The negotiations will cover the sale of a stake in Elk-Antelope-hosting petroleum retention licence 15, which is big enough to supply gas for an additional train on the Exxon-led PNG LNG project.
The exclusive talks will also cover the possibility of funding InterOil and its PRL 15 partner Pacific LNG to drill additional Elk-Antelope wells to recertify the resource.
The third item on the agenda is providing InterOil and Pacific LNG the options to develop their own LNG project using the Elk-Antelope field or to pursue more development with Exxon.
InterOil's announcement was foreshadowed by social media reports that Prime Minister Peter O'Neill had chosen Exxon over the competing bidders.
PNGIndustryNews.net views that Exxon had the advantage of offering a quicker path to commercialisation. The PNG LNG project is on track for first exports in 2014 with a lot of infrastructure in place.