Gas flare at InterOil’s Antelope gas field in Gulf Province. Credit: InterOil

InterOil Corporation has finalised a US$300 million (K814 million) loan, which it will use to further explore the Eastern Papua Basin of Papua New Guinea.

The new loan means InterOil has US$500 million in cash, undrawn debt and working capital to further its expansion plans, according to Chief Financial Officer, Don Spector.

The new loan is through InterOil’s existing banks, Credit Suisse, Commonwealth Bank of Australia, Westpac Bank, ANZ, Bank of South Pacific, BNP Paribas, UBS AG, Macquarie Capital Group, and new banks, The Bank of Tokyo-Mitsubishi UFJ and Societe Generale.

The facility, which has an annual interest rate of LIBOR plus 5%, matures at the end of 2015.

InterOil expects to repay the facility at maturity using variable resource payments that Total SA is obliged to make on certification of Elk-Antelope reserves as part of Total’s purchase of an interest in those two fields (PRL 15).

Spector said the banks’ response was pleasing, with expressions of interest well in excess of the final amount.

‘This is a positive indication of how our lenders view the quality of our assets,’ Spector said.

‘Importantly, InterOil now has access to more than US$500 million in cash, undrawn debt and working capital to support our operations and fund further exploration and appraisal as part of our growth strategy.’