Downstream

Retail Distribution

As of December 31, 2012, we provided petroleum products to 53 retail service stations with 43 operating under the InterOil brand name and the remaining ten operating under their own independent brands. Of the 53 service stations that we supply, 16 are either owned by or head-leased to us with a sublease to company approved operators.

We currently operate one InterOil branded service station in Port Moresby directly, with a view to capturing the additional margin available on the retail sale of petroleum products. If this venture proves successful, we may consider operating more of our own retail service stations in the future. The remaining 37 service stations we supply are independently owned and operated. We supply products to each of these service stations pursuant to distribution supply agreements.

We also provide fuel pumps and related infrastructure to the operators of the majority of these retail service stations that are not owned or leased by us.

One of our major strengths is our spread of storage and distribution facilities throughout Papua New Guinea. We have terminal facilities in POM (2), Alotau, Lae (2), Madang, Wewak, Goroka, Mt Hagen (2), Rabaul, Kimbe (2) and Kavieng. The only area we are not represented in is Oro Province (Popondetta). This enables us to offer national deals to customers spread over various geographical locations.

We also service eleven airfields throughout the country although we are not represented at the main international airfield at Jacksons. While we supply the only provider at this airfield with Jet A1, we have to date not been represented on the field.