Received from Joyo Indonesian News

Dow Jones Newswires November 29, 2001

East Timor Expects To Resolve Timor Sea Dispute In Weeks

CANBERRA -- East Timor's cabinet minister for foreign affairs, Jose Ramos Horta, said Thursday his government is confident it can reach agreement with Philips Petroleum (P) and other contractors in the next few weeks so multibillion dollar resources projects in the Timor Sea can proceed.

"I don't expect that there is going to be further delay," he told reporters.

"We are hoping that in the next few weeks we can conclude the arrangements...(and the) agreement with Philips and other contractors," Ramos Horta said.

"Talks are going on right now in a very positive climate," he said. "I have seen a proposal from Philips to provide additional incentives to East Timor itself... We are very pleased with...that proposal."

Philips Petroleum in July deferred stage two of its Bayu-Undan project, which involved hauling gas 500 kilometers through a pipeline from the Timor Sea to Darwin in Australia's north.

Philips announced the deferral after East Timor sought to impose a new taxation regime on gas production at the Bayu-Undan project.

There is also a delay in development at the Sunrise gas field, which is also in the Timor Sea.

Woodside Petroleum Ltd. (A.WPL) is the operator and 33.44% owner of Sunrise, with Royal Dutch/Shell Group (RD) holding 26.56%, Phillips 30% and Osaka Gas Ltd. (J.OSG) 10%.

-By Iain McDonald, Dow Jones Newswires;

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