InterOil Corporation

InterOil Corporation

March 23, 2005 09:18 ET

InterOil Provides Update on Jet Fuel Supply in Papua New Guinea


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: INTEROIL CORPORATION

TSX SYMBOL: IOL
ASX., AMEX SYMBOL: IOC

MARCH 23, 2005 - 09:18 ET

InterOil Provides Update on Jet Fuel Supply in Papua
New Guinea

PORT MOREBY, PAPUA NEW GUINEA--(CCNMatthews - March 23, 2005) - InterOil
Corporation (TSX:IOL) (AMEX:IOC) (ASX/POMSoX:IOC), a Canadian company
with operations in Papua New Guinea, today announced it is aware that
Shell Papua New Guinea has decided not to release to the market a
shipment of Jet A1 specification fuel which was uplifted from our
refinery and delivered to the Shell Port Moresby terminal in early March.

We are informed that Shell's decision relates to the certification of
Jet A1 product and specifically to the 'freeze point' specification.
Prior to release from the refinery, this shipment had been fully
certified to Jet A1 international specification by SGS, an international
independent testing company.

Immediately upon being notified by Shell PNG that their subsequent
testing had failed to recertify this shipment of fuel, further testing
was undertaken by SGS, who confirmed that the shipment was well within
Internationally Accepted Specifications for Jet A1 fuel. Further testing
was then undertaken by another 3rd party independent laboratory which
tests also confirmed the original certificated quality.

Subsequent independent testing procedures undertaken by other
distributors of the same shipment in Papua New Guinea as that supplied
to Shell have also certified the Jet A1 fuel as, well within Jet fuel
specifications. Procedures are underway to deliver this product to
market to alleviate the current shortage of Jet fuel currently being
experienced by the airlines in Papua New Guinea.

InterOil is actively working with Shell and the other industry members
to ensure that the fuel requirements in Papua New Guinea can be supplied
in an active manner. InterOil does not accept that this shipment does
not comply with international jet fuel specifications and will be
submitting samples from this shipment for further testing by an
independently appointed testing laboratory.

InterOil is developing a vertically integrated energy company whose
primary focus is Papua New Guinea and the surrounding region. Its assets
comprise an oil refinery, upstream petroleum exploration licenses, and
retail and commercial distribution assets. The majority of the refined
products from InterOil's refinery are secured by off-take contracts with
Shell and InterOil's wholly-owned subsidiary, InterOil Products Limited.
BP Singapore is InterOil's agent for crude oil supplied to the refinery.
InterOil is also undertaking an extensive petroleum exploration program
within its eight million acre license area located in Papua New Guinea.

InterOil's common shares trade on the Toronto Stock Exchange under the
symbol IOL in Canadian dollars; on the American Stock Exchange under the
symbol IOC in US dollars; and on the Australian Stock Exchange in CHESS
Depositary Interests in Australian dollars under the symbol IOC which
trade on a 10:1 basis to common shares. For more information please see
the InterOil website at: www.interoil.com.

Cautionary Statements

This press release contains forward-looking statements. All statements,
other than statements of historical facts, included in this release,
including without limitation, statements regarding our drilling plans,
business strategy, plans and objectives of management for future
operations and those statements preceded by, followed by or that
otherwise include the words "believe", "expects", "anticipates",
"intends", "estimates" or similar expressions or variations on such
expressions are forward-looking statements. The Company can give no
assurances that such forward-looking statements will prove to be
correct. Risks and uncertainties include, but are not limited to, the
existence of underground deposits of commercial quantities of oil and
gas; fluctuations in prices for oil and gas production; curtailments or
delays in development due to mechanical, operating, marketing or other
problems; capital expenditures that are either significantly higher or
lower than anticipated because the actual cost of identified projects
varied from original estimates; and from the number of exploration and
development opportunities being greater or fewer than currently
anticipated.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these
securities in any state in which such offer, solicitation or sale would
be unlawful prior to the registration or publication under the security
laws of any such state. These securities have not been registered under
the Securities Act of 1933 and may not be offered or sold in the United
States absent registration or an applicable exemption from the
registration requirements.

The Company currently has no reserves as defined under Canadian National
Instrument 51-101 reserve definitions. See the Company's filings with
the Canadian securities regulators for additional risks and information
about the Company's business.

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