IOC's Lynn Responds

[Putncalls]

Sent: Sunday, 1 February, 2015 2:42 AM
To: Michael Lynn
Subject: Lack of Communication

 

Michael,

I'm writing to ask Intereroil to give investors some status information.

It seem that we are being kept in the dark even though we have skin in this game. Following is a list of information that I believe investors deserve.

 

A4 porosity related data.

A) The CEO address associated with the 27 Jan presentation refers to the "integrated appraisal program with an extended well test that will draw on data from previous wells to give us a better idea of reservoir connectivity and productivity". This work is expected to be completed by mid-year. A good understanding of Elk-Antelope volumes is critical to correctly designing the LNG plant and facilities. A specific well activity or even a porosity data point on its own will not answer the critical question as to the total volume for the field. We have been advising investors not to expect information regarding the appraisal work until the integrated program is complete. If something material occurs in the meantime we will naturally update the market.

A5 reservoir depth and porosity data.

A) Antelope-5 is drilling towards top reservoir and is not yet in the reservoir.

Raptor porosity data.

A) We have not provided porosity data for individual wells. We did however provide information regarding the testing at Raptor in the address given by Laurie Brown on 3 December 2014. Basically due to heavy mud in the fractures a stabilised flow rate was not obtained. IOC has been encouraged by the initial result and intends to revisit Raptor in Q2/Q3 2015. To provide a single data point like porosity would not tell the full picture. More information should be forthcoming on completion of the appraisal program at Raptor.

The case made at the arbitration hearing.

A) The case was heard in London in November 2014. We are bound by the court process not to provide details of the hearing. We anticipate getting the result from the arbitration sometime in Q1 2015.

The reasoning behind the need for A6 before certification.

A) We should obtain enough information from Ant-4 and 5 to support a two train development. However the JV is keen on Ant-6 as it will provide additional information on the field. It also makes good sense for IOC since, under the Total deal, we receive $400 million for each additional trillion cubic feet that is certified. It is prudent to define as much upside volumes as possible in this first certification process, especially as IOC is being carried in the appraisal drilling.

 

Thank you,

Me

[admin]

Thanks for the effort, Put.

[Getitrt2]

True, Putn, can't fault you for lack of effort, and I think you got appropriate answers for every question. On the other hand, I can't really agree with your making the questions a complaint about "Lack of Communication" being described as "being kept in the dark" as a purpose of management, and the questions you asked. I think there is a large amount of valuable and useful information on the website and in the press between December 3 and January 27 that has been provided by management, for which you give them zero credit. Basically all you got was available in that information and/or brought out and explained in discussions recently on SHU. For example, everything you got on A6 and more, including potential relevance for train 3, was pointed out and discussed by me and others here in recent days. We would all like more detailed information, but I don't think the rest was really reasonable to request or expect at this point. Your perpetual negativity is very frustrating and difficult to be patient with, imo. Of course, my patience also seems to be declining over time in many respects.

[sfiaes]

Good information Putncalls.

Thank you for your effort.

The answers sound reasonable to me. How 'bout you?