Total and InterOil Corporation have closed a revised sales and purchase agreement covering the Elk-Antelope gas field in Petroleum Retention Licence 15 in Papua New Guinea. Under the revised agreement signed today, Total has acquired – through the purchase of all shares in a wholly owned InterOil subsidiary – a gross 40.1% interest in PRL 15.

InterOil retains 35.5% of the licence and immediately receives US$401 million for closing the transaction, and will receive US$73 million on a final investment decision for an Elk-Antelope LNG project, and US$65 million on the first LNG cargo. InterOil will also receive payments for certified gas volumes following appraisal of Elk-Antelope. All fixed and variable payments that were agreed on 6 December 2013 continue to apply pro-rated according to the new equity split, including those for exploration, appraisal and resource certification.

Total Exploration and Production Senior Vice President Asia Pacific, Jean-Marie Guillermou , said the agreement allowed the joint venture to proceed with confidence. “Elk-Antelope is a significant project in Total’s global portfolio and our presence in Papua New Guinea provides an ideal opportunity to grow our business in the Asia-Pacific region,” Mr Guillermou said. “We have a strong relationship with our joint venturers, strong support from the Papua New Guinea Government, and we now look forward to leading the development of the LNG project”, he added.

InterOil Chief Executive Officer, Dr Michael Hession, said the agreement enabled InterOil to maintain a material interest in PRL 15, which covers one of Asia’s largest gas discoveries of the past 20 years. “The agreement clears the way for co-operative joint venturers, who all share the Government’s wish to monetise Elk-Antelope as quickly as possible, through the fast-growing Asian market,” Dr Hession said. “InterOil now has a solid partnership where Total can use its considerable LNG expertise to develop Papua New Guinea’s second LNG project.”

Other joint venturers in PRL 15 are Oil Search Limited, which has 22.8% (gross) as a result of its acquisition of interests held by Pacific LNG Group Companies, and indirect participating interests, which hold 1.6% (gross).