideration is foolish.  It can be completed anyday, just by some specific date.  USE or FLUSH as normal with all I or anyone posts.

William Christopher McDougall - Westlake Securities LLC, Research Division

I'm looking forward to hearing the results on the bidding process. I wanted to understand a little bit of the process with communicating with the market over the next few months, will it be kind of one update at the end when you accept the bid? Or will there be some interim updates?

Phil E. Mulacek - Chief Executive Officer and Director

I mean, as we need to disclose under law, we'll complete and comply with proper disclosure. We -- it's -- I don't want to say it's too premature, but we wouldn't want to talk and be prejudicial where any comments affect the final outcome. I mean we have waited this long. We have never had better interest. LNG prices this winter have been some of the highest. We saw over $20. We saw $19 earlier this month, $19.50. And when everyone was claiming 6 months ago, we're going to see some U.S. parity and that was an absolute falsehood. So I mean we're coming together on the timing at no better -- we don't want to jeopardize that. So as we have requirements, we'll complete and we'll announce it to the market.

[/quote]

Tree, thanks although it is a muddle. My take away was McDougall mentioned a few months not Phil. Phil's comment about affecting the final outcome doesn't pertain to a timeline so I think March is still a good bet.

I reserve the right to be humiliated when March comes and goes without a partner but I have drawn my line in the sand.

[Getitrt2]

Tree, your hi-lited phrase, of course, was from McDougall only. Phil focused on what they would and would not comment on. Perhaps you should also have hi-lited from what Phil said: "So I mean we're coming together on the timing at no better (time than now)."

Where are you getting something about "IBs soliciting re-bids", just an IMO? Did McDougall say something about such as that in his report?

[Tree]

We have partner selection in March and I think the bids are firm, no back and forth. It was give it your best shot. Where does it say otherwise?

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project.

Eller, did you happen to catch this Q by McDougall who just penned the best analysis of IOC I've seen?  How else do you explain it?  Unless a bidder met IOC's asking price/terms I would expect IB's to silicit re-bids within a reasonable time window.  They get paid commission and they only sell this once.  To expect IOC to operate on firm timelines which they never laid out for this bid consideration is foolish.  It can be completed anyday, just by some specific date.  USE or FLUSH as normal with all I or anyone posts.

William Christopher McDougall - Westlake Securities LLC, Research Division

I'm looking forward to hearing the results on the bidding process. I wanted to understand a little bit of the process with communicating with the market over the next few months, will it be kind of one update at the end when you accept the bid? Or will there be some interim updates?

Phil E. Mulacek - Chief Executive Officer and Director

I mean, as we need to disclose under law, we'll complete and comply with proper disclosure. We -- it's -- I don't want to say it's too premature, but we wouldn't want to talk and be prejudicial where any comments affect the final outcome. I mean we have waited this long. We have never had better interest. LNG prices this winter have been some of the highest. We saw over $20. We saw $19 earlier this month, $19.50. And when everyone was claiming 6 months ago, we're going to see some U.S. parity and that was an absolute falsehood. So I mean we're coming together on the timing at no better -- we don't want to jeopardize that. So as we have requirements, we'll complete and we'll announce it to the market.

Tree, thanks although it is a muddle. My take away was McDougall mentioned a few months not Phil. Phil's comment about affecting the final outcome doesn't pertain to a timeline so I think March is still a good bet.

I reserve the right to be humiliated when March comes and goes without a partner but I have drawn my line in the sand.

[/quote]

Agree on the muddle, I should have left Phil's answer out (hoho) as the key is McDougall as he assigns a few month time frame to the bid process.  Either he picked that up from conversations with management or he has been through enough of these situations to know how they play out.  McDougall is ready to allow a few months for the bid to be announced and this was before he released his report with a $115 target.

[Palm]

We have partner selection in March and I think the bids are firm, no back and forth. It was give it your best shot. Where does it say otherwise?

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project.

Eller, did you happen to catch this Q by McDougall who just penned the best analysis of IOC I've seen?  How else do you explain it?  Unless a bidder met IOC's asking price/terms I would expect IB's to solicit re-bids within a reasonable time window.  They get paid commission and they only sell this once.  To expect IOC to operate on firm timelines which they never laid out for this bid consideration is foolish.  It can be completed anyday, just not  by some specific date.  USE or FLUSH as normal with all I or anyone posts.

William Christopher McDougall - Westlake Securities LLC, Research Division

I'm looking forward to hearing the results on the bidding process. I wanted to understand a little bit of the process with communicating with the market over the next few months, will it be kind of one update at the end when you accept the bid? Or will there be some interim updates?

Phil E. Mulacek - Chief Executive Officer and Director

I mean, as we need to disclose under law, we'll complete and comply with proper disclosure. We -- it's -- I don't want to say it's too premature, but we wouldn't want to talk and be prejudicial where any comments affect the final outcome. I mean we have waited this long. We have never had better interest. LNG prices this winter have been some of the highest. We saw over $20. We saw $19 earlier this month, $19.50. And when everyone was claiming 6 months ago, we're going to see some U.S. parity and that was an absolute falsehood. So I mean we're coming together on the timing at no better -- we don't want to jeopardize that. So as we have requirements, we'll complete and we'll announce it to the market.

[/quote]

“Our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project."

That statement was of course CV's from the CC:

"Thanks, Phil, and welcome to everyone listening to today's presentation. You can see from our filed financials, we continue to progress and expand on the Gulf LNG Project to monetize existing, resources, and we also continue to invest in our exploration portfolio, which David Holland will cover in more detail. I know that you are all eagerly awaiting the announcements on the asset sell-down process, and I can assure you that we are all excited about our future, especially given the certified resources that we have.

As publicly disclosed and highlighted by Phil, the final bid solicitation period for the partnering process will close today, and our board intends to meet our advisors during March for the purpose of evaluating the proposals received and selecting our partner for the development of the LNG project. The asset sell-down, once completed, will fund the Gulf LNG Project and our longer-term exploration program. The timing and execution of agreements will be advised in accordance with our continuous disclosure requirements. Also, we may not extend existing agreements as we move forward towards an integrated LNG project and conclude documentation with the selected strategic partner."

Then on March 1 in the official PR announcing that final bids had been received they stated:

"The InterOil Board of Directors will meet the Company’s advisors during March 2013 for the purpose of evaluating bids received for the development of the Gulf LNG Project utilising gas from the Elk and Antelope fields in Papua New Guinea."

That's the official, official, official filed with SEDAR/SEC company line; no mention of "selecting". Probably a wise move.