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(INTEROIL LOGO)
    
    InterOil CorporationC/- PO Box 6567Suite 2, Level 2Orchid Plaza
79 Abbott StreetCairns, Qld 4870Phone: (61) 7 4046
4600Fax: (61) 7 4031 4565www.interoil.com
 To the Employees, Officers and Directors of
 InterOil Corporation and its Subsidiaries:
 Company
  
    
    Would my action inspire trust? Is it fair and just?
    
    Is my action legal? If legal, is it also ethical? Are my actions honest in every respect?
    
    Is anyones life, health or safety endangered by this action?
    
    Can I defend this action with a clear conscience before my supervisor, fellow
employees, and the general public?
    
    Would my supervisor act this way? Would it be helpful to ask my supervisor about
this matter before I act?
    
    Would I be proud to read about my action in the newspaper?
    
    Does the action violate Company policy?
    
    Is the action consistent with the Companys values?
    
    What would I tell my child to do?
    
    Would I want to tell my parents or children about my action?




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Sincerely,By:
    
    /s/ Phil E. MulacekPhil Mulacek, Chief Executive Officer




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InterOil Corporation
 Code of Ethics
 and
 Business Conduct




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CODE OF ETHICS AND BUSINESS CONDUCT
 TABLE OF CONTENTS
 PageI.
    
    ETHICS AND COMPLIANCE
    
    
    1II.
    
    COMPLIANCE WITH LAWS, RULES AND REGULATIONS
    
    
    1III.
    
    CONFIDENTIAL INFORMATION
    
    
    1Disclosure of Companys Confidential Information
    
    
    1Patents, Copyrights, Trademarks and Proprietary Information
    
    
    2No Inadvertent Disclosures
    
    
    2Competitive Information
    
    
    2IV.
    
    CONFLICTS OF INTEREST AND CORPORATE OPPORTUNITY
    
    
    3V.
    
    CUSTOMER, SUPPLIER AND COMPETITOR RELATIONS
    
    
    4Permissible Payments
    
    
    4Bribes
    
    
    4Gifts
    
    
    4VI.
    
    ENTERTAINMENT
    
    
    4Government Representatives
    
    
    5Compliance with Antitrust Laws
    
    
    5VII.
    
    INSIDER TRADING
    
    
    6VIII.
    
    RECORD MANAGEMENT
    
    
    6IX.
    
    RECORDING TRANSACTIONS
    
    
    7Company Records
    
    
    7X.
    
    USE OF COMPANY ASSETS
    
    
    7Electronic Communications
    
    
    7Third Party Software
    
    
    8Intellectual Property
    
    
    8XI.
    
    FAIR DISCLOSURE POLICY
    
    
    8XII.
    
    FINANCIAL CODE OF ETHICS
    
    
    9XIII.
    
    DISCRIMINATION AND HARASSMENT
    
    
    9XIV.
    
    HEALTH AND SAFETY
    
    
    9XV.
    
    REPORTING VIOLATIONS OF COMPANY POLICIES
    
    
    9XVI.
    
    WAIVER
    
    
    10




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I. ETHICS AND COMPLIANCE
 Company
  If you are in a situation which you believe may violate or
lead to a violation of this Code, follow the guidelines described in Section XVI of this Code.
 II. COMPLIANCE WITH LAWS, RULES AND REGULATIONS.
  III. CONFIDENTIAL INFORMATION
  Disclosure of Companys Confidential Information
   
    
    Confidential information of the Company should be disclosed within the Company only
on a need-to-know basis;
    
    Confidential information of the Company (paper or electronic) should be marked with
additional handling instructions designated by the General Counsel; and
 1




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
    
    Confidential information of the Company should be disclosed outside the Company only
when required by law or when necessary to further the Companys business activities and
in accordance with the Companys disclosure guidelines.
  Patents, Copyrights, Trademarks and Proprietary Information
   No Inadvertent Disclosures
    Questions Employees Should Ask Themselves
 
    
    Am I conversing in a place where my conversation can be overheard?
    
    Have I received the express consent of the Companys Disclosure Review and Control
Committee that authorizes the release of confidential information?
 Competitive Information
  2




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Questions Employees Should Ask Themselves
 
    
    If the president of the competitor knew I was using this means of obtaining
information about his/her company, would he/she believe it was proper?
    
    If I changed jobs and went to work for a competitor, would it be appropriate for me
to disclose to the competitor the Company confidential information?
 IV. CONFLICTS OF INTEREST AND CORPORATE OPPORTUNITY
   
    
    Perform services for a public or private company, or have a financial interest in a
private company or more than a 5% financial interest in a public company, that is, or
may become, a supplier, customer, contractor or competitor of the Company.
    
    Perform outside work or otherwise engage in any outside activity or enterprise that
may create a conflict with the Companys best interests.
    
    Take for themselves personally, opportunities that are discovered through the use of
Company property, information and position;
    
    Use Company property, information or position for personal gain; or
    
    Compete with the Company.
    3




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Questions Employees, Officers and Directors Should Ask Themselves
 
    
    Could my outside business or financial interests adversely affect my job performance
or my judgment on behalf of the Company?
    
    Can I reasonably conduct my business outside of normal Company work hours and
prevent my outside customers, clients or affiliates from contacting me at work?
    
    Will I be using Company equipment, materials, or proprietary information in my
outside business?
 V. CUSTOMER, SUPPLIER AND COMPETITOR RELATIONS
  Permissible Payments
  Bribes
  Gifts
  VI. ENTERTAINMENT
  4




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Questions Employees Should Ask Themselves
 
    
    Am I offering something in order to obtain special treatment for the Company?
    
    Will I favor this supplier because he gives me a gift?
    
    If my supervisor knew about the gift a supplier/vendor/customer gave to me, would he/she approve?
    
    How often this year have I provided gifts to this customer?
    
    Are the gifts I am providing customary in the industry?
    
    How often this year have I taken gifts from this supplier/vendor?
    
    If this gift or payment were disclosed to the public, would it embarrass the Company?
    
    When you give a gift or if you accept a gift is there a sense of obligation created
as a result of the gift?
 Government Representatives
   Facilitating Payments
  Third Party Agents
  Questions Employees Should Ask Themselves
 
    
    Has a third party working on behalf of the Company told you not to worry because he
or she will take care of the demands of the local culture?
    
    If this payment were disclosed to the public, would it embarrass the Company?
 Compliance with Antitrust Laws
  5




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Agreements with Competitors
  Agreements with Customers
  International Application
  Questions Employees Should Ask Themselves
 
    
    Are my discussions with the competitor directly or indirectly touching on pricing
considerations or other terms and conditions of sale?
    
    Could my actions be used as evidence that I unlawfully agreed upon prices or price
changes with a competitor, even though no formal agreement or understanding was made?
    
    Does the pricing or promotional program I am formulating discriminate unfairly
against any of the resellers of the Company?
 VII. INSIDER TRADING
 . All employees, officers and directors shall follow the
Insider Trading Policy which is attached hereto as Addendum A and incorporated herein by
reference.
 VIII. RECORD MANAGEMENT
  6




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IX. RECORDING TRANSACTIONS
  Company Records
   
    
    No unrecorded or off the books funds or assets should be established for any purpose;
    
    No false, misleading or fictitious invoices should be paid or created;
    
    No false or artificial entries should be made or misleading reports issued;
    
    Assets and liabilities of the Company shall be recognized and stated in accordance
with the Companys standard practices and GAAP;
    
    No material failure to make entries should be permitted; and
    
    The documentation evidencing each transaction and each payment on behalf of the
Company shall fairly represent the nature of such transaction or the purpose of such
payment.
  Questions Employees Should Ask Themselves
 
    
    Does the report I am planning to submit mischaracterize in any way the transaction
or the purpose of the transaction?
    
    Am I being asked to make an entry I feel uncomfortable making?
 X. USE OF COMPANY ASSETS
  Electronic Communications
  7




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Third Party Software
  Intellectual Property
  Questions Employees Should Ask Themselves
 
    
    Would the e-mail I am thinking about drafting embarrass me or the Company if it
became public? Does the e-mail I am sending relate to the business of the Company?
    
    Do I safeguard the assets of the Company entrusted to me?
 XI. FAIR DISCLOSURE POLICY
    Authorized Spokespersons
  
    
    the Companys Chief Executive Officer
    
    the Companys Chief Financial Officer
    
    the Companys Vice President of Investor Relations
 8




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General
   XII. FINANCIAL CODE OF ETHICS
 Addendum B
 XIII. DISCRIMINATION AND HARASSMENT
  XIV. HEALTH AND SAFETY
   XV. REPORTING VIOLATIONS OF COMPANY POLICIES
  Attention: General CounselInterOil Corporation
 9




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Suite 2, Level 2Orchid Plaza, 79-88 Abbot StreetCairns, QLD 4870, Australia
  Attention: Chairperson of the Nominating and Governance
Committeec/o General CounselInterOil CorporationSuite 2, Level 2Orchid Plaza, 79-88 Abbot StreetCairns, QLD 4870, Australia
  XVI. WAIVER
  10




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ADDENDUM A
INTEROIL CORPORATION
INSIDER TRADING POLICY
 Overview
 InterOil Corporation Insider Trading Policy
 material, non-public information
 Company Policy employees
 You are ultimately
responsible for compliance with the Policy and all applicable laws.
 The Company takes its obligations under the securities laws very seriously, and any violation or
suspected violation of this or any other Company policy could subject you to disciplinary action,
up to and including termination of your employment for cause.
 Scope of this Policy
 Material Information Defined .
  
    
    Financial and operating performance, especially quarterly and year-end earnings and
significant changes in financial performance, outlook or liquidity.
    
    A significant change in the Companys debt ratings.
    
    Estimates or projections by the Companys officers of future earnings or losses,
especially Company projections that significantly differ from external expectations.
    
    Events or business operations which are likely to affect future revenues or earnings
(for example, mergers and acquisitions, the acquisition or divestiture of significant
assets, subsidiaries or business units, exploration drilling progress, discoveries of oil
and gas, and the execution, or loss, of important contracts with partners or other
parties).
 A-1




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
    
    Plans for substantial capital investments.
    
    Stock splits or other recapitalizations, capital restructuring, public or private
securities offerings, or changes in Company dividend policies or amounts.
    
    Redemptions or repurchases by the Company of its securities.
    
    Actual or threatened major litigation, developments in major litigation or the
resolution of such litigation.
    
    Significant changes in senior management.
    
    Any other information which is likely to have a significant impact on the Companys
financial results or share price.
 Non-public Information Defined
 SEC
 Prohibited Transactions
 Transactions in Company Securities.
  
    
    Trade in Company securities. Buying or selling securities of the Company,
whether in the form of common shares, options or any other type of security, is prohibited.
Indirectly trading in Company securities through a corporation or other entity that you
control, family or any other trust, private superannuation fund, 401(K) plan, IRA trust or
otherwise, is also prohibited.
    
    Advise others to buy, hold or sell Company securities. Even if no material,
non-public information is actually disclosed, employees may not suggest buying or selling
any Company securities while in possession of material, non-public information.
    
    Have others trade for him or her in Company securities. Employees may not
authorize any member of his or her immediately family or anyone acting on his or her behalf
to trade in Company securities.
    
    Disclose the information to anyone else who might then trade (tipping).
Passing material, non-public information on to a friend, relative or anyone else that buys
or sells a security on the basis of that information is prohibited.
    
    Assist anyone in any of these activities.
  Transactions in the Securities of Other Companies.
  A-2




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Short Sales; Trading in Options or Speculative Trading.
  Trading Window
 Transactions in Company Securities.
  
    
    The director or employee must instruct his or her broker to purchase or sell shares
during the period beginning two trading day after the Company issues a press release
disclosing its most recent annual or quarterly earnings and ending on the earlier of (1) 45
days after the issuance of such earnings release, or (2) 5 trading days prior to the end of
the annual or quarterly period following the period for which such earnings were released
(window period);
    
    The employee is not then in possession of material, non-public information;
    
    The employee, other than Covered Persons (as described below), receives prior
authorization (pre-clearance) to conduct the transaction from the Compliance Committee (as
described below); and
    
    In the case of Covered Persons, the Covered Person receives prior authorization
(pre-clearance) to conduct the transaction from the Compensation Committee of the Companys
Board of Directors (Compensation Committee).
 Covered Transactions.
  Excluded Transactions.
  A-3




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Special Situations
 Rule 10b5-1 Trading Plans.
 Rule
10b5-1 Trading Plan
  Additional Rules for Directors, Executive Officers, Vice Presidents and Managers
 Covered Persons
 Hardship and Special Circumstance Cases.
  Compliance Committee.
   A-4




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Additional Black-Out Periods.
  Applicability of this Policy to Employees Family Members and Other Related Parties
 Related
Party
 Applicability of this Policy to Former Employees
  Reporting Violations
  Legal Review
  Penalties for Insider Trading
 regardless of whether or not the employees failure to comply with
this Policy results in a violation of law
 The dealing of securities on any one or more of the exchanges on which InterOil securities trade
are deemed to fall under the InterOil Insider Trading Policy.
 A-5




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ADDENDUM B
 INTEROIL CORPORATION
 Code of Ethics for the Chief Executive Officer
and Senior Financial Officers
 Officers Company
 
    
    Honest and ethical conduct, including the ethical handling of actual or apparent
conflicts of interest between personal and professional relationships;
    
    Full, fair accurate, timely and understandable disclosure in the reports and
documents that the Company files with, or submits to, the Securities and Exchange
Commission (the SEC), and in other public communications made by the Company;
    
    Compliance with applicable governmental laws, rules and regulations;
    
    The prompt internal reporting to an appropriate person or persons identified herein
of violations of this Code of Ethics; and
    
    Accountability for an adherence to this Code of Ethics.
  Competence
  
    
    Maintain an appropriate level of professional competence through the ongoing
development of their knowledge and skills.
    
    Perform their professional duties in accordance with relevant laws, regulations, and
technical standards.
    
    Prepare accurate and timely financial statements, reports and recommendations after
appropriate analyses of relevant and reliable information.
 Confidentiality
  
    
    Refraining from disclosing confidential information (regarding the Company or
otherwise) acquired in the course of their work except when authorized, unless
legally obligated to do so.
    
    Informing subordinates as appropriate regarding the confidentiality of
information acquired in the course of their work and monitoring their activities to
assure the maintenance of that confidentiality.
 B-1




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
    
    Refraining from using or appearing to use confidential information acquired in
the course of their work for unethical or illegal advantage either personally or
through third parties.
 Integrity
  
    
    Comply with laws, rules and regulations of national, state and local governments,
and appropriate private and public regulatory agencies or organizations, including
insider trading laws.
    
    Act in good faith, responsibility, without misrepresenting material facts or
allowing their independent judgment to be subordinated.
    
    Protect the Companys assets and insure their efficient use.
    
    Avoid actual or apparent conflicts of interest with respect to suppliers, customers,
contractors and competitors and report potential conflicts as required in the Companys
Code of Ethics and Business Conduct.
    
    Refrain from engaging in any activity that would prejudice their ability to carry
out their duties ethically.
    
    Refuse any gift, favour or hospitality that would influence or would appear to
influence their actions.
    
    Refrain from either actively or passively subverting the attainment of the
organizations legitimate and ethical objectives.
    
    Protect the Companys assets and assure their efficient use.
    
    Recognize and communicate professional limitations or other constraints that would
preclude responsible judgment or successful performance of an activity.
    
    Report to senior management and the Audit Committee any significant information they
may have regarding judgments, deficiencies, discrepancies, errors, lapses or any
similar matters relating to the Companys or its subsidiaries accounting, auditing or
system of internal controls. The Officers must communicate unfavorable as well as
favorable information and professional judgments or opinions.
    
    Refrain from engaging in or supporting any activity that would discredit their
profession or the Company and proactively promote ethical behavior within the Company.
 Objectivity
  
    
    Communicate information fairly and objectively.
    
    Disclose all material information that could reasonably be expected to influence
intended users understanding of the reports, comments and recommendations presented.
 Oversight and Disclosure
  
    
    Ensure the preparation of full, fair, accurate, timely and understandable disclosure
in the periodic reports required to be filed by the Company with Canadian Securities
Administrators and the SEC. Accordingly, it is the responsibility of the Officers to
promptly bring to the attention of the Audit Committee and the Companys Disclosure
Review and Control Committee any material information of which he or she may become
aware that affects the disclosures made by the Company in its public filings or
otherwise assist the Audit Committee in fulfilling its responsibilities of overseeing
the Companys financial statements and disclosures and internal control systems.
 B-2




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
    
    Promptly bring to the attention of the Audit Committee any information he or she may
have concerning (1) significant deficiencies in the design or operation of internal
controls which could aversely affect the Companys ability to record, process,
summarize and report financial data or (2) any fraud, whether or not material, that
involves management or other employees who have a significant role in the Companys
financial reporting, disclosures or internal controls.
    
    Promptly bring to the attention of the General Counsel and to the Audit Committee
any information he or she may have concerning any violation of the Companys Code of
Ethics and Business Conduct, including any actual or apparent conflicts of interest
between personal and professional relationships, involving any management or other
employees who has a significant role in the Companys financial reporting, disclosures
or internal controls.
    
    Promptly bring to the attention of the General Counsel and to the Audit Committee
any information he or she may have concerning evidence of a material violation of the
securities or other laws, rules or regulations applicable to the Company and the
operation of its business, by the Company or any agent thereof, or of violation of the
Code of Ethics and Business Conduct or of these additional procedures.
 Enforcement
  B-3




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IN WITNESS WHEREOF,
 (Signature)(Print Name)Date: , 2003