The Resource : 2010 Third Party Resource Estimate of Elk and Antelope Underpins a large LNG development with a 5% increase over 2009

Gross Contingent Resource Estimate for Gas and Condensate as of December 31, 2010

An evaluation of the potential resources of gas and condensate for the Elk/Antelope field has been completed by GLJ Petroleum Consultants Ltd., an independent qualified reserves evaluator, as of December 31, 2010.

The estimates presented are in accordance with the definitions and guidelines in the COGE Handbook and Canadian NI 51-10. Best Case estimate of 9.4 Tcfe gross (5.5 Tcfe net) and High Case estimate of 11.3 Tcfe gross (6.6 Tcfe net).All at at cost of 2C contingent resource additions of approximately $0.10/BOE ($0.17/Mcfe).

World Class Hydrocarbon Province – InterOil Acreage

 
The CSP: InterOil Complete JVOA and Option Deed with Mitsui & Co. Ltd

On August 4, 2010, InterOil finalized a Joint Venture Operating Agreement (JVOA) for the Company’s proposed Condensate Stripping Plant (CSP) with Mitsui & Co., Ltd. (Mitsui)

• Under the JVOA, InterOil and Mitsui will each have a 50% ownership stake, before the State of Papua New Guinea's statutory right to acquire up to 22.5% in the CSP
• The capital cost for the CSP is currently estimated at $550 million; both parties looking at increasing size
• Mitsui will be responsible for arranging or providing financing for the capital costs of the plant
• Mitsui does not own or receive any liquids

InterOil and Mitsui also executed an Option Deed to acquire interests of up to a 5% in the Elk and Antelope fields and in the liquified natural gas (LNG) Project

• After reaching final investment decision on the CSP, Mitsui has options to acquire interests of up to a 5% in the Elk and Antelope fields and in the LNG Project on equal terms, yet to be determined, to those agreed with a future industry partner

The CSP facilities are targeted to be operational in parallel with EWC and Flex LNG trains.