InterOil

InterOil Corporation is developing an Integrated Oil and Gas Company in Papua New Guinea. The Company has positioned itself to own assets through the entire value chain - from the well-head to retail. InterOil has also positioned itself through a joint venture holding company to develop the first LNG project in Papua New Guinea. The joint venture company is targeting 2012 for the delivery of 'first gas'.

InterOil has the largest wholesale, retail and aviation petroleum product distribution base in Papua New Guinea. This is the result of the acquisition of BP's entire commercial and retail distribution assets through BP Papua New Guinea in April 2004 and the subsequent acquisition of Shell Papua New Guinea on October 1, 2006.

The wholesale and retail distribution business supplies petroleum products nationally through an extensive portfolio of sea-board terminals & inland depots and retail service stations. We currently supply approximately 70% of Papua New Guinea's refined petroleum product needs.

The retail and wholesale distribution business distributes diesel, jet fuel, gasoline, kerosene and fuel oil as well as Shell and BP branded commercial and industrial lubricants such as engine and hydraulic oils. In general, all of the refined products sold pursuant to the wholesale and retail distribution business are purchased from the refining and marketing business segment. InterOil imports the commercial and industrial lubricants, which constitute a small percentage of the sales. InterOil also imports fuel oil that is sold to a domestic power generator.

The company also supplies petroleum products as a wholesaler to commercial clients. InterOil owns and operates 6 large terminals and 11 depots that are used to supply products throughout Papua New Guinea. InterOil supplies the aviation, marine, mining, agricultural, fishing, logging and similar commercial clients with their petroleum product needs and in many instances, also supplies and maintain company-owned above-ground storage tanks and pumps that are used by these customers. The head office for our wholesale and retail distribution business is currently located in Port Moresby, the capital of Papua New Guinea.

Retail Distribution

In addition to the wholesale distribution network there are 60 retail service stations that currently operate under the InterOil brand name of which, 21 are either owned by or leased with a sublease to company approved operators. The remaining 39 service stations are independently owned and operated.

InterOil owns 11 airfield operations in Papua New Guinea generally also located on or adjacent to an airstrip. Customers supplied with fuel products include the National Government carrier, commercial passenger airlines, mining and exploration and independent airlines operators.