It closed down 3.2% in what was the stock's highest-volume trading day for this calendar year, as buyers realised an overreaction had taken place.
The report in question from PNGIndustryNews.net was specifically based on news from an industry source that the exclusive negotiations period over a possible PNG transaction between ExxonMobil and InterOil had expired.
The significance of this news was that such a development would allow InterOil to also host negotiations with other parties interested in its Elk-Antelope discoveries in PNG.
It did not mean that negotiations between Exxon and InterOil over this gas field were over.
However, this was the message that was frighteningly run with by various mainstream media around the world, purportedly even including CNBC in the United States, with these outlets not realising that the source's comments of "it's dead" were only in relation to the exclusive negotiations period.
Some of the media reports even inaccurately referred to as PNGIndustryNews.net as a blog, and reading some of them online is enough to make one wonder if the reporters involved even bothered reading the original story on the site, or just blindly followed doomful posts made on message boards or comments made by stockbroker types.
While the ineptness of mainstream media to accurately report on anything in the petroleum world was not too surprising, it was especially disappointing to see that Upstream, which should know better, falsely claimed that PNGIndustryNews.net reported that "talks between the two sides had collapsed".
Moving on to the topic of the exclusive negotiations period between InterOil and ExxonMobil, it is important to consider how it has been publicly communicated. The original announcement on May 24 on the start of the exclusive negotiations failed to mention how long they went for.
This is not even common in the PNG space. This can be seen in the announcements made by PNG minerals explorer Foyson Resources last year which provided end dates for the exclusive negotiation periods held with TVI Pacific which later ended in a deal taking place.
Fortunately, PNG Prime Minister Peter O'Neill informed parliament that Exxon's exclusive period of negotiations with InterOil was for 60 days. Two months rolled by with no update on this topic. My inquiries to InterOil received no response, so I was forced to seek information from other sources.
I received some intel, which I did not report on at the time, that they were possibly extended to August 1. While InterOil's conference call earlier last week left the impression that the exclusive negotiations period was continuing, one of my contacts got back to me on Friday that this was no longer the case.
I did not get any confirmation from an InterOil spokesman that the exclusive negotiations period was still in place and no comment on the matter from ExxonMobil, so I ran with what was known in my report on Friday.
InterOil is yet to get back to me today to correct me on this, although by now everyone should know that negotiations are still taking place between InterOil and ExxonMobil.
There could be more news to emerge on this front this week so stay tuned. In relation to some of the claims made on message boards, I did not know that Friday was an option expiry day for InterOil but aim to keep abreast of these key dates going forward when it comes to the timing of my reports.
I'm also not being investigated by the "SEC", or on the take, or being bribed, by anybody and it's worth noting that this website is designed to keep PNG industry folk up to date with what's going on - investors are not a key readership market.
Furthermore I have never owned any InterOil shares, and like many other people I would like to see the quality Elk-Antelope field commercialised for the benefit of PNG and its industries. In my view, the proposal to use 4.6 trillion cubic feet of this field's gas to help expand the ExxonMobil-led PNG LNG project is logical when considering monetisation timeframes and the possible benefits to PNG's economy.