Quick Comment: PNG drilling MS on OSH

[Gator]

February 17, 2015

Oil Search Ltd.

Quick Comment: PNG drilling

update: potentially significant

InterOil (IOC) as operator of the Antelope drilling

program in PNG,

reports that the Anteolpe#5 appraisal

well has intersected the top of the reservoir 230m higher

than IOC’s “reference case”. The Elk/ Antelope gas field

is in petroleum license PRL15, and OSH’s working

interest in this is 23%.

The Antelope-5 well is one of three planned or under

way to appraise the field’s reserves size and production

characteristics. Other wells are Antelope-4 (currently

under way) and Antelope-6, which is planned to follow

Antelope-5. The Antelope-5 well is important as it is a

1.8 km step-out from the nearest well and aims to test

the western extent of the field.

A positive result is potentially very significant

, as it

could evidence a better than expected outcome and

support the targeted growth in reserves needed to

underpin an independent LNG project.

More drilling and testing will follow,

to determine the

reservoir thickness, reservoir quality and gas content.

Pressure data from flow rate tests will be very important

in determining if this well is in communication with

Antelope 2 &3, and if so, would increase the operator’s

confidence of the size of the field

We retain an Equal-weight rating.

[petrengr1]

February 17, 2015

Oil Search Ltd.

Quick Comment: PNG drilling

update: potentially significant

InterOil (IOC) as operator of the Antelope drilling

program in PNG,

reports that the Anteolpe#5 appraisal

well has intersected the top of the reservoir 230m higher

than IOC’s “reference case”. The Elk/ Antelope gas field

is in petroleum license PRL15, and OSH’s working

interest in this is 23%.

The Antelope-5 well is one of three planned or under

way to appraise the field’s reserves size and production

characteristics. Other wells are Antelope-4 (currently

under way) and Antelope-6, which is planned to follow

Antelope-5. The Antelope-5 well is important as it is a

1.8 km step-out from the nearest well and aims to test

the western extent of the field.

A positive result is potentially very significant

, as it

could evidence a better than expected outcome and

support the targeted growth in reserves needed to

underpin an independent LNG project.

More drilling and testing will follow,

to determine the

reservoir thickness, reservoir quality and gas content.

Pressure data from flow rate tests will be very important

in determining if this well is in communication with

Antelope 2 &3, and if so, would increase the operator’s

confidence of the size of the field

We retain an Equal-weight rating.

I wonder if this means that IOC (or OSH) has told MS that the connectivity test will only involve flowing Antelope-5 while monitoring pressure at Antelope-2 and 3, the two closest wells? That would leave out appraisal wells Antelope-1 and the Antelope-4 which is currently being drilled.

[Gator]

When I talked with IOC early in January, I was told Antelope 4 is being drilled on the flank of the field to find the shape and size of the asset. When they are done drilling (within a month) Antelope 4 will be like a pressure gauge. Antelope 5 will be the extended flow test with pressure gauges on Antelope 1 and Antelope 4. This will allow the petroleum engineers to know exactly the size of the Antelope field. I was told InterOil would love to drill Antelope 6, but they need JV approval. Antelope 6 would be paid for (except $5 Million) by TOT and IOC would get an additional $400 Mill for every TCF discovered.

[Getitrt2]

MS is Morgan Stanley, right? Why the hell aren't they commenting on IOC, or are they?

[jft310]

Wild guess they are restricted .

[Gator]

"Wild guess they are restricted."

No. The two stocks are covered by different analyst in different parts of the world. This week is a big vacation week in NY. Maybe Evan is away (some place warm).