Subject: Woodside Says Sunrise LNG Marketing May Start Late This Year


Woodside Says Sunrise LNG Marketing May Start Late This Year

By Angela Macdonald-Smith

May 4 (Bloomberg) -- <>Woodside Petroleum Ltd., operator of the proposed Sunrise liquefied natural gas project in the Timor Sea, and its partners in the venture may start marketing the fuel late this year after an accord on the field development.

The partners, which include <>Royal Dutch Shell Plc and ConocoPhillips, expect to decide in the second half whether to use a floating LNG plant or pipe the gas to northern Australia for processing, said Jon Ozturgut, vice-president of Sunrise LNG Development at Perth-based Woodside. The LNG may be marketed to Asian buyers including Japan, South Korea and China, he said.

East Timor and Australia completed a treaty in February 2007 for the administration of the Sunrise field, which straddles a boundary between Australian waters and an area jointly managed by Australia and East Timor. While East Timor would prefer the venture builds an LNG plant in East Timor, the treaty requires the partners to choose the project design that offers the "best commercial advantage," Ozturgut said.

"We're getting good engagement now" from the East Timor authorities on discussions on the project development plan, Ozturgut said in an interview in Perth on May 1. "We would expect that once we submit it, with the proper level of engagement that we would get it approved" by East Timor and Australia, he said.

The venture partners haven't decided yet whether they would market their own LNG or sell it jointly, he said.

Woodside has about 33 percent of Sunrise and is the operator, while Houston-based <>ConocoPhillips owns 30 percent, Woodside's 34 percent-shareholder Shell owns 27 percent and <>Osaka Gas Co. holds 10 percent. The field, which lies 450 kilometers (280 miles) northwest of Darwin, is estimated to hold about 5.4 trillion cubic feet of gas and 240 million barrels of condensates, a type of light oil.

Dili Talks

Woodside Chief Executive Officer <>Don Voelte, Ozturgut and senior executives from the partners held meetings in March in Dili with East Timor's president, delegates of the prime minister and regulators, to discuss Sunrise, Ozturgut said. Each venture partner committed to agreeing to implement the "best commercial outcome" for the project design, whichever of the two existing options that turns out to be, he said.

"Relationships are good" with East Timor, Voelte told reporters on May 1. "They're conciliatory, we're working together and there has got to be opportunities for everybody."

The venture spent about A$33 million to narrow down the development options for <>Sunrise last May to a floating plant and the expansion of a ConocoPhillips-operated plant in Darwin and to eliminate the onshore East Timor option, Ozturgut said.

LNG is gas chilled to liquid form for transportation by tanker to destinations not connected by pipeline. Woodside operates the <>North West Shelf LNG venture, is building the Pluto plant and is also seeking to develop an LNG project in the Browse Basin in Australia's far northwest.

To contact the reporter on this story: <>Angela Macdonald-Smith in Sydney at <>

Last Updated: May 4, 2009 04:22



Tue. May 05, 2009; Posted: 01:45 AM

May 05, 2009 (AsiaPulse via COMTEX) --

MELBOURNE, May 5 Asia Pulse - Shell Australia chairman Russell Caplan says he could not say if Shell was in talks with Woodside Petroleum (ASX:WPL) about acquiring Woodside's stake in the Sunrise project in the Timor Sea.

Asked if Shell were in talks with Woodside, about the Sunrise stake, Mr Caplan told reporters: "Shell is a partner in Sunrise and Shell participates in the discussion about the Sunrise project."

Asked again, if Shell were in talks with Woodside about acquiring the stake, Mr Caplan said: "You wouldn't expect me to answer that question, would you."

Mr Caplan made the comments after addressing an American Chamber of Commerce in Australia luncheon.

Woodside said on Tuesday that it was not in discussions with Shell or any other company about the future of its 33.44 per cent stake in the Sunrise liquefied natural gas (LNG) development.

"While Woodside advised the market in February that that company was reviewing its portfolio of non-core assets, it emphasised assets located in Western Australia and the Timor Sea would not be part of this review," Woodside said in a statement.

"This includes the Sunrise LNG development."

Woodside said it continued to progress Sunrise and expected the joint venture to choose a location for the development in the second half of this year.


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