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InterOil gas discovery underpins LNG project

LNG Industry,

InterOil Corp.’s promising appraisal results of the Elk-Antelope gas field in Papua New Guinea (PNG) underpin its multi-train LNG project, the company announced in its 1Q15 results.

In announcing the quarterly financial results CEO Michael Hession said well results from Antelope-5 had been very encouraging: "Drilling results from Antelope-5 identify this well as having the best reservoir thickness, quality and fracture density of all wells drilled on the Elk-Antelope field.

Reservoir quality

"In particular, the thickness and quality of the dolomite zone with porosity readings of up to 25% is superior to other wells, signifying a high-quality reservoir. Antelope-5 has a 680 m (2231 ft) gross gas column and appears to have even better reservoir quality than we initially thought.

"Evaluation of seismic and new high-definition gravity data indicates that the field could extend further west than originally modelled. This data, combined with the top reservoir being higher than expected, suggests potential for significant upside."

The appraisal results underpin a multi-train LNG development at Elk-Antelope, as well as the quantification of volumes in the “world-class resource”.

LNG development

Total, the operator of PRL 15, has continued work on the development, with a large team across the joint venture working in France, Papua New Guinea, Singapore and Australia.

It is anticipated that a preferred development concept will be announced by mid 2015.

Financial update

The net loss for the first quarter of 2015 was US$21.9 million, compared to a net profit of US$318.6 million for 1Q14. Most of this loss resulted from expensing US$19.3 million of seismic that the company acquired over its extensive exploration portfolio during the quarter.

Adapted from press release by Katie Woodward

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