Papua New Guinea's oil and gas exploration and development company Oil Search has decided not to submit a revised offer for oil company InterOil, after ExxonMobil made a "superior proposal" for InterOil earlier in July 2016. This will allow ExxonMobil to acquire InterOil for US$2.2bn.
ExxonMobil's acquisition of Oil Search will give the company a 62.2% stake in the existing 6.9 Mt/year PNG LNG project (29% Oil Search, 33.2% ExxonMobil, 16.6% government and 13.5% Santos) along with a 23.4% stake in the proposed 6.8 Mt/year Papua LNG project (23.4% Oil Search, 40.1% Total and 36.5% InterOil), that would tap gas resources from the large undeveloped Elk-Antelope gas field.
In May 2016, Oil Search signed an exclusive Memorandum of Understanding (MoU) with Total, under the terms of which Oil Search would sell down 60% of InterOil’s interests in PRL 15 and 62% of InterOil’s interests in its other exploration assets to Total following the successful completion of Oil Search’s acquisition of InterOil. The companies have mutually agreed that they will terminate their MoU (including its exclusivity provisions) if InterOil terminates the Arrangement Agreement with Oil Search so that it can enter into a binding agreement with ExxonMobil.
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