Subject: East Timor PM says Greater Sunrise revenue deal close
East Timor PM says Greater Sunrise revenue deal close
Nov 17, 2005 SYDNEY (Reuters) - The Prime Minister of East Timor believes a long-running territorial dispute with Australia will be resolved within months, paving the way for the development of the moth-balled Greater Sunrise Gas Field.
Mari Alkatiri told oil and gas executives visiting East Timor that a deal to split revenue from the contested field was close, and reaffirmed his belief that the best solution for harvesting the gas was a pipeline to his country, a statement from his office said.
"I can inform you today that I believe this process can be concluded in 1-2 months," he told the conference in Dili.
"The Greater Sunrise field lies just 150 km (93 miles) from our coastline compared with almost 300 km from Australia. The best development model for this field is to build a pipeline to feed gas into an LNG processing plant in Timor-Leste."
Greater Sunrise operator, Australia's Woodside Petroleum Ltd., froze the $5 billion project in December last year after sea border talks between East Timor and Australia collapsed over the biggest gas resource in the Timor Sea.
Both sides have repeatedly said since April they expect a pact to be finalized soon, once minor details are resolved, with East Timor last putting a timeframe of August on resolution.
About 20 percent of Greater Sunrise, which holds an estimated 8 trillion cubic feet of gas and up to 300 million barrels of condensate, lies in the Joint Petroleum Development Area (JPDA) and the rest in what Australia calls its exclusive jursidiction.
Under the JPDA, 90 percent of royalty revenues go to East Timor and 10 percent to Australia. But under the yet-to-be formalized pact, East Timor has agreed to shelve talks on drawing up a permanent sea border in exchange for dividing total revenues from the field equally between the two countries.
Woodside, which had been aiming to make its first liquefied natural gas deliveries in 2010, has long said it would prefer Greater Sunrise gas to be transported to Wickham Point near the northern Australian city of Darwin where an LNG plant is already being built for ConocoPhillips's Bayu-Undan project.
Greater Sunrise's other stakeholders are: ConocoPhillips, Royal Dutch/Shell and Japan's Osaka Gas Co. Ltd.. Woodside is 34 percent-owned by Shell.
Agence France Presse -- English
November 17, 2005 Thursday 9:23 AM GMT
East Timor expects to announce Australian oil and gas deal soon
DILI Nov 17
East Timor expects within two months to announce a deal with Australia on developing a disputed oil and gas field, its prime minister said Thursday as the world's youngest country courted foreign interest in its petroleum resources.
East Timor, which was Asia's poorest nation upon independence in May 2002, has been in long-running talks with its neighbour Australia over a deal on sharing billions of dollars' worth of oil and gas reserves under the Timor Sea.
The two countries in July hammered out the broad political terms of the pact but said the final technical details were still being worked out. Under the deal, they will defer deciding where their maritime boundary should be fixed for 50 years to allow oil and gas projects to go ahead.
"I can inform you today that I believe this process can be concluded in one to two months," Prime Minister Mari Alkatiri told a gathering of foreign oil executives from more than 20 companies, a statement from his office said.
He said he maintained his position that the disputed area would be best developed by building a pipeline to feed gas into a processing plant in East Timor.
"As well as making commercial sense, building this plant would play a dynamic role in the development of our economy," he said.
Oil companies had threatened to scrap Timor Sea projects if the two governments did not end their squabbling over the resources revenue.
Under the July deal Australia's tiny northern neighbour will receive a larger share of revenues from the Greater Sunrise oil and gas field in return for shelving the boundary dispute.
It would also continue to receive a 90 percent share of revenues from the previously agreed Joint Petroleum Development Area, worth more than 7.5 billion dollars.
Prime Minister Alkatiri also told the executives, attending a workshop for companies interested in bidding for exploration rights in the Timor Sea, that the country's first-ever seismic survey indicated significant potential.
East Timor opened bidding in September on 11 blocks in its maritime area, billed as being "Asia's last petroleum frontier", with bids due in March and winners due to be announced next June.
The dispute between East Timor and Australia blew up when Australia insisted that a 1970s sea boundary agreed with Jakarta, East Timor's former coloniser, should remain in place.
That boundary gives Canberra two-thirds of the sea area and most of its energy resources. East Timor wants the boundary to be set at the mid-point between the two countries, which would give it most of the resources.
Dili has said the resources revenue was its only chance of ending its dependence on foreign aid and accused Australia of trying to cut its financial lifeline.