InterOil has signed an agreement with Total to sell its 61.3% stake in petroleum retention license 15 (PRL 15) that includes the Elk-Antelope gas fields in the Gulf province of Papua New Guinea.
The company also granted Total an exclusive right to negotiate a farm-in to all its exploration licenses in Papua New Guinea.
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According to InterOil, the transaction price depends on appraisal and certification of Elk-Antelope, with illustrative payments of about $1.5bn to $3.6bn for around 5.4 trillion to 9 trillion cubic feet of hydrocarbon gas equivalent (tcfe).
On transaction completion, fixed payments to InterOil include about $613m, which is expected in Q1 2014 and a $112m on a final investment decision for a new LNG plant, as well as $100m at first LNG cargo from the proposed LNG facility.
InterOil CEO Michael Hession said: "Total is a world-class operator and will bring experience and expertise to a development that will diversify Papua New Guinea’s hydrocarbon sector.
"It is satisfying that Total, one of the world’s largest international oil and gas companies, shares our faith in developing Elk-Antelope, a world-class hydrocarbon resource and one of the largest discoveries in Asia in the past 20 years."
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By GlobalDataTotal has also agreed to pay $100m per tcfe for volumes over one tcfe for additional resources discovered in PRL15 from one exploration well.
In 2015, the programme and certification of Elk-Antelope is expected to be completed.
InterOil has also provided an option for Total to take an interest in all of its exploration leases in Papua New Guinea (PPLs 236, 237 and 238), which InterOil will continue to operate.
InterOil’s assets include petroleum licenses covering about 3.9 million acres, an oil refinery, and retail and commercial distribution facilities, all in Papua New Guinea, while Total has oil and gas exploration and production in more than 50 countries.
